Editing Northern Pacific Railway (section)

===Hill, Harriman and the Northern Pacific Corner===
[[File:RotaryPlow.jpg|left|thumb|A Northern Pacific rotary plow on the [[Coeur d'Alene, Idaho|Coeur d'Alene]] Cutoff near [[Mullan, Idaho]]. (1903)]]In the late 1880s, the Villard regime, in another one of its costly missteps, attempted to stretch the Northern Pacific from the Twin Cities to the all-important rail hub of [[Chicago, Illinois]]. A costly project was begun in creating a union station and terminal facilities for a Northern Pacific which had yet to arrive.

Rather than build directly down to Chicago, perhaps following the Mississippi River as the [[Chicago, Burlington and Quincy Railroad|Chicago, Burlington and Quincy]] had done, Villard chose to lease the [[Wisconsin Central Railway (1897–1954)|Wisconsin Central]]. Some backers of the Wisconsin Central had long associations with Villard, and an expensive lease was worked out between the two companies which was only undone by the Northern Pacific's second bankruptcy.

The ultimate result was that the Northern Pacific was left without a direct connection to Chicago, the primary interchange point for most of the large U.S. railroads. Fortunately, the Northern Pacific was not alone. [[James J. Hill]], controller of the [[Great Northern Railway (U.S.)|Great Northern Railway]], which was completed between the Twin Cities and Puget Sound in 1893, also lacked a direct connection to Chicago. Hill went looking for a road with an existing route between the Twin Cities and Chicago which could be rolled into his holdings and give him a stable path to that important interchange. At the same time, [[E. H. Harriman]], head of the [[Union Pacific Railroad]], was also looking for a road which could connect his company to Chicago.

The road both Harriman and Hill looked at was the Chicago, Burlington and Quincy. To Harriman, the Burlington was a road which paralleled much of his own and offered tantalizing direct access to Chicago. For Hill as well, there was the possibility of a high-speed link directly with Chicago. Though the Burlington did not parallel the Great Northern or the Northern Pacific, it would give them a powerful railroad in the central West. Harriman was the first to approach the Burlington's aging leader, the irascible [[Charles Elliott Perkins]]. The price for control of the Burlington, as set by Perkins, was $200 a share, more than Harriman was willing to pay. Hill met the price, and control of the Burlington was divided equally at about 48.5&nbsp;percent each between the Great Northern and the Northern Pacific.

Not to be outdone, Harriman now came up with a crafty plan: buy a controlling interest in the Northern Pacific and use its power on the Burlington to place friendly directors upon its board. On May 3, 1901, Harriman began his stock raid which would become known as the Northern Pacific Corner. By the end of the day, he was short just 40,000&nbsp;shares of common stock. Harriman placed an order to cover this, but was overridden by his broker, [[Jacob Schiff]], of [[Kuhn, Loeb & Co.]] Hill, on the other hand, reached the vacationing Morgan in Italy and managed to place an order for 150,000&nbsp;shares of common stock. Though Harriman might be able to control the preferred stock, Hill knew the company bylaws allowed for the holders of the common stock to vote to retire the preferred.

In three days, the Harriman-Hill imbroglio managed to wreak havoc on the stock market. Northern Pacific stock was quoted at $150 a share on May 6 and is reported to have traded as much as $1,000 a share behind the scenes. Harriman and Hill now worked to settle the issue for brokers to avoid panic. Hill, for his part, attempted to avoid future stock raids by placing his holdings in the [[Northern Securities Company]], a move which would be undone by the [[Supreme Court of the United States|Supreme Court]] in 1904 under the auspices of the [[Sherman Anti-Trust Act]]. Harriman was not immune either; he was forced to break up his holdings in the [[Union Pacific Railroad]] and the [[Southern Pacific Railroad]] a few years later.