to rhubarb commando:

You account of railroad gauge is a further copy of text that appears verbatim many times on the net, such as http://www.gomilpitas.com/homeschooling/humor/035.htm.

It is not necessarily entirely accurate, though. Some further reports, among many, are:
http://www.snopes2.com/history/american/gauge.htm (urban legends)
http://www.straightdope.com/columns/000218.html (straight dope)
http://www.scsra.org/library/milspec-debunk.html (from a historian of railroad engineering)

US railroad gauge was in fact highly NON-standardized until after the Civil War here. (Particularly in the south, thus hindering the South in that war.) The problem was so extreme that freight-cars were built with special trucks (the wheel assmebly) that could run on either of two gauges.

Even today, numerous gauges are in use in various parts of the world. On a quick look: "Some major rail systems use wider gauge (India uses 5½', Russia uses 5') and others use narrower (portions of Africa, Brazil, Japan, and Australia use gauges of around 3½')."