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OUR RAILROADS TO-MORROW
OUR RAILROADS TO-MORROW
BY EDWARD HUNGERFORD
NEW YORK
THE CENTURY CO.
1922
COPYRIGHT, 1922, BY
THE CENTURY CO.
COPYRIGHT, 1920, 1921, 1922, BY
CURTIS PUBLISHING CO.
PRINTED IN U. S. A.
CONTENTS
CHAPTER PAGE
I IN INTRODUCTION 3
II THE UNITED STATES RAILROAD ADMINISTRATION 25
III THE UNITED STATES RAILROAD ADMINISTRATION (continued) 47
IV THE RETURN OF PRIVATE OPERATION 65
V THE PRESENT-DAY SITUATION 79
VI THE MAN FACTOR OF THE PROBLEM 91
VII SOLVING THE RAILROADS' HUMAN PROBLEM 115
VIII THE POSSIBILITIES OF ELECTRIFICATION 135
IX MORE ABOUT ELECTRIC MOTIVE-POWER 159
X A CASE FOR THE STEAM LOCOMOTIVE 172
XI THE GASOLINE-MOTOR UNIT AND ITS POSSIBILITIES 191
XII SPEEDING UP THE FREIGHT TERMINALS 213
XIII THE TWILIGHT OF COMPETITION 238
XIV THE REGIONAL RAILROAD OVERSEAS 272
XV THE REGIONAL RAILROAD AT HOME 293
XVI THE UNITED STATES RAILROAD 317
OUR RAILROADS TO-MORROW
CHAPTER I
IN INTRODUCTION
Do you chance to recall the story of Frankenstein, of the man-made
monster, who, having been created, arose to slay the man who had created
him? The railroad to-day is in much the position of the man who created
the Frankenstein. Having in no small sense created the modern world,
having riveted its very sinews of commerce together, it now stands in
apparent danger of collapse. The world over, it is at least in peril of
bankruptcy. Everywhere it is in trouble. One of the greatest if not indeed
the greatest of factors in our social and commercial structure to-day is
flying the signals of distress. Its perplexities are upon all tongues.
Their solution seemingly has become the problem of all men. The railroad
is almost the single great unsolved economic problem of the entire world
to-day.
The sweep of a great war, the debris of men and of human understanding
that followed in its wake, the new and independent position of labor
everywhere, the vast increases in fuel and in raw material costs--all have
contributed to the serious embarrassment of our railroads. But never to
their breakdown. Please remember this. It is a common phrase these days to
allude to "the breakdown of the railroads." But it is an incorrect phrase,
decidedly incorrect.
Even in Russia, where transport conditions to-day are the worst anywhere
in the world, there has not been a complete railroad breakdown. The
Russian railroads after nearly a decade of overburden are to-day
functioning--after a miserable fashion, to be sure, but functioning none
the less.
For, truth to tell, a necessary railroad structure may never break down
completely. It may descend into the valley of deep woes, it may crawl on
its stomach in the despair of seemingly hopeless disease, but it may never
quite die. That is out of the possibilities of the thing. Dying, a
railroad dying? It must never die. A factory, a merchandising
establishment, even a whole town may struggle along fitfully for a number
of years and then decide to quit, leaving but a forlorn group of ruins as
a memento of vanished enterprise. But a necessary railroad may never quit.
When a rail highway of any real importance ceases to operate, civilization
itself, begins to crumble. For a railroad is a not alone life but also a
life-giver. Upon it depends virtually all the life of the community it
serves, not merely commercial life but political and social as well. Which
means that the mere suggestion that the railroad structure should cease to
function is unthinkable. And here thrusts to the front the vexing problem
of how not only to enable it merely to live but to enable it to live in
the fullest strength, to grow apace withal, to more than keep pace with
the growth of the community that it is designed to serve.
* * * * *
For nearly a hundred years now we have been upbuilding the railroad
structure of the world. America pioneered in its creation. Our fathers and
our fathers' fathers cannot now remember the day when the call of the iron
horse was not heard across the land. The railroad train has become part
and parcel of our lives. And even though in these days with our motor cars
at the curb we may have come to scorn the railroad train for our own short
travels, we know full well that it brings the milk to our doorstep, the
coal to our bins, the provender to our larders. It helps weave the fabric
upon our backs, build the shoes upon our feet, form the hats upon our
heads. At every corner, every turn, we are dependent upon the railroad.
Therefore there is not a man or a woman in the entire United States to
whom its present plight should not be of the keenest interest and
importance.
* * * * *
We were promised a complete solution of our transport troubles with the
hurried passage two years ago of the Esch-Cummins Bill, now known
officially as the Transportation Act. Have we reached that solution, or
anything like unto a solution?
You do not have to ask the average man twice for an answer to that
question. He knows. If he is a business man he knows doubly well. He knows
that for the last ten years our American railroad system has been in
something of a decline. A decade ago it was at the zenith of its
efficiency. For eighty years it had been climbing upward; for the last ten
it has been slipping backward. Oh, yes, I do know its war record. It _was_
a fine record and one of which every American should be duly proud. There
is hardly a physician, however, who has not seen a patient, terribly sick,
under the stress of great emergency rise magnificently to a definite
situation of supreme importance. So four years ago rose our sick man of
American business. And now he has gone to bed more ill than ever before
while many doctors quarrel about his case.
And still he functions. The sick-abed man of our American business still
renders the all-necessary service that none but him really can render.
Fortunately perhaps American business itself at this moment is not in the
very best of health. One shudders to think what would happen if industry
all the way across the land were again in its top notches of production.
It is not the least of the perplexing phases of this all-perplexing
railroad problem of ours--the question, when traffic shall again rise (as
it certainly will) to normal volume, to say nothing of any abnormal
volume, of how our weakened railroad structure will meet it.
That it recently withstood severe tests is of course no indication that it
could again withstand such strains. All the way across the land our
railroad functioned in the recent ordeals through which it has
passed--which of course is not saying that it could do this again. It
quite naturally worked at its best in the western sections of the land,
where there are both less congestion and comparatively larger rail
transport facilities. Yet as one came east he found the American railroad
still meeting its responsibilities bravely and with a real degree of
efficiency. One crossed the Missouri, the Mississippi, the Maumee, and
still found the railroad functioning--the stout, pliable rod of its energy
bending but never breaking. He came further east still, crossed the
Susquehanna and then the Delaware, and still the rail carrier functioned.
He came to the Hudson and found the battered and overburdened railroad
machine still meeting its obligations, after a fashion at least.
Our railroad machine did not break even in New England, where conditions
are and for a long time past have been almost at their worst; where for
nearly two decades a high-grade community has been forced to pay penalty,
and pay generously, for a grave accumulation of railroad errors. It was in
New England that American railroading really began, with the construction
in 1808 of a crude wooden railed line at Quincy, Massachusetts, whose
horse-drawn cars brought granite from the quarries down to the water's
edge, whence it might go by sloop to Charlestown, where the tall shaft of
the Bunker Hill monument was beginning to arise. It was in New England too
that the first real railroad enterprise and development were shown; by the
middle of the forties a group of energetic and profitable small companies
rapidly expanded and offered genuine transport to six of the busiest and
most rapidly growing States of the Union.
It is in that same New England that when one comes to-day he finds the
picture of our national railroad machine almost at its very darkest--the
stations dirty, unpainted, neglected; the passenger-cars and the
locomotives in similar or even worse condition; the morale of the rank and
file of railroad labor low in many different ways. Remember that it is not
like this everywhere else within the land. It is particularly different
out in the West. Take California; out there the stations almost invariably
are clean and brightly painted, the broad lawns that surround them are in
the pink of perfection, while the trains that enter and leave the stations
are in full keeping with them. Engines, and the passenger-cars behind, are
alike clean, fresh-painted, efficient in every detail of their appearance.
Paint certainly does wonders. The cherry-red electric trains of the
Southern Pacific never seemed brighter or more immaculate. I rode a little
more than a year ago on a huge steam locomotive of the El Paso and
Southwestern railroad. The brightness of her appearance, the efficiency of
her performance, seemed to belie the fact that it was eleven years since
she had left the big shop in Philadelphia where she had been born.
Always it is as one comes further east that the American railroad machine
grows more and more shabby, until in New England we see it at its worst.
Our entire railroad structure, speaking nationally and subject only to a
few exceptions, is worn down a bit. It is a shoe outgrown. It pinches. It
pinches hard. Yet nowhere does it pinch harder than in New England. I
hinted but a moment ago of the transportation machine there, twisted and
bended and torn and all but completely broken. I spoke of the desolate
appearance of many of the trains and of the stations. The Boston and
Albany, it is true, has been something of an exception to this rule. The
present condition of the Springfield station does not prove the exception
however. Always a wealthy road, the B. & A. is compelled by its State
charter to return to the Commonwealth of Massachusetts all of its earnings
in excess of an annual 8 per cent. It is hardly necessary to add that
even in its most prosperous years the excess earnings went into the
property. And in consequence the patrons of the road benefited. But that
was yesterday.
It was yesterday too that Boston possessed a suburban service in which she
could at least display some slight evidences of satisfaction. That
yesterday is now quite gone. To-day the service is unquestionably the very
worst in all this land. It is doubtful if any other large American city
would tolerate for a month the sort of suburban service which to-day is
doled out to the Boston metropolitan district. Ancient and dilapidated
cars, pulled by equally ancient and dilapidated locomotives, are the sad
lot of the Boston commuter. The records of the railroad companies
themselves show that some of these ancient coaches date from as far back
as the early eighties; many of them go back into the nineties. Nightly the
trains are crowded, not only to the extent of their seating capacities,
but well beyond them. Nightly the abominable overcrowdings of the New York
subways are repeated throughout the Boston suburban zone, and with far
less excuse.
In its appropriate time I shall discuss the large possibilities of
electrification as it applies in particular to the Boston suburban zone.
For the moment consider this New England corner as the darkest corner of a
transportation picture which to-day has but few patches of brilliancy. As
one goes from east to west however the picture brightens perceptibly. Do
not forget that it is at its very worst in New England and perhaps at its
best in California.
* * * * *
For the moment the freight service, nationally speaking at least, is not
subject to the same criticisms as the passenger. (To the depleted
passenger service we shall come in good time.) This for the simple reason
that the traffic is not being produced across the land. A sadly depleted
transportation structure easily can take good care of a sadly lessened
freight traffic. But let our wheels of industry begin really to hum again
and contemplating the present condition of our carriers, I shall fear a
reversion to the conditions of the winter months of the early part of
1920, when one box-car took forty days to go from Boston to Chicago, a
trip that easily should have been made in a fortnight, while another car
but a few days later took fifty days for the same journey!
Yet, to be entirely fair, these runs were made in a winter which, by the
official records of the weather bureau, was the worst that the country had
known in thirty-six years.
All right. Let us be fair. We shall go back three years to 1917 before
government control and the really big labor problems had been wished upon
the railroads. The New England roads even then were already having a
fearful time of it. The Boston Chamber of Commerce sent out questionnaires
to the big shippers of the district asking for specific reports on _all_
of the car-load shipments that they were making. When the questionnaires
came back to it, all filled in neatly on the dotted lines and in the blank
spaces, they showed the definite record of 2625 cars, quite enough to be
fully representative of the entire situation. One New England land shipper
reported that the fifty-nine cars which he had had in Chicago movement had
ranged from thirteen to eighty-seven days in transit. (Remember, if you
will, that a fair average for that journey is fourteen days.) One hundred
and sixty cars bound to his siding from various Western points had
together consumed 6709 days in transit. A reasonable time for their
journeys would have totaled 2550 days. Detentions due solely to railroad
delays had in his one case come to the considerable figure of 4159 days.
For the entire 2625 cars--in almost every case from the primary
grain-markets of the West--the total transit time came to 109,569
car-days. Again the law of fair average time comes into play. Let me
explain briefly how it is made. To the shortest time in transit between
two given points an arbitrary of 50 per cent. is added. This makes the
fair average. In practice it results that the average time to Boston from
points east of a line drawn through Buffalo and Pittsburg is fixed at
seven days. Two weeks are allowed from points west of that line and east
of the Mississippi, three weeks from those east of the Missouri and thirty
days from places as far distant as Montana. With this rule as a measure
and taking the individual routings of each of these 2625 box-cars, the
fair average time of all of them came to a total of 40,753 car-days.
Subtracting this time from the total transit time as you have just had it,
we get in a few months at the beginning of 1917 a railroad detention of
68,996 car-days, or an average waste of 26.2 days for each car. If this
waste could have been avoided there would have been an additional use of
9856 cars for one week each, or 3285 cars for a three weeks' period. The
hard-headed railroad executives who continue to argue against a too
elaborate car-building program must understand these figures and their
full import. Nor can their brethren in the field be entirely blind to the
success of the Car Service Commission of the American Railway Association
in making an extensive and vastly bettered use of the freight equipment
immediately at hand at that time and available all the way across the
country. It takes a lot of time and money to build any considerable
quantity of new freight-cars. It does not take much of either to make a
better use of the cars already in operation. And this is the very thing
that had been done to a certain extent, up to the beginning of the present
business slump.
It would not be just or fair to assert or even to imply that all of the
car delays which we have just seen occurred within the boundaries of New
England. It is just as fair to assume that many of them came to pass in
Montreal, or in Toronto, or West Albany, or East Buffalo, or Altoona, or
Brunswick, as in West Springfield, or Cedar Hill, or Mechanicville. But
when this point has been stated the fact still remains that the New
England roads to-day are and have been for a number of years past fairly
typical--certainly not exceptional--of the condition that prevails in
certain other sections of the land, particularly upon the so-called
"weaker lines." The great trouble is that in New England there are
virtually no strong roads. They are all down in the doldrums. Even the
last series of rate advances by the Interstate Commerce Commission, which
gradually are proving very profitable to many of the already strong
railroads in the southwestern corner of the United States, have failed to
bring relief to the already weakened properties in its northeastern
corner.
In the course of this book I shall refer more than once to the deplorable
New England situation. I have referred just now to the fearful delays to
freight originating there in the last fairly normal period of private
operation, giving full heed to the fact that many if not most of these
delays occurred outside of the actual New England territory, in order to
emphasize the absolute unpreparedness to-day of our national railroad
structure should great freight traffic demands be made upon it once again.
In a merely introductory chapter I cannot expatiate at length upon the
reasons that have led to this bad condition nor attempt to give the
methods by which it may possibly be corrected. I merely am trying to paint
in brief a picture that has all too few high lights. In the course of this
book I shall attempt gradually to fill in some of the details.
All these things, and many others too, are upon the face of our present
railroad situation in this country. When one goes beneath the surface
matters are even worse. If one is a security-holder in rails he does not
have to study Wall Street reports to see the saddening decline in dividend
payments--either average or cumulative. It is he who long ago began to
smell the rat. And the news that in the railroad the employer and the
employee have been slipping further and further apart until a seemingly
unbridgeable gulf has come to exist between them, that the executive
personnel of our railroads of to-day is growing on in years with little
or none to replace it, that no steps whatsoever are being taken to bring
our railroad structure up to the necessities of to-day--to say nothing of
to-morrow--is not news to him.
Perhaps the most pathetic of all these declines is that of the fine
tradition of American railroading--the thing which in war days we learned
to call morale. It was that tradition that used to make the farmer's boy,
as he stood in the field and watched the express sweep by, yearn to become
a railroad president. In a less romantic and far more concrete form it
enabled the old-time railroaders to fight against fearful conditions at
times--against the blizzards of midwinter in the north, the blazing
midsummer of southern deserts, flood, pestilence--come what might, that
old-time railroader was ready for it.
It was the survival of that tradition, the fine fiber of its long-created
morale, that enabled our railroads to make such a fine war-time
performance. And it is its lessening, the gradual passing of the old-time
railroader with none of his caliber to replace him, that is one of the
tragedies of our railroad situation of to-day.
To Americans these things still will come as more or less of a surprise.
They may have felt themselves fairly remote from actual railroad
responsibility. They may have been depositors in the saving-banks downtown
or holders of policies in the insurance companies, and yet have quite
forgotten the millions of dollars of railroad securities in the
strong-boxes of these great fiscal institutions. The financial
ramifications of the railroad as well as its social and commercial ones
are far-reaching indeed.
Once again, it is because of this intertwining of the railroad with the
every-day life of the American community in its every phase and relation
that the growing seriousness of its present predicament becomes a matter
of so large national import. Our transport problem is no academic matter.
It is very real, very human, very close to every one of us. I did not
overstate when I said that the railroad to-day was life itself to us. And
because it is life, our life if you please, its present serious problem is
very much our business.
If we should go back and begin at the beginning we should find our
American railroads in their beginnings small individual units, in many
cases personal properties, like a store or a bank or a factory, and seldom
correlated. Even the gages of our pioneer roads did not always agree, and
in at least one case purposely so. The early builders of the Erie felt
that by laying down a six-foot gage for their enterprise they would
succeed in keeping their freight-cars and other equipment on their own
property and under their own eyes. In this purpose they succeeded
admirably. They also succeeded in keeping the freight-cars of other
railroads, bringing valuable interchange merchandise, off their rails,
with the eventual result that that railroad, twenty years after it was
first laid down, was forced at great trouble and expense to bring its
track to the standard width.
There was much that was crude and experimental about those early roads--a
condition that was of course bound to exist. The traveler who went abroad
upon them quickly became aware of all this. In the beginning he would
change cars four or five times between Albany and Buffalo; and when
fifteen or sixteen years later the railroad had extended itself all the
way out to Chicago there were three or four more changes to be made.
To-day a solid train from New York or Boston to Chicago or St. Louis is so
much a part of our regular order of things as to cause no comment
whatever. Yet even to-day one cannot ride across the North American
continent from the Atlantic Ocean to the Pacific without a change of
cars--that is, not in the United States. In Canada he can do it quickly,
easily, comfortably. Of which much more in good time.
The lack of convenience in the handling of freight was equal to if not
greater than that in the handling of passengers. Of through routes there
were none. Freight bound from five hundred to a thousand miles or more was
repeatedly transferred and retransferred. The fact that until the late
seventies two such important links of the important New York-Chicago
routes as the former Lake Shore and the New York Central and Hudson River
railroads had gages varying a little more than an inch, and so
necessitating an elaborate mechanism at Buffalo for the transfer of the
trucks beneath the freight-car bodies, shows the fearful lack of rail
correlation everywhere across the land. Indeed it was hardly a decade
before, that a state of near civil war had been precipitated at Erie,
Pennsylvania, by the efforts of the Lake Shore railroad to standardize its
gage through that town. The townsfolk, urged and led forward by local
hotel-keepers and bus-drivers, had stoutly resisted the change.
In railroad rate-making and accounting of every sort conditions were even
more chaotic. There were no standards. You could hardly expect a group of
several hundred widely separated and highly individualistic railroads to
have uniform bookkeeping practices when in many instances there were not
enough standards in the building of their cars to enable them to be
coupled together into a single train.
And yet with all of this wretched system, or lack of any system
whatsoever, those little railroads of yesterday had many, many things in
their favor. Their very individuality was an asset. The fact that they
were owned and operated by men who lived upon their lines or very close to
them was a still greater asset. The railroad executive of those days
understood from first-hand knowledge and intimate personal contact the
problems as well as the opportunities of the communities that he was
trying to serve. And a third and still greater asset was the close
personal relationship that he might enjoy with his employees. On a
railroad owning from twelve to twenty locomotives he might know, and
almost invariably did know, not only each of those engines individually
but the men who ran them. In fact in those days it was customary for a
locomotive to be named and to be assigned to a permanent crew of engineer
and fireman, who immediately began to take a surpassing pride in the
upkeep of their craft--in keeping her boiler black and shiny and her
brasses and her nickel-work gleaming like new.
In these days the brass and the nickel and all the rest of the former gay
trimmings have departed from the locomotive. Its boiler is no longer
shiny. On the average American railroad, locomotive upkeep has become an
all but forgotten art. The names and the individuality have gone from its
engines. They are assigned to crews out of the roundhouses in a very
systematic and utterly unsentimental way. Yet something very definite has
been lost.
You could scarce expect a modern railroad president whose system may own
three or four thousand locomotives to know any considerable number of the
men who operate them. Yet here is the loss. On that little road of
yester-year the president not only knew his engine crews by
name--generally calling them by their first names--but his conductors, his
station-agents, his telegraphers too. And knowing them, understanding
them, working with them in almost every case, there was no labor-union
problem to confront him. There were no unions then for the simple reason
that there was no necessity for them. The labor-union upon the railroad
with all of its problems for the management came definitely as an effect
of its super-consolidation. And the railroad tradition began to fall.
Even after the first steps in the inevitable consolidation of our various
lines had begun, when for instance the six railroads in the
three-hundred-mile stretch between Albany and Buffalo had been merged into
the first New York Central, this intimate sense of personal relationship
remained for a long time.
The statue of William Bliss, president of the Boston and Albany railroad,
which stood for many years in the lobby of the old Kneeland Street Station
in Boston, typified it. When the Boston and Albany was the Boston and
Albany it was the pride not only of its employees but of all New England.
But when, in accordance with the general railroad practice of the moment,
the Vanderbilts took it over upon a long lease and painted out the old
name, placing "New York Central" upon the cars and locomotives, New
England rose in its anger, and it was not appeased until a shrewd
executive, going to Boston from New York, reversed the new order of things
and painted the beloved old name back again upon the equipment. After
which serenity ruled once again along the lines of the "Albany," as the
Boston people to this day love to call it.
What's in a name? More than you can imagine. I asked a shrewd brotherhood
man once what the New York Central had sacrificed in operating efficiency
when it had chosen to paint the names "Lake Shore," "Michigan Central,"
and "Big Four" from its western constituent lines, and he said that he
guessed--it really is anybody's guess--that 50 per cent. would be about
right. The Pennsylvania system, with a great deal of real wisdom and long
vision, not many months ago decided to divide itself into four large
regional operating divisions, all to be known however under the general
title of Pennsylvania System. Yet an old passenger conductor with whom I
have ridden these great many years between New York and Philadelphia
confessed to me his great personal regret at the passing of the fine old
name, "Pennsylvania Railroad."
"I feel as if I had buried an old friend," said he. So felt others, and a
little later the Pennsylvania dropped the "system" from its official name
and came back as the good old Pennsylvania Railroad once again.
A few miles further south the people are still grieving over the loss of
the "Cumberland Valley," one of the earliest railroads of the
land--incidentally a Pennsylvania constituency and one which until the
recent change had held its name and its individuality. Across the land the
thing repeats itself again and again. Away up in the northwestern corner
you will find people to-day lamenting the renaming of their chief railroad
system into the Union Pacific.
"We were proud of the name 'Oregon-Washington Railway,'" said one of the
really big men of that community not long ago. "It was a good railroad and
we felt that in no small sense its goodness reflected that of this
particular corner of the U. S. A."
If this feeling comes to the patrons of these railroads how much more
distinctly must it come to their workers? In subsequent chapters in a
pleading for a division of our national railroad structure into shorter
operating units, despite the ponderous suggestions of the Transportation
Act, I am going to refer to the fact that in this country a half-dozen or
so of the small railroads ("small" at least in a comparative sense) are
the best operated and hence the most profitable lines in the land. And
incidentally, despite the great tangle of red tape that the government
system of railroad control has spun about them, they still enjoy
comparatively friendly relations with their labor.
With the fundamental idea of railroad consolidation one can have no
quarrel whatsoever. It was inevitable. It came logically and
sequentially--in some ways before many folk were really aware of it. When
a very few years after the close of the Civil War the merger of the Grand
Trunk railroad was accomplished--a single system of nearly four thousand
miles, stretching all the way from Portland, Maine, by way of Montreal and
Toronto to Detroit (a little later, on to Chicago)--America stood aghast.
And yet what were four thousand miles to be compared with a single system
of twelve thousand miles of main-line track--nearly one-twentieth of the
total mileage in the United States, upon which moves one-seventh of the
traffic of the nation? And yet here is but one of three or four big
twelve-thousand-mile systems that our land holds.
In our Yankee version of the English language we dearly love that word
"big." Yet is it not now a fair time to ask what that bigness has really
cost us? Granted that with a certain amount of real aid from the state it
has given us through rail and through car routes of an amazing
multiplicity--even though one cannot cross the United States from the
Atlantic to the Pacific in a through car, unless it be a freight-car--that
it has simplified vastly our tariffs, our ticketing and our way-bill
systems, it certainly is failing to-day in many, many instances to give us
the high degree of service which our railroads themselves have educated us
to expect. As I said at the beginning our transport service to-day is
appreciably poorer and the rates a great deal higher than they were a
decade ago, while the personnel problem of our railroads, in their
executive ranks as well as in the ranks of the great mass of their labor,
has become a matter of real alarm.
In this book I am going to give scant attention, if any, either to the
scandals or to the triumphs of railroad finance for a half-century past in
this country. Neither am I going to hark back to the evils of multiple and
ofttimes conflicting regulation of our carriers by the Federal and the
forty-eight State governments. Both have been pretty thoroughly treated
over and over again. And so we shall assume, first that the railroads must
be properly financed in order to function at all, and second that the
principle of regulation by the state is so thoroughly established by this
time as to be removed from the field of controversial argument; while the
perplexing factor of many and ofttimes annoying conflicts between the
State regulatory bodies, or between them and the Federal Interstate
Commerce Commission, is being solved automatically by the steadily
increasing usurpation of the individual rights of the various States by
the centralized government at Washington.
The problems upon which I shall prefer to linger in this book are those
that concern the physical side of our national railroad structure, future
as well as present, its operating problems as well as its purely human
ones, in these last including not merely the very human problem of the men
and women who work upon the railroad but those who ride upon it or
otherwise become its patrons. Granting the great importance of its
questions of finance and of state regulation, I still feel that these last
are of still greater portent to its future. With these properly solved,
finance and regulation, to a large extent at least, will solve themselves.
A national railroad structure well operated, with efficiency, with
economy, with vision, with a broad human relationship, will not have to
worry very much about the sale of its securities or about interference
from fussy regulatory bodies. I think that this may be fairly set down as
a fundamental fact in our argument.
As to what constitutes good operation, efficiency, economy, vision, broad
human relationship, there will of course come more than one opportunity
for an honest difference of opinion. It is in the sincere effort to gain
the real current of forward-looking opinion upon these great questions of
our national transportation problem that the writer for the last sixteen
years has traveled many thousands of miles across the United States and
Canada and has interviewed hundreds of people in railroad circles and out.
For more than a dozen years past he has foreseen the present crisis. The
coming of the World War hastened it a bit perhaps but the crisis was
inevitable. A drifting policy, which ofttimes was no policy at all,
followed by both the railroad and the various groups of persons that
assumed to control it, has brought us almost to the edge of supreme
catastrophe.
* * * * *
Go back with me once again to the beginning. Remember if you will that the
railroad in the United States to-day is a little more than ninety years
old. For eighty of those years it was in a state of steady and healthy
development and progress. For the last ten or twelve of them it has not
only been in a state of arrested development but narrowly approaching
entrance into a state of decadence.
For eighty years the American railroad grew, and grew heartily. It
financed its own growth and, consisting very largely of independent units,
financed itself quite readily and as a rule locally. It kept its physical
facilities, track and rolling-stock and all the rest of it, abreast if not
ahead of actual traffic requirements. About the beginning of the present
century, as presently we shall see, it began to feel the burden of greatly
increased material costs, and of taxation also. It met these added costs,
without any very visible addition to its revenues, by holding rather
tightly down on its pay-roll and by adopting large operating efficiencies
and economies. For a while these sufficed. They had to suffice. Appeals to
the State and Federal regulatory commissions for increased rates were
generally vetoed pretty promptly. Since the establishment of the
Interstate Commerce Commission in 1887 these regulatory boards had
increased steadily in strength and in prestige. They felt their oats. And
many did not hesitate to deny the applications of the roads for rate
increases.
In 1906 something happened which in later years was to loom large in
American railroad history. Congress, under a considerable pressure from
President Theodore Roosevelt, passed the so-called Hepburn Bill, radically
amending the Interstate Commerce Act and giving the I. C. C. an almost
unbridled authority over railroad rates. The Interstate Commerce
Commission could not itself authorize changes in the tariffs of the
carriers but it could, and frequently did, veto any changes that the roads
themselves saw fit to make.
Parenthetically it may be stated that even though this increase of power
granted to the big Federal commission stirred up something of a
competitive energy on the part of the State regulatory commissions to
supervise more carefully than ever before the operation of the railroads
through their respective bailiwicks, it also marked the long beginning of
the end for the State boards; as far at least as our steam railroads are
concerned. As I have said already, it is still another of our difficult
national question-marks in which the old, old problem of States' rights
again shows its disagreeable face. Eventually it probably will be ended by
shearing these State boards of virtually if not absolutely all of their
supervision over interstate railroads; and the I. C. C. long since has
shown marvelous ways in which this phrase may be extended to cover even
the tiniest of apparent intra-state lines.
The passage of the Hepburn Bill put the first quietus upon the development
of the carriers. Soon after, they began to cease large additions to their
plants, even though the nation that they served went steadily ahead in its
development, by leaps and by bounds. Yet for full ten years after 1906 the
net earnings of the carriers continued to increase, in pace with the great
growth of the nation and its industries in those selfsame years, until
under the war stress of 1916 and 1917 they had come to the astounding
total of almost a billion dollars a year "net operating income," which
under the rigorous accounting systems of the Interstate Commerce
Commission signifies the amounts available for paying interest and
dividends and making permanent improvements. In other words the
deterioration of the national railroad structure had begun well before the
maximum of net earnings had been reached, and by the end of 1917 had
reached so serious a stage as to threaten a possible breakdown--I am
using this last word advisedly--or at best a fearsome congestion and
uselessness, in the face of one of the gravest national crises that the
United States has ever had to meet.
Confronted with such a possibility President Wilson did not hesitate. He
took no chances. With the supreme powers which were his as the war leader
of the nation he reached out and took over the railroads and made them a
direct agency of the national conduct of the war, under the name of the
United States Railroad Administration, placing them under the direct and
autocratic control of William G. McAdoo, secretary of the treasury and a
man with not only a large knowledge of railroad finance but with a degree
of success as an actual railroad operator--of the short but busy Hudson
and Manhattan rapid transit lines connecting New York, Jersey City,
Hoboken, and Newark.
There has perhaps been no single activity of the Wilson administration and
its conduct of the war more seriously discussed and criticized than its
control of the railroads. Even the gigantic expenditures and manifest
blunders of the Shipping Board have been passed quickly by, to linger upon
those of Mr. McAdoo and his fellows in the Railroad Administration. Yet
when all has been fairly considered the Railroad Administration in its
brief twenty-six months of life accomplished some very creditable things,
and some not so creditable--some of these obvious, some others most
unexpected and strangely outre. It was obvious for instance that a highly
centralized, automatic, and supreme control could obtain large operating
economies by completely obliterating competition and could by appealing to
the traveler and the shipper in the role of a sadly harassed government,
obtain a cooperation that no private agency might ever obtain.
Because the brief history of the Railroad Administration enters so very
vitally into any consideration of the railroad situation in the United
States both to-day and to-morrow, I shall come to it for the next chapter
of this book. For the final paragraphs of this, consider once again the
present lowered efficiency of our rail transport in this country. That it
has been bettered in some of its phases since its relinquishment by the
government I shall not deny; that it has been bettered in some of the most
vital of them I shall dispute until the end. The proofs are too easily at
hand. And so the reading of them may lead us into a really intelligent
understanding of the situation.
* * * * *
What's the matter with our railroads?
That question is being asked hundreds of times each day by business men
all the way across the land--from Portland, Maine, to Portland, Oregon,
from north to south and back again. These men, keen in their perception of
many of the great and perplexing problems assailing the United States at
this moment, frankly admit their lack of an understanding of the railroad
one. They are torn by a vast conflict of statements and of opinions.
Skilled propagandists succeed only in adding to the confusion. Apparently
nowhere is an independent voice raised in the interest of the common
citizen of America, the man who perhaps is not a wholesale user of our
overland transport but who realizes from personal contact each time he
makes a shipment of his goods or goes himself abroad into the land that
our national railroad has suffered a vast deterioration within the last
decade, that it no longer functions with anything like the high efficiency
that it had attained say twelve or fifteen years ago.
What's the matter with our railroads?
It is a fair question, and one that demands a fair answer. Why should not
our railroad structure in the United States to-day be rendering service at
least as good as that which it rendered but ten or twelve years ago? Is it
man failure, either in the lists of the rank and file or in those of the
executives? Is it, as has been charged frequently, interference by the
Federal and State governments or, to put it in a gentler fashion,
over-regulation by these same agencies? Is there lack of intelligence or
vision or human understanding? If so, just where are these lacks?
It is to the answering of these questions that the writer puts his sixteen
years of intimate and personal study of the American railroad and, as he
has just promised, takes up that problem on April 5, 1917, the day that
the United States of America officially entered the World War overseas.