CMStPnP I don't know where you guys are getting your information from but a large portion of the Milwaukee Road lines are in use East of the Dakota's. Wisconsin, Indiana, Illinois, Iowa, Mo, MN Still have a large chunk of former Milwaukee Road lines in use. Some of what is not in use is rail banked as valuable future passenger routes.......two examples: The former Milwaukee and Mississippi mainline.....now a branch from Brookfield, WI to the former Soo Line interchange is railbanked.........rails and bridges still in place under the weeds. Wisconsin and Southern almost brought it back to life but the Nimby's killed it with their lawyers. Still WS-DOT is holding onto the line for potential future passenger service. The former Air Line from Elm Grove into Milwaukee's Muskego Yard via West Allis is now a trail but also held in reserve as well by the WS-DOT. One day it will be a light rail line because of it's proximity to the Brewers Stadium as well as State Fair Park. Agree that most of the PCE is gone but certainly that does not extend to the Eastern Lines.
I don't know where you guys are getting your information from but a large portion of the Milwaukee Road lines are in use East of the Dakota's. Wisconsin, Indiana, Illinois, Iowa, Mo, MN Still have a large chunk of former Milwaukee Road lines in use. Some of what is not in use is rail banked as valuable future passenger routes.......two examples:
The former Milwaukee and Mississippi mainline.....now a branch from Brookfield, WI to the former Soo Line interchange is railbanked.........rails and bridges still in place under the weeds. Wisconsin and Southern almost brought it back to life but the Nimby's killed it with their lawyers. Still WS-DOT is holding onto the line for potential future passenger service.
The former Air Line from Elm Grove into Milwaukee's Muskego Yard via West Allis is now a trail but also held in reserve as well by the WS-DOT. One day it will be a light rail line because of it's proximity to the Brewers Stadium as well as State Fair Park.
Agree that most of the PCE is gone but certainly that does not extend to the Eastern Lines.
Mark Meyer
The government basically took control of the railroads in 1906 while leaving ownership in private hands. "Fair" rules and rates would be applied. Public service before profit. "Fair" aside, what effect?
Milwaukee management knew they needed to merge, or expand into new markets. Did management see regulation as a game changer that would guarantee them a piece of a market moved into?
Merger could be seen as less of an option under government control. The C. B. & Q. had found refuge in the Hill empire. That triggered the Northern Securities case. That delayed BN for a long time. If you can not move into an existing home, take the risk and build your own.
Assume the Milwaukee built to the coast without regulation. The debt involved and lack of traffic still brings on bankruptcy shortly after completion. In a free market, what fate? If proven unprofitable so soon after completion, would anybody want the entire line to the coast?
In addition to the Chicago-CoBluffs line that still exists, there were a couple more sections that survived about 20 years, but have since been abandoned. There were elevators at Dawson, Woodward and Slater that loaded grain trains into 2000. (I pulled one of the last ones from Dawson. The reason they quit loading was that a larger cooperative bought out the cooperative that owned them and now trucks the grain to elevators on the UP, exCNW, main. The abandonment between Woodward and Slater allowed the UP to reuse parts of the bridge over the Des Moines River in their new Kate Shelley bridge.)
There are also two large elevators that no longer ship grain. (It's amazing to see a large concrete elevator abandoned.) I don't know when they went out of business. Both had access to rail service, one is on one of the now abandoned sections, the other while built next to the MILW had access to the CNW (via the exRI Spine line) and could load unit trains.
These additions had slipped my mind. There have been a lot of changes since 1980 and sometimes it's hard to remember what was then. Changes not only in how railroads, especially the large ones, do business, but changes in what business is out there. What is now may not have been then and what was then may be gone now. I think sometimes we lose sight of those changes, seeing things today and imposing them on what was then.
Jeff
Can anyone list those specific routes that where service was discontinued that have reopened? I believe there have been several.
MP173 There is a reason that the RI line from Chicago to Council Bluffs is still in use but not the MILK line, except to Sabula. ed
There is a reason that the RI line from Chicago to Council Bluffs is still in use but not the MILK line, except to Sabula.
ed
About 100 miles of the MILW Council Bluffs main line in western Iowa is still in use. A few large grain elevators and at least one large ethanol plant (built after the MILW quit) are on it. Originally after the MILW shut down, it was bought by a shipper's group and operated by the BN/BNSF. It escapes me at the moment, but I think the BN/BNSF was leasing it from the group. In any event, a few years ago the BNSF bought it outright. That business, plus another elevator at Pickering Iowa (now served by UP on the exMSTL/CNW line south of Marshalltown, IA) probably would've made continued operation viable.
The MILW in 1978 started operating over the CNW between Clinton, IA and Tama, IA. They still operated a way freight from Green Island (junction with the still existing river line) to Marion/Cedar Rapids on their own line. I think long term, they planned to also abandon Green Island to Marion and use the CNW to access their CR/Marion area trackage. As far as I've been able to tell, there was no service between M/CR and Tama then on the MILW line. It seemed they wanted to originally keep the viable parts and abandon the in-between part of the route in favor of trackage rights over CNW.
I have read at times that when planning on what lines to retain, early on the plan was to keep the CB route and drop the KC route. This changed to the final plan where they kept KC and dropped CB. Some things that I've thought contributed to this change follows. One was the RI was quitting, removing one competitor on the KC route (not to mention the business the MILW picked up from former RI customers in the QC/Iowa City area provided almost half the revenue for the reduced core system). Another was the UP agreed to interchange traffic at KC that had formerly interchanged at CB. I think one more was that if they got out of the Chicago-Council Bluffs lane, one that the DOT had identified as having too many routes, that the DOT would be more inclined to give help to the MILW elsewhere. The RI had tried to save the entire railroad and got little help from the US Government. By the late 1970s, the Feds were betting that the CNW (understandably so, since they had become the UP's best friend) would be the survivor, not the MILW or RI. The 4R money went to the CNW, very little to the RI for any work on it's system. I feel that the MILW couldn't help but notice that and decide that if they wanted any chance to receive Government help, they had to get out of CB.
MP173 . Today's railroading environment suggests that expansion will result in a more unorthodox manner. Instead of building new lines, the rails will simply prune off the less desirable and profitable business. Thus, growth will be more of a higher return on investment rather than true volume growth. ed
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Today's railroading environment suggests that expansion will result in a more unorthodox manner. Instead of building new lines, the rails will simply prune off the less desirable and profitable business. Thus, growth will be more of a higher return on investment rather than true volume growth.
I'll disagree. Today's railroads are dealing with capacity problems in several ways. Getting rid of marginal business is just one of those ways.
Railroads are putting down new rail. The UP is adding a second main between El Paso and LA. The BNSF, and its predecessor lines, has been in a capacity expansion mode for 20 years. First on the Transcon and now on the former Great Northern/SP&S. NS and CSX are doing similar capex. That's one way to expand capacity.
Building new intermodal terminals is certainly a capacity expansion. That's happening.
Another way is to increase the capacity of freight cars. And that's certainly going on with the maximum weight limit on some lines now at 315,000 pounds.
DPU is allowing huge trains. Moving those huge freight cars. More capex.
.Yet another way is the concentration on intermodal trains and unit trains. These trains don't need classification yards and bypass those capacity choke points.
There are various ways to deal with the need for additional rail freight capacity. And the railroad companies are using every way they can.
MP173 Great points Greyhound. In 1970-1980 era there just wasn't enough traffic for MILW and RI to be profitable, particularly with the regulatory environment at that time. It is interesting to note, as has been pointed out, the evolution of the MILW and RI lines. Many of the RI lines are still in use. Not so much the MILW. There is a reason for that. There is a reason that the RI line from Chicago to Council Bluffs is still in use but not the MILK line, except to Sabula. That portion of the line exists today simply as an alternative route for Chicago to KC and Twin Cities, plus KC - Twin Cities traffic. It is a desirable route, but it is an alternative and as the economy grows, it will see small growth, unless something BIG happens (oil, more corn, drying of Mississippi River). Investors cannot efficiently hold large capital investments awaiting a "BIG" event, unless there are indications it will occur. Would the PCE be efficient today? My guess (and only a guess) is that it would have very small levels of traffic. Why? There are better routes available. More efficient, quicker, and cheaper. At some point the PCE might have been viable, when all capacity is filled and there is no room at the inn. Today's railroading environment suggests that expansion will result in a more unorthodox manner. Instead of building new lines, the rails will simply prune off the less desirable and profitable business. Thus, growth will be more of a higher return on investment rather than true volume growth. ed
Great points Greyhound. In 1970-1980 era there just wasn't enough traffic for MILW and RI to be profitable, particularly with the regulatory environment at that time. It is interesting to note, as has been pointed out, the evolution of the MILW and RI lines. Many of the RI lines are still in use. Not so much the MILW. There is a reason for that.
There is a reason that the RI line from Chicago to Council Bluffs is still in use but not the MILK line, except to Sabula. That portion of the line exists today simply as an alternative route for Chicago to KC and Twin Cities, plus KC - Twin Cities traffic. It is a desirable route, but it is an alternative and as the economy grows, it will see small growth, unless something BIG happens (oil, more corn, drying of Mississippi River).
Investors cannot efficiently hold large capital investments awaiting a "BIG" event, unless there are indications it will occur. Would the PCE be efficient today? My guess (and only a guess) is that it would have very small levels of traffic. Why? There are better routes available. More efficient, quicker, and cheaper. At some point the PCE might have been viable, when all capacity is filled and there is no room at the inn.
Interesting thread, please don't "get over it" and keep the discussion going.
"The true sign of intelligence is not knowledge but imagination."-Albert Einstein
http://gearedsteam.blogspot.com/
Aw, man!
I don't know what it is about the Milwaukee Road and its unfortunate Pacific Coast Extension that brings out the conspiracy types.
If you understand economics and commerce it's evident that the decisions made by the railroad's management were logical and thoughtful when they were made. They didn't make perfect decisions. But no one makes perfect decisions. (Including Big Brother, the government) Milwaukee Road management got things wrong. They underestimated the cost of the PCE and overestimated the business they would get from the PCE. Big Deal!. There is no certainty. You pay your money and you take your chances.
There just wasn't enough business to support a 4th railroad into the Pacific Northwest. When they built the line they thought there would be enough business. They didn't see the oncoming advent of motor transport. No one did. But nobody can see the future.
When it came time to adjust to the advent of motor transport the stupid fools with the government jobs would not allow them to do so in a timely manner. So they went bankrupt 3 times in 57 years. To me, that's a pretty good indication that the enterprise is not viable. Basically, no one could run it without consuming more resources than they produced. So get rid of the dang thing.
It's gone. It's ripped up. Get over it.
Does anyone know if the Milwaukee even had the money to do routine maintenance? I'm guessing it took all they had, just to keep their heads above water.
Thanks to Chris / CopCarSS for my avatar.
SALfanMilwaukee Road had two big problems that either caused or hastened its demise, IMHO. Management and the board of directors were obsessed with the notion that merger with CNW would be the RR's salvation, and slashed maintenance for at least a decade to raise the stock price to assure their control of the merged entity. The track and rolling stock was about to the point of complete collapse by 1980, and management's shenanigans with sale and leaseback of cars didn't help. At least most of management was similarly obsessed with the midwestern granger branch network and did everything they could to hobble and handicap the Pacific extension. Would the RR have survived long-term without these problems? I do not know, but am convinced it would have survived longer than it did. If the track and rolling stock had been in decent shape, the extra traffic SP was feeding it toward the end along with profits from the long hauls to Louisville (obtained as a condition of the MP/L&N division of C&EI), along with deregulatíon, might have been enough to keep it alive if it had dumped th granger branches.
If the Milw did this, they were just like the RI waiting on the UP. Of course, there was not a lot of spare money to spend on maintenance in any case, between the competition for freight traffic and the passenger-train drain.
Amtrak and Staggers cured a lot of ills. Just too late for Milw and RI.
I am with SALFan, it may be that the management was doing the best they could at the time but the decisions they made have turned out to be wrong. Think about cost of entry into railroading (i.e., building new rights of way), and then think about cost of entry into financial services: the amount of new competition that you face from new railroads is infinitesimal. Go into the service business and you can expect major competition and low margins, and that is what they found. MILW already had the track, but decided that the amount of business that track would see would continue to fall as it had post-WWII with interstates and truck competition. Could MILW management have guessed that pricing would be deregulated, that energy/fuel prices would rise, that regulation of truck drivers (long needed in my opinion) would cause driver shortages and thus make railroads far more competitive? I don't know, but I just saw a report on the Trains news wire that UP had the biggest profit in its history last quarter even though the US/ world economy is still down. Traffic is at all time highs, railroads are turning away business. No doubt revenues for BNSF and UP (and probably CP and CN) would fall with the MILW still intact, but the overall economy would likely be better off. But that is my opinion, which is: the more railroads, the better.
SALfanMilwaukee Road had two big problems that either caused or hastened its demise, IMHO. Management and the board of directors were obsessed with the notion that merger with CNW would be the RR's salvation, and slashed maintenance for at least a decade to raise the stock price to assure their control of the merged entity. ..........
Even after the enactment of Staggers in 1980, you had senior railroad management that had no idea how to operate a minimally economically regulated railroad property - for profit - they had NO EXPERIENCE in such a form of operation. I took nearly 20 years for senior managements to come to realization of what could and could not be done in operating a railroad for profit, in developing services and pricing for those services that can bring results to the bottom line of the balance sheet and return to the stockholders..
Never too old to have a happy childhood!
schlimmIt is a good point, as a business, not just nostalgia. Soo Line managed to make money using some of the former MILW lines (not the Pacific extension). Perhaps if MILW management had not milked the cash flow to go into non-rail endeavors, and had been competent, they could have been successful and eventually sold self to CN or CP.
You all seem to be forgetting that Congress made it impossible to make money in the railroad business starting in 1906. By the late 1960's every railroad in the country was a financial wreck.
Management has a duty to the stockholders, the owners, to protect the assets and maximize income. Most rail managements looked at the situation and concluded that the only way the stockholders would get anything out of their railroads was to diversify into other lines of business where profit was still legal.
CNW moved into a variety of non rail businesses and sold the railroad to employees. They got out completely. IC diversified extensively and sold the railroad off in pieces. SP turned its private microwave system into the beginings of Sprint. UP went into oil in a big way. MILW management was far from the only one to figure that there was no future in the railroad business, they simply failed to get out of the railroad before it collapsed.
Dumb acts of Congress have consequences, some just take longer to show up than others.
Mac
Murphy Siding cp8905 They believed, incorrectly, that railroads were a senile industry, and wanted to get out. They wanted to do what Penn Central did before them: become a non-railroad financial services and real estate company. The C,M, St.P.&P became Chicago Milwaukee Corporation. They used the funds they received from selling the railroad to CP/ Soo LIne to pay off their debt, and together with the real estate holdings that weren't part of the sale they became an investment firm until they merged or were bought out in the nineties. I realize that rail fans wish the Milwaukee Road had not disappeared, and that makes it easier, in hindsight, to see a conspiracy by the management to get rid of the railroad. In the end though, didn't they make the right decision for their stockholders? If they had managed the railroad differently in the last couple of decades, would the outcome have been any different?
cp8905 They believed, incorrectly, that railroads were a senile industry, and wanted to get out. They wanted to do what Penn Central did before them: become a non-railroad financial services and real estate company. The C,M, St.P.&P became Chicago Milwaukee Corporation. They used the funds they received from selling the railroad to CP/ Soo LIne to pay off their debt, and together with the real estate holdings that weren't part of the sale they became an investment firm until they merged or were bought out in the nineties.
They believed, incorrectly, that railroads were a senile industry, and wanted to get out. They wanted to do what Penn Central did before them: become a non-railroad financial services and real estate company. The C,M, St.P.&P became Chicago Milwaukee Corporation. They used the funds they received from selling the railroad to CP/ Soo LIne to pay off their debt, and together with the real estate holdings that weren't part of the sale they became an investment firm until they merged or were bought out in the nineties.
It is a good point, as a business, not just nostalgia. Soo Line managed to make money using some of the former MILW lines (not the Pacific extension). Perhaps if MILW management had not milked the cash flow to go into non-rail endeavors, and had been competent, they could have been successful and eventually sold self to CN or CP.
C&NW, CA&E, MILW, CGW and IC fan
Murphy Siding If they had managed the railroad differently in the last couple of decades, would the outcome have been any different?
If they had managed the railroad differently in the last couple of decades, would the outcome have been any different?
That's a very interesting questions. Using todays management know-how, and with todays technology, how do you imagine the Milwaukee Road running to the northwest would be run?
Would it be a bridge route of hot-shot double stacks...or perhaps perishable fruits from Washington and Oregon?
How do you believe it would have been utilized?
Awe man.....now the software is playing pick and choose on the font size in my post. I tried changing it all to the same size, but nooooo......
Redundant Post deleted by user
"I Often Dream of Trains"-From the Album of the Same Name by Robyn Hitchcock
Murphy SidingThat sounds more like simple bad management, or an evolution of circumstances than a deliberate move to get out of the railroad business. Why would any railroad management team want to 'get out of the railroad business' anyway? Once they got out of the railroad business, what were they going to do?
They believed, incorrectly, that railroads were a senile industry, and wanted to get out. They wanted to do what Penn Central did before them: become a non-railroad financial services and real estate company. The C,M, St.P.&P became Chicago Milwaukee Corporation. They used the funds they received from selling the railroad to CP/ Soo LIne to pay off their debt, and together with the real estate holdings that weren't part of the sale they became an investment firm until they merged or were bought out in the nineties. As I recall the Rockefellers owned the railroad at the time of the PCE and financed its building but I don't know if they still owned any of it by the end or gained anything by the sale. Here is a news story I dug up:
Chicago Milwaukee Corp., a closed-end, non-diversified management investment company, said net assets for 1991 rose $29.1 million. Net investment income totaled $17.5 million, down from $19.8 million in 1990. The results for 1990 included real estate operations that were transferred to Heartland Partners L.P. Net realized gains on sales of investments for 1991 totaled $8.2 million, up from $2.6 million in 1990. Net assets on Dec. 31 totaled $281 million, or $151.49 a common share."
The Rock Island did the same thing, becoming Chicago Pacific Corporation. Funny thing, they used their surplus after the sale of railroad assets to first buy Hoover, Maytag wanted Hoover and so bought Chicago Pacific, and Maytag was part of the group of companies that bought the old Rock Island main and leased it to Iowa Interstate, so the Rock Island is technically in the railroad business still.
All good answers, and I appreciate it. However considering MILW's circumstances, why did they send a train to Portland OR? I am from Portland, and my Dad works at the museum where the 4449 lives, so I've seen a historic map of the city. I can say with a good deal of confidence that if there is one place MILW was late in arriving to, and likely had little to do in, it was Portlnad...
The Beaverton, Fanno Creek & Bull Mountain Railroad
"Ruby Line Service"
Geared Steam There are many who believe management , based on their actions, wanted out of the railroad business,. Deferred maintenance, bad accounting, bad judgement, bad order cars and motors all led to two trains a day and many derailments.
dakotafred The best perspective of all is remembering what a tough business railroading was for everybody in the 1970s, let alone the 4th and last line to the Pacific Northwest. If we could have had deregulation earlier, maybe a lot of nice things like the Rock Island and Milwaukee Road, or important parts of them, could have been preserved.
The best perspective of all is remembering what a tough business railroading was for everybody in the 1970s, let alone the 4th and last line to the Pacific Northwest. If we could have had deregulation earlier, maybe a lot of nice things like the Rock Island and Milwaukee Road, or important parts of them, could have been preserved.
WSOR 3801 MILW management at the time felt getting out of the railroad business was the course of action they should take. The electrification was too efficient, so they got rid of it, just as the price of copper dropped and diesel fuel went up. Then cook the books a bit, double state the expenses for Lines West, and it almost seems justified to get rid of it. Total traffic was lower then, so the other existing lines had the capacity to handle it.
MILW management at the time felt getting out of the railroad business was the course of action they should take. The electrification was too efficient, so they got rid of it, just as the price of copper dropped and diesel fuel went up. Then cook the books a bit, double state the expenses for Lines West, and it almost seems justified to get rid of it. Total traffic was lower then, so the other existing lines had the capacity to handle it.
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