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[quote user="MP173"] I am not an economist, nor am I consider myself a railroad historian, but as I have read there were a number of factors which lead to the great meltdown in the 70's:[/quote]Okay, I'll bite![quote]1.  Too much ROW due to build ups in earlier eras.[/quote]Yes, and no.  Too many branchlines in granger country, yes.  But to say that there was too much mainline capacity flies in the face of normal economic growth, which on average has consistently risen during the same time that railroads were retrenching.  The business was there, but for whatever reason the railroads didn't grow with it.  Blame it on the ICC, blame it on the integrated model, blame it on the Panama Canal, whatever.[quote]2.  Movement of freight from the rail systems to much more efficient truck transportation.[/quote]Fuel efficiency of OTR trucks - 60 ton/miles per gallon.Fuel efficiency of carload rail - 200 ton/miles per gallon*Fuel efficiency of unit trains - up to 800 ton/miles per gallonIt is that carload vs OTR truckload where the efficiency arguement is pronounced.  It is true that OTR trucks are more efficient in the short haul than carload due to dock to dock flexibility.  It is also true that OTR trucks are more efficient than carload in the less than boxload catagory, regardless of length of haul.  Beyond that, rails beat highways hands down due to the efficiencies of bulk movements, aka aggregation.  And also note that normally OTR LTL trucks can and do move much more efficiently by rail where the service is provided.And unit train efficiency beats OTR truckload hands down, even in the shorthaul lanes.[quote]3.  Loss of revenue in passenger service.[/quote]As I pointed out, the highways and airlines did the railroads a favor by taking up most of the passenger carrying duties.  Even in the heyday of passenger rail, the concept did not make money for the most part, or only marginally so.  The loss of dedicated passenger rail was a godsend to railroads, allowing them to focus on the more lucrative freight markets.[quote]4.  Inability to rapidly discontinue the passenger service.  The end of the mail contracts was the  final bullet.[/quote]Agreed.  Once passengers went by road and air, there was no reason for the railroads to have to maintain the passenger fleets.  Perhaps some entreprenuers somewhere saw a market potential for hauling passengers, but since the rail system was of the closed integrated type, those opportunities to serve the niche markets were lost as well.The loss of the mail contracts was a direct result of faster air service.  It is possible that higher rail speeds might have allowed the railroads to maintain some of the mail contracts, but not likely.  However, it is interesting that when the US Post Office was ditching the railroads, companies like UPS were just starting out utilizing railroads from some of their package delivery.  The private sector saw the opportunity of moving parcels by rail while the government sector didn't.  Ironic.[quote] 5.  Full crews which gained significant wage increases during the 60's/70's which were not recovered in the rate making process.[/quote]Agreed.  [quote]6.  Inability to reduce fixed costs, which coupled with a rising variable cost factor and flat revenue led to squeezed margins.[/quote]??  Can you clarify?[quote]7.  Inflationary era of the 70's.8.  Migration of manufacturing from the Northeast to other regions.  This led to a rapidly reduced Northeastern rail system (NYC and PRR plus many others).  Once the dominos began falling, others fell. [/quote]There is a correlation between your #5 and your #8.  The unions miscalculated the ability of capital to migrate to lower labor cost areas in both instances.[quote] 9.  Paradoxically, even tho railroads could not easily abandon assets (light density lines), they could not maintain the heavily used lines, thus leading to slow orders and reduced service. It was an ugly time for railroading.  I became "aware" of railroading in 1972 with the purchase of the May issue of Trains Magazine.  I watched the industry reach rock bottom, never witnessing it at full or even partial strength until the revolution began in the 80's. [/quote]Remember that this was also the advent of heavier axle loads, you know, to make the railroads *more efficient*.  It is interesting how the introduction of the HAL's corresponded with the increased degradation of the tracks.
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