The depression of 1857, which ultimately saw the demise of virtually all of Nebraska's wildcat era banks, was particularly severe in the New England states.
With unemployment soaring, nearly 500 German "shareholders" living in Buffalo, N.Y., investigated the American West, with one fact-finding committee visiting what had originally been set aside by the federal government as the Half-Breed Reservation in Richardson County. Here they discovered timberland could be purchased for $6 or prairie grass land for $5 an acre.
Ultimately, the colony purchased land owned by Stephen Story, who had just established the nearby community of St. Stephens, named in his honor. The German settlement was on the bank of the Missouri River about eight miles north of Rulo, where only a handful of families from the state of Missouri had previously located.
In 1860, the Nebraska Legislature incorporated the city as Arago, after the French astronomer Dominique Arago. The census of that year showed 193 residents. But the village of "St. Stephens ... a suburban portion of Arago," just below it on the river, did not flourish and in 1862 the two precincts merged as Arago.
In July of 1862, the Arago post office opened, and the village began to prosper. John C.F. McKesson, whose father was a minister, arrived as a boy at Arago in April of 1864. The following year, his uncle John M. McKesson visited and spoke to local gatherings as a promoter of the new Methodist seminary and community of Lancaster, where he had settled in June of 1863 and built a log house at what would later become 11th and U streets in Lincoln.
Although not even a decade old, Arago had become "the metropolis of Richardson County and southeastern Nebraska, boasting a population of some 1,500." Steamboats docked on a nearly daily basis, with sometimes as many as four or five tied up at a time.
The city's businesses at that point included four saloons, two hotels, five general stores, three blacksmiths, a whiskey distillery, the Southeastern Nebraskan newspaper, a brewery, brickyard, huge pork canning plant, an opera house, numerous small businesses and a "jolly, good-natured population."
That spring, Rev. McKesson was asked to investigate inland Nebraska with the intention of "establishing churches." With his son John M., he set out to visit his brother in Lancaster and the surrounding area.
To get to Lancaster, the father and son first headed to Brownville, then to Nebraska City, stopping for lunch at Walling & Luff's Ranche at Otoe City. They then followed the Steam Wagon Road which forked at Palmyra, taking the Roca, Saltillo, Yankee Hill branch which would see 255 Mormon wagons the following year.
After visiting the Wallingfords on Salt Creek six miles to the south of Lancaster and camping at Half-Way Slough 2.5 miles southwest of Emerald, they arrived at Lancaster.
Arago's fortunes meantime had begun to wane. Cholera struck in the summer of 1866, "nearly depopulating" the village, and with the arrival of the St. Joseph & Council Bluffs Railroad on the Iowa side of the Missouri River, the era of steamboating was drawing to a close.
As if more devastation was needed, the fickle Missouri River began eroding its banks and, in order to save the town, it was moved several miles inland, becoming, at the same time, Fargo, Neb., named for the Wells Fargo Company.
Young John McKesson returned to Lancaster in the summer of 1867, this time visiting the seminary building. He also visited Cyrus Carter, who lived at 24th and R streets; his father's cousin Elder John M. Young, who lived at 17th and O streets; James Young on the south side of O Street at 27th Street; Jacob Dawson on the south side of O at Eighth; and the blacksmith across O Street from the Dawsons.
Young John McKesson was still in Lancaster later that summer, fishing at Willow Bend on Salt Creek at about Fourth and O streets. Heading back to his uncle's with "a small string of mud catfish, and in company with another boy of (his) age, barefoot and muddy, (they) came upon a crowd hurrahing and waving." This proved to be a small group which had gathered at Captain Donovan's cabin, where the Nebraska Capital Commission had just met and voted to move the new state of Nebraska's capital from Omaha and change the city's name to Lincoln.
Within a few years, Arago's one-time supremacy in freighting had completely ended. By 1870, the population had dropped to 374, and in 1913, even the then renamed Fargo post office closed.
Today, the original site of Arago is completely returned to farm land and the only remnant at the second, inland site, is the nearly forgotten and tricky to locate Arago Cemetery. McKesson's log house, meantime, is well buried under the southeast corner of Memorial Stadium and likewise almost totally forgotten.