Demise of the Olympian Hiawatha

[Vermontanan2]

TRR

And the Empire Builder is "just as profitable!" That is, yet another complete fabrication by Mr. Meyer.

Indeed, that I would say that is a fabrication.

TRR

"ABOARD THE EMPIRE BUILDER (Reuters) - Its passengers are mostly silver-haired retirees, oil-field workers and a few young families gazing out the windows of Amtrak’s least-profitable and third-longest line, rumbling from Chicago through eight states and on to the American West Coast."

https://www.reuters.com/article/us-amtrak-finances-insight/to-see-why-amtraks-losses-mount-hop-on-the-empire-builder-train-idUSKBN0OD17R20150528

I don’t know the specific purpose of this “drive-by” posting (since the thread is on the Olympian Hiawatha).  But context is in order.

The article says Amtrak has profitable routes. It doesn’t.  Some people think the Northeast Corridor is (pre-COVID, obviously), but that doesn’t include operation and maintenance of the infrastructure and the HUGE amount of needed investment just to keep the thing afloat.  Even by Amtrak standards, the Empire Builder is actually the “longest line” with more route-miles than any other (they obviously missed that the Empire Builder has two sections – each with their own 300+ miles, and that the Texas Eagle and Sunset Limited are separate trains), and other trains routinely “lose” more money according to Amtrak accounting.  In FY2019 – the last pre-COVID year, both the California Zephyr and Southwest Chief “lost” more money than the Empire Builder, and the Sunset Limited “lost” 61% that of the Empire Builder while only operating 43% of the time, and this has been pretty uniform in throughout the 2010s.  Missing basic facts aside, few have absolute faith in Amtrak accounting methods.  With the station in Miami being assigned a fixed expense for snow removal and part of the NEC electrification being assigned to non-electrified routes, this might make one skeptical of Amtrak’s figures.  For the Empire Builder specifically, it and the Coast Starlight bear the cost of all redcap and baggage handling costs at Seattle and Portland even though all the “Cascades” trains do checked baggage.  And then there’s the overall cost of the fact that Amtrak equipment is just worn out.  BNSF requires a third locomotive on the Empire Builder during the winter just because theirs are too likely to croak during cold weather, and when it’s not cold, paying BNSF for a locomotive because of an Amtrak failure is relatively commonplace.  So, the financial aspect of the Reuters article is really lacking in context and facts.  But the part in the article about the train having bipartisan support is true, and why it’s still around.  Regardless of the amount of money it “loses,” obviously, there are sufficient numbers of people who see value in retaining the service, which is pretty much what it all boils down as to whether a train or route is operating or not.

--Mark Meyer

[Vermontanan2]

TRR

Milwaukee Road was the most experienced of the "three railroads mentioned," by far. It's primary markets for the transcontinental service in 1955 were: Butte, Spokane, Seattle, Tacoma.

So "experienced" that the Milwaukee didn't offer leg rest seats in its Olympian Hiawatha until 1953, 6 years after the train's debut.  Pretty much a given for a route over 2,000 miles.

TRR

In 1955, the Milwaukee succeeded in getting the "Union Pacific" passenger contract.

And, of course the C&NW - whose line today remains the primary route between Chicago and Omaha/Council Bluffs/Fremont - might say something kind of similar but adding/changing a few words: In 1955, the C&NW succeeded in getting RID OF the "Union Pacific" passenger contract."

TRR

This gave the Milwaukee Road passenger service, over the UP, to Butte, Spokane, Seattle, and Tacoma. After that, add on Portland, San Franciso, Denver and Los Angeles.  Now, why would Milwaukee Road even "want" to offer TWO passenger routes to Butte, Spokane, Portland and Seattle, and why would it want to turn down adding passenger service to Denver, Portland, San Francisco and Los Angeles?

This, of course, is patently ridiculous.  It's only applicable if the Olympian Hiawatha only offered service to (and only stopped at) Chicago, Butte, Spokane, Seattle and Tacoma.  All told, of course, there were 42 stops in all (at the time of discontinuance), and travel was allowed between just about all of them without restriction.  And the statement is even more ridiculous after the Olympian Hiawatha was discontinued in 1961.  The Milwaukee continued to serve Butte until 1964 from its Minneapolis-Deer Lodge train, but there was never any through-car service to Spokane, Seattle, or Tacoma from Chicago involving a Milwaukee Road train after May 1961 (and to Butte after February 1964).  After the Olympian Hiawatha was discontinued, sure, you could still take a train from Seattle and Tacoma to Portland to board the City of Portland and ride the UP to Council Bluffs and the Milwaukee to Chicago, but the train you boarded in Seattle and Tacoma would have been a Great Northern train.  Indeed, in 1960 - the last year there was through car service to/from Seattle on the City of Portland, the eastbound sleeping car was handled on the GN train.  Using this logic, you could say that Great Northern served places like Perry and Marion, Iowa on the MILW, plus just about everywhere on the UP!  The reality was that the discontinuance of the Olympian Hiawatha was just that - less service.  Between Chicago and Omaha, the communities served were modified (and downgraded because the C&NW served more communities directly), but amount of service was unchanged.

TRR

Milwaukee began moving quickly to preserve and expand its passenger services, and, at the same time, clear the schedule on its own line for high speed freight service, while increasing profitability from its passenger service. The slogan was "All Freight by '58."

Moving quickly?  "All Freight by '58?"  More like: "Losing money galore through '64!"  The Milwaukee claimed loses on its Minneapolis-Deer Lodge service (May 1961-February 1964) of well over $1 million annually.  And what an embarrassment to point out that the Milwaukee Pacific Extension - one that was only running 1 or 2 through freight trains daily as it was - needed to get rid of the one passenger train it had to facilitate its "high speed freight service."  Really doesn't speak well of the operating folks or the infrastructure, especially considering that the Milwaukee had to limit its "high speed freight service" to 3,000 tons and provide 3.0 HPT to make its schedule (XL Special Chicago-Seattle) due to the Milwaukee's horrible operating profile.  When CB&Q and GN matched the Milwaukee's schedule 4 years later (train 97), their operating plan required a similar amount of locomotive power but with a tonnage limit of 5,500 tons between Chicago and Spokane, easily doable with GN’s superior operating profile.  The traffic set out at Spokane provided superior service to that city (Spokane was on a Milwaukee Road branch line), and was forwarded by GN subsidiary SP&S to Portland (the second largest market in the Pacific Northwest and unserved by the Milwaukee).  All this while GN was hosting several other freight trains and two daily passenger trains.  In short, GN didn’t need to “clear the schedule” to operate a 55.5-hour schedule.  With planning, and superior operating profile, and sufficient infrastructure, not a problem.  But as degrading as Michael’s “clear the schedule” suggestion is to the Milwaukee in general, it’s probably true.  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.  Meanwhile, BN kept its 55.5-hour Chicago-Seattle schedule for train 97, and in 1971 added its “Pacific Zip” on a 50-hour schedule, which routinely operated 4-5 early into Seattle.  Getting back to the original topic of the Olympian Hiawatha, the "All Freight by '58” is by itself questionable, as the Milwaukee never did degrade the service.  Jim Scribbins documents the pains the Milwaukee went through to increase patronage on the train in 1958, 1959, and 1960 in his book “The Hiawatha Story.”  The railroad also touted serving Yellowstone and boasted about a speed-up of the westbound Olympian Hiawatha in its employee magazine. And, the Olympian Hiawatha always remained the first train shown in the “condensed schedules” section of timetable and Official Guides – never the City of Portland or anything else. 

TRR

Railroad service abandonments "being what they were" in that era, the abandonment could not occur until 1961, despite Milwaukee Road serving those key destinations over Union Pacific.

Again, only applicable talking about Chicago, and possibly stations really near Chicago.  I challenge Michael to show documentation of anyone choosing to go from Chicago to Butte or Spokane to Seattle on UP trains because the Milwaukee pulled out.

TRR

The Milwaukee turned the money-losing transcontinental passenger operation -- GN and NP were crying loudly about their losses -- and made it profitable.

From "an actual source:"

"The so-called "City" trains are presently being operated jointly with the Union Pacific and the Southern Pacificby the Milwaukee betweon Chicago and Omaha. These operations are covered by a contract which provides for a one-year termination notice from either party. As shown in the following Table IX, during the year 1962 the Milwaukee realized a net gain of $1,604,086 based on out-of-pocket expenses in the operation of the City trains between Chicago and Omaha. Revenues on these trains were $5,590,478, and out-of-pocket operating expenses were $3,986,392."  Report of Committee on Possible Mergers of Union Pacific-Rock Island-Southern Pacific Railroads, May 3, 1963. P. 21.

Turning a money-losing operation into a profitable endeavor was difficult for railroads in general in the 1960s. Mr. Meyer, anxious as always to discuss what he does not know, does not know that either.

Well, context matters here.  1962 is one year.  What about the other 15?  Another “actual source” is Trains magazine (and others) who wrote about the $7 million the Milwaukee spent alone for new locomotives and signaling for its Chicago-Council Bluffs route.  And then there’s the several millions of dollars spread over a variety of projects to accommodate talking on these trains: Hiring and training new people, miles and miles of new or upgraded track (especially in the commuter zone west from Chicago), tripling the number of people working in the Milwaukee’s reservations center, and painting all the equipment in the UP color scheme.

And then there’s the reality that this bonanza of business would not be all it was cracked up to be being realized in pretty short order.  The upgrading was to accommodate an additional five trains per day in each direction starting in October 1955 (for a total of six passenger trains daily each way, including the Arrow).  But already in the Spring of 1956, the Challenger and City of Los Angeles were consolidated, except during some holiday and peak seasons (and always consolidated after 1960, though the name lingered). By 1959, the City of Denver became basically just additional cars on the City of Portland.  In 1960, the City of San Francisco and City of Los Angeles/Challenger consolidated between Chicago and Ogden.  From 6 trains to 3 in only 5 years.  The Arrow was axed in 1967, and the finally “City of Everywhere” consolidation down to one passenger train by 1969.  Such expenditures or “stranded assets” I doubt were part of the anecdotal 1962 “profit.”

And such malarkey was not lost on Milwaukee Road employees on the Pacific Extension either.  Referencing the Minneapolis-Deer Lodge stub train that the Milwaukee was forced to operate from 1961 to 1964 as the “City of Deer Lodge” can sound cute, but employees were not impressed by their railroad sinking millions of dollars into basically a passenger-only operation (freight traffic did not increase substantially as a result) that by 1964 was already hosting only half of the trains originally intended by the investment.  And then to see the XL Special being launched on their railroad with a bunch of hoopla without ANY corresponding upgrades (CTC or even ABS where still missing) was indeed a slap in the face.

Being a revisionist historian can be challenging, even if you’re successful.  But if you’re trying to change a failure into a success, you’re only convincing if your story ends on a success.  Not the case here:  The traffic millions was spent on eroded quickly without backfill with the remainder diminishing pretty much in line with most passenger services prior to Amtrak.  Come 1971, Amtrak didn’t choose that route and became freight-only.  And by the end of the decade, the Milwaukee Road became the only trans-Iowa Chicago-Omaha line to be mostly abandoned (the CGW was folded into the C&NW before it mostly went away).  An epic failure, indeed.

--Mark Meyer

[daveklepper]

It was pretty clear to me, at the time, that the Milwaukee expected the interchange freight traffic, from the UP, to follow the routing change in passenger traffic.

It did not happen.

[CSSHEGEWISCH]

All of those statements about the other carriers may have been true at that point, but why are they still operating and the PCE and MILW's Omaha main are only memories?

[Vermontanan2]

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.

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.  True, one could ride the “City of Portland” from Chicago to Council Bluffs on the Milwaukee, and then the UP to Hinkle, Oregon and change trains and go to Spokane, but one could also ride the Milwaukee Road from Chicago to Deer Lodge 1961-1964 and change trains and ride the Northern Pacific to Spokane.  Or ride the Milwaukee Road from Milwaukee to St. Paul and the Great Northern to Seattle.  Not “preserving” service, but simply using the trains of another carrier.

And it’s far from a “fact” the UP contract was profitable when the entire cost of the upgrade is factored, especially considering the upgrade was designed for six passenger trains daily each way, which was halved in only 5 years.  Anecdotal “profit” (example given: only the year 1962) is irrelevant compared to sustainability.  That the Chicago-Council Bluffs upgrade ended up being “stranded assets” in a hurry is one thing, but even that wasn’t the worst part.  The Milwaukee Road ended up being the only Chicago-Omaha route mostly abandoned across Iowa.

TRR

Good? Bad? Well, they did what other railroads did not do in that particular instance AND opened up its freight service to offer services far superior to its direct competitors. Did they get additional freight traffic, Omaha to Chicago? According to officials, "some" but perhaps not what was hoped. Did Burlington Northern practically destroy itself in Lou Menk's drive to carry all the coal traffic that it could? Well, pretty much. The resulting 95% operating ratio at BN was shown to be "one way" to lose your job as the disaster unfolded at BN. Bringing over the "Frisco" management was another.

Of course, mentioning Burlington Northern is simply a deflection maneuver, which has zero to do with this thread.  And again, if you’re only running one or two freight trains on 1,500 or so miles of a transcontinental railroad and you need to discontinue the one passenger train to “open up” for “superior” service, that speaks volumes about your inherent inadequacy. 

Burlington Northern’s investment into its coal network was indeed not what it had hoped.  However, there is an obvious difference between “practically destroy(ing) itself” and actually doing it.  The Milwaukee really did it.  It is the only transcontinental railroad in the U.S. to be largely abandoned and the only trans-Iowa Chicago-Council Bluffs railroad to be largely abandoned.  If abandonment is the criteria for success, then Burlington Northern is a failure.  But the reality is that all of BN’s core routes from the day of the coal expansion remain intact, and in prime condition as part of a larger (as a result of Burlington Northern being able to have the financial wherewithal to purchase ATSF), more profitable railroad.  And with the passage of the Clean Air Act, the demand for low-sulfur coal nationwide from places like Montana and Wyoming exploded and Burlington Northern stepped up to the plate and provided the infrastructure, something that might not have been fantastically profitable for the railroad, but fantastically beneficial for the country.

TRR

As the most experienced "passenger hauler," Milwaukee Road saw the need for change, and moved quickly to do so by 1955. And those changes moved rapidly. For anyone following the passenger operations, it is interesting to see that Milwaukee's ancillary passenger services on its Pacific Extension were also being transformed in precisely that time period. The passenger train from Harlowton to Great Falls was changed to bus service, from Roundup to Great Falls.

Again, a total fabrication.  The Milwaukee simply discontinued the Harlowton-Great Falls train and then mentioned existing bus service as a possibility.  In reality, the Greyhound bus service was a Billings-Great Falls route which stopped in Roundup, and for passengers actually desiring to go to Great Falls or Lewistown from the westward Olympian Hiawatha at Roundup, the layover was well over 10 hours. (A more expedient connection to Great Falls would be with Greyhound at Butte, which offered four daily trips.)  It should be noted that the Milwaukee never showed actual times the buses operated, and the concept of through ticketing is hit-and-miss.  (There’s also no specific indication that buses would call at the Roundup Milwaukee Road station, or how that would work when having to wait for the Great Falls bus departing at nearly 900 PM, well after the Milwaukee agent went home…)  And like the bogus claim that Milwaukee’s Chicago-Council Bluffs passenger trains somehow continued serving the Olympian Hiawatha route, the connecting bus didn’t serve most of the communities that lost Milwaukee passenger service.  Lewistown, Moore, and Great Falls where the only common communities served, but all the rest except one lost their only public transportation when the Milwaukee pulled out.

The Milwaukee also did this for main line locations when the Columbian was discontinued.  Footnotes in the schedule at Terry, Forsyth, and Drummond directed patrons to use the Olympian Hiawatha to the nearest stop, and then Greyhound to the destination, which was often directly served by the Northern Pacific.  The Milwaukee could ill afford to add stops to the Olympian Hiawatha; by the time of its death, it had already slumped to being over 2 hours slower than the Empire Builder and just 25 minutes faster (westbound) than the North Coast Limited on its much longer route.

Bus service in lieu of rail hardly “transformed” anything and was no way specifically indicative of an “experienced hauler,” but rather a commonplace occurrence in place for decades.

TRR

That had nothing to do with the UP contract, it reflected a different decision, a strategic decision, to "get out" of rail passenger service. And those changes were rippling through the Milwaukee "out west" in 1955. GN and NP could not do that. "Could not" is a choice of words. "Did not" would be another choice.

The choice for the Milwaukee: “Had to.”  The acknowledgement of too much service in a sparsely-populated region was becoming a reality.  And it was especially applicable for the Milwaukee, which had little exclusivity in service, where the abundant competition provided superior frequency and amenities, and because the Milwaukee’s Olympian Hiawatha was basically a stand-alone single-train operation on a long branch line with almost no connecting service to funnel off-route passengers.

TRR

And, those decisions allowed Milwaukee to offer, by the 1960s, a series of improvements to freight operations, lowering the tunnel floors to get the traffic that the Northern Pacific could no longer carry. The speed-up of freight service after the passenger trains were out of the way was unmatched by any competitor: they physically could not do it. They said so. In sworn testimony to the ICC during the frantic Northern Lines merger efforts.

Unmatched?  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.  No only was the Great Northern Empire Builder the fastest passenger train ever between Chicago and Seattle, but GN had the longstanding mail contract (handled east of St. Paul by the Milwaukee), both of which relied on speed.  Such “testimony” is not reinforced by historical fact, nor does it specifically identify any benefit for the Milwaukee, still the only transcontinental U.S. railroad to be mostly abandoned.

The NP didn’t need to lower the tunnel floors at Stampede Pass to handle the higher auto rack cars – they simply routed their traffic via their subsidiary SP&S, which they also used for their Portland traffic.  A railroad with alternate routes has options – not the case for the Milwaukee.

And it’s interesting that those “decisions” on the Milwaukee didn’t lead to redirecting the money to basic safety features commonplace on the competition, such as a continuous automatic block signal system, centralized traffic control including power switches, longer sidings, and later on continuous welded rail and lineside failed equipment detectors.

TRR

The Olympian Hiawatha offered an "object lesson" for railroading. Milwaukee had invested heavily in that train, with iconic design by Brooks Stevens, innovative equipment with Superdomes and Skytop cars, a fast schedule, and even the two "passenger electrics," E-20 and E-21. Too, the route was of extraordinary scenic beauty.

One “object lesson” about the Olympian Hiawatha:  Don’t spend a bunch of money on a service which only lasts 14 years – a very poor investment indeed.  The route was indeed scenic – a component of its horrible and expensive operating profile, as was electrification – but lacked exclusivity and utility, hence the reason for its demise.  The Skytop cars were unique, but the Super Domes were a flop, due to lack of forward visibility.  Fortunately, some were unloaded on Canadian National.  The train didn’t offer leg rest coaches until 6 years into the operation, and the train wasn’t completely streamlined for several years into its operation, despite the advertising.

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.

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.  Take the 1951 timetable for instance: Train 15 arrived in Tacoma at 1145 AM and train 16 departed at 130 PM – only 1 hour, 45 minutes difference.  Hardly enough time to turn, stock, and clean the train.  Even the initial 1947 trip allowed only a 4-hour turnaround in Tacoma – not enough wiggle room.  That was the price of not having maintenance and mechanical facilities in the region’s primary city: Seattle.  Running the train to Tacoma added precious time and cost a whole set of equipment.  But in 1947, the Empire Builder’s turnaround time in Seattle was 7 hours.  And, unlike the Olympian Hiawatha, the Empire Builder got faster.  By 1961, the Empire Builder was over 2 hours faster than the Olympian Hiawatha westbound with an equipment turnaround time in Seattle of 7 hours, 40 minutes. 

After 1951, the Empire Builder was joined by another GN streamliner, the Western Star, which had a much longer equipment turnaround time in Seattle.  When/if the inbound Empire Builder was severely delayed, GN could easily substitute Western Star equipment.  GN also had streamliners to Vancouver, BC and a train (or trains) to Portland.  GN and NP also were known to loan equipment to each other in Seattle as necessary.  GN’s longer turn times and greater equipment availability created an ongoing operational flexibility that the Milwaukee simply did not have; they were one train in and one train out (the Columbian was always all-heavyweight equipment), and without the spare set of equipment dwelling for over a day, had no recourse – just an ongoing additional cost.  At Northern Pacific, the North Coast Limited maintained a 5- to 6-hour turnaround time in Seattle for equipment for 24 years with 93% or better on-time performance.

TRR

But -- and it is important to examine how that played out -- it was quickly apparent that 1) passengers were NOT coming back to the rails, and 2) passenger train schedules were a corrosive handicap to "fast freight" service.

Passenger trains are not automatically “corrosive” (whatever that means) to faster freight schedules.  They actually can be complementary since meet/pass delay is minimal with both trains operating at higher speeds.  But how it played out for the Milwaukee:  When the freight traffic increased in 1972 – without passenger trains – the “fast” schedule went by the wayside while Burlington Northern continued to maintain its fastER schedule.

TRR

And, as part of that "larger picture" that picture was clear by 1955. The "UP Contract" was "part" of that larger picture, but was not the "whole" picture. The innovative part was that Milwaukee not only EXPANDED its transcontinental passenger services dramatically, but could even make a profit on it, using the same equipment that it already had; that is, finding a way to make money on "sunk costs."

The development history of the "Olympian Hiawatha," which is distinct from its predecessor the "Olympian," is a compelling case study. There is no doubt that the Milwaukee Road gave that passenger service "it's best shot," but then also was much quicker to recognize the hard reality that GN and NP had failed to do: it wasn't going to work.

The "legal" department moving somewhat slower than the "operating department," Milwaukee by 1955 had embarked on a new passenger rail strategy "out West" and one that, on the whole, was successful: it turned a money losing proposition into a profitable one, and, as a key element in that, opened up the entire route to the expanded freight service that cut a full day off of transcontinental freight, and quadrupled the high-end, long haul traffic that railroads desperately needed and sought.

Reality check despite the claims above:  The ex-GN and ex-NP main lines are largely still vibrant components of today’s BNSF Railway; the ex-Milwaukee Road Pacific Extension – at its most useful – supports some of the Northwest’s most popular hiking trails. 

As stated in Jim Scribbins’ “Hiawatha Story,” the Olympian Hiawatha posted losses exceeding $3 million for the ten-month period November 1959 to August 1960, which equates to about $32 million in today’s money, despite measures to promote the train and its amenities never being downgraded.  Inferior equipment, lack of exclusivity in the market, few connections, and too much available alternate transportation simply made the train superfluous.  Nothing special about the Olympian Hiawatha from that standpoint and no reason that it wouldn’t have lasted longer were it a better performer.  And the suggestion that the train was specifically discontinued as the Milwaukee was proactive in ridding itself of passenger trains is countered by the railroad operating passenger trains into relatively obscure places like Aberdeen, SD, Channing, MI, and Wausau, WI into the late 1960s and early 1970s.  This followed by abandonment of both the Pacific Extension and the route across Iowa.  The epitome of “failure.”

(Scribbins had a long record of service with the Milwaukee Road, mostly in the passenger service department.)

TRR

[Edited by admin to remove personal attacks on another Forum user. In future, refrain from doing this, please.]

Interesting indeed.

[Vermontanan2]

CSSHEGEWISCH

All of those statements about the other carriers may have been true at that point, but why are they still operating and the PCE and MILW's Omaha main are only memories?

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?  The leaders of the other railroads were well aware of the physical plant and the operating inefficiencies of the Milwaukee.  Clearly, if the Milwaukee was that superior, they would jumped at the chance to obtain it.  The reality was that BN wanted just about no part of it, and UP passed it up, too.  The Pacific Extension was the high-cost operation and the route across Iowa was superfluous.  

The underlying reality of Michael Sol's attempts to show why things turned out the way they didn't are:

The Milwaukee Road Pacific Extension is the only U.S. transcontinental railroad to be largely abandoned; and

The Milwaukee Road's route across Iowa is the only such route to be largely abandoned.  

Two impressive superlatives, indeed.

 

[Vermontanan2]

TRR

In addition to forest products, high profit auto traffic, and containers, by 1973, "fast freights" were being increased in in numbers and, unfortunately, in tonnages as well. #261C and #261TC, as well as #263C would routinely meet both an advance #262S and a regular #262S, for instance, in addition to #264S, all within a five hour period at Avery. These were all "hotshots" and that's a lot of fast trains to be meeting. That was in addition to normal 265,266, DFW and DFE traffic. The #262 sections were up to 4800 tons. Had MILW stayed with its 3000 ton "Hotshot" limits, it would have had three sections of #262 eastbound, and probably two sections of #264 rolling into Avery in the early afternoon, trying to get around three sections of #261 westbound and two sections of #263 in addition to the "regular" trains.

 

"These were the 8-10 trains per day that the PCE averaged for the remainder of the time before bankruptcy. These were trains that were up to 60% heavier than the trains run during the 1960s, and had MILW stayed with those tonnage limits, the PCE would have been running 14-16 trains per day.

In 1973, Milwaukee “hotshot” train 261 was carded for 63 hours from Chicago to Seattle, and 80 hours from Chicago to Portland. 

At Burlington Northern, train 3 was still on its 50-hour schedule from Chicago to Seattle, train 97 on its 55.5-hour schedule from Chicago to Seattle, and train 197 was carded for 60.5 hours from Chicago to Portland. 

It’s hard to really understand the purpose for above posting; obviously, the tone of it and others by this author is designed to paint a picture of the sluggish Milwaukee being some super railroad fantastically out-performing its solvent competitors and their modern infrastructure – right up to the time that the Milwaukee went under.  However, this particular post does the opposite:  It shows the opposite.

First, to clarify, by 1973, the Milwaukee had dropped the maximum speed on its railroad west of Miles City to only 50 MPH.  Between Avery and Plummer, the maximum was 45 MPH, and between Plummer and Marengo it was only 40 MPH.  This is significant as the Plummer-to-Marengo segment (except for the short section from Plummer to the Sorrento tunnel) was dark territory (no Automatic Block Signals, and the Milwaukee’s Pacific Extension never achieved significant return on investment to provide this basic safety equipment).  Without ABS, the maximum authorized speed for good track would be 49 MPH – which it was at one time – but it had since been lowered, as was the case for the rest of the mainline track.  Except for the section from Sorrento Tunnel to Marengo which was dark, the Milwaukee main line was single track ABS with no power switches.  Burlington Northern – except for a very short section – was CTC, double track, or had parallel routes on its transcontinental route.  Track speed for freight was uniformly 60 MPH.

With regard to the “3,000-ton hotshot” trains – these were ridiculously small trains – even in 1973, as were those at 4,800 tons. And the quantity of trains is hardly a measure of their viability or even profitability.  The 3,000-ton limitation was the formula the Milwaukee decided was necessary to achieve their “hotshot” XL Special schedule which equated to 3.0 horsepower per ton; This would be enough to conquer (westbound) Milwaukee’s three very steep grades (Pipestone, St. Paul, Boylston) and one lesser grade (Loweth) and maintain a decent track speed.  Somewhat less would be required just to make the grade at a lesser speed.  Interestingly, the 4,800-ton limit is likely a reference to the trailing tonnage limitation on westward grades such as Pipestone Pass and Boylston, and the uber-curvy climb to St. Paul pass, though the grade was somewhat less.  4,800-to-5,000 tons is the maximum for any train with all the power on the head end; anything more would require helper or distributed power midtrain or on the rear.  It should also be noted, however, that the 9000 HP assigned to operate the 3,000-ton train over these grades would not be sufficient to handle the 4,800-ton trains.  Heavier trains = more power on grades.  In reality, train sheet records show that the Milwaukee really was running 5,000-6,000 ton trains through Avery on occasion with additional power distributed throughout the consist.  But the salient points are: 3,000-ton trains are expensive to operate and consume a lot of resources; 4,800-ton trains are simply the maximum to be operated not using distributed power of some sort.  The number of these trains is irrelevant compared to the amount of traffic handled and the profit derived from doing so.  Given that, for instance, a BN train had a trailing tonnage limit of 10,000 tons from Chicago to Portland and Chicago to Wenatchee without auxiliary power – and that GN/BN was able to modernize its route with CTC, lineside safety detectors, power switches, and longer sidings – mostly absent on the Milwaukee – shows that for all the perceived excitement over the number of trains at Avery, it didn’t allow a corresponding return on investment.  The Milwaukee continued – to the end – to be a long branch line with few hints it was the 1970s instead of the 1940s. 

And, from a dispatcher’s point of view (I’ve been one), it’s interesting to note that in the 1973 (and after WWII, really), the train-order Milwaukee Pacific Extension was not only devoid of traffic, but also telegraphers to handle that traffic.  With all that traffic at Avery, no continuous open offices between Avery and Alberton.  Between Miles City and Harlowton and Harlowton and Three Forks, also no continuous open offices – just day agents.  This suggests a lack of traffic and/or delays moving trains as open telegraph offices were how changes in train orders were relayed.  If you’re a railroad that really seeks to run expedited traffic, you keep your track well-maintained, and you install block signals, CTC, power switches, and lineside safety equipment to achieve that goal.  Or, if you’re really efficient and successful, over of the course of time, you are able to add these enhancements from the profit you’ve made by your operation.  But on the Milwaukee Road Pacific Extension, this NEVER happened.  Its cost of operation was simply too high to make a sufficient return on investment.  And as impressive as these 4,800-ton trains might be to those without knowledge of operations, four of them a day each way won’t pay the rent – especially on a particularly high-cost operation.  And not only was the Milwaukee high cost for the traffic it was able to get, there were all the other places in the Pacific Northwest and Canadian Southwest that the Milwaukee didn’t serve at all (Yakima, Pasco-Richland-Kennewick, Eugene, Salem, Mount Vernon-Anacortes) or served exceptionally poorly due to its circuity and/or grades (Vancouver, BC, Portland, Aberdeen, Spokane, Bozeman, Great Falls).

A 1973 Milwaukee timetable is available here:

http://wx4.org/to/foam/sp/maps/perryETT/1973-08-12CMStP%26P_RockyMtn%26Coast_1-SheldonPerry.pdf

The stark inferiority of the Milwaukee route compared to the BN, including grade, fuel usage, and locomotive rotation is noted here:

http://trainweb.org/milwaukeemyths/

--Mark Meyer

 

 

[Vermontanan2]

TRR

Well, the graphic version of that is better organized by not accidentally hitting the "send" button.

According to the ICC Exhibits:

Milwaukee Road Revenue, 1976-1978

System Net Operating Income

1976  ($8,834,435)

1977  ($29,392,706)

1978  ($49,331,000)

Total System Net Three Year Operating Loss ($87,558,141)

Lines West of Miles City, Net Operating Income

1976  $10,580,676

1977  $8,051, 207

1978  $3,555,501

Lines West of Miles City, Net Three Year Operating Income $22,187,384

System, Net Operating Income WITHOUT Lines West of Miles City

1976  ($19,415,111)

1977  ($37,443,913)

1978  ($52,886,501)

System Net Operating Income WITHOUT Lines West of Miles City ($109,745,525)

Now, just to enhance the "view" of the shenanigans involved in "Exhibit K," add "Miles City" Revenues "back into Lines West."

Net Operating Income, Lines West, Including Miles City

1976  $17,632,978

1977  $15,677,061

1978  $11,177,355

Net Three Year Operating Income, Lines West Including Miles City $44,487,394.

System Net Operating Income WITHOUT Lines West Including Miles City

1976  ($26,467,413)

1977  ($45,069,767)

1978  ($60,508,335)

Net Three Year System Operating Income WTHOUT Lines West Including Miles City ($132,045,535).

And, if the "surreptitious juggling of the books" were also "unjuggled," and Miles City was properly included in the "Lines West" economic data, as it historically had been (right up until that Abandonment Petition), the data was more ... "illuminating!"

It is amazing what can be done when ... passenger services "get out of the way!"

 

 

And of course, there were other "accountants" who showed the opposite.

Which to believe?

The answer: Instead, check the operational characteristics of the railroad and ask if it's worth saving compared to abundant solvent, modern competition.  

That's what happened.

--Mark Meyer

[Vermontanan2]

TRR

And that process began with the realization, at Milwaukee, that transcontinental passenger rail service was doomed to be unprofitable but, in 1955, embarked on a clever plan to 1) preserve service to key transcontinental locations, 2) add service to other major West Coast locations, 3) terminate or convert ancillary transcontinental services such as the Great Falls train, 4) opened up transcontinental freight service to trains that not only beat the competition by 1-2 DAYS, but 4) managed to turn a profit on it all, and finally make the transcontintal portion the only part of the railroad that made money, and, at the end, according to BAH, the only part that likely ever could make money.

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.  The reality is that the Milwaukee Road offered a quality service on its Olympian Hiawatha right to the end, and made numerous attempts to attract riders through 1960.  The train was simply losing too much money to warrant continuing the service.  Another reality is that the ICC allowed the train to be discontinued because of the operating deficits and lack of patronage, not because the Milwaukee want to rid itself of passenger trains to operate priority freight service.  There was no correlation between the two in the petition to discontinue the service.  It’s also interesting that the Milwaukee spent a huge sum of money to upgrade its Chicago-Council Bluffs route, add locomotives, repaint equipment, and add employees, but no such substantial investment correspondingly occurred on the Pacific Extension for the “new, high-speed” freight service.  While the route across Iowa was CTC or double track with power switches, the Pacific Extension remained a long branch line that didn’t ever receive basic block signal protection for the entire route.

I challenge anyone to provide documentation that the takeover of the UP trains between Chicago and Omaha in 1955 had any link to the petition to discontinue the Olympian Hiawatha starting in 1960.

Handling the “City of Portland” between Chicago and Omaha by the Milwaukee Road did NOTHING to “preserve service to key transcontinental locations.”  This is a total fabrication.  Other than Chicago, the Olympian Hiawatha and City of Portland served no common cities, nor did the City of Portland offer any through car service to any location served by the Olympian Hiawatha.  The discontinuance of the Olympian Hiawatha was simply one fewer train between the Upper Midwest and Pacific Northwest, and South Dakota lost its only service in this lane.

Taking over the “Cities” (and Challenger) trains between Chicago and Omaha was even a questionable move at the time.  But there is also no reason to believe the intent was part of a “clever plan” to “add service to West Coast Destinations.”  As the Milwaukee Road president Wiley stated in 1955, “Many people have probably wondered why our railroad, which takes a realistic view of passenger service as a modest revenue producer, should have been interested in the Union Pacific's proposal. The main thing to remember is that the trains involved represent a great deal more than ‘passenger service’ in the usual sense of the phrase. They are among the world's very best. We are happy to work with the Union Pacific and Southern Pacific in attempting to make these fine trains even finer and more popular. Passenger service advertises a railroad as nothing else can. When that service is really good, it builds both passenger and freight revenues by keeping the company name and the quality of the service uppermost in people's minds. This, combined with the tremendous traffic potential and modern freight facilities of our three railroads, can mean a lot to all of us.”

Obviously, the intent was to attract corresponding freight traffic as a result of handling the passenger trains.  Since the UP could not show preference in a connecting carrier east of Council Bluffs, this intent could not be specifically stated, but Mr. Wiley comes quite close here.  But rather than the Milwaukee being “clever,” it was the C&NW who lost the “Cities” trains; UP was unhappy with the C&NW’s performance of the trains in general, and went shopping for another way to get to Chicago.  Rock Island had the best route, but was much slower and needed capacity upgrades; Burlington was also considered as they had the infrastructure in place and could match the running time; but they didn’t have the room on the south side of Chicago Union Station to accommodate this many extra trains.  The Milwaukee – the sole entrant to Union Station from the nonrth end, and the one willing to fork out millions – was the basically the only remaining option, despite it having the worst route as far as accessing online communities.  For all the money spent on upgrading the route, the number of passenger trains was halved within 5 years, and freight business was insufficient to warrant the expense.  The Milwaukee did gain some freight business initially.  In 1962, the MILW led the railroads receiving tonnage from UP at Council Bluffs with 33% versus 24% for the C&NW, but westbound, the C&NW delivered 40% of the traffic, versus only 22% for the Milwaukee.  Even the IC handled 20%.  By the mid-1960s, however, UP started run-through trains with CB&Q at Grand Island to avoid the Omaha-Council Bluffs terminal altogether.  And this was the one thing that the “clever” people at the MILW evidently never understood:  The Omaha terminal was a bottleneck, and the best candidates for interchange would be those railroads that could avoid it, such as the CB&Q and the C&NW at Fremont.  The MILW, IC, and CRI&P were doomed to interchange at Council Bluffs.  By 1970 on the eve of Amtrak, the MILW was interchanging just two trains daily at Council Bluffs.   The BN was getting just as much at Grand Island, and C&NW was receiving three daily trains, with one each to IC and CRI&P.  That was hardly the amount of traffic the MILW expected given its significant investment.  In addition to the 2 through trains and scattered local service, passenger service was down to one train daily (the “City of Everywhere” consolidation).  Just prior to Amtrak, the best the Milwaukee could do was 8 hours, 50 minutes on its Chicago-Omaha passenger train with 5 intermediate stops.  The BN route – though 8 miles longer – still hosted the Denver Zephyr in 8 hours flat (westbound) with 13 intermediate stops.  Westbound on BN, the remnant of the Nebraska Zephyr made the Chicago-Omaha trek 4 minutes faster than the Milwaukee “Cities” train with 25 intermediate stops!  Obviously, it was the BN route – not the sluggish MILW – chosen for the basic Amtrak system.

 But the UP was unhappy having to interchange to the BN which it viewed as a competitor; the IC was too circuitous, and the MILW and CRI&P were in disrepair – as was the C&NW, but again, with the superior route (superior routes survive no matter what – the primary reason the MILW’s Iowa and Pacific Extension routes didn’t) and its own bridge over the Missouri River, the UP again looked to the C&NW as the best way to Chicago, - especially since by 1972 after Ben Heineman (who fought the UP and SP acquisition of CRI&P) was out at C&NW beginning a much better relationship between John Kenefick at the UP and Larry Provo at C&NW.  The rest is history as C&NW shed much of its branchline and got back into shape with government grants and focus on the Fremont gateway.  Its “Falcon” service began in 1973 and by the mid-1970s was carded westbound from Chicago to Fremont in just over 9.5 hours with a maximum speed of 70 MPH – only about an hour more than Amtrak’s San Francisco Zephyr from Chicago to Omaha on BN.  Meanwhile on the Milwaukee, the deterioration continued, and after a Milwaukee train derailed on the C&NW diamonds at Tama, the Milwaukee began using the C&NW from Clinton to Tama.  So, the reality is that the MILW got the UP passenger trains by default, then spent a lot of money to get track capacity to the point that was never needed, culminating largely in abandonment.

The Harlowton-Great Falls train was hardly “converted” when it was terminated.  The service was simply discontinued, with a reference to existing bus service.  Unlike other routes, such as in South Dakota and Wisconsin, the “clever plan” didn’t bother to give actual times the bus was operating.  In reality, the “connections” were quite poor.

There is zero evidence that discontinuance of the Olympian Hiawatha “opened up” anything to allow shorted freight schedules.  Again, given that the Milwaukee was operating only 1 or 2 freight trains in each direction, it’s an insult to Milwaukee employees to even insinuate this couldn’t be done without the passenger train.  And it should be noted that the passenger service between Deer Lodge and Chicago was still being operated when the XL Special was launched in 1963, with passenger service lasting east of Aberdeen until 1969 and east of the Twin Cities until….now.  There’s absolutely zero evidence of the XL Special being “beat(ing) the competition by 1-2 DAYS” anywhere.  When initially launched in late 1963, the train bested the published GN schedule by 21 hours, but this was only for a few short months when NP and GN sped up their fastest train to only 5 or 6 hours slower than the Milwaukee,  By 1968, GN matched the Milwaukee, and in 1971, the BN best the Milwaukee by over 5 hours.  In 1972, the Milwaukee lengthened the schedule of the XL Special by about 10 hours, but the “faster” schedule continued on BN well after the Milwaukee Pacific Extension was history.  It should also be noted that GN didn’t need to “open up” its railroad by discontinuing passenger trains to match the Milwaukee (but its Empire Builder bested the Olympian Hiawatha by over 2 hours by the time of the latter’s demise), and it also ran significantly heavier trains than the Milwaukee with the same amount of locomotive power due to its superior profile.  And it’s not only that the Milwaukee could only hold the exclusive title of “fastest” for four years that’s unimpressive;  it’s the unsustainability.

The “make the transcontinental portion the only part of the railroad that made money, and, at the end, according to BAH, the only part that likely ever could make money” shows that Booz Allen Hamilton wasn’t too good at prognostication.  That the much smaller Milwaukee Road in 1985 was finally an entity that another railroad WANTED to buy (contrary to when it included the Pacific Extension) notwithstanding, it is undeniable that parts of the Milwaukee Road’s transcontinental route are indeed profitable, such as St. Paul-Duluth (continued trackage rights), River Jct./La Crosse-Dubuque-Sabula, IA, Chicago-Savanna-Sabula-Quad Cities-Kansas City (a major route should the CP-KCS merger come to pass), Marquette-Mason City-Sheldon, and most of the ex-MILW routes in service in South Dakota, including the former “transcontinental” main line that isn’t used as such today.  As for “managed to turn a profit on it all” is debatable.  The Iowa route, possibly, considering that it did handle a fair amount of freight business at one time and that the Chicago-Sabula portion is still well-used today.  The question remains, however, whether the millions to spent to accommodate all the passenger trains that vanished in short order was worth it compared to some of the freight traffic the MILW might have received regardless?  As for the Pacific Extension, if you’re a railroad that is planning for the future, yet you can’t afford basic operational and safety upgrades (largely achieved by the competition), was your ”plan” profitable in the long run?

The reality is that none of this rises to status of “clever,” especially in light of the fact that in the end the MILW Pacific Extension was the only “transcontinental” U.S. route to be mostly abandoned, and the MILW route central Iowa was the only trans-Iowa route to be abandoned.  And trying to present these epic failures as clever clearly isn’t.

--Mark Meyer

[Vermontanan2]

TRR

Booz Allen Hamilton estimated that "the Louisville Transcon," had the highest likelihood of success, and prospective proffitability by a factor more than double that of any other proposed configuration."

Did that meet approval? Well, yes, after Max Baucus put together the legislation that provided a venue for reorganizing the Milwaukee Road under the newly created law, the "Milwaukee Railroad Restructuring Act," a consortium of experienced railroad executives, major shippers, and the States of South Dakota, Montana, and Idaho put together "the Plan" and submitted it, as required, to the Interstate Commerce Commission.

It is everything that Mr. Meyer claims did not exist. That too was a false claim.

Dated December 1, 1979, the detailed reorganization plan was submitted.

It is "the Louisville Transcon" alternative, the most probable identified by BAH as likely to be successful -- at a time when even solvent railroads were struggling.

New Milwaukee Lines Reorganization Plan, December 1, 1979

 

 

I don’t know who the plan “met approval” with, but it wasn’t with ANYONE who had the financial wherewithal to save the railroad.  Period.  The railroad ceased to exist as a “transcontinental” route in 1980 and was largely abandoned west of Miles City, Montana.

 

Indeed, the “plan” had support – notably from politicians, but outside of South Dakota, there was little actual monetary buy in.

 

More links from the same website:

 

Hearing on the Milwaukee Road Restructuring Act:

https://www.milwaukeeroadarchives.com/Bankruptcy/SenateHearingsMRRA102979.pdf

This link is invaluable to give multiple perspectives.  It’s clear that the politicians are mostly supportive of retaining the service.  Again, there is an inordinate amount of focus on grain and coal movements by the South Dakota and Montana congressmen.  The ICC and railroad people generally give the best actual operating data, including how little actual grain is handled by the Milwaukee.  The testimony of Charles Swinburn, Acting Assistant Secretary of Transportation for Policy and International Affairs at DOT is most interesting.

 

ICC Opinion on “New Milwaukee Lines” proposal:

https://www.milwaukeeroadarchives.com/Bankruptcy/NewMilICC%20Opinion.pdf

 

A few excerpts from the ICC about the NewMil:

 

*The plan was not sustainable and the amount of projected traffic growth was unreasonably optimistic.

*The plan relies on capturing a large amount of business from existing carriers (and that any failure to achieve these overly-optimistic gains in traffic would result in a huge financial shortfall) which was unlikely to occur.

*The plan projects an unreasonable operating ratio: 75.4, which was significantly better than industry-leader Union Pacific.

*Liability for labor protection as projected by NewMil would not be likely to occur as projected.

*Funding for operation and rehabilitation would not be available as projected.

*The NewMil’s “operations would be only marginally profitable even assuming achievement of the unprecedented performance contemplated by the NewMil.” 

*Not a quick fix: “an ambitious seven-year program of rehabilitation will be undertaken to return the track structure and equipment fleet to truly competitive levels.”

 

Basically, the ICC didn’t believe that the traffic would materialize, nor could NewMil draw much if any away from the remaining carriers due to their superior infrastructure.  It also didn’t accept the overambitious projected traffic growth that NewMil claimed would happen.  Just on that point alone, the ICC was correct:  Those of us railroading in the 1980s in the Northwest know that this was a lean time for all the railroads, and traffic would not fully rebound until the 1990s.

 

Beyond that, the really interesting thing about the NewMil proposal is that there is very little for actual new capital expenditures.  A new yard at Fife is specifically mentioned, but nothing else.  Missing are funds for longer sidings, CTC, power switches, and lineside detectors – things that – by the 1980s – would be a given to be competitive.  This omission alone shows the lack of foresight in the plan, especially considering the pending cabooseless operation; Power (or Spring) switches are a necessity for fluidity for even a moderate amount of traffic. 

 

Keeping the railroad in place for burgeoning coal traffic is mentioned, referencing the Tongue River Railroad and coal deposits.  History tells us: a.) the Tongue River Railroad was never built, nor will it be; b.) The major coal mine near Roundup didn’t materialize until 30 years after the end of the Pacific Extension; c.) The U.S. didn’t and still doesn’t have a West Coast coal export facility.  The one that is used for U.S. coal exports in British Columbia is directly accessible from BN/BNSF, while the Milwaukee would need to interchange to BN in Washington State or interchange with a shortline at Sumas, BC via a cumbersome, grade-ridden route which would require significant capital to achieve. 

 

The NewMil proposal also makes no mention of the pending deregulation, or even the prospect of such.  Very important for potential coal and grain shipments where tariffs are not fixed, but are adjusted for competition.  Due to the Milwaukee Road’s vastly inferior operating profile, as heavier unit trains evolved, the Milwaukee (or NewMil, if it got that far) would be effectively shut out of this business, or would be forced to interchange the trains to another railroad somewhere in Montana, Marengo, Washington, or at Tacoma (basically due to St. Paul Pass, no water-level route through the Cascades, and/or Tacoma Hill).  Not acknowledging this operational reality could be due to believing numerous misstatements about the comparative characteristics of the railroads involved, such as that the Milwaukee was “providing the shortest mileage to the west coast, the least grade and the best curvature of all of the northern railroads.”  (“West Coast” is unspecific.  The Milwaukee could be shorter from Chicago to Seattle and Tacoma by a fraction of 1%, but to all other “West Coast” destinations, including major ones like Vancouver, BC, Vancouver, WA, Anacortes, Everett, Longview, Kalama, and Portland – not remotely true; least grade and best curvature, not remotely true.)

Mileage: http://trainweb.org/milwaukeemyths/#myth1

Grade: http://trainweb.org/milwaukeemyths/#myth3

Curvature: James J. Hill’s Legacy to Railway Operations by Earl Currie, pages 154 through 157.

 

Like the NewMil plan, this plan from the Montana Department of Agriculture fails to acknowledge how little grain production is affected by the Milwaukee (though some of the congressional testimony covers it), but at least it acknowledges the shortcoming of not having a water-level route across Washington State and the growing importance of Columbia River ports as well as other realities:

 

https://www.milwaukeeroadarchives.com/Bankruptcy/MontanaStateRailCorpPlan030780.pdf

 

This plan retains the main trunk of the Milwaukee only as far west as Marengo, Washington, where all traffic then goes to the UP.  It does state that “Montana continues to support the New Mil plan as its preferred solution; however, Montana is not particularly optimistic that this plan will be successful” and acknowledges the uselessness of the Milwaukee main line west of Marengo for unit grain train shipments by stating the plan “eliminates unproductive mainline trackage in Washington.”

 

--Mark Meyer

[Vermontanan2]

TRR

Meanwhile, Midwestern Railroads were struggling desperately for survival, and those with transcontinental business, not so much, although by 1979, Burlington Northern management at "Burlington Northern" were having as much difficulty as Burlington Northern management at Milwaukee Road!

The Operating Ratio there was over 95% that year. The "Hill era" was over. Say Hello to ... the Frisco!

 

 

Which (if true) begs the question:  Well, why didn’t the Burlington Northern then go the way of the Milwaukee Road?  Because railroads with strong route structures survive, regardless.  Those with weak route structures (the Milwaukee Road) are largely abandoned.  Even if you’re a weak railroad like the Rock Island with worthwhile routes, most survive bankruptcy – lines so attractive, the even railroads with minimal financial resources stepped up to the plate to save it: C&NW, MKT, and SP.

 

But for the Milwaukee Pacific Extension: No suitors for 90% of it.

 

But back in the reality zone, the operating ratio for BN in the late 1970s mostly showed the cost of building and upgrading thousands of miles of track to accommodate huge coal demand necessitated by the Clean Air Act (while the Milwaukee was about to abandon thousands of miles of track!).  1979 was just a snapshot in time, not indicative of the entire history of the railroad.  Kind of like the short-lived “fast schedule of the XL Special” was not indicative of the Milwaukee Road Pacific Extension over its short 71-year lifespan.  And snapshots do not freeze time (unless you’re an abandoned railroad):

 

16 years after 1979, BN had the financial wherewithal to purchase ATSF to become BNSF.

30 years after 1979, BNSF purchased by Berkshire Hathaway, its largest acquisition ever.

36 years after 1979, BNSF cumulative profit since acquisition matched its Berkshire Hathaway purchase price.

1979 on the BN?  Now only remembered for its substantial contribution to American infrastructure.

 

 

--Mark Meyer

[SD60MAC9500]

 

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..

 

 

 

[Lithonia Operator]

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?

[Overmod]

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...)

[Lithonia Operator]

But what, basically, is in dispute?

[Overmod]

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

[Lithonia Operator]

You mean "could have been?"

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

[daveklepper]

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

Just trying to be helpful.

 

[Overmod]

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

[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.

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

[Erik_Mag]

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.

[Erik_Mag]

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.

[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?

[NP Eddie]

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

[Vermontanan2]

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:

 

http://www.mrcd.org/portland_trains.html

 

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.

[Vermontanan2]

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.

[Vermontanan2]

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

[BaltACD]

[Vermontanan2]

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

[Vermontanan2]

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