The Milwaukee Road

[MichaelSol]

Michael,

How much did labor costs play in the demise of the Milwaukee Road? Many railroads have been successful in making money using ex-Milwaukee Road track.

As arbfe points out, prior to the filing of the bankruptcy petition, Milwaukee was subject to industry standard contracts. Certainly, the inability of the industry to negotiate productivity increases based on employees, particularly train crew, was a big part of the industry's financial crisis, was unrelated to government regulatory policy, and was a big part of productivity increases often attributed to the Staggers Act, but which was in fact a result of labor contract changes.

The Milwaukee bankruptcy was the major pivot point in union perspectives, and Worth Smith negotiated the pioneering two man crew agreement for Sprint trains.

However, prior to the bankruptcy, Milwaukee had perhaps more employees per whatever unit of productivity you might want to use, and certainly burdensome collective bargaining conditions would be more burdensome on the Milwaukee Road than on other roads if that were true. And, Milwaukee's Lines West employees were approximately 130% more productive per revenue dollar than its Lines East employees, at least during the 1970s which is the period of time I have specifically looked at employee productivity comparisons.

As the result of automation and other improvements, the rail industry was able to reduce its numbers of employees on an ongoing basis during the 1950s and 1960s.

During that period, Milwaukee Road was able to reduce its employee numbers at rates marginally ahead of the industry. This was no doubt one reason Milwaukee's Operating Ratio was able to improve over that period of time. even as the Operating Ratio of key competitors deteriorated. During the 1970s, Milwaukee reduced its overall employee numbers at a rate marginally slower than the industry as a whole, and its Operating Ratio began its fatal turn for the worse.

To that extent, that data is suggestive that labor costs played a role during the 1970s on the Milwaukee in its deteriorating position, and that those costs were greater than those incurred by the industry as a whole. A management change occured in 1972 and it may well be that those changes interrupted what had been a well-managed process of employee reduction that had been in place for quite some time prior to those personnel changes.

After 1972, the rate of employee productivity improvements not only deteriorated from previous rates of improvement, but the company embarked on costly purchases (leases) of new motive power during a time of high interest charges, and substituted more expensive fuel costs for what had previously been relatively cheap operating costs on its transcontinental line.

 

[Los Angeles Rams Guy]

I know I'm getting in on this thread WAYYYYYY too late but since having become part of the forums only a few months ago I just felt compelled to write something in this thread simply because I grew up so close to the Milwaukee Road.  The MILW's Cedar Rapids - Calmar branchline went through my hometown of Edgewood, Iowa and our old house was located next to the MILW's tracks and as a young boy I became enthralled with the wayfreight that passed through 6 days a week (north on Monday, Wednesday, and Friday and return on the odd days).  The coolest moments were when the branch was forced to host the St. Paul - Kansas City trains that had to detour when the Mississippi River flooded in 1965 and 1969 - how awesome it was to see big autoracks and piggybacks crawling through town at 10 m.p.h.!

I also felt quite a connection to the Chicago - Omaha mainline and as a young boy was thrilled to see the Union Pacific "Cities" streamliners stop in Marion - just the most glamorous passenger trains in the world to this day as far as I'm concerned.  Naturally, I was crushed when the Green Island - Council Bluffs was abandoned after the 1979 embargo.  I do wonder, though, had that segment somehow survived, if it might be quite attractive to the UP to take pressure off the Overland Route mainline.

Fortunately, good things do happen sometimes and "my mainline" - the River Route mainline between La Crescent, Minnesota and Sabula, Iowa thrives under ICE ownership after near abandonment.  How thrilling it was back in 1981 when the MILW put the segment between La Crescent and Marquette back in service and to see all the work being done. 

Simply put, I'll always hold the Milwaukee Road close to my heart.     

[arbfbe]

The Milwaukee labor rates were standard within the industry.  Now you have to wonder if  there were labor savings account deferred maintenance where less labor was used or if all the deferred maintenance was catching up to the railroad and labor for derailment clean up and needed repairs was causing the MILW to use more labor.

The New Milwaukee Lines proposal would have contained a labor agreement negotiated separate from any national agreements.  Included were plans to eliminate the second brakeman which at that point was only a part of the C&NW contracts.  Also probably most of the arbitrary payments for doubling grades, payment until the caboose reached the terminal, terminal switching and a number of other goodies would have been eliminated.  It would have not been cheap for the employees but certainly would have to been considered in light of losing employment.

Wow, a Phoenix post if there ever was one.  Over a year since the last post.   This is sort of like finding a lost friend.......a frustrating friend but someone close over time.

[cpprfld]

Michael,

How much did labor costs play in the demise of the Milwaukee Road? Many railroads have been successful in making money using ex-Milwaukee Road track.

[spokyone]

Hey FM

 What a great posting on 10-01-2004 concerning the Milwaukee Road. My father took me down to the depot in Durand IL to watch the postal car throw out the mail and pick up mail at 60MPH. I lived in Spokane when they shut down operations west of Miles City.

Bob

[Anonymous]

 

Perhaps if you and Michael stay off this thread, the antiFM and antiMS guys (ilks?) will stay off it as well, and it won't get relocked.

Yes, but we shouldn't throw the baby out with the bathwater.  MS is the one guy who makes Milwaukee threads intimately educational.  Without him, most Milwaukee threads would be pap.

The way I see it, forum readers have two choices.  They can either play ignorant and only discuss seminal railraod minutia (e.g. "When did GN change from the wimpy Rocky symbol to the more rugged looking Rocky symbol?"), or they can get their hands dirty once in a while and dare to discuss controversial railroad issues, the kinds that can make some professional railroaders uncomfortable if not violently reactive - open access, the real value of the PCE, captive shippers, et al.

[nanaimo73]

 So you played around with the new forum and found out about the ability to post on previously locked threads?  Then, finding out this nuance, you remembered that this was one of the best threads ever to occupy the TRAINS.com forum, and resurrected it from the dead?

Actually, I've been going back through the forum looking for several threads, including this one, because my old links would not work. I saw another locked thread before this one that still had post and quote so I thought I'd give it a try when I found this one. Then I realized I've already been posting on a locked thread, the first one at the top of the forum. I am not going to post on Steam vs Diesel if I see it, but I will post on the forum's best thread, "Chicago", if I find it. None of these have been locked- 

Big Boy       WC Roster       Montana Coal      Great Northern      Duplex steam     N&W       CRI&P        C&NW         Death Trains        Canadian RYs        Heydays         UP's Historical Blunder

 

Now I just need to find out where this was-                                                       http://www.rr-fallenflags.org/milw/milw2020abp.jpg

[solzrules]

still at it I see........

still nothing said here that hasn't been said before.  At least a million times. 

[Anonymous]

Here's another glitch in the forum. We can post on previously locked threads.

So you played around with the new forum and found out about the ability to post on previously locked threads?  Then, finding out this nuance, you remembered that this was one of the best threads ever to occupy the TRAINS.com forum, and resurrected it from the dead?

That was rather clever of you, Dale!

Now, back to the discussion of how the  BN infiltrated and killed off the  Milwaukee..........

[Lord Atmo]

yeah and this can be the "Milwaukee Road Thread for Everybody!!"

milw rd was great and i actually have an HO milw rd locomotive. a dummy, but a nice look to it.

[Kevin C. Smith]

Oh, but things like that wouldn't ever happen on the new message boards!   LOL!

[nanaimo73]

Here's another glitch in the forum. We can post on previously locked threads.

[Bergie]

I'm locking this thread due to the actions of certain members. Please, try to keep things civil, gentlemen.

Bergie

[MP173]

Bob has very few insults. I would certainly not crown him the king. This thread has just dissolved into a pissing match.

Since I dont have an MBA...I cant play.

ed

[bobwilcox]

QUOTE: [i]Originally posted by MichaelSolApparently, it is in Econ 102 where they get to the difference between "elastic" demand and "inelastic" demand.

Best regards, Michael Sol

Your gratuitous insults certainly always add so much to any thread you are involved in on this forum.

[MichaelSol]

QUOTE: Originally posted by greyhounds
You specifically quoted Crukshank as saying they couldn't fill all their orders for equipment - there was a shortage. Well, if demand exceeds supply (a shortage!) then, pretty much by definition, the price is too low. Why didn't they acquire more equipment? You see some kind of conspiracy. I see simple economics. Under normal conditions, the price would rise and the equipment shortage would go away. Some of the shippers would find alternatives to the higher price. And some of the shippers would benifit by being able to use additiional equipment acquired by the railroad to take advantage of the additional revenue opportunity.

That's what happens now under deregulation - but it couldn't happen then. The price was held too low by the regulators. Now any rational being who has passed economics 101 with at least a "C" will understand this. I explained it. You don't seem to understand it. Whether you are rational or if you failed econ 101 is beyond my knowledge.

Apparently, it is in Econ 102 where they get to the difference between "elastic" demand and "inelastic" demand.

Best regards, Michael Sol

[MichaelSol]

QUOTE: Originally posted by Cris Helt
Just how much of a hornet's nest did The Nation Pays... stir up with the Milwaukee management, or was the controversy limited to mutterings among the executives? I know at least one executive considered the book a "hatchet job."

The quote sounds like Ray Merrill's [Milwaukee VP Legal] comment on "The Investor Pays," by Max Lowenthal, 1933, about Milwaukee's first bankruptcy, which claimed that the first bankruptcy was not a "real" bankruptcy, but a contrived event to obtain control of the company by its bankers.

I know that many Milwaukee executives who might have otherwise agreed entirely with the Tom Ploss book were very much put off by his description of Curtiss Crippen, which was unflattering, and which many thought both unfair and entirely misleading. That was not particularly germane to the thrust of the book, but Crippen was very much admired by many officers, as well as considered a distant and somewhat disengaged entity to others, apparently including Tom Ploss.

Otheres were simply offended by his inference that they came over from the BN to "wreck the Milwaukee."

"I haven't read his book and I don't intend to. I don't give a d**** what Tom Ploss thinks or writes. He thinks I came over to wreck the Milwaukee and that's just not true."

Yeah, there's some strong feelings out there.

Best regards, Michael Sol

[MichaelSol]

QUOTE: Originally posted by Murphy Siding
So, Why didn't they? They apparantly thought BN wasn't playing fair, but did nothing?

Well, that is pretty much what the book is about. His thoughts about what Milwaukee's situation was, what it had available for remedies, and why he feels they did not pursue those remedies.

The book is more of a personal memoir, not an attempt to write a history, although it is extensively footnoted. I recall that his first working title included the cutline: " A Memoir" but it didn't appear in the final publications. I don't know why.

I had suggested that he needed a little more of a financial picture to fill out the narrative, but Tom wasn't a financial guy, so it is very much a lawyer's perspective -- a very angry lawyer's perspective -- on the events of the day.

I had reviewed the evidence uncovered as the result of the discovery order in the Inclusion Case matter, and agree that the evidence was pretty clear. Montana's Anti-trust Counsel in the Attorney General's office, Jerome Cate, had reviewed that evidence with me in preparation for a state action. I still have a copy of the Complaint that was to be filed in Federal Court on the matter against the BN (and the Milwaukee).

However, I think -- and this is purely my opinion, I haven't found anyone who specifically has confirmed this -- the problem was that the BN Merger Conditions were so enormously successful overall for the Milwaukee, it would have been a difficult case to actually prove direct "injury" as a result of the BN efforts. The public face of the Milwaukee was that the Conditions were ineffective. Yet, I think a trial on the matter would have shown the opposite: enormous success.

So, to be able to continue to claim "victim" status, the Company could not file a suit to that effect, because they couldn't prove anything like that and would spend a lot of money to show that the Conditions had been a substantial benefit.

Tom had cross-examined me as an ICC witness in April, 1979 on that very topic, but he was taking the Company line at the time and I am not sure he fully understood the testimony ( a written copy was provided in advance). Well, maybe he did understand it, as he avoided the topic as much as possible (which, as Company Counsel, he was probably directed to do).

Best regards, Michael Sol

[Anonymous]

"The Nation Pays Again" makes for an interesting, if somewhat bitter, read. Sure it's one-sided as are any books dealing with history, but that's the nature of the beast. In reading any book of history or documentation of a business, you're bound to get the author's point of view on the matter no matter how "fair and balanced." You can't blame Thomas Ploss for being bitter over how the Milwaukee's management seemingly dropped the ball time and time again and eventually wrecked the company, but in retrospect, he should have reigned in his emotions and looked at things more objectively.

Just how much of a hornet's nest did The Nation Pays... stir up with the Milwaukee management, or was the controversy limited to mutterings among the executives? I know at least one executive considered the book a "hatchet job."

[Murphy Siding]

QUOTE: Originally posted by MichaelSol

QUOTE:

QUOTE:
Originally posted by MichaelSol

QUOTE: : Originally posted by PNWRMNM

Murphy,

"The Nation Pays Again" is one of the very few books I own that I would not recommend to anyone.

It is a highly biased rant against the evil BN for putting the MILW out of business. Ploss went to work for the MILW and lost his position somewhere along the way. He was shocked, shocked mind you, that the BN competed against the MILW at the gateways which the ICC forced the BN to open.

Wellll, it was the manner in which BN competed through the Gateways. This is an interesting take on this Mac. Milwaukee officials felt it was highly biased against them. Most senior executives refused to read it and the very mention of it usually brings forth very strong feelings.

It's an odd book in some ways, many ways. An unusual writing style. I know Tom Ploss quite well and even Milwaukee President Worth Smith acknowledges that Ploss's work on key Gateway conditions was outstanding legal work, particularly on the Louisville Gateway entry, that "he's a very bright guy."

Ploss was one of Milwaukee's senior attorneys, directly involved in many of the key events of the time, and so the book is an "insider's" perspective of what was going on during the 1970s.

Very critical of Milwaukee management, but also in the fashion that he felt BN "evaded" the Gateway Conditions, not that they competed, but in the manner that they competed (i.e. memos discovered threatening shippers with retaliation). But this is a GN thread and the book is controversial enough to generate its own thread.

Best regards, Michael Sol

Wouldn't behavior like that have gotten someone in legal trouble?

One of the questions Tom raises in his controversial book is why the Milwaukee Road refused to pursue alleged violations of the BN Merger Conditions. He pointed out that CNW, which was a victim of similar violations, had successfully pursued remedies, but that Milwaukee management did not and would not.

As a senior Company attorney, he was in a position to have some credibility on the issue, particularly after discovery of some incriminating documentation in BN files resulting from discovery orders in the Inclusion Petition proceeding.

I have a different take on that than Tom, but that was his view of what was unfolding at the time.

Best regards, Michael Sol

So, Why didn't they? They apparantly thought BN wasn't playing fair, but did nothing?

[bobwilcox]

QUOTE: Originally posted by MichaelSol
Well, I wrote an extensive history of the NYC Flexi-Van project and how the Milwaukee used the system...

What other books and articles have your published on the MILW?

[MichaelSol]

QUOTE:

QUOTE:
Originally posted by MichaelSol

QUOTE: : Originally posted by PNWRMNM

Murphy,

"The Nation Pays Again" is one of the very few books I own that I would not recommend to anyone.

It is a highly biased rant against the evil BN for putting the MILW out of business. Ploss went to work for the MILW and lost his position somewhere along the way. He was shocked, shocked mind you, that the BN competed against the MILW at the gateways which the ICC forced the BN to open.

Wellll, it was the manner in which BN competed through the Gateways. This is an interesting take on this Mac. Milwaukee officials felt it was highly biased against them. Most senior executives refused to read it and the very mention of it usually brings forth very strong feelings.

It's an odd book in some ways, many ways. An unusual writing style. I know Tom Ploss quite well and even Milwaukee President Worth Smith acknowledges that Ploss's work on key Gateway conditions was outstanding legal work, particularly on the Louisville Gateway entry, that "he's a very bright guy."

Ploss was one of Milwaukee's senior attorneys, directly involved in many of the key events of the time, and so the book is an "insider's" perspective of what was going on during the 1970s.

Very critical of Milwaukee management, but also in the fashion that he felt BN "evaded" the Gateway Conditions, not that they competed, but in the manner that they competed (i.e. memos discovered threatening shippers with retaliation). But this is a GN thread and the book is controversial enough to generate its own thread.

Best regards, Michael Sol

Wouldn't behavior like that have gotten someone in legal trouble?

One of the questions Tom raises in his controversial book is why the Milwaukee Road refused to pursue alleged violations of the BN Merger Conditions. He pointed out that CNW, which was a victim of similar violations, had successfully pursued remedies, but that Milwaukee management did not and would not.

As a senior Company attorney, he was in a position to have some credibility on the issue, particularly after discovery of some incriminating documentation in BN files resulting from discovery orders in the Inclusion Petition proceeding.

I have a different take on that than Tom, but that was his view of what was unfolding at the time.

Best regards, Michael Sol

[MichaelSol]

QUOTE: Originally posted by SPandS-fan

QUOTE: Originally posted by futuremodal

It is well known that the Milwaukee was DPM's favorite railroad.

Hmm, not likely -- DPM's first love was the Louisville & Nashville, if I recall.

This is from another thread, but this comment is Milwaukee oriented, so I am putting it here.

Chet Dilley, Milwaukee Road Director of Public Relations and Vice President of Passnger Services, was old friends with David P. Morgan and so Morgan always got special treatment from Milwaukee Road.

The Milwaukee had organized a press trip to say goodbye to the Electrification, and Morgan was invited. All of the other press had to get to Deer Lodge on their own, but I think Milwaukee flew Morgan into Butte and Marc Green had picked him up and brought him to Deer Lodge that morning.

It was mid-October and the Fall colors of red and yellow were almost flourescent. Perfectly blue sky, but there was a heavy morning mist around the Roundhouse and shops area. The mist made the whole scene otherworldly, like we were stepping into a history, which of course we were.

Dilley had told me to "keep track" of Morgan while the press party and officials toured the roundhouse. During the tour, Morgan said he wanted to go out back where eight of the Little Joes had been placed in storage. We could see them through a window. I said "well sure" and we went out the back door. The Joes were wrapped in this mist, even as the sun shone brightly.

The ground was rough back there, and it was a storage area as well. Morgan was elderly by that time, and so I was keeping a pretty close eye on him. Didn't want any Trains Magazine headlines "Milwaukee Road Loses David P. Morgan in Gopher Hole in Montana."

He wanted to get close to one of the Joes and so we walked over. He stood there while I went back and took a picture of the whole scene. There's Morgan, just standing there, dwarfed by the enormous black and orange engine, the mist rolling around the whole scene. A man and a machine, both in their twilights, both coming to the end of their legendary careers.

He stood for a very long time, just looking at that Little Joe.

Finally, I went up to him and said "Mr. Morgan, I think they're getting ready to go back to the depot and board the business cars." He just said, "oh .... OK." He hesitated for a bit longer, seemed like he didn't want to leave.

A few months earlier, Trains had featured the Electrification, noting in a caption to a Ted Benson photograph that the Little Joes had operated "in grand defiance of BN and in grudging partnership with GM", remarking on the clever operating equipment, the "Diesel Synchronous Controller," as it was called by its inventor, L.W. Wylie, or the "Wylie Throttle," by everyone else, which allowed the electrics to operate in conjunction with diesels.

Morgan himself had written:

"The publicists of the C.M.&St.P. saw to it that all the world was impressed with "making nature drive the wheels," with freedom from "cinders that blind, and sparks that fall in red-hot showers," with "white coal," with power vastly in excess of requirements," and with a 1925 study which reported that in just 81/2 years the electrification not only had paid for itself but had generated an additional 12.4 million dollars in savings over steam operation ...

"We loved steam, but we were awed by electrification; and as we raced through the 212 exciting pages of Tom Swift and his Electric Locomotive we shared the amazement of Mr. Damon and Koku and Ned Newton and Mary Nestor because we knew that out in Three Forks and Deer Lodge, in Kittitas and Cle Elum, there really was a railroad with locomotives just like the boxcab engine on the book's dust jacket. That road's wood-pole-supported thread of catenary coiled through breathtakingly beautiful country which enchanted artist and photographer alike. ... For a time we felt that the Milwaukee would be precursor as well as prototype; and decades after it became apparent that trolley wire would not be strung over Cajon and through the Moffat Tunnel, we still thought of Milwaukee's catenary as immortal ... .

"Bless my catenary, Tom, it wasn't forever after all."

Morgan was one of the best writers I know of.

But, he wasn't a reporter.

Later in the day, we were sitting in the lounge area of the Milwaukee Business Car "Montana." I wasn't sure of the expiration date, so I was still "keeping track" of him.

Milwaukee General Manager Lines West Q.W. "Bing" Torpin had come in and sat down and we started talking. Torpin had been with Chairman Quinn and Robert Downing as well as other BN officials on this same business car just six weeks earlier, going over the same stretch of track we were on, discussing the Milwaukee's proposal to merge with BN.

That morning, there had been a dust-up on the tour. The Master Mechanic, Dean Radabaugh, had been tapped to give a presentation on the electrification and the Little Joes. He had come to Deer Lodge a firm proponent of diesel-electric locomotives, but had become a big fan of the electrics. "These are the finest machines I've ever worked with."

He was answering questions, and going down a list of features of the Little Joes, and how these distinguished them from modern diesel-electrics. Well, the list was lengthy, and every feature came out in favor of the electrics. Dilley, whose department had been tasked with explaining that the electrics were "outmoded" and "obsolete," was getting redder and redder, and his ever-present cigar was beginning to twirl ominously.

Finally, a reporter from the Great Falls Tribune asked, "well if this system is so good, why are you getting rid of it." I was getting ready to do a flying tackle as Dilley looked like he was about to pick up a wrench and go after Radabaugh when Radabaugh answered, looking straight at Dilley, "I don't know."

Torpin laughed about it. "As you know, the studies favored the electrification. The problem is that any money put into the electrification would be an obstacle to consolidating the trackage out here if we consolidate lines with the BN."

Torpin admitted, right in front of Morgan, that Milwaukee Road was scrapping a valuable operating asset in favor of a risky consolidation strategy. Morgan didn't seem interested, and not a word ever appeared about it in Trains. 

David P. Morgan was a transcendental writer, capturing in words every nostalgic feeling about trains and their history. That's what he wanted to do, and he did it better than anyone else.

But, he was not a reporter.

Best regards, Michael Sol

[MichaelSol]

Maintenance $ available per mainline mile of track
MILW------- GN
1950 9,580--7,963
1951 11,050-- 9,048
1952 12,411-- 9,763
1953 13,031-- 10,351
1954 11,614-- 10,092
1955 13,509--10,448
1956 13,007--10,936
1957 12,175--11,092
1958 11,408--8,228
1959 11,069-- 8,560
1960 9,770--8,364
1961 8,600--7,633
1962 9,019--7,973
1963 8,455--7,889
1964 8,641--8,249
1965 9,135--7,543
1966 10,922--7,928
1967 9,575-- 8,300
1968 11,656-- 8,266
1969 13,451

You can see why Milwaukee's OR was worse in the 1950's; it was spending prodigiously on its mainlines. You can see how both cut back during the 60s. You can see at all times why MILW could run faster trains.

The Interesting thing is how GN cut back, even as Northern Lines ORs crept higher; Milwaukee cut back, as its OR went lower. There is a story in there.

Best regards, Michael Sol

[MichaelSol]

Comparing the Operating Ratios of the Consolidated Northern Lines (GN,NP,CBQ) prior to the BN merger shows why the BN merger was of utmost importance.

If you did a linear regression of railway operating expenses/income for the Consolidated Northern Lines (CNL) and the Milwaukee Road and then calculated trend lines, the direction of these lines would be opposite. That is, the CNL line would be deteriorating, the Milwaukee line would be improving. But, you can see it as well in the raw data.

MILW --------CNL
1950 78.2, 72.1
1951 76.9, 74.7
1952 82.4, 76.1
1953 84.0, 75.6
1954 83.9, 76.3
1955 83.4, 76.7
1956 83.0, 76.1
1957 82.0, 79.4
1958 81.6, 77.6
1959 82.2, 78.9
1960 81.6, 81.1
1961 79.3, 81.3
1962 79.5, 80.6
1963 79.4, 80.0
1964 81.0, 81.1
1965 79.4, 79.9
1966 79.4, 77.3
1967 79.6, 83.0
1968 81.7, 81.8
1969 81.9, 83.0

For the decade, 1960-1970, Milwaukee Road was doing better than the consolidated Northern Lines in terms of economic operating efficiency, its trend was improving, and the Northern Lines deteriorating.

Best regards, Michael Sol

[MichaelSol]

Below is the text of a 1968 advertisement:

"The Railroad That Made a Day Disappear"

"Every day our fast freights save more
than a day for shippers between Chicago and
the Pacific Northwest. Actually our
westbound XL Special and our eastbound
Thunderhawk clip 26 hours from
the former freight schedule. That's
faster than any other railroad.
One good reason more
shippers than ever are
riding the Fast Track."

"Get on the Fast Track."

"The Milwaukee Road"

[CMSTPP]

My name is James. The milwaukee road is my favorite railroad by far and this is perfect. I model the milwukaee roads Rocky mountain division which absolutely fascinated me. I like the little joes that ran through the area and the box cabs which I am working on getting in model. So if any one has any questions on the milwaukee just let me know!

[MichaelSol]

The mystery surrounding descriptions of GN as a strong railroad, and by comparison, Milwaukee as weak, puzzled some ICC analysts. And puzzles me to this day.

"The record shows that the applicants' [to the BN merger] rates of return are low by any standard: Great Northern's highest and lowest in the 11 years between 1951-1961 were 4.74 (1956) and 2.47 (1961), Northern Pacific's 3.99 (1957) and 1.26 (1961), Burlington's 4.65 (1952) and 2.14 (1960) and SP&S' 5.40 (1953) and 1.72 (1961). ...

And it wasn't because railroads inherently earned less. Norfolk & Western was listed as No. 272 on a Forbes list of 352 domestic corporations at 8.9 %, where the first 232 on the list had returns at 10 per cent or better. 328 ICC 348.

By 1964, GN's car count at Troy, Montana had declined from 206,000 in 1957 to 188,000. GN was surpassed by NP, which had surprisingly increased it's car count at Paradise, Montana from 189,000 to 194,000. 328 ICC 515. GN had lost 10% of its carloadings, while NP had increased by 5% in the same period.

The PNW "service corridor," the Union Pacific Railroad, at it's Huntington, OR car count mustered 168,000 in that year, only 26.9% of the combined car counts of the UP, Milwaukee, NP and GN.

The Northern Tier carriers were carrying 73.1% of PNW traffic, dwarfing the Central Corridor carrier to the PNW. But, you can also see the impetus behind the BN merger. Certainly at the point in time they were drafting proposals, NP was overtaking GN. Apparently shippers didn't ship by analyzing grades, and were abandoning the GN.

There was a long-haul quality difference as well. In 1964, NP had a 461 mile line haul. MILW, clearly a midwestern carrier in terms of tonnage, had a 355 mile line haul. GN had fallen to third place with a 330 mile line haul. 328 ICC 550. To make up for its Midwestern short hauls, clearly what MILW was carrying on Lines West was some very long haul freight even in 1964.

The reason for GN's steady deterioration in OR and carloadings was not apparent. There was no obvious answer but that its vaunted system investment was failing to generate a return, or worse, a negative rate of return. By contrast, Milwaukee's difficulties were clearly identifiable: "The fact is that Milwaukee is shorthauled at the Twin Cities gateway on a large volume of traffic." 328 ICC 493.

In 1962, GN's fastest freight (via CBQ), Chicago to Seattle, was 94 hours. NP could do it in 97 hours, notwithstanding the burdens of grades and mileage. 328 ICC 474.

Truck transit time, Chicago to Seattle, (the Interstate was not completed) was 60 hours. When Milwaukee Road introduced its #261, it was a very fast train, and was able to compete with trucks, head-on, with a 55.5 hour schedule.

Few railroads could beat trucks over a 2200 mile run.

It was important because, interestingly enough, the average length of haul, trucking, between Chicago & Seattle was 402.4 miles. 328 ICC 550.

Milwaukee Road's previous fast freight, # 263, "remained" on its 77 hour schedule which already beat GN's fast freight by 17 hours, the new train beating it by 39 hours.

It has been suggested that GN "didn't want" to compete on speed.

Well, yes it did. It tried.

GN attempted to run a short train with more power. So did NP. The best the GN could do by 1966 was a 67.5 hour schedule, and while NP could almost keep up with 69.35 hours. 328 ICC 474. Milwaukee could still beat them by a full half a day.

Interestingly, the NP and GN had claimed that one of the merger benefits of a "single line haul" would have been their ability to run an 84 hour "fast freight." 328 ICC 328. The Milwaukee's XL Special at 55.5 hours caused a particular effort to attempt to meet the competition and the Northern Lines did better than the promises of their merger petition.

But they still couldn't beat #261.

Milwaukee had virtually reballasted its entire mainline, 1954 through 1965. Contrary to conventional wisdom, during those years, It didn't skimp on maintenance. On top of the ballast, Milwaukee installed heavy rail.

By 1967, the number of miles of 131 lb, or heavier rail, was as follows:

CNW 13 miles
GN 77 miles
NP 774 miles
CBQ 1,243 miles
MILW 1,361 miles

Moody's Manual of Railroads, 1967. This is why, in that year, MILW could run trains from Chicago to Omaha an hour faster than CNW, faster to Twin Cities than anyone, and faster to the Pacific Northwest by 12 hours. This is why they could, without any embarrassment, advertise that Milwaukee Road was "The Fast Track" compared to the CNW, the UP, the NP or the GN.

As several ICC Commissioners asked, reflecting on the common terminology of description of the times, which they saw as reflecting a conventional wisdom, but not necessarily a reality.

""Very large and strong," "strong" and "relatively weak" with respect to what?" 328 ICC 548.

The fact is, business practices as well as anticompetitive strategies had a far larger role in determining revenue and expense, profit and loss -- the thngs that finally matter in railroading as in any other business, and not an obsessionally narrow focus on the alleged physical strong points of a company, while dwelling on the alleged weak points of another.

As the record of the era clearly demonstrates, most of those odd theories of railroading are unsupportable by reference to the genuine historical record.

Best regards, Michael Sol

[MichaelSol]

QUOTE: Originally posted by nanaimo73

Michael-
Did the Milwaukee Road use the NYC Flexivan service on the PCE ?

Well, I wrote an extensive history of the NYC Flexi-Van project and how the Milwaukee used the system. Unfortunately, it was so long ago, I don't specifically recall how far West the service was provided. Milwaukee went in for the project in a big way, and I guess now that I'm thinking about it, I seem to recall that service was ultimately provided to Spokane, Seattle and Tacoma sometime in 1958 or 1959. That stuff is in storage along with my memory of what i wrote, but I'll see if I can dig it out.

Best regards, Michael Sol

[nanaimo73]

Michael-
Did the Milwaukee Road use the NYC Flexivan service on the PCE ?