Why were boomtowns created

The abundance of wood and water, the extreme fertility of its shores, the excellence of its climate, which is as near to being perfect as any in the world, and its facilities for navigation, affording the best anchoring grounds in the whole western coast of America, all fit it for a place of great importance.

In fact, everything Dana saw was about to change, first in a trickle, then in a torrent. Drawn by reports of California's agricultural and trading prospects, the little village of Yerba Buena grew to about 20 homes by In January , when the settlement changed its name to San Francisco, it was a town of several hundred people.

A year later, when a carpenter and millwright named James Marshall picked gold out of the American River east of Sacramento, the settlement had people or so. And gold changed everything. First it emptied out San Francisco, as the predominantly male population dropped everything to rush to the American River. Then it filled the city back up again the following year as tens of thousands of "Argonauts" swarmed through the city to hunt for treasure. San Francisco's population neared 25, in and 36, by What did the city look like during this population explosion?

Here's a rather romantic description from Bayard Taylor , a New York reporter who landed in San Francisco in the latter half of The appearance of San Francisco at night from the water is unlike anything I ever beheld.

The houses are mostly of canvas, which is made transparent by the lamps within, and transforms them in the darkness to dwellings of solid light. Seated on the slopes of its three hills, the tents pitched among the chapparal to the very summits it gleams like an amphitheatre of fire.

Here and there shine out brilliant points from the decoy lamps of the gaming houses; and through the indistinct murmur of the streets comes by fits the sound of music from their hot and crowded precincts. Of course, hundreds of witnesses attest that the city in the making was also crowded, disorganized, filthy and vermin-ridden. It was expensive, rife with out-of-control property speculation, and full of all the familiar vices, most notably gambling houses. It was prone to burning down, with half a dozen blazes sweeping parts of the city in the first few years of the Gold Rush.

So, that was San Francisco, becoming the archetype of the American boomtown a term, by the way, that did not come into use until the s. And like other towns during other booms, it proved to be an economically unstable place that was at first almost wholly dependent on the continuing extraction of gold and expansion of population to move ahead. The city suffered several small downturns during its first few years before declining gold shipments knocked the bottom out of the speculative economy in and One of the newspapers in town, the Daily Alta California, published an essay in June that surveyed the wreckage of the real estate market and talked about its deeper causes and costs:.

It is an indisputable fact that nearly all the prominent operators of are now bankrupt, and the mass of smaller men are utterly ruined.

A year or two ago they thought themselves rich — they lived extravagantly, kept their horses and carriages, furnished their houses magnificently, and now — they have nothing. Think of a boomtown as a lottery winner. Fans of schadenfreude can salivate over stories of the unluckiest, which litter the Internet in slideshows and listicles. Mismanaged money can disappear in a flash—and so it goes for a town in the midst of a boom. Taking advantage of the situation requires a city planner with a long-term vision and quick feet.

Both Palermo and Kessel point to their own pet project made possible or rapidly accelerated by the boom. Their current plans for the facility are ambitious: adding climbing walls, an outdoor pool, an ice rink, and 35, square feet to the floor plan.

For Calgary, it was the C-Train, their light rail system. Light rail is the opposite of the quick-result developments governments often want to see during a boom, requiring a steep initial investment with a slow payoff. The gold and silver strikes in Tonopah and Goldfield at the turn of the century were the last of the great bonanza strikes in the United States.

While mining continues as a major industry in the West, the gold and silver rushes with their booming mining camps were a thing of the past by World War I. The great California gold rush of boomed California and turned San Francisco into a major financial center. The Comstock bonanza of populated Northern Nevada and further enriched San Francisco stock brokers and financial institutions.

Although gold was discovered in Southern Nevada in Eldorado Canyon on the Colorado River in , and silver in Pioche in , these camps were remote and isolated from other population centers and from any rail lines, so these southern mining districts never experienced the rush of people that northern mining camps did.

Then an unprecedented national economic panic in caused by over speculation in stocks, in which mining and railroads played a major role, brought on a general contraction in the economy and a tightening of the capital necessary for the development and sustaining of mining operations. The great Comstock rush was over as the mines played out or the companies went bankrupt, and the population left for opportunities elsewhere.

These opportunities presented themselves in enormously rich deposits of copper discovered in Montana in , gold in the Black Hills of South Dakota in , and silver in Cripple Creek Colorado in The influx of silver bullion into the economy, with its inevitable speculation and inflation, brought about another financial panic and recession in and the collapse of the price of silver.

Then gold was discovered in the Yukon and the great Alaskan gold rush followed in The successive mining camps attracted the same groups of inveterate prospectors, engineers, transients, fortune hunters, and speculators, but also hardened professional miners and big business, who clashed violently in this period of unregulated industrialization and monopoly, nascent socialism, and labor organization. It is no fluke of historical survival that what remains of most mining companies was the paper they printed on, because many of these companies existed only or mostly on paper.

Many of the boomtown characteristics align with the core development stages in oil and gas development, as depicted in image 1. This enhances community and family wealth associated with boomtowns. In stage two, communities experience an increase in construction activities related to drilling and pipeline infrastructure.

During this stage communities will see an increase in population and enhanced economic activity. For example, a Pennsylvania study indicated that the drilling and infrastructure development phases account for 80 percent of oil and gas employment Brundage, et al.

As noted above, the increase in population to support short-term construction activity is a common characteristic found in boomtowns. In stage three, communities experience additional investments in supportive supply chains and midstream development such as natural gas processing facilities.

In stage four, the mature stage of production, new construction has slowed leading to a regression in the migratory workforce. Rather than new construction jobs, economic activity is now based on operations and maintenance jobs, as well as royalty payments connected to oil and gas production. A sudden increase in population, wealth and economic activity due to a sudden shock can create a boomtown scenario for communities. While there have been numerous types of economic shocks to trigger boomtowns e.

While economic shocks contributing to a boomtown are well documented, every community will respond differently. Historical data indicate there is a beginning and an end to an economic boom for communities.