QUOTE: Originally posted by MichaelSol QUOTE: Originally posted by oltmannd [I would be willing to buy the arguement that states the RRs had pretty much given up on there being any future for the RRs by 1950 and were doing whatever it took to keep being able to pay out a dividend. If that meant taking on a lot of debt in order to save a nickel in operations, so that nickel could be put towards a dividend, then that was probably in the best interest of the stockholders. ...this fits with the lack of track maint in the 1950s - that was all operating expense that could be deferred in order to pay a dividend. Management attitudes undoubtedly played a role. Management competence undoubtedly played a role. The ROI chart I posted earlier reflects in an interesting fashion on the following maintenance data, which is not for all railroads but happens to be what I have at the office at the moment: Maintenance $ available per mainline mile of track MILW------- Great Northern 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 that even as ROI continued to decline into the 1960s, it would have been worse had maintenance expenditures continued at the rate they were at during the 1950s. Debt from dieselization and high maint./h.p. operating expenses continued to corrode ROI and then, after a decade of substantially lower track maintenance, along comes the bright idea of the 100-ton car. This one deserves the Nobel Prize for Railroading. The train wreck was just a matter of time, literally as well as figuratively. Railroading was making only a few major decisions with far-reaching ramifications, and we can see what those were. We know the effects of both. We saw the Rail Crisis of the 1970s. Best regards, Michael Sol
QUOTE: Originally posted by oltmannd [I would be willing to buy the arguement that states the RRs had pretty much given up on there being any future for the RRs by 1950 and were doing whatever it took to keep being able to pay out a dividend. If that meant taking on a lot of debt in order to save a nickel in operations, so that nickel could be put towards a dividend, then that was probably in the best interest of the stockholders. ...this fits with the lack of track maint in the 1950s - that was all operating expense that could be deferred in order to pay a dividend.
-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/)
QUOTE: Originally posted by MichaelSol QUOTE: Originally posted by Murphy Siding Michael Sol: What do you make of the fact that the downside of dieselization never has gotten much publicity? Railroads (and railfans) tend to take it as a given that it was the right decision, at the right time. You mention that railroads incured additional labor and and facility costs in the mid-1960's, due to aging diesel fleets. Can you expand on that a little? Thanks Railroads are poor historians and have little inclination to introspection. Gabriel Kolko offers a good example. Generations of railroaders and rail historians, as well as academicians of all types, believed the original Interstate Commerce Act was anti-railroad. Indeed, it was touted for purely partisan political purposes as a triumph of the Progressive movement. Kolko pointed out in The Triumph of Conservatism, that a substantial, compelling body of evidence existed to show that the reverse was true: that the original ICC Act was the result of railroad pressure and demands to control "cut-throat" competition between railroads. Now, why did Kolko figure that out, and no one else did? Which railroad mechanical officer wanted to confess that his decision was wrong? These jobs are as political as any county sheriff: you commit careers to business judgment decisions. Nobody hardly ever says "oops." Not to stockholders and investors after you just wiped out their investment. And, which company was spending, literally, millions of dollars on both advertising and studies to show the compelling advantages of rapid dieselization? Call it propaganda, but what is propaganda designed to do? And who was funding the other side of the story? Conventional wisdoms are compelling and controlling. That has nothing to do, ever, with whether they are correct or not. Rail fans? As near as I can tell, railfanning is a labor of love. Isn't love blind? Best regards, Michael Sol
QUOTE: Originally posted by Murphy Siding Michael Sol: What do you make of the fact that the downside of dieselization never has gotten much publicity? Railroads (and railfans) tend to take it as a given that it was the right decision, at the right time. You mention that railroads incured additional labor and and facility costs in the mid-1960's, due to aging diesel fleets. Can you expand on that a little? Thanks
Quentin
QUOTE: Originally posted by oltmannd Are those real $$ or constant $$?
QUOTE: Originally posted by oltmannd The Mechanical officer wasn't wrong! Not even a little. He got what he was looking for - reduced mancount. With wages on the rise and huge pressure from the finance guys to reduce costs, diesels were just the thing. The capital didn't come from HIS budget -he was being measured on expenses. It's the finance guys that blew it. And, if the game was to suck money out of the company to pay out in dividends, I can't even find fault with the finance guy.
QUOTE: Originally posted by MichaelSol Management attitudes undoubtedly played a role. Management competence undoubtedly played a role.
QUOTE: Originally posted by oltmannd in constant 1967$$ year 1967$MILW 1967$GN 1950 $13,287 $11,044 1951 $14,203 $11,630 1952 $15,611 $12,281 1953 $16,268 $12,923 1954 $14,427 $12,537 1955 $16,844 $13,027 1956 $15,979 $13,435 1957 $14,442 $13,158 1958 $13,173 $9,501 1959 $12,679 $9,805 1960 $11,015 $9,430 1961 $9,598 $8,519 1962 $9,955 $8,800 1963 $9,220 $8,603 1964 $9,301 $8,879 1965 $9,667 $7,982 1966 $11,237 $8,156 1967 $9,575 $8,300 1968 $11,186 $7,933 1969 $12,250 Looks like GN gave up in suddenly in 1958 but MILW gave ground more grudgingly over a 6 year period.
QUOTE: Originally posted by oltmannd Looks like GN gave up in suddenly in 1958 but MILW gave ground more grudgingly over a 6 year period.
QUOTE: Originally posted by oltmannd Possible correlation with the construction of I90 and I94???
QUOTE: Originally posted by oltmannd How about highways effecting offline origins/destinations - received/delivered traffic at Minneapolis? Traffic doesn't just "decline" - something had to cause it.
QUOTE: Originally posted by MichaelSol QUOTE: Originally posted by oltmannd The Mechanical officer wasn't wrong! Not even a little. He got what he was looking for - reduced mancount. With wages on the rise and huge pressure from the finance guys to reduce costs, diesels were just the thing. The capital didn't come from HIS budget -he was being measured on expenses. It's the finance guys that blew it. And, if the game was to suck money out of the company to pay out in dividends, I can't even find fault with the finance guy. Well, the more conventional approach to paying dividends is to increase the ROI, not decrease it. Best regards, Michael Sol
QUOTE: Originally posted by oltmannd [Looks like GN gave up in suddenly in 1958 but MILW gave ground more grudgingly over a 6 year period.
Thanks to Chris / CopCarSS for my avatar.
QUOTE: Originally posted by Murphy Siding Michael: Did the Santa Fe fare any better? Given that every book about dieselization says that SF *needed* diesels, for their bad water,desert areas?
QUOTE: Originally posted by AC6000CW on a narrow gauage railway steam would be the solution because there no narrow gauage diesel in north america.
QUOTE: Originally posted by AC6000CW there 2 railroads in the united states that are narrow gauage.
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