Indiana Mammoth Internal Improvement Act - Aftermath

Aftermath

The creditors had taken the public works expecting that they could be quickly completed and become profitable, but were disappointed to discover that not to be the case for all the projects. The Vincennes Trace was renamed the Paoli Pike, and operated for several years as a private toll road until repurchased by the state thirty years later. Its tolls covered its operating costs, but it was never profitable. The Central Canal was abandoned as a total loss, the expense to finish it was considered to be too great for any possible profitability, and the area was found to be unsuited for canals. The Whitewater Canal had about one fifth of the line completed, and although it was not finished, the existing portion remained in use until 1847 when a portion of the canal collapsed and rendered the northern section unusable. The southern section continued in use until 1865 when it was closed after losing traffic to a railroad built adjacent to the canal. The Wabash and Erie was finally completed in 1848 and continued to operate for thirty-two years, but the high-rise portions of the canal in the central part of the state were found to be high maintenance and the frequent victim of muskrats. The cost of upkeep, and competition from the railroad eventually led to the collapse of the canal and its company in the 1870. The rail line from Madison to Indianapolis was also abandoned by the creditors and sold to a group entrepreneurs, including James Lanier, who were able to raise funds to complete the line. The Madison & Indianapolis Railroad was instantly profitable and went on to expand and connect to several other cities.

In 2008, all that remains of the Wabash and Erie is a restored fifteen mile (24 km) stretch and a few ponds. Much of the canal lands were sold to railroad companies and were excellent land for constructing rail lines. The turnpikes and railroads turned out to be the most successful projects, and some parts of them have remained in use until modern times.

Although the government lost millions, there were significant benefits for the areas of the state where the projects succeeded. On average, land value in the state rose 400%, and the cost of shipping goods for farmers was drastically decreased, and increasing the profit on their goods. The investors in the Bank of Indiana also made substantial profits, and the investments served as the start of a modern economy for the state. The act is often considered the greatest legislative debacle in the history of the state.