In December 1898, some Chicagoans began wearing twine—twisted into the shape of a hangman’s noose—in their buttonholes. It was their way of sending a message to the City Council about an upcoming vote. “I will not be surprised to see some hanging done in the streets of Chicago,” said Mayor Carter H. Harrison II, sizing up the city’s mood.
Between 1855 and 1861 city and state legislators passed laws allowing three companies to build and operate horse-drawn streetcars. The Chicago City Railway Company ran them on the south side and the North Chicago City Railway Company and the Chicago West Division Railway Company took the areas their names suggest. Each company got a 25-year monopoly on the business in the neighborhoods it was allotted.
Chastened by the experience, Young says, Illinois started “chartering private railroad companies to build at their expense hither and yon across the state.”
But it did not look so reasonable early on, when a series of scandals turned public sentiment against the railroads. “Many, perhaps most, of the post-Civil War railroad lines suffered from the evils of inflated construction costs, fraudulent stock manipulations, and incompetent management,” Stover wrote.
Like the firms seeking today’s privatization deals, the 19th-century traction companies wanted contracts or franchises long enough to make their investments worthwhile. But how long was that? Chicago gave them 25-year franchises, and after a judge ruled that the city had lacked the authority to do so, the Illinois General Assembly stepped in and gave them similar terms.
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Governor Richard Oglesby vetoed a bill giving the companies the leases they wanted, but the General Assembly overrode his veto. It was a representative from Peoria, Alexander McCoy, who made one of the most impassioned speeches against Chicago’s streetcar monopolies. “The streets of a great city are being voted away to a mammoth corporation,” he said. “It prevents all competition. It gives the control of all the streets of a great city, so far as railways are concerned, into the hands of a great monopoly for almost a century to come.”
These actions left Chicago’s traction system in a state of uncertainty. Did the railways now have franchises for 99 years or 20? Or was it back to 25? The argument went on and on. In 1878 the City Council imposed an annual license fee of $50 per streetcar that the companies refused to pay and challenged in court. In 1883 the city said the 25-year franchises signed in 1859 were expiring, while the companies insisted they were good till 1958.
