The dominant national trend in railroad management and finance from the 1880s on was consolidation. By purchase, lease, or trust arrangements, the larger systems absorbed smaller lines. The giants of railroad strategy and finance, such as the Big Four and New York's Vanderbilt group, reached out far beyond the regions where they had begun so as to control railroad interests to which they might tie their older holdings. Meanwhile the investment banking houses took advantage of railroad bankruptcies and crises to establish firm control over emergent rail groups, or 'communities of interest', as they were commonly called.

By 1906, the division of ownership and territory had become fairly stabilized. Of the 228,000 miles of American railroad then in operation, about two-thirds had come under control of seven groups. The New York-Chicago region was controlled by the Vanderbilt roads; the Pennsylvania system dominated roads to the west from Philadelphia and Baltimore; the Southeast was dominated by Morgan interests; James J. Hill dominated the northwestern region of the nation; the Harriman interests controlled the southern and central transcontinental routes; and the Gould roads and the Rock Island system were dominant in the Mississippi Valley.

These seven groups controlled 85 percent of railroad earnings in 1906, and their ownership and management interlocked elaborately with overlapping directorships and several informal alliances. The emergence of giantism was only one of several features in railroad development that created widespread concern and resentment in the nation at large.