Transportation. Michigan's extremely favorable
location with respect to water transportation
has been of great value in the exploitation of the
local mineral and forest resources. (For a
discussion of lake transportation, see Great Lakes.)
Besides the canals connecting the main lakes, a
short canal has been constructed connecting the
northern end of Lake Portage with Lake
Superior. The small rivers were formerly much
used for the transportation of logs. Owing to
its peninsular form, the State is not traversed
by many of the great trunk lines of the country.
A large mileage, however, was early
recorded for the southern part of the State, and
railway construction has steadily spread to the
northward, until recently almost every region is
well supplied with railway advantages. Detroit
ranks first among the lake ports in the amount
of its exports, and second in the amount of its
imports. The customs districts Huron and
Superior also have a large foreign trade, and a
small trade is done from the Michigan district.
The first railway began operation in 1836. In the
following year the State undertook the building
of railways, but owing to financial embarrassment
the lines were sold after a decade to private
corporations. The chief lines are the Lake Shore
and Michigan Southern, the Michigan Central,
the Chicago and Grand Trunk, and the Père
Marquette. In recent years there has been a very
extensive construction of interurban electric car
lines. There is one railroad commissioner. His
duties chiefly pertain to the physical condition of
the roads and to accommodations.
Banks. The Bank of Michigan, organized in
Detroit in 1817, was the first in the Territory. It
incurred large losses in the panic of 1837-38, and
was placed in the hands of trustees for liquidation
in 1842. In 1835, shortly before Michigan was
admitted as a State, nine new banks were organized.
The free banking law of 1837 was the first in
the United States to put into practice the system
of securing the circulation of banks by deposit of
collaterals. It also provided for examination of
banks by bank commissioners. The law was
imperfectly administered, however, and in 1839 42
banks were in the hands of receivers, and more
than a million dollars of bills became worthless.
In 1844 the banking law was declared
unconstitutional. The banking system of the State did
not recover from this depression for many years,
and the banking business was carried on mainly
by brokers and private bankers. In 1857 a new
banking law was adopted, similar to the law of
New York. In 1902 there were 84 national
banks, with a capital of $11,380,000; surplus,
$3,416,000; cash, etc., $6,019,000; loans, $59,464,000,
and deposits, $64,657,000; 223 State banks
with a capital of $13,941,200; surplus, $3,916,280;
cash, $8,471,249; loans, $64,674,091, and
deposits, $132,517,710.
Government. The original Constitution of
1835 was revived in 1850, when many features,
radical for the time, were introduced. It has
been amended in 1866, 1870. and 1876, and also
in 1900. when it was provided that railway
corporations might be taxed on the gross value of
