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Chicago and Northwestern - The final word

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Chicago and Northwestern - The final word
Posted by MP173 on Friday, January 26, 2007 2:24 PM

The subject title of this thread is not a brazen attempt by me to indicate that I know everything there is to know about the CNW.  It is titled as the final word based on the success of the CNW 70's style thread we had.  I do not care to re-open that thread, but do have a little more to add.

I just finished reading H. Roger Grant's Northwestern, A History of the Chicago & Northwestern Railway System.  All of Grant's works are pretty easy to read and follow a basic format of digging very deeply into historical resources to put together a good history book on the subject.  I typically skip the first several chapters and jump in around the depression.

Such was the case with Northwestern.  I began on Chapter 8, The Great Depression and Bankruptcy.  It was a good chapter to begin, not only for the modern history content, but also to see a picture of one of the most striking women ever to work in railroading, Princess Redfeather. 

I ended up with 5 pages of notes from the early 70's on.  This is a remarkable story and is well worth investing the time to read the book.  I never quite realized how CNW evolved over the years.  The story of the employee ownership in the early 70's, as touched on by Bob Wilcox on this forum is truly amazing.  Can you imagine a 60 for 1 stock split?

Grant discusses at length the UP's choice for using the CNW to Chicago as the designated route.  We discussed most of those reasons in the "70's Style" thread, but one other reason was the refusal of ROCK to give UP "most favored nation" status by interlining westbound freight to them at Omaha, instead going for the long haul to Tucumcari or Denver. 

Grant also discusses the Powder River Basin coal story.  CNW simply didnt have the resources to get the Cowboy line fixed up and faced several options, one which would have been turning all rights and lines in Wyoming over to UP.  In return CNW would have received 2 cents per ton of outbound coal, or about $200 per loaded train for 20 years.

The purchase of the Rock's "Spine Line", the MILW bankruptcy sale (Soo), Japonica's attempted takeover, Blackstone's "white knight" rescue, and finally the UP's ultimate marriage is covered.

What came out strong in the book was the exceptional management from mid 50's to the end with Heineman, Provo, Wolfe, and finally Schmiege.

The CNW and IC are two great companies that overcame the problems of the 70's and found a way to reach the 90's and then became important parts of the larger systems.

Interestingly, CNW considered purchase of the IC back in the late 70's.  Go figure.

ed

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Posted by MichaelSol on Friday, January 26, 2007 3:11 PM
 MP173 wrote:

What came out strong in the book was the exceptional management from mid 50's to the end with Heineman ...

Do you believe it?

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Posted by CShaveRR on Friday, January 26, 2007 3:26 PM
I remember the 60-for-one stock split (technically, with the shares being de-valued, it was more like 11 for 1, but still...), and knew a couple of fellow employees who profited greatly with it.  I couldn't afford to get in on that initial offering, but bought a batch of shares on the installment plan right afterwards.  Best I could get was a three-for-one split down the road.

Carl

Railroader Emeritus (practiced railroading for 46 years--and in 2010 I finally got it right!)

CAACSCOCOM--I don't want to behave improperly, so I just won't behave at all. (SM)

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Posted by MP173 on Friday, January 26, 2007 3:38 PM

Do I believe it?

 Possibly, when placed in comparison with the previous managements of Bud Williams and Paul Feucht.  I wasnt there, so it is kinda hard to tell.  Hence, the discussions. 

I like the old Ronald Reagan motto...."trust, but verify".  I am usually the one checking Note 54 on the BNSF financials. 

This discussion goes back to Gabe's thread a few weeks ago about what happened during the 70's.  That decade set it in motion.  Just wish I would have paid just a little more attention at the time.

ed

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Posted by MichaelSol on Friday, January 26, 2007 3:44 PM

If a railroad made it past 1981, wasn't it the rule, rather than the exception, that they did much, much better than during the awful Stagflation 1970s?

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Posted by MP173 on Friday, January 26, 2007 4:07 PM

Never thought about it quite that way, but it sure seems correct.

ed

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Posted by bobwilcox on Friday, January 26, 2007 4:39 PM
 MP173 wrote:

Do I believe it?

 Possibly, when placed in comparison with the previous managements of Bud Williams and Paul Feucht.  I wasnt there, so it is kinda hard to tell.  Hence, the discussions. 

I like the old Ronald Reagan motto...."trust, but verify".  I am usually the one checking Note 54 on the BNSF financials. 

This discussion goes back to Gabe's thread a few weeks ago about what happened during the 70's.  That decade set it in motion.  Just wish I would have paid just a little more attention at the time.

ed

I think CEOs can make a difference for good or ill.  In my experience on one side of the ledger are CEOs like Mike Walsh (UP), Drew Lewis (UP), Larry Provo (CNW), Rob Krebs (BNSF), D. W. Brosnan(SRS).  On the other side of the ledger there are CEOs like Mike Mohan (SP), D. K. McNear (SP), Jervis Langdon (CRIP) and Dick Davidson (UP).   

Bob
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Posted by MP173 on Friday, January 26, 2007 6:27 PM

Brosnan had quite a reputation, but for results and also for intimidation.  Bob, what were your experiences with him?

Also, what about Rob Krebs?

ed

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Posted by CSSHEGEWISCH on Saturday, January 27, 2007 6:55 AM
 MP173 wrote:

Brosnan had quite a reputation, but for results and also for intimidation.  Bob, what were your experiences with him?

Also, what about Rob Krebs?

ed

Intimidation should not be underestimated as a management tool, but it should be used with discretion.  I have found over the years that I can work well with a tough manager, as long as he/she treats everybody fairly and consistently.  A tough manager who is also fair will inspire a surprising amount of loyalty.

The daily commute is part of everyday life but I get two rides a day out of it. Paul
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Posted by MP173 on Saturday, January 27, 2007 7:08 AM

Paul:
I tend to agree.  Tough managers that know how to motivate while being fair are a rare breed.

ed

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Posted by Murphy Siding on Saturday, January 27, 2007 10:06 AM
 MichaelSol wrote:
 MP173 wrote:

What came out strong in the book was the exceptional management from mid 50's to the end with Heineman ...

Do you believe it?

     Michael:  I know from past discussions, that you sometimes find disagreement with some of the things authors have written in books.  Which leads to a request-

     Can you offer some recommendations for books about railroading?  I know Ed looks more for the business end of railroading, I tend to look more for the historical end.  Either way, I've always found it interesting to read about things from different perspectives.

     Thanks

 

 

Thanks to Chris / CopCarSS for my avatar.

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Posted by MichaelSol on Saturday, January 27, 2007 2:34 PM
 MichaelSol wrote:
 MP173 wrote:

What came out strong in the book was the exceptional management from mid 50's to the end with Heineman ...

Do you believe it?

My first thought on the Grant book comment was as follows:

Have you looked at the financials? Have you talked to the employees of that era? Where on earth did Roger Grant come up with that?

BobWilcox commented:

"... we kissed Ben, Cutty Sark Scotch and Fruit of the Loom underware goodbye with employee ownership. Ben was unable to solve the problems the CNW .... Ben was to a great extent a victum of his times. A granger railroad president in those years was on the last leg of a succesful Kamakaze mission."

One demoralized CNW employee to MILW attorney Thomas Ploss on the CNW/MILW merger: "at least Milwaukee knows how to run a railroad."

In 1969, when Heineman breached the CNW/MILW merger agreement regarding stock valuations, it was not because of brilliance -- the CNW stock price crashed because he was playing too smart by one empty hole card on some unrelated matters and brought the whole effort crashing down.

Unhappy stockholders ultimately pressed the employee stock purchase -- getting out of what was at the time seen objectively as a sinking ship; not the brilliance now assigned by hindsight.

I deleted it, people are going to believe what they want to.

And that's my problem with most railroad histories. They are hagiographies, pure and simple. That's what readers want to read -- most readers and not looking for real-life case histories, they simply want a good story -- and that's all that most historians are capable of writing.

And my perspective on that has surely changed since I graduated with a degree in History, and spent my first years in a real job as a professional Historian. The reasons for that change are purely experience-based. Indeed, it started with a railroad history, "The Investor Pays" by Max Lowenthal, about the Milwaukee Road's first receivership, in 1925.

Starting from a position of admiration for the detail, coherence, and outstanding writing -- purportedly evidencing from a financial perspective, the history of the Milwaukee leading to its first receivership -- I thought of it as a model of of outstanding historical writing. And it really is a good read.

So much so that I was apparently talking about it one day, and Marc Green, Milwaukee Road's director of publicity, said that he believed Lowenthal was still alive, why didn't I go talk to him, it might be interesting. The book had been written in 1933, and it didn't dawn on me that Lowenthal might still be around in 1971, but typically, Marc Green seemed to know everybody that ever had anything to do with the Milwaukee, especially in the literary area and sure enough, Max Lowenthal was still alive.

I found a phone number in New York City, and called him up. He was cordial, and said he didn't remember too much about the whole affair but that it had been an exciting project for him. He had kept voluminous files which he had stored in a barn in Connecticutt and if I wanted to fly out, he would arrange for me to get access to his files.

Well, he died just a few months later and naturally I hadn't had the opportunity to take him up on it. Thought to myself, "oh well," the book was pretty detailed, and I naturally assumed the best stuff was in the book anyway. Isn't that the point of going to the trouble of writing a book?

Years later, I was on my way to visit Judge McMillen on some Milwaukee Road matters, and someone had mentioned that Lowenthal's papers had made their way to the University of Minnesota. So, on my way, I stopped by in St. Paul to visit the papers. Yes, they had obviously been stored in a barn, and had not been processed yet. Dust, straw, and pigeon poop.

There were several boxes related to his 1933 book, and I waded into them. There I found pages and pages of testimony and exhibits that directly contradicted what Lowenthal had said in his book. Engineering studies that he had intentionally misrepresented as to their content and meaning. Letters to New Deal politicians/friends discussing the right "spin" for the book. As a trained historian, I was frankly shocked, stunned, at discovering what Lowenthal had done with the evidentiary record in the case -- which was to distort it completely in the pursuit of a partisan political agenda.

But it had made Lowenthal a hero among certain New Dealers -- William O. Douglas, Roosevelt, Senator Burton K. Wheeler, Harrry Truman. Wheeler made him Counsel to the Senate ICC Committee. He helped draft the Transportation Act of 1940. He was Douglas' "campaign manager" for the vice presidential slot that ultimately went to Truman. He engineered Douglas' appointment to the SEC, then to the US Supreme Court. He was instrumental in Truman's early recognition of the State of Israel. He had frequent dinners at the Felix Frankfurter household. Mrs. Frankfurter had typed the manuscript of "The Investor Pays." He was at the center of a very politically active world.

Looking in on that world was J. Edgar Hoover. For years, ever since the mid-1920's, New York field agents kept reporting that, on their surveillance of known Soviet agents, Max Lowenthal was "visited" on a regular basis. Prominent persons reported to the FBI their own personal belief that Lowenthal was a Soviet agent. Protected by powerful politicians, Lowenthal was appointed to successive positions of increasing influence. After WWII, he secured an appointment to the sensitive Allied Occupation Authority in Berlin in 1948, just as the Soviet Union was beginning a showdown over Berlin.

Suddenly, he was sent home on orders of General Clay himself, and barred from any further activity on the part of the U.S. Government. As rumors swirled, he fled across the country to a hotel room at the Shattuck Hotel in Berkeley, California, where he wrote pleading letters to Burton K. Wheeler about what to do if he were subpoened before the Dies Committee -- implicitly asking Wheeler to intercede for him with Martin Dies. I guess he thought he was hiding out. The FBI was right next door.

I stay at the Shattuck from time to time, and was intrigued on one of my visits a few years ago to be assigned to the room Lowenthal had stayed in.

"The Investor Pays" is probably the most influential railroad history book of all time.

It provided a useful impetus for the passage of the Securities and Exchange Acts of 1933 and 1934; it provided the historical and financial "proof" that the capitalists were fundamentally incompetent or corrupt, or both, and that only a highly regulated government supervision could restrain such excesses as the Milwaukee's Pacific Coast Extension. It also colored the history of the Milwaukee in perhaps a fatal way, as the PCE was forever assessed in the light of Lowenthal's ringing phrase: "To a quarter of a billion dollar, long-established and profitable railway was added a quarter of a bil

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Posted by MP173 on Saturday, January 27, 2007 2:35 PM

Yes, a recommended list of books would no doubt make this winter go a bit quicker.

Spending this afternoon reading November 1989 Trains article on Powder River history.   Written by Fred Frailey, it is an excellent article, almost a small book as it is 22 pages plus a ton of great photos by Gary Bensen.

I would certainly like a recommendation on a MILW book.

ed

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Posted by MP173 on Saturday, January 27, 2007 5:07 PM

Well Michael, that sure was interesting.  I guess Lowenthall had quite an agenda.

Personally, I am looking for something in the more recent era, say from 1960's on.  When looking at the entire railroad industry, lets say in 1960 and then fast forwarding to 1985 and then finally today; there has been considerable change, not only in the color of the lines on the map, but also Penn Central/Conrail, Staggers, mergers, mega-mergers, rationalization of assets, labor restructuring, passenger/commuter trains, globalization, technology, and much much more.

I find it fascinating what has occured in my lifetime in this industry...one could say the same for nearly any industry out there. 

ed

 

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Posted by SALfan on Saturday, January 27, 2007 6:25 PM
 bobwilcox wrote:
 MP173 wrote:

Do I believe it?

 Possibly, when placed in comparison with the previous managements of Bud Williams and Paul Feucht.  I wasnt there, so it is kinda hard to tell.  Hence, the discussions. 

I like the old Ronald Reagan motto...."trust, but verify".  I am usually the one checking Note 54 on the BNSF financials. 

This discussion goes back to Gabe's thread a few weeks ago about what happened during the 70's.  That decade set it in motion.  Just wish I would have paid just a little more attention at the time.

ed

I think CEOs can make a difference for good or ill.  In my experience on one side of the ledger are CEOs like Mike Walsh (UP), Drew Lewis (UP), Larry Provo (CNW), Rob Krebs (BNSF), D. W. Brosnan(SRS).  On the other side of the ledger there are CEOs like Mike Mohan (SP), D. K. McNear (SP), Jervis Langdon (CRIP) and Dick Davidson (UP).   

 I always thought Jervis Langdon was a pretty good CEO at the B&O, where he turned a loss into a small profit in only a year or two and almost derailed the takeover by C&O.  I admit this is based on very limited information.  Anyone care to elaborate? 

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Posted by bobwilcox on Sunday, January 28, 2007 2:36 PM
 MP173 wrote:

Brosnan had quite a reputation, but for results and also for intimidation.  Bob, what were your experiences with him?

Also, what about Rob Krebs?

ed

 

I never had a direct experience with Brosnan but I think that was a good thing.  My first railroad job was as a summer intern assigned to the District Sales Office in Hattiesburg, MS.  In Hattiesburg, in addtion to the two man sales office, we had the dispatcher for the NO&NE between New Orleans and Meridian, MS and the superindent's office.  In the summer of 1965 the presence of Mr Brosnan was felt everywhere at the Southern.  As an example we had a problem with empty special cars being swiped enroute as the headed back for a load or their pool location.  I managed a small pool of bulkhead flats for offline loading on the Mississippi Central with hardwood for the furniture manufactures in North Carloina.  I would run short of empties because someone between NC and Hattiesburg had grabed one of my cars returning empty for their local customer.  One day word went out to everyone that all of the empty special cars would move back on special empty waybills and the cars were not to be diverted en-route.  Two days later word flashed over the local company phone line that the agent up in Meridian had swiped a DF enroute to New Orleans for a Meridian shipper.  This was followed the next morning by a personal call from Mr Brosnan to the Meridian agent informing him that he was no longer employed by the Southern Railway System.  No one swiped one of my flats for the rest of the summer.  Staff meetings with Brosnan were also dreaded by the participants.  The superintendent, George Burwell, was sweating bullets getting ready for a second quarter budget review.  George must have done ok since he finished his days at the Southern as CEO.

I was only in one meeting with Rob Krebs in the short time his having CEO respondsiblities just announcement of the SPSF merger.  He was refreshing because he understood the deep problem the SP's management had with being totally internally focused. Virtually all of the long time managers at the SP had long ago forgotten that their job was to provide employees with the resources to transport freight in a fashion that satisfied customers and investors.  Coming from the Northwestern it was quite a shock to go to a meeting where 90% of the discussion was about who got the blind or double blind copy on a memo about the Lone Pine abandoment.   I earned a lot of points asking the chair of the meeting why it was taking so long to abandon a line with such large losses.  The SP had many deep problems that may have been insolvable but in hind site Krebs departure to Sante Fe Industries was a body blow.

 

Bob
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Posted by daveklepper on Sunday, January 28, 2007 3:01 PM

Lowenthal was definitely NOT the person who influenced Harry Truman to overrule the oil-influenced State Department and reverse Roosevelt's position (agreement with Ibn Saud at Yalta) to recongize Israel.   That did not stop him from claiming such influence, but it simply was not so.   The person who influenced Harry was his old Jewish Missouri business partner who argued that the DP's had no other place to go and that now the Arab Jews were to face a holocaust in certain of the Arab countries unless they had a refuge.   I'm surprised Michael that you would mention this without looking further than just Lowenthal's own papers and statements.  A good book on the period is Jerusalem in American Diplomacy, by Shalom Solnick (not absolutely shure of the last name, but it also begins with S.)  Elvaser Press, Holand.   Solnik teachers American History (as Emeritus) as Hebrew University, Mount Scopus, Jerusalem.  His book is well footnoted with references to many primary sources, including Sate Department memoranda, messages between the British Foreign Secretary and the USA Secretary of State, Harry's own statements, and even material from the Vatican!

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Posted by MichaelSol on Sunday, January 28, 2007 9:10 PM
 daveklepper wrote:

Lowenthal was definitely NOT the person who influenced Harry Truman to overrule the oil-influenced State Department and reverse Roosevelt's position (agreement with Ibn Saud at Yalta) to recongize Israel.  

I am unfamliar with the book you cite. I cannot find it anywhere. I am familiar with Truman and Israel, by Michael Cohen, 1990, which I have here on my desk, and which summarizes as follows:

"Through private letters, diaries, and interviews, Cohen introduces several characters who had an impact on Truman's thinking. These include his "Jewish buddies" from Kansas City, Eddie Jacobson and Abe Granoff, as well as Max Lowenthal, whose private diary is used here for the first time and whose key role in Truman's recognition of Israel has hitherto gone unnoticed."

Truman is quoted in many accounts as to his association with Lowenthal who was counsel to the Senate Interstate Commerce Committee on which Truman had served, and who specialized in drafting Zionist memoranda. In 1952 Truman stated in a letter to Lowenthal, "I don't know who has done more for Israel than you have."

 

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Posted by Datafever on Sunday, January 28, 2007 9:36 PM

I have to concur with Mr. Sol.  I was also unable to find any reference to the book.  I even searched the faculty directory at Hebrew University and was unable to find anyone with a name even vaguely close to Shalom Solnick, or Shalom anything that worked in the area of History.

 

EDIT:  Nor have I found anything on Elvaser Press in Holland. 

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Posted by billbtrain on Sunday, January 28, 2007 9:59 PM

Michael Sol's writings always make for interesting reading.A different spin on accepted histories and practices as always.But you have to always remember that 'To the victor goes the spoils',be it war,politics,or history.Political and/or personal bias always plays into the mix.Who really shot JFK,Who is really buried in Billy-The-Kid's grave,What was the best railroad,Who was the best railroad executive,etc.Nobody will ever agree on the same points or parts thereof.Michael tends to make some people annoyed,and others to think about reviewing things from different perspectives.I'll entertain myself reading other views,but almost always return to the same bias thoughts and feelings that I developed years ago while learning about my favorite railroads at an early age(from the Santa Fe to the Boston & Maine to the Burlington Northern and finally Great Northern with some Rock Island,Milwaukee Road,and C&NW mixed in amongst others).

I've been following the Milwaukee and Great Northern routes on several different mapping sites and plan to do the same for the NP(easy to do NP and MILW in Montana and Washington).Looking at the 'who had the best route' theories presented by Michael and others.As always just subjective opinions to research and draw conclusions of one's own.Beats the hell out of the crap they have on the other tube!

Have a good one.

Bill B

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Posted by MP173 on Monday, January 29, 2007 3:29 PM

Well said Bill.

ed

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Posted by erikem on Tuesday, January 30, 2007 12:17 AM
 billbtrain wrote:

Michael Sol's writings always make for interesting reading.A different spin on accepted histories and practices as always.But you have to always remember that 'To the victor goes the spoils',be it war,politics,or history.Political and/or personal bias always plays into the mix.Who really shot JFK,Who is really buried in Billy-The-Kid's grave,What was the best railroad,Who was the best railroad executive,etc.Nobody will ever agree on the same points or parts thereof.Michael tends to make some people annoyed,and others to think about reviewing things from different perspectives.I'll entertain myself reading other views,but almost always return to the same bias thoughts and feelings that I developed years ago while learning about my favorite railroads at an early age(from the Santa Fe to the Boston & Maine to the Burlington Northern and finally Great Northern with some Rock Island,Milwaukee Road,and C&NW mixed in amongst others).

I've been following the Milwaukee and Great Northern routes on several different mapping sites and plan to do the same for the NP(easy to do NP and MILW in Montana and Washington).Looking at the 'who had the best route' theories presented by Michael and others.As always just subjective opinions to research and draw conclusions of one's own.Beats the hell out of the crap they have on the other tube!

I find Michael's writings to be interesting as well, he's brought up a lot of interesting facts about the Milwaukee. Probably the most interesting one was the Cadotte Pass  saga - as I've wondered why Bonner Junction looked so heavily built (this would have been where the Cadotte Pass line rejoined the original main line). Also found it interesting to read about some of the plans the MILW had for their electrification. Most importantly, he does make a case that 'accepted wisdom' about RR history can be very misleading or just plain wrong.

As an off topic example of 'accepted wisdom' with respect to history - I thought I had a pretty good understanding of WW2 history by the time I graduated from high school ('72). - and since then have learned that things were a 'bit' more complicated than what I thought I knew. A couple of points are that most histories are way too kind to Chamberlain (he messed up the chance to stop the European war before it started) and too kind to FDR.

 - Erik

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Posted by daveklepper on Tuesday, January 30, 2007 2:37 PM

I'll do the detective work to find the book and the correct author name and get back to you.  I did read it cover to cover and it seems pretty authentic.  But that was about five yeas ago.

 

Truman may have written the same kind of letter to several people and he would simply be a good politician to do so!

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Posted by Anonymous on Tuesday, January 30, 2007 8:14 PM

So, from what I gather, if Milwaukee had indeed given UP access to the Omaha-Chicago line (either via trackage rights or an outright purchase), then CNW's boat would have been sunk unless they merged into the Milwaukee.  The hypotheticals associated with this one deal could have been enormous:

1.  My perception of such a deal has Milwaukee granting UP rights over the O-C line in exchange for Milwaukee getting a reciprocol set of rights elsewhere, and the most likely place for this reprocicity (in my view) would have been for the Milwaukee to get rights into Portland Oregon via the Marengo junction to Hinkle then through the Columbia River gorge.  Milwaukee obviously had it's sights set on Portland for some time, and the eventual rights into Portland due to the BN merger confirms this.....

2.  But, with UP giving Milwaukee rights into Portland via the Gorge, Milwaukee is then in a stronger position to oppose the BN merger, since the BIG concession from that merger to the Milwaukee would no longer be on the table.  What could BN have offered Milwaukee in it's stead?  Thus.......

3.  Is the BN merger rejected by the ICC in similar fashion as the rejected UP-RI merger deal? 

4.  If so, do we see the more conceivable bankruptcy of the NP?  NP did have the worst line of the Northern Tier lines - do we instead end up with only GN and Milwaukee as the Northern Tier lines?  Does GN make a play for CNW or RI?  Does GN try for a parallel merger with Milwaukee?  If NP had been allowed into bankruptcy and abandonment, what happens to the CB&Q?

Mind boggling to consider such......

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Posted by MP173 on Tuesday, January 30, 2007 10:04 PM

Dave:

Quite a thought process of "what ifs".  I cannot really comment too much about the PNW, being a Hoosier, but:

1.  What was the big attraction of the Portland market?  I have no idea of the market.

2.  I agree with you regarding the O-C line.  I just dont see that it fit in with MILW's overall operations.  A deal with UP could have been very healthy for both parties.  Your comments regarding opposing the BN merger would have made sense.

3.  Not sure I will agree with you regarding the impending NP bankruptcy. A look at their financials indicate they had substantial "other income".  I dont know if that was from natural resources or from ownership of the Q, but they certainly were not near bankruptcy.  From past threads, it does appear they had the worst route to the NW, but one cannot ignore the assets on the balance sheet.  

4.  GN would not have made a play for Rock or CNW, instead simply stayed with the Q, since they owned it.

ed

 

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Posted by Kevin C. Smith on Wednesday, January 31, 2007 12:34 AM

Well, to play the "what ifs" out a bit further...

If the C&NW would be without a western traffic source if the UP switched its freight traffic to the MILW's Omaha-Chicago main (traffic agreement or merger) and

If this threw a monkey wrench into the proposed BN merger and

The NP was either not included in a successful BN or was the neglected stepchild of an unmerged "Hill Lines" association,

Could not the two "odd men out" have created a third northern tier trancontinental-the Chicago & North Western Pacific?

Can't imagine the GN/CB&Q letting the NP go but still, a fun idea. "North Coast 400" sounds nice...

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Posted by daveklepper on Wednesday, January 31, 2007 2:19 AM

This is intended primarily for Michael Sol:

The author is Shlomo Slonim, the name of the book is:  Jerusalem in America's Foreign Policy.  The publisher was Klumer Academic Publishers in Germany, and the book was published in 1998, and available at a reasonable price as a paperback.   Now it is available from the Netherlands (possibly also Klumer), for USA $311.25 as a hardback only.   Dewey No. is 327.7305694

I would point out that if Lowenthal were the kind of person you describe him to be, he would be perfectly capabable of forging the Truman letter that you refer to.   He would have taken Truman's signature from some other documents, ditto the White House letterhead, and had his official letter that he used to bamboozle other people.

I assure you Lowenthal had absolutely nothing to do with Truman's decision.  My Dad was a close friend of both Adlei Stevenson and Rabbi Stephen S. Wise.  He worked hard for Truman's election, against both Dewey and Henry Wallace.  I was alive at the time and overhead on lots of these people's discussions.   My Dad was President of the United Rumanian Jews of America during WWII, and you can check the Jewish Enclyclopedia of 1944 on this, his name was Dr. Julius I. Klepper

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Posted by Anonymous on Wednesday, January 31, 2007 8:20 PM
 MP173 wrote:

Dave:

Quite a thought process of "what ifs".  I cannot really comment too much about the PNW, being a Hoosier, but:

1.  What was the big attraction of the Portland market?  I have no idea of the market.

Portland was and is the biggest export market for US bulk commodities like grain.  Needless to say, having access to Portland paid dividends for those PNW railroads running grain trains - UP, GN, and NP all had Portland access, Milwaukee did not.  That left Milwaukee's grain trains to ply at the smaller Puget Sound grain ports, Gray's Harbor, or Longview.  Which is why getting access to Portland as a condition of the BN merger (albeit the long and steeper way around via a Cascades mountain pass, not via the Columbia Gorge) was so coveted by Milwaukee.

I still say they should have held out for more direct Portland access via the SP&S line through the Gorge as a condition of the BN merger, but that debate has done gone.  The thing is, this potential trade with UP would have occured prior to the BN merger, and would have allowed Milwaukee a better route to Portland via the gorge than what they ended up with from the BN merger.  And if it happened, I believe CNW has to merge with Milwaukee to stay alive.

2.  I agree with you regarding the O-C line.  I just dont see that it fit in with MILW's overall operations.  A deal with UP could have been very healthy for both parties.  Your comments regarding opposing the BN merger would have made sense.

And this is where CNW comes into play.  UP gets into Chicago, so no need for access via CNW.  CNW must then find a merger partner per the loss of UP overhead, and the most likely marriage then is with Milwaukee.  Assuming BN never happens (or at least is delayed a few more years), GN probably retries a smaller merger with CB&Q, so what else can CNW do?  Ditto for RI.

3.  Not sure I will agree with you regarding the impending NP bankruptcy. A look at their financials indicate they had substantial "other income".  I dont know if that was from natural resources or from ownership of the Q, but they certainly were not near bankruptcy.  From past threads, it does appear they had the worst route to the NW, but one cannot ignore the assets on the balance sheet.

My take on NP is that they go the SP route - create a holding company, divide railroad from non rail assets, then try and jettison the railroad.  The question then is, who'd want it?

  

4.  GN would not have made a play for Rock or CNW, instead simply stayed with the Q, since they owned it.

Makes sense.  Railroad-wise, GN needed the CB&Q more than it needed NP.  So if NP the railroad loses it's non rail assets, what would GN want with it?  (BTW - wasn't that the point I made a while back that raised the ire of BN fans?  JJ Hill only wanted NP for the land grant acreage, and that acreage ended up saving Hill's hide!)

Perhaps the NP may have ended up divvied up - GN gets the Sandpoint-Spokane trackage, Milwaukee gets the St. Regis-Lombard trackage, UP gets the Stampede Pass line Auburn to Pasco - something like that.  The rest is branchlined or embargoed.

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Posted by Anonymous on Wednesday, January 31, 2007 8:25 PM
 Kevin C. Smith wrote:

Could not the two "odd men out" have created a third northern tier trancontinental-the Chicago & North Western Pacific?

I still think CNW and Milwaukee merge, and we end up with the "Milwaukee & Northwestern".

Smile [:)]

I like how that name just rolls off the tongue......

Can't imagine the GN/CB&Q letting the NP go but still, a fun idea. "North Coast 400" sounds nice...

Beats the ill fated "North Coast Hiawatha"........

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Posted by MP173 on Wednesday, January 31, 2007 9:46 PM

Or, one could have ended up with:

1.  GN/CBQ

2.  MILW lite (dump the branches and go Chicago PNW).

3  UP plus MILW O -C route.

4.  CNW - NP

Four lines to the PNW...a couple too many in my estimation for the 70's, 80's and 90's.  Except CNW-NP could have used the proceeds from the natural resources to upgrade the Cowboy line to Powder River and hauled all that coal to Chicago itself, bypassing Uncle Pete.  But then again, would the trade of actual natural resources for the infrastructure to HAUL natural resources been a sound tradeoff?

ed

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