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Demise of the Olympian Hiawatha Locked

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Posted by SD60MAC9500 on Tuesday, May 11, 2021 12:54 AM
 

TRR
 
With the resulting progressive upgrade of freight services, the tunnel floor project in 1962, giving Milwaukee the auto traffic that could no longer use the Northern Pacific, the Kent Auto Facility finishing in 1969 taking virtually ALL of the rail auto traffic into and out of Seattle, the Stacy Street Intermodal Facility in 1969 which captured 50% all ALL intermodal traffic into and out of Seattle, were just precursors to the business caputured as the result of the Burlington Northern Merger and the ending of the long-haul discrimination fomerly practiced by the NP and GN.
 
 

 
Yet the the rates the MILW charged for this low volume traffic didn't cover their operating cost now did it? The historical traffic base for the PNW has been higher revenue Westbound bulk traffic. That mostly ignore(s) the Ports of Seattle and Tacoma for Columbia River Ports down state, and Port of Vancouver, B.C.... Guess which RR never had its own track to these all important export facilities? So in hindsight it doesn't matter if MILW had virtually "ALL" of this traffic. It's freight that didn't pay the bills..
 
 
 
 
 
 
 
Rahhhhhhhhh!!!!
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Posted by Lithonia Operator on Tuesday, May 11, 2021 8:17 AM

For a good bit of this thread, two individuals argue quite lengthily and vociferously; sometimes it seems almost personal.

For someone like me who doesn't know the history of the MILW, can someone explain in thirty words or less the crux of what this conflict is basically about?

Still in training.


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Posted by Overmod on Tuesday, May 11, 2021 9:03 AM

Lithonia Operator
For someone like me who doesn't know the history of the MILW, can someone explain in thirty words or less the crux of what this conflict is basically about?

You have two scholarly individuals with very different opinions, who in the best tradition of ancient Internet flame wars do battle to prove very different explanations of a common thing.

This is only a resumption of a timeless topic that became memorable on the old Forum; in fact much of it predates my joining here.  If you look up 'Michael Sol' in community search, and go back in time to 2004 and before, you'll see battling titans in their prime.

(There is an amusing post where someone carefully tots up all the firsthand experience one of them claimed over the years, to wonder implicitly if it could be possible.  Decide for yourself...)

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Posted by Lithonia Operator on Tuesday, May 11, 2021 11:22 AM

But what, basically, is in dispute?

Still in training.


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Posted by Overmod on Tuesday, May 11, 2021 12:44 PM

Whether the Pacific Extension could be the basis of a profitable railroad or not.

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Posted by Lithonia Operator on Tuesday, May 11, 2021 2:22 PM

You mean "could have been?"

Or is there some talk of trying to resurrect the line? (I'm thinking probably not.)

Still in training.


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Posted by daveklepper on Tuesday, May 11, 2021 3:28 PM

Overmod, I think you meant "could have been...."

Just trying to be helpful.

 

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Posted by Overmod on Tuesday, May 11, 2021 5:19 PM

For them it might as well have been present tense for over two decades.  And the beat goes on.

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Posted by NP Eddie on Tuesday, May 11, 2021 7:26 PM

The MILW Board of Directors in 1910 or so had delusions of grandeur when they decided to built west of Aberdeen, SD to the Pacific Northwest.   It cost three times the budgeted cost. GN, NP, and UP had the traffic patterns already.

Please read Jim Scribbins "The Hiwatha Story" and "Milwaukee Road History" for his insights.

The MILW mad a foolish move to upgrade the  Chicago to Omaha main line for UP passenger trains instead of improving the Pacific Extension. Now most of the line is abandoned.

The "Olympian" was a train that was not needed.

 

Ed Burns, Retired Class 1

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Posted by Erik_Mag on Tuesday, May 11, 2021 10:00 PM

NP Eddie

The MILW Board of Directors in 1910 or so had delusions of grandeur when they decided to built west of Aberdeen, SD to the Pacific Northwest.   It cost three times the budgeted cost. GN, NP, and UP had the traffic patterns already.

The decision to build the extension was made circa 1904 and the "last spike" was driven in 1909.

The Milw board of directors included a fair number of men associated with the Anaconda Mining Company, and the decision to build the extension was partly driven by Anaconda wanting more competition in rail service for Butte and Anaconda. Similarly, the decision to electrify was seen as a way of increasing demand for copper.

A couple of good resources would be Myrick's Railroads of Arizona, Vol 1, specifically the chapter on the El Paso and Southwestern (Phelps Dodge) and Stan Johnson's The Milwaukee Road's Western Extension.

FWIW, one of the first things that my grandfather did when he arrived in the U.S was helping his brother-in-law provide horse teams for the grading on the extension around Terry, MT as well has later on having dealing with the Milwaukee shops in Miles City.

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Posted by TRR on Tuesday, May 18, 2021 5:00 PM
I am always entertained when Mark Meyer has to refer to "me" -- my website -- in his struggle to explain what he does not know. The formal record is well-developed. An honest observer has to know what it is, however.
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Posted by TRR on Tuesday, May 18, 2021 6:27 PM

The Milwaukee Road's success "out West" after 1968 is well documented. The 1960s took their toll on all railroads as the Interstate Highway System cut into the high-end revenues that formerly went by rail. And that was particularly true in the Midwest, but is also well-documented in the Interstate Commerce Commission Reports regarding the "Northern Lines Merger" case, which was initially denied by the ICC.

When the Merger Committee "came back" offering enhanced protections for competing railroads, the ICC noted singularly, the conditions requested by the Milwaukee, and granted, were the "sine qua non" -- "without which, nothing" -- of the Burlington Northern merger.

But, the Northern Lines had no choice. They were failing rapidly under the rapidly changing rail traffic conditions of the 1960s, and projections, without the merger, were catastrophic.

As a result, there was a success story, and it was the success of the merger conditions on Milwaukee Road's Lines West.

Recall, in the period 1967 through 1977, the carloads on Milwaukee Road Lines East plummeted from 1,008,000 carloads to 651,866 carloads. A decline of 35%, as railroads lost their high revenue traffic to the Interstate Highway System. By contrast, traffic on Lines West grew 41%, virtually all high revenue, premium long haul traffic that Milwaukee could move faster than trucks could over the highways. And that was because Milwaukee could "outrun" the highways. Train #261 average speed through Montana was 43 mph. Trucks could not come close.

Rock Island filed for bankruptcy in 1976. The three railroads in the nation with the highest levels of deferred maintenance were 1) Chicago and North Western, 2) Milwaukee Road and 3) Burlington Northern.

After the "Rock" folded, everyone expected Illinois Central Gulf to be next, but William Johnson kept the money supply flowing from his assortment of very profitable companies assembled at Illinois Central Industries. Recall, before his arrival at Milwaukee as Trustee, Stanley Hillman had been trying to salvage ICG, but couldn't do it, and retired. Some said "catapulted."

But, despite the catastrophic loss of both numbers and quality on Lines East, out West Milwaukee had a success story. It dominated the Ports of Seattle and Tacoma, and after its arrival in Portland, Southern Pacific reported that its Brooklyn Yard in Portland did more work for the Milwaukee than it did for itself.

“Milwaukee Road had in excess of 76% of the Port of Seattle’s business. It had mail, it had Toyotas, it had almost all the domestic auto business westbound. It had the long ticket items we needed to build on that today are what railroads are all about." William Brodsky, Interview by Jim Scribbins, “S.O.R.E.” Milwaukee Railroader, First Quarter, 1994, p. 11.

Of course, as the successful founding president of Montana Rail Link, and later head of the entire Washington Corps empire, an experienced "actual" executive, Bill Brodsky deserves both the attention and respect for his credibility that others have not earned.

As with Paul Reistrup, another authentic rail executive, "If you save anything, save that Washington Division."

And, as the experienced consultants at Booz, Allen Hamilton confirmed, "the most successful likely outcome of any reorganization has to include the "Louisville Transcon."

Now, all of that has to be contrasted with the voluminous and tendentious output of someone who 1) does not have the relevant experience, 2) had nothing to do with the Milwaukee Road, 3) has a documented history of odd fixations involving his Father's railroad, the Great Northern, 4) and all the time in the world, in retirement, to humor his fixations. This just happens to be one of them. Oh well. His professional colleagues privately report that he would launch into these lectures at work, at the BN shuffling locomotives, and if any dared disagree with him, he would stop speaking to them.

Division Revenues, Milwaukee Road 1977

 

Division Mileage Revenue Revenue per mile
Galewood (Conrail exchange) 168,997,829  
Illinois-Iowa 2141 200,386,331 $93,594.74
Wisconsin 1562 122,770,371 $78,598.19
Minnesota-Dakota 3507 170,319,461 $48,565.57
Montana 1097 39,814,745 $36,294.21
Washington 1199 169,710,365

$141,543.200

TRR
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Posted by TRR on Tuesday, May 18, 2021 6:36 PM

The Milwaukee Railroad Restructuring Act provided for both federal funding (loans) and provided for a plan of reorganization, and a broad coalition of shippers, states, and employees, representing everyone except notorious Quack, Dixi Lee Ray, Governor of Washington, whose principal adviser was BN VP Taul Watanabe, the coalition quickly put together a reorganization plan, essentially modelled along the "Louisville Transcon" alternative proposed by Booz, Allen, Hamilton.

https://www.milwaukeeroadarchives.com/Bankruptcy/NewMilPlanCover_small.jpg

https://www.milwaukeeroadarchives.com/Bankruptcy/NewMilwaukeeLines.pdf

 

 

 

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Posted by TRR on Tuesday, May 18, 2021 7:18 PM

Ed Burns wrote: "The MILW Board of Directors in 1910 or so had delusions of grandeur when they decided to built west of Aberdeen, SD to the Pacific Northwest.   It cost three times the budgeted cost. GN, NP, and UP had the traffic patterns already."

Most of this is false.

At the time of construction, the Milwaukee Road was owned by William Rockefeller and H.H. Rogers, who after John D's retirement from the Standard Oil, ran the thing. They had bought the Anacoda Copper Mining Company from Marcus Daly, but noted that the "Hill Lines" were dominated by J.P. Morgan, who they didn't particularly like. They didn't want to have anything to do with him, including his two railroads, the NP and the GN.

After the "Northern Securities" imbroglio in 1901, Rogers told his stockbroker, Thomas Lawson, that "it won't be too long before we won't have to deal with Morgan." By which he meant, he and Rockefeller were planning to take the Milwaukee Road "out West," to Butte, and the lucrative traffic in the mines, the smelters, the supporting lumber interests, and, of course, the lucrative long haul traffic in supplies and in copper product.

And, while building, Milwaukee looked to other lumber traffic, mining traffic, and began buying thousands of acres of the best timberlands in the United States in northern Idaho and on the Olympic Peninsula in Washington State. Too, the Milwaukee Road took the lead in developing agriculture in Montana and eastern Washington, a increased the population of Montana by over 50,000 in a few short years of promotion and support through 14 experimental farms in Montana alone.

After that, Milwaukee went after "port traffic" at Seattle and Tacoma, and in 1909 was the only American railroad in either of those ports that even HAD any international trade. By 1916, Milwaukee had to lengthen its passing tracks on Lines West. Because of unexpectedly heavy traffic, the trains were longer than Milwaukee had expected them to be.

By 1920, Milwaukee had exceeded substantially, carloadings on its western lines over the Great Northern, which was a distant third, and was second only to the Northern Pacific which had "cornered the market" in short distance movements.

The Northern Pacific was actively worried.

Letter, Howard Elliott, Chairman, New York, to Charles Donnelly, President, St. Paul, December 11, 1920:

"The St. Paul road, in making its extension to the coast, introduced a most active competitive force in Northern Pacific territory all the way from the Montana-South Dakota state line to Puget Sound. This line divides the business in the Yellowstone and Gallatin valleys, at Butte, the lumber territory of northern Idaho, at Spokane, in the Palouse and Big Bend wheat country, in the Kittitas Valley, in the Puget Sound country and in the Gray's Harbor and South Bend territory. Their line to the coast is shorter than that of the Northern Pacific, and considerable of it is electrified, attracting thereby much attention of the traveler and the shipper. Their passenger equipment on the through trains between Chicago and the North Pacific Coast is today superior to that of the Northern Pacific, and in any competitive struggle, better time can be made by the St. Paul road than by the Northern Pacific, because of the shorter distance. They are very aggressive as to all features of commercial development and in catering to the public, and with their own line to Chicago and a large mileage in Wisconsin, Minnesota and South Dakota, they are formidable competitors on all westbound business to Montana, Idaho and Washington points and for products of those states moving east to the consuming territory of the Missouri and Mississippi valleys." 

https://www.milwaukeeroadarchives.com/Chicago,%20Milwaukee%20&%20St.%20Paul/Journals/1920%20December%2011,%20Letter,%20Elliott%20to%20Donnelly%20re%20St.%20Paul%20Competition.pdf

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Posted by TRR on Tuesday, May 18, 2021 7:38 PM

Erik_Mag: "A couple of good resources would be Myrick's Railroads of Arizona, Vol 1, specifically the chapter on the El Paso and Southwestern (Phelps Dodge) and Stan Johnson's The Milwaukee Road's Western Extension."

Stan Johnson was a meticulous researcher, and a very good writer. I worked with him on most of his later works, proofing and commenting. I provided open access to my own manuscripts (8,000 footnotes!), and much enjoyed his explorations, made, always, as an homage to his beloved step-father, Frank Fiebelkorn, Milwaukee Road passenger conductor.

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Posted by TRR on Tuesday, May 18, 2021 7:53 PM

Ed Burns wrote: "The MILW Board of Directors in 1910 or so had delusions of grandeur when they decided to built west of Aberdeen, SD to the Pacific Northwest.   It cost three times the budgeted cost. GN, NP, and UP had the traffic patterns already."

It did not cost three times its budgeted cost. In 1904, in preparation for the construction effort, Milwaukee executives, as part of their budgeting process, started out by asking for an estimate of what it would cost to duplicate the Northern Pacific. They did not WANT to duplicate the Northern Pacific, but it was a start for planning purposes.

The estimate came back to build a railroad that wandered all over the place to avoid heavy construction, and I believe was about $45 million. Milwaukee's final actual estimate was closer to $70 million, and the final cost was $99 million as the rail industry was just then settling on higher construction standards for bridges and tunnels, and using "compensated curves" for example. The Milwaukee Road out West was built with compensated curves, whereas the initial construction of NP and GN were not.

The "cost" that contaminated the historical record, $257 million, was a wholly fictitious number that Max Lowenthal had found in an engineering study done by Coverdale & Colepitts that had estimated the total capital investment through the year 1925. "Total capital" is not the same as "cost of construction."

I had asked Max Lowenthal if I could look through his research papers, and he had consented, but then he keeled over and died, so I did not get actual access to them until his family finally hauled them out of his barn in Conneticut and donated them to Lowenthal's alma mater, the University of Minnesota, where I did finally review the records, still in their boxes covered with barn dust, hay seeds and pigeon poop.

Lowenthal knew he had mistated that historical record. He had done it on purpose.

https://www.milwaukeeroadarchives.com/Bankruptcy/Coverdale&Colpitts.pdf

 

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Posted by Erik_Mag on Wednesday, May 19, 2021 12:12 AM

TRR

Stan Johnson was a meticulous researcher, and a very good writer. I worked with him on most of his later works, proofing and commenting. I provided open access to my own manuscripts (8,000 footnotes!), and much enjoyed his explorations, made, always, as an homage to his beloved step-father, Frank Fiebelkorn, Milwaukee Road passenger conductor.

I remember you writing about the book when it was being published and ordered a copy from the local B&N when it became avialable.

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Posted by wjstix on Wednesday, May 19, 2021 4:27 PM

OK, I'm missing something here....

The Milwaukee Road's western extension was making money hand over fist right up until it was abandoned?

GN-NP-CB&Q-SP&S, with all their traffic, natural resources (timber, iron ore, etc.), were on the edge of total collapse c. 1968 if they hadn't merged? They tried merging for more than half a century before that, from what I've seen/heard/read they were doing OK in the 1960's I thought?

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Posted by NP Eddie on Thursday, May 20, 2021 3:18 PM

I am choosing my words carefully as I write this reply.

This topic have been off topic for a long while and has become personal attack on myself and others. Karlmbach had a special edition of "Classic Trains" a number of years ago about blunders of railroading. The PC debacle and the Pacific Extension were at the top of the list.

The original question about the Olympian was simply this: The passenger traffic would not support four passenger trains between Chicago and Seattle/Portland. The weakest one went first.

End of argument.

 Ed Burns

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Posted by Vermontanan2 on Friday, May 21, 2021 12:24 AM
TRR
and after its arrival in Portland, Southern Pacific reported that its Brooklyn Yard in Portland did more work for the Milwaukee than it did for itself.
Not believable.  SP’s Brooklyn Yard was the primary SP yard in the Portland area, and SP had more interchange traffic than any other railroad since it was the primary railroad to and from California.  The Milwaukee operated but one train in and out of Brooklyn.  Meanwhile, BN and UP were still interchanging trains with the SP and there were numerous transfer runs to and from other yards in the city.  Moreover, Brooklyn was the main marshaling point for the north end of the SP – not only for longer distance trains, but for the numerous locals operating out the terminal.  In the 1970s still, Brooklyn was still the location accommodating the many locals on both sides of the Willamette River from Silverton to Salem to McMinnville to Hillsboro.  The Milwaukee Road trains obviously were a small contribution to overall traffic.
 
But the Milwaukee Road’s Portland traffic is a good example of how flawed the Milwaukee Road route structure was on the Pacific Extension.  A great explanation of this “turkey trail” between Tacoma and Chehalis and operation over BN to Portland is available at John Crosby’s website:
 
 
Where BN could easily move a train from the Seattle and Tacoma terminals to Vancouver and Portland with one crew, it’s obvious that most Milwaukee Road trains from Tacoma to Portland took two or three.  The southward trip was especially grueling with Tacoma Hill’s ridiculous 3.6 percent grade.  Not only did it require a helper (and that helper locomotive stayed pretty much in place all the time just for this purpose), but crews rarely made the trip within their hours of service. 
 
“On a map, Southern Pacific plus Milwaukee Road equal Los Angeles to Seattle.  Management at Chicago Milwaukee Corporation in Chicago thought that this made sense.  A line on the map was a line on the map.  But railroads are not lines on a map, they are tracks on the ground.  This misconception was one of many conclusions, the totality of which would prove fatal to the Milwaukee Road.  For how could a railroad with a top speed of 40 mph and an average speed of 25 mph, with numerous 10 mph slow orders with a 3.3% grade requiring extra crews and time cobbled together from indirect logging branch lines with nineteenth century engineering and wooden trestles with no signals of any kind, running strictly on train order with frequent meets on single track and a mix of mainline and logging trains compete with a double track CTC built to modern specifications with steel bridges no unusual grades and 55 MPH track?”
 
Specifically, Mr. Crosby mentions copper ore moving from Los Angeles to Portland on SP and interchanging to the Milwaukee Road for movement to Silver Bow, Montana for the smelter at Anaconda.  That a train with 15 of these heavy cars collapsed the bridge at McKenna tells the story of the condition of the railroad, but only part of the story.  The routing via the Milwaukee rather than the BN was largely retribution by the SP stemming from their losing interchange business at Portland after the BN merger.  Northern Pacific-to-Southern Pacific was the primary interchange at Portland, but after BN was created, some of that NP traffic was routed via the ex-SP&S/OT/GN route via Wishram, Bend, and Klamath Falls to California (then via WP and ATSF).  So, instead, the Milwaukee got the traffic.  Good for them, right?
 
Probably not.  In addition to the inefficient and awkward operating conditions described by Mr. Crosby, it should be noted that the Milwaukee Road between Chehalis Jct. and Tacoma Jct. had but one siding longer than 4,000 feet in 69 miles which obviously would negatively affect the meet/pass of even moderately-sized trains.  Overall from Portland to Silver Bow, the Milwaukee route was 53 miles further than BN, and required 2 to 3 more crews.  The maximum grade on Burlington Northern was 1 percent, whereas the Milwaukee Road had to lug these heavy cars up three grades of 1.6 percent or greater.  Undoubtedly, the Milwaukee received the same “cut” of the tariff as BN would have, but the cost to move the traffic was much greater, likely to the point that no profit was obtained from the movement.  The collapse of the bridge fully indicates that traffic for the sake of traffic is not beneficial when your infrastructure is not up to it.

But the Portland line was not unusual.  Just about all the branch lines – and all the important branch lines – on the Pacific Extension had exceptionally steep grades and high operating costs.  The branch from Cedar Falls to Everett was abandoned it after the BN merger and receiving trackage rights on BN’s ex-NP line from Black River to Snohomish.  The BN line had grades up to 1.7% as did the branch eastward from Everett to Cedar Falls (compared to BN’s water-level route from Black River to Everett via downtown Seattle).  The Milwaukee also got trackage rights (instead of GN handling Milwaukee locomotives and cars) from Everett to Bellingham to create a through route from Black River to Sumas and the interchange to CP and BCE.  The 1.7% grade on BN was probably not a big deal to the Milwaukee in that its own railroad from Bellingham to Sumas was blessed with a 2% grade.  By 1975, however, the Milwaukee more than understood that their routes west of the Cascades sucked horribly, and asked for BN trackage rights from Tacoma to Chehalis and South Bellingham to Vancouver, BC and to be able to serve industries from Renton to Snohomish.  In fact, the only route out of the Seattle/Tacoma area without steep climbs were the barge runs to Port Townsend and North Vancouver, BC (for PGE interchange).  CP was the only direct interchange railroad in the Vancouver area (at Sumas); CN required cars first be interchanged with the British Columbia Hydro and Power Authority railroad (BCE).  Meanwhile, BN (ex-GN) had a route with minimal grades from Seattle to Vancouver, and direct interchanges with all the railroads including access to North Vancouver (CN’s route over the Second Narrows bridge was accessed by ex-GN trackage) and the Roberts Bank Superport.  The additional trackage rights were never granted, but the Milwaukee Road had the right idea:  To become competitive, it basically needed trackage rights on everything BN west of Miles City, Montana.
 
Things weren’t any better east of the Cascades.  Spokane – the largest city between Minneapolis and Seattle/Portland – was on a branch line – and a UP branch line to boot – with another 1.7% grade for eastward trains (not a big deal considering grades on the main line from Plummer were that steep or steeper).  The Gallatin Valley line to Bozeman had grades of about 1.5% each way, and the route from Great Falls to Harlowton had a 1.5% grade against all the loads (the Milwaukee was steeper from Great Falls to Lewistown than BN from Great Falls to West Coast ports).  Even on the branches of lesser importance, the Milwaukee could work miracles.  On a route from Lewistown across Montana’s “Big Open” toward Richey, Great Northern surveyed (and even graded somewhat) the line from Lewistown to Grassrange with a 1.6% grade.  The Milwaukee actually built such a line, but with a 2% climb each way!
 
It all adds up.  A circuitous branchline “network” is one thing, but with nearly all of them being a severe operating challenge, it’s reasonable to assume that they obviously didn’t contribute to the wellbeing of the railroad or their infrastructure would reflect something much different than was actually the case.  Which of course was also applicable to the “main line.”  
 
Not all traffic was worth the effort, and would have been even more of an issue had the Pacific Extension survived into the era of deregulation where BN – with nearly always the superior route – could undercut in pricing.
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Posted by Vermontanan2 on Friday, May 21, 2021 12:27 AM
TRR
“Milwaukee Road had in excess of 76% of the Port of Seattle’s business. It had mail, it had Toyotas, it had almost all the domestic auto business westbound. It had the long ticket items we needed to build on that today are what railroads are all about." William Brodsky, Interview by Jim Scribbins, “S.O.R.E.” Milwaukee Railroader, First Quarter, 1994, p. 11.
It logically could have in excess of 76% of the Port of Seattle’s business ONLY IF the Milwaukee Road served in excess of 76% of the destinations of ALL the Port of Seattle’s business – a tall order that given truck competition and that it was basically a one-direction route out of the area, in contrast to highway and other rail competition.   Meanwhile, through the 1970s and beyond, BN continued to crank out about three times the daily traffic than the Milwaukee did at its peak, and that’s because other than Seattle and Tacoma, the amount of traffic the Milwaukee handled elsewhere compared to UP and BN was inconsequential.  And what “today railroads are all about” are heavy unit trains (in this case coal and grain) for which the Milwaukee would likely have been nearly shut out due to its multiple severe grades and not accessing the actual port facilities via a viable route (or at all).
TRR
Of course, as the successful founding president of Montana Rail Link, and later head of the entire Washington Corps empire, an experienced "actual" executive, Bill Brodsky deserves both the attention and respect for his credibility that others have not earned.
As the only such regional railroad in the country with an iron-clad guaranteed traffic quota, the “success” of Montana Rail Link was “guaranteed.”  With regard to respect, reciprocity is also in order for the scores and scores of railroad company officers not only at the Milwaukee Road, but at other railroads who understood that the Pacific Extension was not worth saving.  Those at the BN and UP, for example, were well-versed in the operating characteristics of the Milwaukee, and if it was the cash cow some claimed, it would have been saved as there would be no reason not to do so as profit (if there was potential for it) trumps even conspiracy theories.
TRR
As with Paul Reistrup, another authentic rail executive, "If you save anything, save that Washington Division."
Reistrup also said that the “Milwaukee should look to boot-strap, minimal-cost upgrading of its western main and/or trackage rights over more than 300 miles of parallel ex-NP Burlington Northern main line, notably in Montana; or creation of a ‘conglomeration of short lines’ which would service 10 ‘traffic clusters’ on its line in the west, feeding traffic to BN and UP.”  That hardly sounds like a ringing endorsement for anticipating the need for a competitive railroad, and suggests acknowledgement of the BN and UP as being the primary conduits for traffic in and out any specific area.
 
Another “authentic rail executive” (and many other titles, such as Secretary of Defense) was W. Graham Claytor Jr., who, while Acting Secretary of Transportation, endorsed a DOT report “that nearly two-thirds of the Milwaukee’s losses in 1977 were accounted for by its Montana, Idaho, and Washington operations.”
 
The DOT said that the New Milwaukee (as proposed) could likely pass only one its five Congressional validity tests (that it could probably start up by April 1, 1980); (The other four were: *Can its plan be funded? *Is it fair to creditors? *Will it be self-sustaining? and *Does it include management-labor agreements to boost productivity?)  As such, the proposed railroad faced a 1981-1986 deficit in excess of 600 million dollars, and Trustee Ogilvie said the proposed railroad would fail in its first year, lose money in 1986 - even if it infused with a half billion dollars of tax monies, fail to repay the estate, and not serve as many shippers as the Milwaukee II plan.
 
And there were a lot of people with significant experience in transportation operations at the Interstate Commerce Commission, when, on December 31, 1979, in a 7-0 (as in unanimous) decision, it turned down the New Milwaukee proposal saying it couldn’t finance or sustain itself and wouldn’t fairly compensate Milwaukee Road’s creditors.
 
Indeed, there was much “attention and respect” paid to all the players here, and that’s why we have no Milwaukee Pacific Extension today.
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Posted by Vermontanan2 on Friday, May 21, 2021 12:46 AM
TRR
Recall, in the period 1967 through 1977, the carloads on Milwaukee Road Lines East plummeted from 1,008,000 carloads to 651,866 carloads. A decline of 35%, as railroads lost their high revenue traffic to the Interstate Highway System. By contrast, traffic on Lines West grew 41%, virtually all high revenue, premium long haul traffic that Milwaukee could move faster than trucks could over the highways. And that was because Milwaukee could "outrun" the highways. Train #261 average speed through Montana was 43 mph. Trucks could not come close.
This is a curious post; Obviously, Interstate Highways were more developed in the East earlier than in places like Montana, but they were coming.  By 1969, I-94/I-90 was just about complete across North Dakota and much of Minnesota, about a third of Montana and nearly all of Washington; by 1979 it was complete just about the entire way from Chicago to Seattle, except for a few short stretches in Montana, and the well-known holdouts at Wallace, Idaho and east of Coeur d’Alene.  Using the stated logic, one could expect a similar decline in freight traffic lost to trucks as the Interstate Highway was completed across the Northern Tier.
By 1968 CB&Q and GN matched the Milwaukee schedule, and in 1971, BN introduced even a faster version and afterward enhanced its Portland trains.  And what did the Milwaukee do to compensate?  Well, in 1972, they added a significant amount of time to the XL Special’s schedule, and in the mid-1970s lowered the maximum speed over most of the route, doing nothing to enhance infrastructure (other than installing derailed equipment detectors!), whereas GN/BN continued with line changes and adding CTC.
In short, the Milwaukee’s focus on speed was short-lived and not sustained, as was business it was handling.  The Milwaukee traffic might have been high revenue, but it was also high cost – at least compared to GN/BN which operated its competing train at nearly double the tonnage with a similar amount of locomotive power as far as Spokane.  The lack of investment by the Milwaukee in this “high speed route” suggests an inadequate return.  In contrast, the GN/BN Northern Transcontinental continued to see upgrades throughout the 1960s, 1970s, and 1980s.
A rundown of speed on MILW/CB&Q/GN/BN after WWII across the U.S. Northern Tier to the West Coast’s primary destinations (Seattle, Portland, and Vancouver, BC):  Shortest running times in bold.
1952 Passenger:
 
Chicago-Seattle:
MILW 15, 2189 miles, 45 hours, 48.64 MPH
CB&Q 49/GN 1, 2211 miles, 45 hours, 49.13 MPH
Chicago-Portland:
MILW: No service
CB&Q 49/GN 1/SP&S 1, 2261 miles, 44.5 hours, 50.8 MPH
Chicago-Vancouver, BC:
MILW: No service
CB&Q 49/GN 1/GN 356, 2351 miles, 48.33 hours, 48.64 MPH
 
1957 Passenger:
 
Chicago-Seattle:
MILW 15, 2189 miles, 44.833 hours, 48.83 MPH
CB&Q 31/GN 31, 2211 miles, 43.833 hours, 50.44 MPH
Chicago-Portland:
MILW: No service.
CB&Q 31/GN 31/SP&S 1, 2261 miles, 43.25 hours, 52.28 MPH
Chicago-Vancouver, BC:
MILW: No service
CB&Q 31/GN 31/GN 358, 2351 miles, 48 hours, 48.98 hours
 
1961 Passenger:
 
Chicago-Seattle:
MILW 15, 2189 miles, 44.916 hours, 48.73 MPH
CB&Q 25/NP 25, 2319 miles, 45.33 hours, 51.15 MPH
CB&Q 31/GN 31, 2211 miles, 42.83 hours, 51.62 MPH
Chicago-Portland:
MILW: No service
CB&Q 31/GN 31/SP&S 1, 2261 miles, 43.25 hours, 52.28 MPH
Chicago-Vancouver, BC:
MILW: No service
CB&Q 31/GN 31/GN 358, 2351 miles, 47.166 hours, 49.84 MPH
 
1964 Freight:
 
Chicago-Seattle:
MILW 261, 2174 miles, 55.5 hours, 39.17 MPH
CB&Q/GN 97, 2203 miles, 61.5 hours, 35.82 MPH
Chicago-Portland:
MILW: No service.
CB&Q 97/GN 97/SP&S 275, 2254 miles, 61.5 hours, 36.65 MPH
Chicago-Vancouver, BC:
MILW: No service.
CB&Q 97/GN 97/GN EXP, 2359 miles, 70.5 hours, 32.52 MPH
 
1968 Freight:
 
Chicago-Seattle:
MILW 261, 2174 miles, 55.5 hours, 39.17 MPH
CB&Q/GN 97, 2203 miles, 55.5 hours, 39.69 MPH.
Chicago-Portland:
MILW: No service.
CB&Q 97/GN 97/SP&S 275, 2254 miles, 57.5 hours, 39.2 MPH
Chicago-Vancouver, BC
MILW: No service.
CB&Q 97/GN 97/GN EXP, 2359 miles, 66.5 hours, 34,48 MPH
 
1971 Freight:
 
Chicago-Seattle:
MILW 261, 2174 miles, 55.5 hours, 39.17 MPH
BN 3, 2182 miles, 50 hours, 43.64 MPH
BN 97, 2182 miles, 55.5 hours, 39.32 MPH
Chicago-Portland:
MILW 261, 2326 miles, 79.5 hours, 29.25 MPH
BN 97/197, 2233 miles, 57.5 hours, 38.83 MPH
Chicago-Vancouver, BC:
MILW: No service
BN 97/BN 138, 2338 miles, 66 hours, 34.42 MPH
 
1973 Freight:
 
Chicago-Seattle:
MILW 261, 2174 miles, 66 hours, 32,94 MPH
BN 3, 2182 miles, 50 hours, 43.64 MPH
BN 97, 2182 miles, 55.5 hours, 39.32 MPH
Chicago-Portland:
MILW 261, 2326 miles, 79.5 hours, 29.25 MPH
BN 197, 2233 miles, 60.5 hours, 39.9 MPH
Chicago-Vancouver, BC:
MILW: No service
BN 97/BN 138, 2338 miles, 66 hours, 34.42 MPH
 
January 1980 Freight:  (Milwaukee no longer posting schedules)
 
Chicago-Seattle:
BN 3, 2182 miles, 55.75 hours, 39.14 MPH
BN 97, 2182 miles, 59.83 hours, 36.47 MPH
Chicago-Portland:
BN 23, 2233 miles, 55.25 hours, 40.42 MPH
BN 197, 2233 miles, 70.67 hours, 31.6 MPH
Chicago-Vancouver, BC:
BN 97/BN 184, 2272 miles, 70 hours, 32.46 MPH
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Posted by BaltACD on Friday, May 21, 2021 2:50 PM

TRR
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Posted by TRR on Tuesday, June 1, 2021 1:54 PM
Ver Montana: "NONE of this is true, nor is any of it anything but speculation without any documentation to support.  Again, reiterating: It’s interesting that “transcontinental passenger rail service was doomed to be unprofitable,” but evidently only on the Milwaukee Road – but not on the Union Pacific?  Unlikely indeed."

This is simply false. The facts are well-documented, and those facts may simply not be understood by someone with zero economic expertise, and even less actual knowledge of the Milwaukee Road.

The comment above doesn't even make sense. The Union Pacific "did not" see that passenger traffic had  become hugely unprofitable? It was the entire point of railroad lobbying for Amtrak, or something like it, during the 1960s. The Milwaukee saw it clearly by 1955 and exploited the "situation" to ... "get out," and not only continue to provide the same passenger service to key locations out West, but add locations, AND turn a profit.

Just "stupid people," right? Not nearly as smart about railroad economics as somebdy who has no background or experience in such issues. Sad

Mark Meyer: "By 1972 – when the Milwaukee was in its temporary traffic increase as a result of the BN merger – the schedule of the XL Special from Chicago to Tacoma had been lengthened from 56.5 hours to 66 hours and was averaging 72 hours."

As usual, Mr. Meyer leaves out the part that he does not know. Milwaukee's high value traffic surge began in 1968 with the Kent Auto Facility, which virtually cornered that market, and then with the Stacy Street Intermodel Facility, which captured the bulk of THAT business. THEN, the merger conditions began their benefits 1-2 years LATER. Because of the explosion of high priority business, two things happened, the XL Special had increased from one train per day to two, and the tonnage limits on each of those trains had increased from 3,000 tons to 5,000 tons, AND they were inserted into a matrix that also included an ADDITIONAL section of the eastbound #262, which had also had their tonnage limits increased from 3,000 tons to 5,000 tons.

Had the tonnage limits NOT increased, Milwaukee would have required THREE sections of #261 and three sections of #262 each day. Not to mention that the former "Hotshots," #263 and #264, ALSO began running multiple sections on their former "Hotshot" schedules. Does Mr. Meyer know ANY of that?

There is no evidence that he does.

TRR

Why did Milwaukee "want out?" Probably for the same reasons that everybody else did, except that Milwaukee managed to find a way to preserve "most" of its service and turn that into a profitable operation. It's UP Contract was, in fact, profitable.
 

 Mark Meyer: "Again, not true.  The service was simply discontinued.  Gone was any through service over ANY Milwaukee Road trackage from Chicago to Seattle or Tacoma or Spokane, not to mention from Minneapolis/St. Paul."

An inexplicable deceit. Milwaukee Road specifically retained passenger service to Butte, Spokae, Seattle, and Tacoma AND added transcontinental passenger service to Portland, San Francisco, Denver and Los Angeles. That is not speculation. That has been documented on this thread, but Mr. Meyer prefers the unreality of his critique, for which he is obsessed, without any particular reason to even have an interest, except a personal one that predates even his obsession with the Milwaukee Road. Cf, his obsession with the supposed inferiority complex of NP railfans.
Mark Meyer: "The Milwaukee’s timing was 55.5 hours for the XL Special.  Great Northern/Burlington matched it with train 97 in 1968, and bested it with a 50-hour schedule in 1971.  And they did it with larger trains due to a superior profile, and while still operating more freight trains and existing passenger trains.  They did it easily, as they did with passenger and mail service."
 Well, I have already cited the specific testimony given to the ICC about what the Northern Lines "thought" they could accomplish by the merger -- the conditions that the ICC rejected in 1966. Relying on THEIR testimony may or may not a useful metric, but it would be laughable if they could not, under oath, be believed! Smile It is an interesting response to their sworn testimony when they run into Mark Meyer, claiming "LIES! ALL LIES!"
TRR
And, six full sets of equipment compared to GN's and NP's sets of five (delaying departure turnarounds in Seattle). Nobody did that better.
Mark Meyer: "And the Milwaukee did it that way because six sets of equipment was a necessity for their limited operation.  The other railroads were not as restricted, and therefore didn’t have to do it."
If anyone has any idea what that is supposed to mean, good for you! Limited operation? The Milwaukee Road was a far larger provider of rail passenger services than GN and, especially, NP.
Mark Meyer: "Actually, the question is:  If these Milwaukee lines were such powerhouse money-making entities, why did no one with the wherewithal to save them, do so?"
If you were aware, and you obviously are not, you would have been aware of the terms and conditions of the Milwaukee Railroad Restructuring Act. On November 4, 1979, President Carter signed into law the Milwaukee Railroad Restructuring Act, which provided that an association composed of representatives of labor, employee coalitions, and shippers could submit to the Interstate Commerce Commission a proposal to convert the Milwaukee Road into an employee or an employee-shipper owned company. And that was the designated entity that "had the wherewithal to save the Lines West." Ignorance of that does not lend credibility to the false claim.
https://www.milwaukeeroadarchives.com/Bankruptcy/MilwaukeeRoadRestructuringAct.pdf
In response, shippers, employees, state agencies, and the Federal Government (through USDA) did, in fact, step forward with such a plan. Another of Mr. Meyer's completely false claims "bites the dust." https://www.milwaukeeroadarchives.com/Bankruptcy/NewMilwaukeeLines.pdf

Mark Meyer: "Another “authentic rail executive” (and many other titles, such as Secretary of Defense) was W. Graham Claytor Jr., who, while Acting Secretary of Transportation, endorsed a DOT report “that nearly two-thirds of the Milwaukee’s losses in 1977 were accounted for by its Montana, Idaho, and Washington operations.”

Claytor had been Secretary of Transportation for about six weeks when he made that statement. And the DOT report had been based on information provided by the Milwaukee Road, as contained in its initial Application to Abandon, which had to be revised after the ICC found double-entered expenses. It was false when he made it, and the subsequent accounting, provided to the ICC in the Milwaukee Road's Application to Abandon, Exhibit K, showed that to be entirely false. https://www.milwaukeeroadarchives.com/Bankruptcy/ApplicationtoAbandonLinesWestFullDocument.pdf

The continued, and somewhat frantic, postings by an individual who had nothing to do with the Milwaukee Road, with no experitse in the key areas of railroad economics, ESPECIALLY of the Milwaukee Road, lends no value to the actual historical record, and that claim illuminates "why" -- Mr. Meyer does not, in fact, know the timing, and the errors, as they were made and corrected.

At the end of the day, as the Milwaukee was forced (by the ICC Office of Rail Public Counsel) to admit that the Milwaukee Road's Pacific Extension (without including the Overhead traffic) was profitable.

We know that as an actual fact, offered under oath.

1975 System Net Operating Income $(8,834,000)

1975 Lines West Net Operating Income $10,580,767

1975 System Net Operating Income without Lines West $(19,415.000)

I have reproduced the remainder of that record previously. Exhibit K, Application to Abandon.

THAT was the source of Stanley Hillman's frustrated comment, after he got his outside studies back, before he resigned: "It turns out that the Milwaukee Road is a relatively wealthy company."

He hadn't consulted the real expert: Mark Meyer!

TRR
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Posted by TRR on Tuesday, June 1, 2021 4:07 PM

And, of course, belying all of Mr. Meyer's huffing and puffing, he still fails to explain why Milwaukee Road stock ultimately returned a substantially higher value to its owners than BN stock ever did. Or why Lou Menk "got the boot" there. Or why BN ended up with a 95% Operating Ratio.

Questions, questions!

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Posted by Vermontanan2 on Wednesday, June 2, 2021 12:10 AM
TRR

The Union Pacific "did not" see that passenger traffic had become hugely unprofitable? It was the entire point of railroad lobbying for Amtrak, or something like it, during the 1960s. The Milwaukee saw it clearly by 1955 and exploited the "situation" to ... "get out," and not only continue to provide the same passenger service to key locations out West, but add locations, AND turn a profit.

There is no evidence that taking over the UP “Cities” streamliners was profitable over the life of the contract (15.5 years), especially when one considers the millions of dollars of required upgrades, and the lack of freight business garnered.  That the number of UP passenger trains were “so profitable” that the number was slashed by 50% in the first 5 years of operation due to declining ridership notwithstanding, the real question is whether the Milwaukee would have still received the same amount of interchange at Council Bluffs (1 to 3 trains per day) if they HADN’T spent all those millions on passenger trains.  Odds are, they would have, and their route (prior to the upgrade) could have handled it.  Even if there was evidence of passenger train profitability over the entire 15.5 years (unlikely, since this wasn’t most other places in the country), the Milwaukee likely would have been better off without spending those millions.  And if the Milwaukee “saw it clearly” by 1955 (the year that it added nearly 6,000 passenger train miles a day between Chicago and Omaha), why did service to Podunk places like Champion, MI (1968), Aberdeen SD (1969), and Wausau, WI (1970) continue for so long?
TRR

Milwaukee's high value traffic surge began in 1968 with the Kent Auto Facility, which virtually cornered that market, and then with the Stacy Street Intermodel Facility, which captured the bulk of THAT business. THEN, the merger conditions began their benefits 1-2 years LATER. Because of the explosion of high priority business, two things happened, the XL Special had increased from one train per day to two, and the tonnage limits on each of those trains had increased from 3,000 tons to 5,000 tons, AND they were inserted into a matrix that also included an ADDITIONAL section of the eastbound #262, which had also had their tonnage limits increased from 3,000 tons to 5,000 tons.

Yes, Michael, we all know this if for no other reason than this is probably the third time you have stated this in this thread.  1968 was also the year that CB&Q/GN matched the XL Special schedule and was limited to 5500 tons east of Wenatchee, including Portland traffic, which – like most places in the Pacific Northwest and Canadian Southwest – the Milwaukee had little of because they didn’t go there or their route was even worse than their main line. 

TRR

Had the tonnage limits NOT increased, Milwaukee would have required THREE sections of #261 and three sections of #262 each day. Not to mention that the former "Hotshots," #263 and #264, ALSO began running multiple sections on their former "Hotshot" schedules.

It is totally impressive that Mr. Sol seems to be so impressed by Railroading 101.  Uh…yeah – you increase the size of the train and you run fewer trains.  Of course there is a down side, and that was lengthening of the schedule in 1972 when these Milwaukee “hotshots” were all slower than multiple BN trains on the same route.  The salient point is:  That when the Milwaukee gained some business, it didn’t have the resources and infrastructure to maintain the business – it lost it all.  Sustainability is what matters, and the Milwaukee never could do it.

The constant repeating by Mr. Sol of the short-lived “fastest schedule” of the XL Special and equally-limited duration of “all the traffic out of the port of Seattle” (or whatever the percentage claim…doesn’t matter) reminds me of driving around in a lot of rural America.  One often sees signs entering a decaying town declaring “Class C State Basketball Champions 1971” even though that was 50 years ago, they hadn’t won another state title since, and the school closed and students bused to the former arch rival’s school.  But you don’t get to keep on claiming you’re the state champion unless you win in subsequent other years.  And when your community became so weak that your school ceased to exist, you’re an entity most no longer even acknowledge. 

By the way, “hotshot” 263 was a day slower than “hotshot” 261 by 1972.

TRR
An inexplicable deceit. Milwaukee Road specifically retained passenger service to Butte, Spokae, Seattle, and Tacoma AND added transcontinental passenger service to Portland, San Francisco, Denver and Los Angeles. That is not speculation. That has been documented on this thread,
True, but it’s only been documented by Michael Sol, and is only speculation on his part.  I challenge anyone to produce actual Milwaukee Road documentation of any link between the 1955 “Cities” fiasco and the 1961 discontinuance of the Olympian Hiawatha.  There is none.
But, if you insist on thinking that boarding the Union Pacific “Butte Special” at the Northern Pacific station in Butte and riding to Pocatello where one would board (no through cars, of course) the UP “City of Portland” in the middle of the night only to arrive in Chicago on a trip 8 hours longer than the Olympian Hiawatha between these cities (Butte and Chicago), then so be it.  But if that’s comparable to the Olympian Hiawatha, your opinion of the latter is obviously not favorable.
Same for Spokane, Seattle, and Tacoma.  Through service on the Olympian Hiawatha, but not on the UP: Longer, no through cars, and inferior onboard amenities.  But have it your way….  Just as good!
TRR
Mark Meyer: "And the Milwaukee did it that way because six sets of equipment was a necessity for their limited operation.  The other railroads were not as restricted, and therefore didn’t have to do it."
If anyone has any idea what that is supposed to mean, good for you! Limited operation? The Milwaukee Road was a far larger provider of rail passenger services than GN and, especially, NP.
But not west of the Twin Cities, where the Olympian Hiawatha was the ONLY passenger train on the Milwaukee Road starting in 1957.  That the Milwaukee in 1961 was running seven trains daily between Chicago and Milwaukee, three trains to Omaha, two to Madison, locals throughout Wisconsin and Michigan and Chicago commuter service didn’t help the equipment utilization situation at Tacoma.  One train in, and one train out, and with shorter turnaround time than the competition and zero equipment substitution options, the hapless Milwaukee Road was forced to keep an extra set of equipment in rotation, and the expense associated with it.
TRR
If you were aware, and you obviously are not, you would have been aware of the terms and conditions of the Milwaukee Railroad Restructuring Act. On November 4, 1979, President Carter signed into law the Milwaukee Railroad Restructuring Act, which provided that an association composed of representatives of labor, employee coalitions, and shippers could submit to the Interstate Commerce Commission a proposal to convert the Milwaukee Road into an employee or an employee-shipper owned company. And that was the designated entity that "had the wherewithal to save the Lines West." Ignorance of that does not lend credibility to the false claim.  In response, shippers, employees, state agencies, and the Federal Government (through USDA) did, in fact, step forward with such a plan.
Thank you, by the way, for having these public documents available at your website.  Most helpful in showing why the Lines West is no more, and this is one of the best examples.  I never said there wasn’t a plan, I said there wasn’t one with the wherewithal to save the Pacific Extension, and since this plan was rejected, and the Pacific Extension was largely abandoned, this is irrefutable. 
 
The ICC didn’t think it was a good plan, as did many others.  Nor did anyone with the money to keep the railroad afloat.  As Fred Simpson said, “If any group comes in with money, they can get approval” [to buy the railroad].  They didn’t.
 
The many flaws in the plan are pretty obvious, notably the unrealistic traffic growth, expecting to steal business from the competition with superior infrastructure, and no money to upgrade the Milwaukee’s inferior infrastructure.  The document touts grain movements to Columbia River ports, which the Milwaukee served so poorly, as well as “bright” future for coal movements even though Lines West had only one on-line coal mine and didn’t have access to the lone coal port in the region.  Additionally, the only coal mine along the route produced lignite (it closed in 1995), which is has the lowest heat value of any coal, and is not sufficiently valuable to ship long distances (the Gascoyne-to-Big Stone City train run by the Milwaukee and later BN was probably the longest run in the country; lignite is mostly used where the power plant is nearby).  It should also be noted that the coal near Roundup didn’t get tapped by rail for 30 years, and has since mostly been shipped for export (and again, the Milwaukee had no access to the port) because it is bituminous coal – not sub-bituminous, preferred for power generation in the United States.  Just a couple additional examples that likely rolled eyes at places like the DOT and ICC.
 
Having a plan does not equate to execution, especially without buy-in from the necessary parties.
TRR

At the end of the day, as the Milwaukee was forced (by the ICC Office of Rail Public Counsel) to admit that the Milwaukee Road's Pacific Extension (without including the Overhead traffic) was profitable.

We know that as an actual fact, offered under oath.

1975 System Net Operating Income $(8,834,000)

1975 Lines West Net Operating Income $10,580,767

1975 System Net Operating Income without Lines West $(19,415.000)

At the end of the day, 1975 is one year.  This versus decades of deteriorating infrastructure and failure to upgrade infrastructure.  Of course, in the end, these failures did the Milwaukee in, but in the interim, they could produce positive operating income numbers.  It wasn’t the right thing to do from an efficiency or sustainability standpoint, but it did temporarily bolster the bottom line because it was money that should have been – but wasn’t – spent.  Estimates of cost of decayed infrastructure are all over the map but end at several hundred million dollars (noted in the DOT and ICC statements and elsewhere).  Distribute these costs over time, and it’s easy to see a meager $10.6 million “profit” vanish into maintenance, not to mention upgrading the infrastructure to ensure sustainability which EVERY ONE of the railroads competing with the Milwaukee on the Midwest-to-Pacific Northwest route did, but the Milwaukee did not – rather could not - do.

--Mark Meyer

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Posted by Vermontanan2 on Wednesday, June 2, 2021 12:11 AM
TRR
And, of course, belying all of Mr. Meyer's huffing and puffing, he still fails to explain why Milwaukee Road stock ultimately returned a substantially higher value to its owners than BN stock ever did. Or why Lou Menk "got the boot" there. Or why BN ended up with a 95% Operating Ratio.
Questions, questions!
 
Actually, no one is asking these questions because either no one cares, or they understand context, which is lost on some.  Stock value of course depends on many aspects of a corporation including how it is diversified.
From a railroad perspective, a 95% operating ratio trumps abandonment every time.  From a legacy perspective, BN (and Menk who after BN led International Harvester) will be remembered as a success, building thousands of miles of track to increase capacity to accommodate a huge coal demand becoming (by far) the country’s number one bulk commodity carrier as a prelude to buying ATSF and creating today’s BNSF.  Contrast this to the legacy of the Milwaukee Road Pacific Extension, fading into greater irrelevancy with each passing day…..

--Mark Meyer

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Posted by Vermontanan2 on Wednesday, June 2, 2021 6:25 PM
wjstix
OK, I'm missing something here....
The Milwaukee Road's western extension was making money hand over fist right up until it was abandoned?
GN-NP-CB&Q-SP&S, with all their traffic, natural resources (timber, iron ore, etc.), were on the edge of total collapse c. 1968 if they hadn't merged? They tried merging for more than half a century before that, from what I've seen/heard/read they were doing OK in the 1960's I thought?
You’re not missing a thing.  You’re in touch with historical reality.
You can learn a lot from just observing employee timetables from the 1970s.
Here’s a Milwaukee timetable from 1974 at the supposed height of the traffic boom when the railroad was running 3 or 4 trains per day:
Even by 1974, the main line from St. Maries, Idaho to Marengo, Washington was speed restricted to 40 MPH.  Granted, this was not a huge deal since most of the route included the Plummer-to-Marengo segment which was dark, but it indicates a deteriorated physical plant.
As a point of reference, here’s a similar Milwaukee timetable from 1977.  More speed-restricted main line track, of course, but you can get a better idea of the operational characteristics of the railroad because the siding lengths are given in feet rather than just “cars.”
Here are some 1970 employee timetables for Burlington Northern right after the merger:
 
 
All the timetables cover the territory from Montana, Idaho and Washington.
Here are some corresponding special instructions:
Note that track speed for the BN trains is generally 60 to 65 MPH, whereas the for the Milwaukee 40 to 55 MPH, dropping to no more than 50 MPH by 1977.
On the BN’s Northern Transcontinental from the North Dakota border to Seattle, all track is CTC with power switches or double track, with the exception of Sandpoint to Spokane via Newport and Spokane to Lamona.  The Sandpoint-Spokane section was not CTC’d in anticipation of using the preferred Northern Pacific line between the two cities after the connections were built in the early 1970s.  The ex-NP main line from Billings to Sandpoint is similarly signaled, except between DeSmet (Missoula) and Paradise where there are two routes.
The Milwaukee Road main line, on the other hand, is nearly all single track ABS with the aforementioned dark territory from Plummer to Marengo.  No power switches or spring switches. 
Nearly all the sidings on the BN transcontinental main line are 7,000 feet or longer, and many much longer.  (And by this time, a 7,000-foot train was commonplace.)  On the Milwaukee main, they’re few and far-between, and there were NONE between Othello and Black River.  Short sidings, and the lack of power switches are just two indications of how the Milwaukee was ill-equipped going forward into the era of ever-longer trains and no cabooses.
TRR

Milwaukee's high value traffic surge began in 1968 with the Kent Auto Facility, which virtually cornered that market, and then with the Stacy Street Intermodel Facility, which captured the bulk of THAT business. THEN, the merger conditions began their benefits 1-2 years LATER. Because of the explosion of high priority business, two things happened, the XL Special had increased from one train per day to two, and the tonnage limits on each of those trains had increased from 3,000 tons to 5,000 tons, AND they were inserted into a matrix that also included an ADDITIONAL section of the eastbound #262, which had also had their tonnage limits increased from 3,000 tons to 5,000 tons.  Had the tonnage limits NOT increased, Milwaukee would have required THREE sections of #261 and three sections of #262 each day. Not to mention that the former "Hotshots," #263 and #264, ALSO began running multiple sections on their former "Hotshot" schedules.

It’s interesting that Mr. Sol thinks this is a big deal, when it actually shows the inherent weakness of the Milwaukee Road.  The 3,000-ton XL Special (operated at 3.0 horsepower per ton) was an exceptionally small train with an exceptionally large amount of locomotive power, but necessary for a train operating on a demanding profile with a slow track speed.  But even a 5,000-ton train was not considered large (at least by Burlington Northern standards), though such a train was in some cases at or over the trailing tonnage limit for some of the Milwaukee’s steep grades. 

At the peak of these multiple-section “Hotshot” schedules on the Milwaukee (even though they were slowed significantly in 1972, while BN maintained their faster trains), frequency was three to four trains daily each way.  Starting in 1974, Burlington Northern began publishing “for information only” (as in they had no timetable authority) freight train schedules in its timetables.  Here are some links:

 

It’s interesting to note that while 3-4 trains smallish trains on the Milwaukee is considered something significant by some, Burlington Northern scheduled five trains westbound (3, 81, 83, 97, 197) and 7 eastbound (4, 80, 82, 88, 90, 172, and 182) on its Northern Transcontinental line.  Not all these trains operated daily, but most did (train 90 was actually very rare, but extra sections of other trains as well as extra symbols were commonplace).  Also, many of the intradivisional trains are not shown (such as the train from Laurel to Whitefish, which could continue all the way to Spokane or beyond).  All things considered, 7 to 8 trains each direction was not uncommon, and BN was also operating 3 to 4 trains daily each way on the ex-NP line east of Sandpoint.  Additionally, BN was generating 1 to 4 trains daily along the coast line from Vancouver, BC to Portland moving tonnage to and from the SP interchange at Portland or the WP interchange at Bieber, California.  Given the day of the week, BN was dispatching 12 to 15 trains daily from the Seattle and Portland divisions. 

Meanwhile at Union Pacific, they were operating on average four trains daily east from Portland:
 
I wasn’t able to find schedules on what the SP was operating south from Portland, but it’s logical to conclude that if BN could gather two trains’ worth of tonnage daily, the SP – with its substantial local traffic in the Willamette Valley, as well as interchange from BN and even some from the MILW – would operate three or more (especially considering they also handled long-haul east traffic at the time on their Modoc line).
 
Given what the BN, UP, and SP were operating out of the Pacific Northwest, it’s obvious that the Milwaukee’s 3 or 4 trains (at its apex) were inconsequential.  While historically speaking, the Milwaukee handled only 14-15% of the total “transcontinental” traffic moved by the GN, MILW, and NP, train count by itself does not specifically determine the amount of traffic handled on each route, but considering that the Milwaukee’s route across the Northern Tier was vastly inferior to grade and profile (and therefore trailing tonnage limit at each major hill), the likelihood that each Milwaukee train would be smaller than the corresponding BN train is high.
 
Putting all things in perspective, it’s truly ironic – and perhaps even sad – that the Milwaukee saw the discontinuance of the Olympian Hiawatha as an “opportunity” to run its XL Special on its 55.5-hour schedule in that it was something only achievable by ridding itself of passenger trains (at least over most of the route).  Given that only 1 or 2 trains per day were being operated to begin with, this is a ringing endorsement of the inferiority of the route in general, and more so when the traffic increased in 1972 and, instead of meeting the challenged, succumbed to an increase in traffic and lengthened its schedules.
 
Meanwhile at the competition, Great Northern was still operating two passenger trains daily each way when it matched the XL Special’s running time in early 1968, as well as a local Spokane-Seattle mail/express train.  Near the beginning of Amtrak in 1971, Burlington Northern morphed the longstanding mail and express business on its Western Star passenger train (the Fast Mail business it had held for most of the century) into the Pacific Zip on yet a faster schedule, while still handling all its other traffic and a daily Amtrak passenger train over most of its route.  By 1976, BN even added a true “Hotshot” train from Chicago to Portland (train 23) which made the trip in 53 hours,
 
 
Rather than some kind of operating coup, the saga of the XL Special was the perfect representation of the vast inferiority of the Milwaukee Road in that its infrastructure was not only not properly maintained, but rarely improved.  And when other traffic developed, the “Hotshot” cooled off to the point of total disappearance.  Meanwhile at GN-NP/BN, UP, UP-SI-CP, SP – and even CP and CN to a certain extent - their physical plant grew and matured with the times, and enabled them to get AND KEEP the traffic – maybe not forever, but indeed, so far.
 
So, no, the BN was not “on the edge of total collapse” nor anywhere close as operating profiles and timetables prove.  But there was one railroad that was, and is no more because of it. 
  • Member since
    February 2002
  • From: Mpls/St.Paul
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Posted by wjstix on Thursday, June 3, 2021 10:39 AM

Vermontanan2
Obviously, Interstate Highways were more developed in the East earlier than in places like Montana, but they were coming. By 1969, I-94/I-90 was just about complete across North Dakota and much of Minnesota, about a third of Montana and nearly all of Washington; by 1979 it was complete just about the entire way from Chicago to Seattle, except for a few short stretches in Montana, and the well-known holdouts at Wallace, Idaho and east of Coeur d’Alene.

In the summer of 1973 (when I was 14) I went with my folks on a car trip from the Twin Cities to Seattle. As I recall, at the Montana border it noted that Montana didn't have speed limits - and soon thereafter, the interstate became a gravel road!  

Stix
  • Member since
    April 2021
  • 39 posts
Posted by Vermontanan2 on Friday, June 4, 2021 1:09 AM

wjstix

In the summer of 1973 (when I was 14) I went with my folks on a car trip from the Twin Cities to Seattle. As I recall, at the Montana border it noted that Montana didn't have speed limits - and soon thereafter, the interstate became a gravel road!  

Oh, come on, it wasn't that bad.  The Montana portion was paved - all two lanes of it!  And Montana DID have a speed limit: "Reasonable and prudent."

https://www.caranddriver.com/features/a14511978/montana-was-once-the-last-bastion-of-hot-nasty-bad-ass-speed-feature/

"Reasonable and prudent" was a Catch-22 law, and actually could work both ways.  After it was reinstated in 1995, I recall meeting a Highway Patrolman on a two-lane road north of Great Falls doing 92 MPH on a clear day with dry pavement.  Didn't get stopped.  But that next winter, a friend who was driving a crew van for the railroad on a Forest Service road in Northwest Montana had the vehicle slide into the ditch after she was stopped - it was THAT icy.  She was subsequently ticketed for going "faster than the conditions allowed."

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