They failed because nobody cared about the railroad. The railroad had to be a government project with leases to companies but the government was too much involved in the slavery issue that it didn't have time to deal with railroads. That's why railroads boomed after the civil war ended. <span />
They intended to damage the u.s. fleet so badly that by the time it could be rebuit they would have uncontested control of all of asia and the south pacific