Milwaukee Road history - Wikipedia version

[Bergie]

Hmm... should I use my power to add the term "Milwaukee Road" to our bad word filter to save the rest of us from future episodes or not. What a dilemma.

Anyone else tired of this brand of bickering? I swear, sometimes it's worse than what I see out of my kids.   You said this. No I didn't, I said this.

Let's move on.

Bergie

[nanaimo73]

The New England, ND line was worth saving, it lasted another two years until 1982 when SD bought the Ortonville-Terry line. Perhaps ND should have stepped up then to save it.

[n012944]

Bert,

Are you still OK with his attitude?

I never was.  Typical know it all.  I love how he says that I "muddle these threads with my contentious arguments," but when I see that I am talking to a wall and try to move on, he keeps arguing.  Sounds to me like someone who just loves to hear himself talk, or in this case read what he writes.

Bert

Well, he got caught by his own game of "gotcha", can't explain the tangle of his own contradictory statements and so the name-calling starts and there goes yet another thread, courtesy of the usual suspects.

I'm outta here.

 

Funny it seems that eveythread that gets blown up has either you or FM in it.  Draw your own conclusions. And as to why Carter didn't listen to the DOT report, I have no idea.  Carter's decisions were not the greatest, one of the reasons he did not have a second term.

 

Bert

 

Bert

[billbtrain]

What were the carloadings on the branchlines from the South Dakota mainline?Would the branch from Andover to Britton been worth saving?What about the lines to Mitchell,Rapid City,New England,Faith,etc? Thanks.

Have a good one.

Bill B

[MichaelSol]

Bert,

Are you still OK with his attitude?

I never was.  Typical know it all.  I love how he says that I "muddle these threads with my contentious arguments," but when I see that I am talking to a wall and try to move on, he keeps arguing.  Sounds to me like someone who just loves to hear himself talk, or in this case read what he writes.

Bert

Well, he got caught by his own game of "gotcha", can't explain the tangle of his own contradictory statements and so the name-calling starts and there goes yet another thread, courtesy of the usual suspects.

I'm outta here.

 

[MP173]

With the shinanigans going on within that corporation, why would there have been a federal bailout?

But quite frankly, I am confused.  I think I will go home now.

ed

[n012944]

Bert,

Are you still OK with his attitude?

 

I never was.  Typical know it all.  I love how he says that I "muddle these threads with my contentious arguments," but when I see that I am talking to a wall and try to move on, he keeps arguing.  Sounds to me like someone who just loves to hear himself talk, or in this case read what he writes.

 

Bert

[greyhounds]

Bert,

Are you still OK with his attitude?

 

[MichaelSol]

Neither, now move on.

Bert

Sorry, not taking  orders from you these days.

It raises a good question as to why the Carter Administration would launch a DOT study, that neither Brock Adams nor Neil Goldschmidt would have anything to do with, using figures contradicted by the FRA within the same department, get Claytor to carry it nothwithstanding his whole 2.5-3 weeks as acting Secretary -- that was surely the fastest "study" ever done in DOT history -- and conclude that after "the US DOT did a study on giving funding to the MILW for the PCE in 1977.  It was decided after that study that not another dime of the goverments money should be spent on the PCE." n012944, 2/23/07.

Yet, after an executive agency under Carter allegedly made this report, and "it was decided ...that not another dime ...."  Jimmy Carter signed a bill doing the exact opposite, and authorizing up to $250 million for the Milwaukee Road. That's quite a few dimes.

Does this mean your statement about the DOT study was false?

There seems to be quite a contradiction between what you specifically said "was decided" and what was "decided." Which is it?

 

[n012944]

In any case, I was not the Carter Administration, and did not make the original statement on its behalf. Your contention that I made the statement is, in fact, false, and that seems to be where the "cracks" on these forums are originating.

You made the statement on this forum in what appears to be an effort to discredit the US DOT study. 

Bert

"The" statement regarding Carter's refusal of funds because of election concerns was made by a representative of the White House to the Governor of Montana. The Governor of Montana, in turn, personally told me of the conversation. I then referred to it on this thread February 20. 

It was only through incredible foresight that I was able on February 20 to make the reference as part of an effort to "discredit" a DOT study that you referred to on February 23.

 

I wasn't talking about the statement made on the 20,  I was talking about this statement said on the 23rd:

"Indeed, the DOT "study" sounds exactly like the Carter Administration's "cover story" on why the "government" was not going to spend any money on railroads that happened to be in Republican states in 1979 and 1980 -- only railroads in Republican states lost money and were, under longstanding government policy -- not entitled to federal funds. "

Now it really doesn't matter when you said it, Carter approved funds to the MILW in 1979 by signing the Congressional bill, making the statement false.  Could we move on?

Bert

I do not know why you wish to muddle these threads with your contentious arguments. Are you saying Carter himself discredited the DOT study by signing the Congressional bill? Or that Carter discredited himself by signing the Congressional bill?

Or both?

Neither, now move on.

 

Bert

[MichaelSol]

In any case, I was not the Carter Administration, and did not make the original statement on its behalf. Your contention that I made the statement is, in fact, false, and that seems to be where the "cracks" on these forums are originating.

You made the statement on this forum in what appears to be an effort to discredit the US DOT study. 

Bert

"The" statement regarding Carter's refusal of funds because of election concerns was made by a representative of the White House to the Governor of Montana. The Governor of Montana, in turn, personally told me of the conversation. I then referred to it on this thread February 20. 

It was only through incredible foresight that I was able on February 20 to make the reference as part of an effort to "discredit" a DOT study that you referred to on February 23.

 

I wasn't talking about the statement made on the 20,  I was talking about this statement said on the 23rd:

"Indeed, the DOT "study" sounds exactly like the Carter Administration's "cover story" on why the "government" was not going to spend any money on railroads that happened to be in Republican states in 1979 and 1980 -- only railroads in Republican states lost money and were, under longstanding government policy -- not entitled to federal funds. "

Now it really doesn't matter when you said it, Carter approved funds to the MILW in 1979 by signing the Congressional bill, making the statement false.  Could we move on?

Bert

I do not know why you wish to muddle these threads with your contentious arguments. Are you saying Carter himself discredited the DOT study by signing the Congressional bill? Or that Carter discredited himself by signing the Congressional bill?

Or both?

In either case, it's fine with me. Carter was perfectly justified in ignoring the DOT study -- it was garbage. And if Congress forced his hand by strongly backing the proposed relief -- his mendacious attitude deserved it.

 

[n012944]

In any case, I was not the Carter Administration, and did not make the original statement on its behalf. Your contention that I made the statement is, in fact, false, and that seems to be where the "cracks" on these forums are originating.

You made the statement on this forum in what appears to be an effort to discredit the US DOT study. 

Bert

"The" statement regarding Carter's refusal of funds because of election concerns was made by a representative of the White House to the Governor of Montana. The Governor of Montana, in turn, personally told me of the conversation. I then referred to it on this thread February 20. 

It was only through incredible foresight that I was able on February 20 to make the reference as part of an effort to "discredit" a DOT study that you referred to on February 23.

 

I wasn't talking about the statement made on the 20,  I was talking about this statement said on the 23rd:

"Indeed, the DOT "study" sounds exactly like the Carter Administration's "cover story" on why the "government" was not going to spend any money on railroads that happened to be in Republican states in 1979 and 1980 -- only railroads in Republican states lost money and were, under longstanding government policy -- not entitled to federal funds. "

 

Now it really doesn't matter when you said it, Carter approved funds to the MILW in 1979 by signing the Congressional bill, making the statement false.  Could we move on?

Bert

[MichaelSol]

In any case, I was not the Carter Administration, and did not make the original statement on its behalf. Your contention that I made the statement is, in fact, false, and that seems to be where the "cracks" on these forums are originating.

You made the statement on this forum in what appears to be an effort to discredit the US DOT study. 

Bert

"The" statement regarding Carter's refusal of funds because of election concerns was made by a representative of the White House to the Governor of Montana. The Governor of Montana, in turn, personally told me of the conversation. I then referred to it on this thread February 20. 

It was only through incredible foresight that I was able on February 20 to make the reference as part of an effort to "discredit" a DOT study that you referred to on February 23.

 

[MichaelSol]

Michael:

Two questions:

1.  What happened with the SEC and Milw in 1975.  Dont know if I can get to the Forbes articles.

The Milwaukee began reporting losses in the early 1970s, even as traffic was increasing. A little odd. Forbes thought so too. Here are my notes:

"For 25 years, the Land Co. has tossed off a million or so dollars of profit yearly, mostly from the sale of stumpage rights on roughly 200,000 acres of splendid Pacific Northwest land. From its fat kitty of retained earnings, the Land Co.'s handsome dividends boosted railroad earnings in lean years."

The magazine pointed out that in the early 1970's, the Land Co. began selling off timberlands -- nearly one-third of them -- and that the stockholders were not informed of this except that each year's annual reports simply listed smaller acreage, without comparative figures or disclosure that land was actually being sold. Perhaps more importantly, in 1971, the Land Co. stopped making dividend payments to the Railroad Corporation, and instead began making "loans" to it.

The result of this was that the Milwaukee Road's contingent bonds, which comprised a goodly amount of its debt load, required payment only in those years in which the Railroad actually earned profit. With the Railroad no longer reporting Milwaukee Land Co. earnings as profits, but rather as further indebtedness, the Railroad avoided paying nearly $12 million of contingent bond payments.

In addition, investigation revealed a political slush fund to which employees contributed, but were then recompensated for in their paychecks; the fund had never been audited, nor the uses to which it was put relayed to the employees. Boxcar numbers were alleged to have been switched to "fool lease or mortgage holders or other railroads which pay per diem charges on Milwaukee equipment."

Forbes asked why the Securities and Exchange Commission had not investigated these irregularities, and, answering its own question, pointed out that the chairman of the Securities and Exchange Commission was Ray Garrett Jr., a former director of the Milwaukee Road who had also set up the holding company, Chicago Milwaukee Corporation, in 1972 and served as its general counsel until his appointment to the SEC.

Garrett denied wrongdoing. The SEC began investigations. Garrett had been shown proofs of the Forbes articles prior to publication and told the SEC investigators that he "went home and wept."  Forbes, in closing its second article, "The Mal-waukee Road?," quoted one "long time observer" of the Milwaukee as remarking that "it was a candy store then. It is a candy store now." The phrase was intended to be a reminder of the scathing ICC commentary on the events leading to the Milwaukee Road's 1926 bankruptcy and reorganization, and Max Lowenthal's remarks that the railroad had been, since 1926 and even earlier, in the hands of persons who wanted control not because of the inherent profitability of railroading, but because "that control would determine who should have the profitable posts as its bankers, its lawyers, and its suppliers of equipment and materials."

Chairman Quinn wanted to sue Forbes for defamation and slander. He changed his mind after he was reputedly told that truth was a defense to a slander charge, which he didn't think was a very good law at all.

 

[MichaelSol]

2.  Any reason why GN didnt go heavier with the rail?

Just going out the door, this question's quicker. GN cut way back in everything to do with the track in 1961, just as the heavier rail was coming into vogue. GN just didn't have a budget for that kind of stuff. Traffic was declining on that route. Heavier rail for lighter traffic? The merger was problematic and off in the future. MILW kept plugging away at heavier rail from 1957 forward, and by 1969, the effort simply showed up in much larger numbers.

[MP173]

Michael:

Two questions:

1.  What happened with the SEC and Milw in 1975.  Dont know if I can get to the Forbes articles.

2.  Any reason why GN didnt go heavier with the rail?

ed

[billbtrain]

What size rail was on the PCE and was it welded or jointed rail?

Have a good one.

Bill B

Mostly 112-115 lb installed mid-1950s. Jointed. Some older 100 lb, quite a bit of 131-132 lb on curves installed early 1960s. A few locations had welded. Just getting into that era. MILW had about 1300 miles of 131-132, for instance, GN had 79 miles.

 

WOW!

Have a good one.

Bill B

[MichaelSol]

What size rail was on the PCE and was it welded or jointed rail?

Have a good one.

Bill B

Mostly 112-115 lb installed mid-1950s. Jointed. Some older 100 lb on some tangents out in Eastern Montana, quite a bit of 131-132 lb on curves installed early 1960s. A few locations had welded. Just getting into that era. MILW had about 1300 miles of 131-132, for instance, GN had 79 miles.

 

[billbtrain]

Had quite a night last night.Ice storm,whiteout snow conditions,lost power at work just before I was to get off early,back up generator didn't work,lost power at home for 6 hours.Stayed indoors where it was warm,had something to eat,had battery operated lanterns(non railroad type-sorry ),and battery op radio.Missed reading and posting to this Milwaukee Road thread.All is well now.

Have a good one.

Bill B

[billbtrain]

What size rail was on the PCE and was it welded or jointed rail?

Have a good one.

Bill B

[MichaelSol]

Is it correct to say there was no intention to re-electrify the Milwaukee, if the New MILW were to run trains?

At the time several railroads were looking at electrifying, including BN. It certainly might have looked like it at NewMil. The President of the NewMil organization was a forrmer Assistant Electrical Engineer at the MILW, and the Chairman of the organization was the President of the Montana Power/Western Energy (coal) Company but, with all that was going on, that was one idea too far -- the mix was already complex enough.

[martin.knoepfel]

Is it correct to say there was no intention to re-electrify the Milwaukee, if the New MILW were to run trains?

[MichaelSol]

I also have a question regarding that car leasing arrangement.  To recap, the Milwaukee sold much of their car fleet to financial institutions, then leased back the cars.  The purpose of this move was to raise some short term cash to ostensibly further entice the prospect of a CNW merger, but it ended up costing the Milwaukee more in the long run.

What I am wondering is this:  Did Milwaukee ever consider (or was there much opportunity to consider) having the shippers lease the car fleet?  After all, that's what the railroads today are doing, and it would have saved the Milwaukee the responsibility for the lease costs.  If need be, could they have reduced rates for shippers who provided their own cars (even if the cars in question were former Milwaukee owned cars)?  Was the pre-Staggers regulatory picture still at odds with this option?

There was a goodly amount of shipper owned cars then; they got a better rate. Evans, LP, Evergreen, Bennett Lumber, I am sure I would recall others that owned their own boxes that were frequent shippers on MILW. Of course, that was an era seeing the start of a big shift in ownership -- wth names like K-Line starting to appear on the outside of "rail" equipment, replacing the names on earlier efforts, NYC, MILW, IC.

Specialty cars tended to be shipper owned, although MILW had some specialty 160 ton depressed flat cars available for big stuff. The "general" car pool, though, was just that -- the railroad was in the best position to maximize use of a standard boxcar, whereas most shippers weren't in the business of also running a car leasing firm or trying to fill backhaul. Certainly much of what is passed off today as "efficiency" gains has simply been the cost shifting of car ownership to shippers. Whether there is an ultimate advantage to that for the railroad/shipper community in the long run depends on the railroad's attitude toward car utilization as a result. From my perspective, that separates cost from incentive and that's never an advantage in the long run.

MILW's strategy of rebuilding, selling the cars, then leasing them back was a fairly common railroad practice at the time, and took advantage of MILW's big shop facility at Milwaukee. While intuitively it seems like a poor practice, I can't offer that it was. I suppose there are arguments both ways and there certainly was a vicious cycle aspect to it that raised operating costs over the long run -- to the point that MILW was spending as much on car leasing in 1975 as the BN, a railroad three times its size.

It certainly did offer some mischief when some cars were renumbered at about the same time as some timberlands disappeared off the corporate books and everybody got into trouble. Forbes Magazine did some good investigative work, resultng in two cleverly titled articles: "No Visible Means of Support," June 15, 1975, and "The Mal-waukee Road?," July 1, 1975. They were so devastatingly accurate that CMC's corporate counsel, Ray Garrett, Jr., went home and, in his own words, "wept."

The SEC filed a formal complaint. The SEC attorneys who conducted the deposition of W.L. Smith were Sam Butler and Bill Hegan. Smith answered forthrightly and honestly, but it was clear -- to me anyway -- that the SEC lawyers didn't fully understand the significance of some of the answers. If they had, I think the investigation might have had a different outcome than the consent decree that was ultimately entered in the matter.

 

[Anonymous]

I also have a question regarding that car leasing arrangement.  To recap, the Milwaukee sold much of their car fleet to financial institutions, then leased back the cars.  The purpose of this move was to raise some short term cash to ostensibly further entice the prospect of a CNW merger, but it ended up costing the Milwaukee more in the long run.

What I am wondering is this:  Did Milwaukee ever consider (or was there much opportunity to consider) having the shippers lease the car fleet?  After all, that's what the railroads today are doing, and it would have saved the Milwaukee the responsibility for the lease costs.  If need be, could they have reduced rates for shippers who provided their own cars (even if the cars in question were former Milwaukee owned cars)?  Was the pre-Staggers regulatory picture still at odds with this option?

[Anonymous]

The PCE had a minimum 19'6" clearance throughout, with standard catenary in place. Catenary in the tunnels used up between 18" and 30" of additional clearance.

The line handled 93' autoracks on a daily basis without incident on the existing curvature.

Two 9' 6" containers stacked in a well stand 20' 2" above the rail.  So the Milwaukee's PCE, with the wire in place, would have been shut out of the container traffic without some major work.

The wire was removed in 1974.

Yes, but you've always said it should have been kept, upgraded and expanded to bridge the "gap" between the two electrfied sections.  You've also maintained that the PCE should have been rehabed and retained.

If those two things would have happened we would have had quite a useless railroad, rebuilt at taxpayer expense, when double stack came along.

The original comment was this:

billbtrain wrote:

I just happened to be thinking about double stacks this morning.Thinking about what would have to be done on the PCE to allow sufficient clearance amounting to say 18'.I'm refering to the PCE as it was in 1979,without the electrification.

Hopefully I answered that specific question, there was plenty of clearance. I guess you want to argue something different. No surprises.

The cost of raising the catenary 12" inside the tunnels was negligible, if that is the condition you wish to impose. There was plenty of room to do so, and plenty of room for double stacks.

And I am sure it could have been done at private expense. I'd guess the seven line crews could have done it in about four week's time, at a total cost of just under $100,000. Probably wouldn't sink the ship.

And it should be pointed out that if BNSF opted to re-electrify the Stevens Pass line, the same conditions would apply.  Only difference is that BNSF would get the State of Washington's taxpayers to fund it!

[MichaelSol]

The PCE had a minimum 19'6" clearance throughout, with standard catenary in place. Catenary in the tunnels used up between 18" and 30" of additional clearance.

The line handled 93' autoracks on a daily basis without incident on the existing curvature.

Two 9' 6" containers stacked in a well stand 20' 2" above the rail.  So the Milwaukee's PCE, with the wire in place, would have been shut out of the container traffic without some major work.

The wire was removed in 1974.

Yes, but you've always said it should have been kept, upgraded and expanded to bridge the "gap" between the two electrfied sections.  You've also maintained that the PCE should have been rehabed and retained.

If those two things would have happened we would have had quite a useless railroad, rebuilt at taxpayer expense, when double stack came along.

The original comment was this:

billbtrain wrote:

I just happened to be thinking about double stacks this morning.Thinking about what would have to be done on the PCE to allow sufficient clearance amounting to say 18'.I'm refering to the PCE as it was in 1979,without the electrification.

Hopefully I answered that specific question, there was plenty of clearance. I guess you want to argue something different. No surprises.

The cost of raising the catenary 12" inside the tunnels was negligible, if that is the condition you wish to impose. There was plenty of room to do so, and plenty of room for double stacks.

And I am sure it could have been done at private expense. I'd guess the seven line crews could have done it in about four week's time, at a total cost of just under $100,000. Probably wouldn't sink the ship.

Far more cheaply in any case than the nearly $200 million in taxpayer funds that were necessary to save and rehab the Illinois Central Gulf "at taxpayer expense".

And there is plenty of railroad line in the East for you to worry about that got federal assistance and can't handle double stacks. Perhaps your time would be best spent worrying about those, if double stack capacity is indeed really your current worry. Perhaps even to turn your attentions to BN's huge expenditure on the Stampede Pass, without obtaining double stack capacity.

But you can rest easy that there was nothing in that regard for you to worry about on the Milwaukee Road out West, and I am sure that will be a great relief to you, given the strength of your recent concerns about it.

 

[greyhounds]

The PCE had a minimum 19'6" clearance throughout, with standard catenary in place. Catenary in the tunnels used up between 18" and 30" of additional clearance.

The line handled 93' autoracks on a daily basis without incident on the existing curvature.

Two 9' 6" containers stacked in a well stand 20' 2" above the rail.  So the Milwaukee's PCE, with the wire in place, would have been shut out of the container traffic without some major work.

The wire was removed in 1974.

 

Yes, but you've always said it should have been kept, upgraded and expanded to bridge the "gap" between the two electrfied sections.  You've also maintained that the PCE should have been rehabed and retained.

If those two things would have happened we would have had quite a useless railroad, rebuilt at taxpayer expense, when double stack came along.

[arbfbe]

Just to answer a couple of questions.

BNSF access to the Bull Mountain coal deposits would be via a branchline east from Broadview, MT on the former GN line between Laurel and Great Falls.  Apparently there has been some grade work done in the area over the years for such a connection though no rail has been laid.

The coal is high grade metalurgical coal but it is mined underground.  Current output is trucked to the MRL at Lockwood, MT and moves west in less than trainload volumes.

The MILW was hauling automobiles in tri level autoracks under wire.  The days of the double stack container cars were a few years away yet.  If the electrification had been rebuilt I would imagine higher clearances for the double stack cars.  If the electrification had remained scrapped in the 80's (most likely scenario) then there was clearance for double stack containers or tunnel clearances could be increased where needed. 

[MichaelSol]

The PCE had a minimum 19'6" clearance throughout, with standard catenary in place. Catenary in the tunnels used up between 18" and 30" of additional clearance.

The line handled 93' autoracks on a daily basis without incident on the existing curvature.

Two 9' 6" containers stacked in a well stand 20' 2" above the rail.  So the Milwaukee's PCE, with the wire in place, would have been shut out of the container traffic without some major work.

The wire was removed in 1974.

 

[MichaelSol]

  However there seems to be a few cracks in some of the things that you have put out on these forums.  You were the one that said the Carter admin was "not going to give ANY money on railroads that happened to be in Republican states in 1979 and 1980". However that statement has shown to be wrong, no matter who authored the bill or what party they were a part of.

The statement came from representatives of the Carter Administration to the Governor of Montana that "the Carter Administration" was not going to approve any money for projects in states where Carter had little likelihood of winning the state in the upcoming presidential election. I can only assume that the gentlemen knew what they were talking about, and that they meant discretionary funds under the control of the Executive Branch -- such as the USDA loan which had been fundamentally approved, and then withdrawn.

Whether Congress showed that statement to be "wrong" in that context is up to you to second guess however you see fit. The Carter Administration and the U.S. Congress happened to be different entities.

In any case, I was not the Carter Administration, and did not make the original statement on its behalf. Your contention that I made the statement is, in fact, false, and that seems to be where the "cracks" on these forums are originating.

 

[MichaelSol]

 You notice how now one came up with a real proposal that would buy just the PCE using private funds?  That should tell you something, no one was willing to put "their" money in just the PCE. 

Quite a game for you, isn't it?

After the BAH report in May, 1979, the conundrum was that the best evidence showed that the MILW could not survive without the PCE.

On the other hand, the same study showed that "only the PCE" -- termed the "Twin Cities Transcon" -- could be viable on its own. Of eight considered options, the Lines East-only option, called the "Core", was considered the least potentially profitable -- the least likely to succeed.

The MRRA encouraged an ESOP that preserved the "Milwaukee" and gave that option a specific set of criteria to meet, a specific timeline, and imposed a specific set of considerations on the ICC in that regard.

The Employee/Shipper group was only going to get one crack at it -- and the best crack was to organize a proposal around what the Trustee's own consultants had proposed as, ultimately, the most profitable long-term configuration of a surviving Milwaukee Road -- the "Louisville Transcon" option as defined by the consulting firm.

Because the option had been proposed independently, based upon a study paid for by the Trustee himself, it was viewed within the SORE group as being the least susceptible to accusations of optimism or bias, particularly in its key finding that it was likely to be substantially more profitable than any other configuration.

It would also avoid the inevitable criticism that SORE proposed to take just the profitable traffic of the PCE and let the rest of the system collapse further and, in essence, be unreorganizable.

SeaFirst Bank and Lazard Freres announced they would handle the private financing for the venture. The Employees group committed to the ESOP -- which were private funds. Several shippers specificially committed to funding the effort. Continental Illinois and Harris Bank testified that they "supported" the proposal as the most financially viable of the Milwaukee alternatives. The proposal included borrowing federal funds under the same terms and conditions available to all railroads, including 4R Section 505 and 4R Section 511 funds.

So, no, I didn't "notice" that "no one" was willing to put their money in.

 

[n012944]

Indeed, the DOT "study" sounds exactly like the Carter Administration's "cover story" on why the "government" was not going to spend any money on railroads that happened to be in Republican states in 1979 and 1980 -- only railroads in Republican states lost money and were, under longstanding government policy -- not entitled to federal funds.

 

So when President Carter signed the Milwaukee Railroad Restructuring Act on 11/4/79 that gave the railroad 30 million dollars, did that money only go for the parts of the railroad that was operating Democrat states that the MILW served?

 

Congress was, and still is, a separate branch of government.

That is correct.  However if your theory about Carter and money not being spent on Republican states was true, don't you think that Carter would have vetoed the bill? 

 

Bert

Well, I am sure you have all sorts of "gotcha'" questions.

No "gotcha" questions here. I am not out to get anyone here, and if you feel that way I do apologize.  However there seems to be a few cracks in some of the things that you have put out on these forums.  You were the one that said the Carter admin was "not going to give ANY money on railroads that happened to be in Republican states in 1979 and 1980". However that statement has shown to be wrong, no matter who authored the bill or what party they were a part of.

 

Bert

[MichaelSol]

Indeed, the DOT "study" sounds exactly like the Carter Administration's "cover story" on why the "government" was not going to spend any money on railroads that happened to be in Republican states in 1979 and 1980 -- only railroads in Republican states lost money and were, under longstanding government policy -- not entitled to federal funds.

 

So when President Carter signed the Milwaukee Railroad Restructuring Act on 11/4/79 that gave the railroad 30 million dollars, did that money only go for the parts of the railroad that was operating Democrat states that the MILW served?

 

Congress was, and still is, a separate branch of government.

That is correct.  However if your theory about Carter and money not being spent on Republican states was true, don't you think that Carter would have vetoed the bill? 

 

Bert

Well, I am sure you have all sorts of "gotcha'" questions. And, it's not my "theory".

Montana's Congressional delegation at the time consisted of Senator Max Baucus (D), Senator John Melcher (D), Congressman Pat Williams (D).

The the bill was pushed through Congress especially by Senator Warren Magnuson of Washington (D), and strongly and vocally supported by Senator George McGovern (D), Senator Henry Jackson (D), Senator Quentin Burdick (D), Senator Ted Kennedy (D), Senator John Pastore (D) and Senator Claiborne Pell (D).

Retired, but strongly influential former Senate Majority Leader Mike Mansfield (D) lobbied for the bill.

Note the (D)'s.

 

[n012944]

the Milwaukee's own books and found that lines west of Miles City had contributed $12.7 million in profits in 1976,

     Michael-can you clarify what you mean, specifically, when you speak of the PCE?  Are you speaking of west of Minnneapolis,Ortonville,Mobridge, or Miles City?  I see a lot of references to Miles City.  Was Miles City the division point for the Milwaukee, as far as their studies and financial reports were done?

The historic PCE was lines west of Mobridge, SD. Miles City was selected by the Trustee (or the fellow who was actually trying to arrange this abandonment) for the reason that the coal traffic coming on line eastbound at Miles City threw the whole "PCE loses money" meme into a crock far too clearly. Indeed, at Aberdeen, the PCE was carrrying 14 MGT, and west of Harlow, one of the consulting engineers commented that it was carrying 11 MGT. Several studies, however, looked at lines west of St. Paul as the PCE.

   To be somewhat accurate in discussion, wouldn't the PCE, as we talk about it here, have to be considered to be that part west of what became NewMil?

The final NewMil proposal to the ICC was a transcontinental proposal, Portland, Tacoma Seattle, to Twin Cities, Milwaukee, Chicago, Louisville, Kansas City.

 

  You notice how now one came up with a real proposal that would buy just the PCE using private funds?  That should tell you something, no one was willing to put "their" money in just the PCE. 

 

Bert

[n012944]

Indeed, the DOT "study" sounds exactly like the Carter Administration's "cover story" on why the "government" was not going to spend any money on railroads that happened to be in Republican states in 1979 and 1980 -- only railroads in Republican states lost money and were, under longstanding government policy -- not entitled to federal funds.

 

So when President Carter signed the Milwaukee Railroad Restructuring Act on 11/4/79 that gave the railroad 30 million dollars, did that money only go for the parts of the railroad that was operating Democrat states that the MILW served?

 

Congress was, and still is, a separate branch of government.

That is correct.  However if your theory about Carter and money not being spent on Republican states was true, don't you think that Carter would have vetoed the bill? 

 

Bert

[greyhounds]

I just happened to be thinking about double stacks this morning.Thinking about what would have to be done on the PCE to allow sufficient clearance amounting to say 18'.I'm refering to the PCE as it was in 1979,without the electrification.Figure that about 45 tunnels would have been in need of enlargment or daylighting.Also,a lot of curvature would need to be reduced.

The PCE had a minimum 19'6" clearance throughout, with standard catenary in place. Catenary in the tunnels used up between 18" and 30" of additional clearance.

The line handled 93' autoracks on a daily basis without incident on the existing curvature.

Two 9' 6" containers stacked in a well stand 20' 2" above the rail.  So the Milwaukee's PCE, with the wire in place, would have been shut out of the container traffic without some major work.

[Anonymous]

Some questions about the PCE makeup.

1) How did the 19'6" tunnel clearances compare to BN's Cascade and Flathead tunnels?

Remember, the Cascade Tunnel was electrified from it's inception until the 1950's, so it also had double stack clearances built in.  It's the Stampede Pass Tunnel that has no such clearances, and that's why BNSF is trying to con the State of Washington into paying for increasing the clearances in that tunnel to allow double stacks. 

And when I say "con", I mean getting public financing without a corresponding public good, aka allowing UP or some other railroad to get trackage rights over this route.  Plus the eternal fact that the entire Stampede Pass line is rather convaluted, so crowing the tunnel is akin to the Biblical analogy of sewing new patches onto old wineskins.  A better option would be to revive the ex-Milwaukee Snoqualmie Pass line with it's ready made double stack clearances intact.  A second best option would be to build a brand new longer lower tunnel underneath the current Stampede Pass alignment aka Cascade Tunnel II to eliminate some of the 2.2% grades and reverse curvature.  And with either option, it would be judicious to also construct a series of short tunnels in the Yakima River canyon to eliminate all those horseshoe curves, and increase track speeds from the current 10 mph to a more reasonable 40 or so mph.

That way, the PNW railroads could use the NP water level grade south of Ellensburg to Pasco for grain and coal trains, and the proposed Ellensburg-Lind rebuild of the ex-Milwaukee line can be used for primarily intermodals and eastbound empties.

But like I say, if it's soley for BNSF's use, then not one penny of taxpayer money should be used, since the WSDOT rail plan specifically calls for "increased competition".

 

[billbtrain]

Some questions about the PCE makeup.

1) How did the 19'6" tunnel clearances compare to BN's Cascade and Flathead tunnels?

2)Concerning rail weight and type(jointed or welded) at the following segments

Aberdeen to Mobridge

Mobridge to Miles City

Miles City to Harlowton

Harlowton to Three Forks

That's all for now.More later.

Have a good one.

Bill B

[MichaelSol]

I just spent the last hour looking on MSN Live Search of the mainline from Harlowton to Three Forks in 3D.Sixteen Mile Canyon looks like it was the difficult part of that line.Curvature doesn't look that bad.

Milwaukee thought about promoting the canyon more -- renaming it "Montana Canyon" -- for its rugged beauty. But, other than open air cars put on at Harlow -- there wasn't much to do directly to promote the area. Most of the residents had forked tongues, so it was never going to be a tourist destination.

In the 48 miles between Loweth and Lombard, the ruling grade was 1% -- not bad for such rugged territory. Most of the curves were between 4 and 6 degrees. There was a tight spot east of Francis Substation with six ten degree curves in a four mile stretch and some 8 and 6 degree curves to the west. This was the old Montana Railroad route, which Milwaukee just about entirely rebuilt.

 

[billbtrain]

I just happened to be thinking about double stacks this morning.Thinking about what would have to be done on the PCE to allow sufficient clearance amounting to say 18'.I'm refering to the PCE as it was in 1979,without the electrification.Figure that about 45 tunnels would have been in need of enlargment or daylighting.Also,a lot of curvature would need to be reduced.

The PCE had a minimum 19'6" clearance throughout, with standard catenary in place. Catenary in the tunnels used up between 18" and 30" of additional clearance.

The line handled 93' autoracks on a daily basis without incident on the existing curvature.

Thanks,Michael.I forgot to factor in the pantographs of the electrics when I was thinking about tunnel clearances.I'm still learning,which means I'm not dead yet!

I just spent the last hour looking on MSN Live Search of the mainline from Harlowton to Three Forks in 3D.Sixteen Mile Canyon looks like it was the difficult part of that line.Curvature doesn't look that bad.

Have a good one.

Bill B

[MichaelSol]

the Milwaukee's own books and found that lines west of Miles City had contributed $12.7 million in profits in 1976,

     Michael-can you clarify what you mean, specifically, when you speak of the PCE?  Are you speaking of west of Minnneapolis,Ortonville,Mobridge, or Miles City?  I see a lot of references to Miles City.  Was Miles City the division point for the Milwaukee, as far as their studies and financial reports were done?

The historic PCE was lines west of Mobridge, SD. Miles City was selected by the Trustee (or the fellow who was actually trying to arrange this abandonment) for the reason that the coal traffic coming on line eastbound at Miles City threw the whole "PCE loses money" meme into a crock far too clearly. Indeed, at Aberdeen, the PCE was carrrying 14 MGT, and west of Harlow, one of the consulting engineers commented that it was carrying 11 MGT. Several studies, however, looked at lines west of St. Paul as the PCE.

   To be somewhat accurate in discussion, wouldn't the PCE, as we talk about it here, have to be considered to be that part west of what became NewMil?

The final NewMil proposal to the ICC was a transcontinental proposal, Portland, Tacoma Seattle, to Twin Cities, Milwaukee, Chicago, Louisville, Kansas City.

[MichaelSol]

I just happened to be thinking about double stacks this morning.Thinking about what would have to be done on the PCE to allow sufficient clearance amounting to say 18'.I'm refering to the PCE as it was in 1979,without the electrification.Figure that about 45 tunnels would have been in need of enlargment or daylighting.Also,a lot of curvature would need to be reduced.

The PCE had a minimum 19'6" clearance throughout, with standard catenary in place. Catenary in the tunnels used up between 18" and 30" of additional clearance.

The line handled 93' autoracks on a daily basis without incident on the existing curvature.

[MichaelSol]

DOT staffers noting that the 4400 miles of the railroad between Minnesota and Washington accounted for nearly two-thirds of the system's loss in 1977,

   Just a thought:  This "4400 miles" would encompass more than just the PCE.  Perhaps 700-800 miles alone, would be just the non-PCE lines in S.D. that were sucking air badly in 1979.

I don't know if it was the Trains article, or the DOT study. One never knows on these second hand reports. But, "between" Minnesota and Washington means the Dakotas, Idaho and Montana. These were mostly "bridge" states, of the kind that UP made its money on -- just rolling freight long distances without doing a lot of work along the way. The Chamblerlain line didn't see much traffic by then, that was true. But Washngton State had become an enormous generator of traffic and revenue -- because it was sending so much of it over that long land line, on some of the longest long hauls of any railroad in the country.

I recall that the Trustee had tried to construct an odd criteria, that each line segment had to generate a minimum of $38,000 a year per mile in revenue -- nothing about operating expenses -- otherwise it needed to be abandoned. It was an odd measure, since it didn't measure the revenue obtained by overhead traffic. None of the transcontinental railroads would have survived the measure, but somehow someone dreamed this up, and it sounds a lot like the DOT study.

So, somebody was able to show that these thousands of miles of track generated just about zero, and compared that to the system average overall at $38,000 per mile. And if you "did the math" it was clear that all two thirds of the system "losses" had to occur on these miles of lines that generated little or no lineside traffic. And I have a feeling that is exactly how DOT "did the math."

And if the reader didn't know anything about "overhead" -- gee, it all kind of made sense to a bureaucrat somewhere.

 

[nanaimo73]

  To be somewhat accurate in discussion, wouldn't the PCE, as we talk about it here, have to be considered to be that part west of what became NewMil?

But the studies were done looking at what would be cut off, and that kept changing. First it was Butte, then Miles City and then Ortonville.

I would prefer all studies had been done looking at Mobridge, but transferring the Faith, SD, Isabel, SD and New England, ND, traffic to the Midwest area.

[billbtrain]

Your continued interest in the Milwaukee out west is always interesting. But, the numbers just don't back you up. And you don't seem to have any of your own. That makes it appear, as always, as argument for arguments sake. There must be a lot of railroads you could be arguing about, and might have a better perspective on.

 

Well, it was an interesting railroad.  Would the electrification have allowed double stacks?

But my contentions here have been totally based on numbers (and a federal study).  I've based my reasoning on the business each line had, cited in hard numbers.  The Milwaukee Pacific Coast Extension just didn't have the volume of business needed to stay in business.  The numbers I've cited show that.  

I just happened to be thinking about double stacks this morning.Thinking about what would have to be done on the PCE to allow sufficient clearance amounting to say 18'.I'm refering to the PCE as it was in 1979,without the electrification.Figure that about 45 tunnels would have been in need of enlargment or daylighting.Also,a lot of curvature would need to be reduced.

Have a good one.

Bill B

[Murphy Siding]

the Milwaukee's own books and found that lines west of Miles City had contributed $12.7 million in profits in 1976,

     Michael-can you clarify what you mean, specifically, when you speak of the PCE?  Are you speaking of west of Minnneapolis,Ortonville,Mobridge, or Miles City?  I see a lot of references to Miles City.  Was Miles City the division point for the Milwaukee, as far as their studies and financial reports were done?

The historic PCE was lines west of Mobridge, SD. Miles City was selected by the Trustee (or the fellow who was actually trying to arrange this abandonment) for the reason that the coal traffic coming on line eastbound at Miles City threw the whole "PCE loses money" meme into a crock far too clearly. Indeed, at Aberdeen, the PCE was carrrying 14 MGT, and west of Harlow, one of the consulting engineers commented that it was carrying 11 MGT. Several studies, however, looked at lines west of St. Paul as the PCE.

   To be somewhat accurate in discussion, wouldn't the PCE, as we talk about it here, have to be considered to be that part west of what became NewMil?

[MichaelSol]

Indeed, the DOT "study" sounds exactly like the Carter Administration's "cover story" on why the "government" was not going to spend any money on railroads that happened to be in Republican states in 1979 and 1980 -- only railroads in Republican states lost money and were, under longstanding government policy -- not entitled to federal funds.

 

So when President Carter signed the Milwaukee Railroad Restructuring Act on 11/4/79 that gave the railroad 30 million dollars, did that money only go for the parts of the railroad that was operating Democrat states that the MILW served?

Congress was, and still is, a separate branch of government.

Congress specifically allocated funds to operate the PCE, even as the Executive Branch refused to extend loans under its jurisdiction through the USDA. Apparently Congress didn't think too much of the DOT report either.

Indeed, the Trustee reluctantly ordered new ballast dumped along the right-of-way -- always next to a highway, and always only on the side facing the highway -- just so everyone knew they were being sincere.

 

 

[MichaelSol]

the Milwaukee's own books and found that lines west of Miles City had contributed $12.7 million in profits in 1976,

     Michael-can you clarify what you mean, specifically, when you speak of the PCE?  Are you speaking of west of Minnneapolis,Ortonville,Mobridge, or Miles City?  I see a lot of references to Miles City.  Was Miles City the division point for the Milwaukee, as far as their studies and financial reports were done?

The historic PCE was lines west of Mobridge, SD. Miles City was selected by the Trustee (or the fellow who was actually trying to arrange this abandonment) for the reason that the coal traffic coming on line eastbound at Miles City threw the whole "PCE loses money" meme into a crock far too clearly. Indeed, at Aberdeen, the PCE was carrrying 14 MGT, and west of Harlow, one of the consulting engineers commented that it was carrying 11 MGT. Several studies, however, looked at lines west of St. Paul as the PCE.

 

[Murphy Siding]

the Milwaukee's own books and found that lines west of Miles City had contributed $12.7 million in profits in 1976,

     Michael-can you clarify what you mean, specifically, when you speak of the PCE?  Are you speaking of west of Minnneapolis,Ortonville,Mobridge, or Miles City?  I see a lot of references to Miles City.  Was Miles City the division point for the Milwaukee, as far as their studies and financial reports were done?

[Murphy Siding]

DOT staffers noting that the 4400 miles of the railroad between Minnesota and Washington accounted for nearly two-thirds of the system's loss in 1977,

   Just a thought:  This "4400 miles" would encompass more than just the PCE.  Perhaps 700-800 miles alone, would be just the non-PCE lines in S.D. that were sucking air badly in 1979.

[n012944]

Indeed, the DOT "study" sounds exactly like the Carter Administration's "cover story" on why the "government" was not going to spend any money on railroads that happened to be in Republican states in 1979 and 1980 -- only railroads in Republican states lost money and were, under longstanding government policy -- not entitled to federal funds.

 

So when President Carter signed the Milwaukee Railroad Restructuring Act on 11/4/79 that gave the railroad 30 million dollars, did that money only go for the parts of the railroad that was operating Democrat states that the MILW served?

[MichaelSol]

But my contentions here have been totally based on numbers (and a federal study).  I've based my reasoning on the business each line had, cited in hard numbers.  The Milwaukee Pacific Coast Extension just didn't have the volume of business needed to stay in business.  The numbers I've cited show that.  

It is significant, I think, in any context, that you have shown not a single number that actually showed the condition of the Milwaukee Road, nor how any of your numbers relate to the Milwaukee Road.

"Hard numbers" are generated by companies, on financial reports, not by government studies. That's the part that gets in your way -- you have referred to not a single "hard number". You have none.

In law, science, economics, or business, the general proposition always yields to the specific example -- and this is no exception.

You would not be the first person whose reliance on broad generalities foundered upon the reality of specifics, nor the last. Why you would be so interested in those generalities -- when myriad examples to the contrary exist -- is simply ... interesting, but not in any fashion that contributes meaningfully in any way to a discussion of the Milwaukee Road. But, I always get the impression, its not the Milwaukee Road that you have that much of an interest in ...

 

[greyhounds]

Your continued interest in the Milwaukee out west is always interesting. But, the numbers just don't back you up. And you don't seem to have any of your own. That makes it appear, as always, as argument for arguments sake. There must be a lot of railroads you could be arguing about, and might have a better perspective on.

 

Well, it was an interesting railroad.  Would the electrification have allowed double stacks?

But my contentions here have been totally based on numbers (and a federal study).  I've based my reasoning on the business each line had, cited in hard numbers.  The Milwaukee Pacific Coast Extension just didn't have the volume of business needed to stay in business.  The numbers I've cited show that.  

[billbtrain]

I disagree, based on evidence, that it was a viable or even potentially viable, enterprise. 

Is this enough evidence for you....?

I have to agree with Michael Sol that the Milwaukee could again have been a viable railroad.Container traffic out of Tacoma,coal from the Roundup,Montana mines,forest products from Washington,the SP connection at Portland,the connection at the Canadian border,grain from the Dakota's and Montana,etc prove to me that it could have worked.Better than the midwest lines in an area overrun with failing economies and lack of rail customers to keep at least 7 systems going.Plus the facts that the ICC,FRA,Democrats,Republicans,and the Supreme Court were willing to dump all kinds of money into the midwest,Conrail,and Amtrak,but not save the Milwaukee Road as a transcon system.Then you have the Milwaukee Executives deferring maintenance on physical plant and equipment and driving away business,just to prove their statements that the railroad would not/could not/should not make money on its own.Looks to me like a lot of the wrong people in the wrong places.I think they should be put out to pasture and bring back the Milwaukee Road as a transcon.

Bill does a nice job of summerizing just some of the evidence that the Milwaukee was predicated for success through the Northern Tier, probably in a better position than GN, definitely in a better position than either NP or UP.  But due to assorted malfeasance (mostly political) it was terminated unjudiciously.  If the Milwaukee PCE had been allowed to continue, it would probably be the dominate line for intermodal, although the likelyhood is that it would have been merged into UP or BNSF by now.

It should then be a shock to Ken that many parts of his so-called "unviable corpse" are either alive and well (Miles City to Twin Cities, South Dakota core lines, St. Maries River Railroad), have been seriously considered for return to service (Snoqualmie Pass line, Ellensburg to Lind, St. Regis to Spokane) or are currently being seriously considered for rebuilding (State of Washington rail plan. 

In addition, it doesn't take a genius to realize that BNSF/UP/MRL would be doing themselves a favor by rebuilding certain sections of the former Milwaukee ROW that are superior to those railroads' current alignments (Sixteen Mile Canyon vs Bozeman Pass, Missoula west, Marengo to Puget Sound, et al).

What Ken will never acknowledge is that oftentimes the best don't survive, while the lessers stay alive.

BTW - regarding total tonnage as the primary indicator of success:  Didn't the SP historically have more tonnage than the SF?  Yet the SF portion of BNSF is flying higher than the SP portion of UP!  Moral - it ain't tonnage, it's net revenue that counts the most.

I learned all that from Michael Sol.I think Michael also mentioned not too long ago that BNSF might be looking to get into the coal mines in the Bull Mountain area?Higher grade of coal than from the PRB.I'd like to see how they would intend to get into the area.It would be interesting.I'm also going to try to look up some of the reports about the Milwaukee's proposed abandonment.Should be interesting reading.Also need to find a copy of 'The Nation Pays Again'.I saw a copy a few years ago at the Public Library.Haven't been back lately because it's a pain to get in and out of.

Have a good one.

Bill B

[MichaelSol]

No, volume is important to any business.

Naturally, this explains why Toyota, with at one point half the volume of GM, earned three times the profits. Sure, it plays a role, but it is not determinative of profitability which is the position some people here take based on looking at lines on a map.

Volume is particularly important in the railroad business.  There are high fixed costs and the railroads need a high volume of sales to cover them.  This is brought out in the side bar to the map on page 76 in the March 2005 issue of Trains

With all due respect for the magnificent job that Trains does, it is not an economic publication.

"3:2:1 for BN:UP:MILW" ... and of course BN was more profitable than UP, right?

Well, the UP had much more tonnage than the BN over much of its system. 

That's my point ... a line on a map says nothing about context.

  One reason the UP was so healthy financially was that its main line across Nebraska and Wyoming had highly concentrated traffic with over 60 MGT.

Profit plummeted when it had to gather and distribute that traffic -- the gross tonnage provided little explanation -- just as it didn't on Penn Central.

And the BN had yet to fully implament its merger, which would concentrate the old NP line's light density traffic on the GN and bring it's costs down.

I don't think you have much to go on here.

I see things as the Milwaukee had absolutely no hope of doing something like this and, at the very least, doubling its business to reach the 20 MGT threshold.  It's Pacific Coast Extension was doomed by low volume.

Your continued interest in the Milwaukee out west is always interesting. But, the numbers just don't back you up. And you don't seem to have any of your own. That makes it appear, as always, as argument for arguments sake. There must be a lot of railroads you could be arguing about, and might have a better perspective on.

 

[greyhounds]

Just as volume is irrelevant to financial condition, so are Lines on a map meaningless from a financial perspective.

No, volume is important to any business.  In the 1930's A&P smacked the mom and pop grocery stores.  An important reason was that they had volume and could sell at a lower mark up - make less on each sale, but make more sales.  A few decades latter, Wal-Mart did a similar thing.  (Volume also gives a company power with its suppliers and can keep the suppliers in line with regard to their own prices.)

Volume is particularly important in the railroad business.  There are high fixed costs and the railroads need a high volume of sales to cover them.  This is brought out in the side bar to the map on page 76 in the March 2005 issue of Trains:

"One federal study in the '70's noted that routes below a threshold of 20 MGT (Million Gross Tons) had signifcantly higher maintenance and operating costs per ton-mile.." 

Volume doesn't tell the whole story, but it's certainly not "irrelevent to finacial condition", particularly in railroading.  And the Milwaukee's Pacific Coast Extension was less than half that important 20 MGT figure.  My question is why.

"3:2:1 for BN:UP:MILW" ... and of course BN was more profitable than UP, right?

Well, the UP had much more tonnage than the BN over much of its system.  Its line from Green River to the Northwest was just part of its picture.  One reason the UP was so healthy financially was that its main line across Nebraska and Wyoming had highly concentrated traffic with over 60 MGT. 

And the BN had yet to fully implament its merger, which would concentrate the old NP line's light density traffic on the GN and bring it's costs down.

I see things as the Milwaukee had absolutely no hope of doing something like this and, at the very least, doubling its business to reach the 20 MGT threshold.  It's Pacific Coast Extension was doomed by low volume.

As an interesting piece of information from the map, The UP had more tonnage going to/from the Pacific Northwest than it did to/from L.A.

[MichaelSol]

You are right.  The study was done in 1979, not 1977.  Former Southern Railway and future Amtrak boss W.Graham Claytor, who was Acting Secretary of Transportation, had the DOT do the study in the summer of 1979.  

What is the name of the study and the date of publication? Who are the authors?

I don't have all the information available this weekend, but here is an excert from an article that I do have on the situation.  From the 11/1979 issue of Trains: 

The messenger with the bad news was former Southern Railway chief W. Graham Claytor Jr, who served briefly last summer as Acting Secretary of Transportation in between being Secretary of the Navy and taking his newest Carter Administration post as Deputy Secretary of Defense.  He dispatched to Capitol Hill a DOT study of Lines West, commissioned at the request of an interested onlooker, Senator John Melcher(Dem., MONT.).  DOT staffers noting that the 4400 miles of the railroad between Minnesota and Washington accounted for nearly two-thirds of the system's loss in 1977, predicted that losses would continue on the lines, even excluding the cost of a 115-million-dollar rebuilding.  Claytor declared DOT opposed to any freeze on the existing railroad or Federal investment in it (systemwide rehabilitation is pegged at 1.092 billion dollars).

Well, news reports are one thing .... there is absolutely no basis for this in the documented record. Claytor held the position less than three weeks! One fast study.

The ICC acknowledged as much in its decision three months later: "The ICC also acknowledged the Trustee's error regarding the profitability of the Milwaukee Road's transcontinental operations. Instead of the terrible cash drain that Trustee Hillman [and DOT] had alleged, the ICC carefully reviewed the Milwaukee's own books and found that lines west of Miles City had contributed $12.7 million in profits in 1976, $11 million in 1977, and $2.9 million in 1978, while the railroad as a whole had been losing $100 million in those years." United States Government Interstate Commerce Commission, "Richard B. Ogilvie, Trustee of the Property of the Chicago, Milwaukee, St. Paul and Pacific Railroad Company -- Abandonment -- Portions of the Pacific Coast Extension in Montana, Idaho, Washington and Oregon" Docket No. AB-7 (Sub-No. 86), decision dated January 30, 1980, p. 57.

Note the date. I am curious, since you seem to use Trains as your source of history -- did Trains report that the Milwaukee Western Extension had been found by the ICC as profitable in its February, 1980 edition? I mean, compared to the DOT report, and the wide variation -- that would be real news!

Apparently, no one in a position of responsibility treated the DOT report as credible in the slightest. I don't think the mere passage of time has made it more credible -- especially considering that losses shot up, and did not go down, when DOT got what it wanted -- the shutdown of Lines West. Which is exactly what Milwaukee's own planning staff said would happen, if it was not sufficiently implied for you by the ICC opinion -- because the losses were on Lines East not Lines West.

I can tell you just about exactly who DOT spoke to at MILW -- as opposed to doing any actual research -- and why they got that story. Perhaps you place no weight in the ICC's understanding of railroads, as opposed to DOT's, at that time. If credibility is a guide, DOT was charged with railroad safety, and otherwise had little expertise in railroad economics as a whole.

Indeed, the DOT rehab number for the system is approximately double what the FRA estimated for total system rehab. Now, why was that? And who was DOT's "expert"? FRA hired Tom Dyer. I know who he is. Where did DOT's figures come from? Why wouldn't they use FRA's numbers? There are some enormous variations in numbers from the same government department here -- somebody's throwing some stuff around there, and it's not clear why.

Indeed, the DOT "study" sounds exactly like the Carter Administration's "cover story" on why the "government" was not going to spend any money on railroads that happened to be in Republican states in 1979 and 1980 -- only railroads in Republican states lost money and were, under longstanding government policy -- not entitled to federal funds.

Interestingly, MILW's estimated Lines West income, if restated in proportion to a modern railroad the size of BNSF, would have represented net annual income of $789,000,000. That's the same rate of return as the modern Union Pacific under deregulation, and less than was predicted by NewMil and Booz Allen Hamilton.

And I happen to think the ICC understated income for a variety of technical reasons, but in a modern context and without adjustment, MILW Lines West was doing quite well. That is the basis for my contention that the ICC decision was quite an anomoly, as it would condemn most prosperous modern railroads, at some point, to shutdown as the results did not represent a "viable" profit.

 

[n012944]

You are right.  The study was done in 1979, not 1977.  Former Southern Railway and future Amtrak boss W.Graham Claytor, who was Acting Secretary of Transportation, had the DOT do the study in the summer of 1979.  

What is the name of the study and the date of publication? Who are the authors?

 

I don't have all the information available this weekend, but here is an excert from an article that I do have on the situation.  From the 11/1979 issue of Trains: 

The messenger with the bad news was former Southern Railway chief W. Graham Claytor Jr, who served briefly last summer as Acting Secretary of Transportation in between being Secretary of the Navy and taking his newest Carter Administration post as Deputy Secretary of Defense.  He dispatched to Capitol Hill a DOT study of Lines West, commissioned at the request of an interested onlooker, Senator John Melcher(Dem., MONT.).  DOT staffers noting that the 4400 miles of the railroad between Minnesota and Washington accounted for nearly two-thirds of the system's loss in 1977, predicted that losses would continue on the lines, even excluding the cost of a 115-million-dollar rebuilding.  Claytor declared DOT opposed to any freeze on the existing railroad or Federal investment in it (systemwide rehabilitation is pegged at 1.092 billion dollars).

 

Bert

[Anonymous]

I disagree, based on evidence, that it was a viable or even potentially viable, enterprise. 

Is this enough evidence for you....?

I have to agree with Michael Sol that the Milwaukee could again have been a viable railroad.Container traffic out of Tacoma,coal from the Roundup,Montana mines,forest products from Washington,the SP connection at Portland,the connection at the Canadian border,grain from the Dakota's and Montana,etc prove to me that it could have worked.Better than the midwest lines in an area overrun with failing economies and lack of rail customers to keep at least 7 systems going.Plus the facts that the ICC,FRA,Democrats,Republicans,and the Supreme Court were willing to dump all kinds of money into the midwest,Conrail,and Amtrak,but not save the Milwaukee Road as a transcon system.Then you have the Milwaukee Executives deferring maintenance on physical plant and equipment and driving away business,just to prove their statements that the railroad would not/could not/should not make money on its own.Looks to me like a lot of the wrong people in the wrong places.I think they should be put out to pasture and bring back the Milwaukee Road as a transcon.

Bill does a nice job of summerizing just some of the evidence that the Milwaukee was predicated for success through the Northern Tier, probably in a better position than GN, definitely in a better position than either NP or UP.  But due to assorted malfeasance (mostly political) it was terminated unjudiciously.  If the Milwaukee PCE had been allowed to continue, it would probably be the dominate line for intermodal, although the likelyhood is that it would have been merged into UP or BNSF by now.

It should then be a shock to Ken that many parts of his so-called "unviable corpse" are either alive and well (Miles City to Twin Cities, South Dakota core lines, St. Maries River Railroad), have been seriously considered for return to service (Snoqualmie Pass line, Ellensburg to Lind, St. Regis to Spokane) or are currently being seriously considered for rebuilding (State of Washington rail plan. 

In addition, it doesn't take a genius to realize that BNSF/UP/MRL would be doing themselves a favor by rebuilding certain sections of the former Milwaukee ROW that are superior to those railroads' current alignments (Sixteen Mile Canyon vs Bozeman Pass, Missoula west, Marengo to Puget Sound, et al).

What Ken will never acknowledge is that oftentimes the best don't survive, while the lessers stay alive.

BTW - regarding total tonnage as the primary indicator of success:  Didn't the SP historically have more tonnage than the SF?  Yet the SF portion of BNSF is flying higher than the SP portion of UP!  Moral - it ain't tonnage, it's net revenue that counts the most.

[MichaelSol]

You are right.  The study was done in 1979, not 1977.  Former Southern Railway and future Amtrak boss W.Graham Claytor, who was Acting Secretary of Transportation, had the DOT do the study in the summer of 1979.  

What is the name of the study and the date of publication? Who are the authors?

 

[MichaelSol]

A question is:  Why did the PCE have such a small portion of the business when it was operating?  According to a tonnage map in March 2005 Trains the ratio was 3:2:1 for BN:UP:MILW.  And that's putting the Milwaukee in the best possible light.

Toyota historically (say the past 20 years) has had a smaller share of business than GM.

But almost always made much more money during that time period at the business than GM.

The volume production always favored GM.

And that's putting GM in the best possible light.

And what does that have to do with the railroads.  I don't think that you could say that the MILW was making more money than either the UP or BN, so the comparision has little or no meaning here.

Bert

Just as volume is irrelevant to financial condition, so are Lines on a map meaningless from a financial perspective.

"3:2:1 for BN:UP:MILW" ... and of course BN was more profitable than UP, right?

Because that's what the little line on the maps says, right? And of course you know that to be true. Right?

And if the Operating Ratios on the ground for the lines involved were 65%, 67% and 82%, you would know exactly which roads those represented?

Right?

And that is because those little lines are a financial tool, right?

Suppose that the little lines on the map in 1967 showed NP 2, GN 2, UP 2. and MILW 1. Why does it only show BN 3, UP 2 and MILW 1 in 1973? Shouldn't it show BN 4? Why did BN lose market share? BN's cost elasticity in that era was about 60%. That meant that for every $1 lost in revenue, it only reduced costs 60 cents. So, compared to BN 4, is BN 3 good ... or bad? Higher OR, or Lower OR? Did BN lose 25%, or did MILW grow 30% according to those little lines on the map?

As with GM and Toyota, production volume, in a vacuum, tells you this about the financial health of a company: zero.

 

[MichaelSol]

If one were contemplating vacationing in Montana...and wanted to mix in fishing, mountains, trains, and scenery, what would be a good starting point? 

Time of the year best for this?

ed

June is good. July is better. I like it hot, and so August is great but problematic if the forest fires have kicked in. Some folks like the extended Fall weather, September and October -- warm days and cool nights. A person could stay at the Yogo Inn in Lewistown (former MILW depot). Lewistown was the former headquarters of the MILW Northern Montana Line, and the center of a web of now-abandoned branch lines, to Winnett, Grass Range, Heath. Travel south to Harlowton and the last MILW Boxcab electric downtown, and the roundhouse is still pretty much intact. Further south to Livingston and visit the NP depot museum and former NP mainline shops.

Go west along the old NP mainline on which MRL still uses helpers over Bozeman Pass and spend the night at Bozeman's Gallatin Gateway Inn (former MILW) -- a magnficently restored railroad hotel. That hotel has elegance all over the place. That one is worth the trip.

The Bozeman MILW freight depot has been preserved by a private business in Bozeman which has carefully kept the Milwaukee colors and logos preserved. Looks like you could walk in the door and order up a freight car. Across the street, the NP freight house has been turned into a neat eatery/bar -- the NP Ale House -- with lots of historical railroad photos.

From there, you can go south to Yellowstone Park and the old Union Pacific station at West Yellowstone, or a short hop west to Butte which contains more history than it can possibly contain, and the junction of the Union Pacific and MRL lines, including the still-in-place but abandoned NP line into Butte, the old GN roundhouse, the NP/BN depot, the Milwaukee depot (a TV station carefully restored) where the upstairs offices still have the MILW official's logos on the doors, such as the division superintendent's office.  

The Rarus Railroad operates a little tourist train, sometimes, between Anaconda and Butte, and into the old Butte, Anaconda & Pacific facilities in Anaconda. The annual MILW Retired Employee's Picnic last summer had a ride on it and everyone thought it was just great.

West to Deer Lodge where the only surviving MILW Little Joe electric is on display; the old MILW depot in Missoula as is MRL's headquarters, dispatch center, maintenance facility, turntable, and sorting yard. North to Glacier Park and the Essex Inn which is next to the former GN mainline. You can stay in a caboose if the old hotel is not to your liking. The next day, drop over the Continental Divide and to the Many Glacier Inn -- one of GN's hotels when it was promoting passenger travel to the parks -- at Spotted Robe which has an extensive history and display of GN-related stuff; a premier passenger stop on the old GN.

South to Great Falls parallels the BNSF Central Montana cutoff into Great Falls, where both the GN and MILW depots have undergone restoration. Just for something totally strange, nothing to do with railroading, stay at the O'Hair Motor Inn. There, they have a lounge -- a Tiki Lounge, no less -- called the Sip-N-Dip on the second story of this otherwise pretty basic little hotel and watch through the large plexiglass window behind the bar -- which is a window onto the hotel pool -- as Mermaids and Mermen frolic underwater. These are usually college students who are paid to crawl into big plastic fish tails -- some of them get pretty good swimming with them -- and ogle the bar patrons, doing fish tricks for tips. A Piano player named "Peg" has been playing there for 50 or 60 years -- she's about 80, and will play whatever you want to hear, as long as she feels like playing it.

Cut across to Geraldine, and you could follow the old Milwaukee Northern Montana Line through Arrow Creek and Denton into Lewistown. The current railroad hosts the Charlie Russell Chew Choo, a dinner train. http://www.charlierussellchewchoo.com/schedule.html.

Or from Great Falls you could follow the old GN Central Montana Line through Belt and either end up back at Lewistown, or on to Billings/Laurel where the former CBQ and NP lines met, and where MRL interchanges today with the BNSF.

 

[n012944]

A question is:  Why did the PCE have such a small portion of the business when it was operating?  According to a tonnage map in March 2005 Trains the ratio was 3:2:1 for BN:UP:MILW.  And that's putting the Milwaukee in the best possible light.

Toyota historically (say the past 20 years) has had a smaller share of business than GM.

But almost always made much more money during that time period at the business than GM.

The volume production always favored GM.

And that's putting GM in the best possible light.

And what does that have to do with the railroads.  I don't think that you could say that the MILW was making more money than either the UP or BN, so the comparision has little or no meaning here.

 

Bert

[n012944]

Plus the facts that the ICC,FRA,Democrats,Republicans,and the Supreme Court were willing to dump all kinds of money into the midwest,Conrail,and Amtrak,but not save the Milwaukee Road as a transcon system.

 

The US DOT did a study on giving funding to the MILW for the PCE in 1977.  It was decided after that study that not another dime of the goverments money should be spent on the PCE.  It seems to me that the US DOT might have seen something that made them decide this, regardless of what some in the railfan community might think.

Bert

Please identify the study.

Note that the Milwaukee did not enter receivership until December, 1977, and had not applied for any government funds for the PCE as a separate entity in 1977.

If you have a copy, please compare and contrast it with the Booz Allen Hamilton study of May, 1979 which has been described in detail on these forums.

 

 

You are right.  The study was done in 1979, not 1977.  Former Southern Railway and future Amtrak boss W.Graham Claytor, who was Acting Secretary of Transportation, had the DOT do the study in the summer of 1979.  

 

Bert

[MichaelSol]

A question is:  Why did the PCE have such a small portion of the business when it was operating?  According to a tonnage map in March 2005 Trains the ratio was 3:2:1 for BN:UP:MILW.  And that's putting the Milwaukee in the best possible light.

Toyota historically (say the past 20 years) has had a smaller share of business than GM.

But almost always made much more money during that time period at the business than GM.

The volume production always favored GM.

And that's putting GM in the best possible light.

Business "analysis" by map.

 

 

[billbtrain]

I looked at that tonnage map.It is dated 1971-73.Then the Milwaukee had an increase in 1976-78 before the decline in 1978-79.I'd like to see a map depicting that.BN and UP had better connections and more resources,MILW had the majority of container traffic coming out of Tacoma/Seattle.Tacoma declined in container traffic after the MILW was gone because of limited capacity,losing business to Long Beach and Portland.

More later,I have to go to work.

Have a good one.

Bill B

[greyhounds]

I have to agree with Michael Sol that the Milwaukee could again have been a viable railroad.Container traffic out of Tacoma,coal from the Roundup,Montana mines,forest products from Washington,the SP connection at Portland,the connection at the Canadian border,grain from the Dakota's and Montana,etc prove to me that it could have worked.Better than the midwest lines in an area overrun with failing economies and lack of rail customers to keep at least 7 systems going.Plus the facts that the ICC,FRA,Democrats,Republicans,and the Supreme Court were willing to dump all kinds of money into the midwest,Conrail,and Amtrak,but not save the Milwaukee Road as a transcon system.Then you have the Milwaukee Executives deferring maintenance on physical plant and equipment and driving away business,just to prove their statements that the railroad would not/could not/should not make money on its own.Looks to me like a lot of the wrong people in the wrong places.I think they should be put out to pasture and bring back the Milwaukee Road as a transcon.

Have a good one.

Bill B

Well, we disagree.  And I think we can have fun disagreeing.  Kind of like discussing wether Kolfax or Drysdale had the best curve ball.

A question is:  Why did the PCE have such a small portion of the business when it was operating?  According to a tonnage map in March 2005 Trains the ratio was 3:2:1 for BN:UP:MILW.  And that's putting the Milwaukee in the best possible light.

 

[MichaelSol]

Plus the facts that the ICC,FRA,Democrats,Republicans,and the Supreme Court were willing to dump all kinds of money into the midwest,Conrail,and Amtrak,but not save the Milwaukee Road as a transcon system.

 

The US DOT did a study on giving funding to the MILW for the PCE in 1977.  It was decided after that study that not another dime of the goverments money should be spent on the PCE.  It seems to me that the US DOT might have seen something that made them decide this, regardless of what some in the railfan community might think.

Bert

Please identify the study.

Note that the Milwaukee did not enter receivership until December, 1977, and had not applied for any government funds for the PCE as a separate entity in 1977.

If you have a copy, please compare and contrast it with the Booz Allen Hamilton study of May, 1979 which has been described in detail on these forums.

 

 

[n012944]

Plus the facts that the ICC,FRA,Democrats,Republicans,and the Supreme Court were willing to dump all kinds of money into the midwest,Conrail,and Amtrak,but not save the Milwaukee Road as a transcon system.

 

The US DOT did a study on giving funding to the MILW for the PCE in 1977.  It was decided after that study that not another dime of the goverments money should be spent on the PCE.  It seems to me that the US DOT might have seen something that made them decide this, regardless of what some in the railfan community might think.

 

Bert

[billbtrain]

 The Milwaukee Road's deceased Pacific Coast Extension is basically the Anna Nicole Smith of this forum.  People are fighting over the deceased's remains. 

Put it in the ground.  It's essence is gone from This Earth.  Texas or Bahamas.  It doesn't matter.

Your constant attacks on the Milwaukee Road are the problem. Judging by the Milwaukee's Yahoo group, the CMSP&P must be one of America's most interesting and popular fallen flags. Why do you hate the CMSP&P, is it jealousy or just Michael ?

Most of us on the forum have learned a lot from his postings, and I can overlook his attitude. I wish there were NYC, EL and MP versions of Michael on the forum. I'd even like to see a "IC/ICG Michael". 

 

Oh, I don't hate the Milwaukee Road.  As I pointed out, it would be like hating a corpse.

I disagree, based on evidence, that it was a viable or even potentially viable, enterprise.  I should be able to say so in a discussion without being personally attacked.  I'm not the only one who has been attacked personally by Michael.  It seems to be his way of dealing with almost anyone who disagrees with him.

I try to ignore it now.

I don't think I attack the Milwaukee.   Pointing out that it could rarely turn a buck or that its PCE was in 4th place in terms of tonnage to/from the Pacific NW behind the GN line, the NP line and the UP line is not an attack.     

I have to agree with Michael Sol that the Milwaukee could again have been a viable railroad.Container traffic out of Tacoma,coal from the Roundup,Montana mines,forest products from Washington,the SP connection at Portland,the connection at the Canadian border,grain from the Dakota's and Montana,etc prove to me that it could have worked.Better than the midwest lines in an area overrun with failing economies and lack of rail customers to keep at least 7 systems going.Plus the facts that the ICC,FRA,Democrats,Republicans,and the Supreme Court were willing to dump all kinds of money into the midwest,Conrail,and Amtrak,but not save the Milwaukee Road as a transcon system.Then you have the Milwaukee Executives deferring maintenance on physical plant and equipment and driving away business,just to prove their statements that the railroad would not/could not/should not make money on its own.Looks to me like a lot of the wrong people in the wrong places.I think they should be put out to pasture and bring back the Milwaukee Road as a transcon.

Have a good one.

Bill B

[greyhounds]

 The Milwaukee Road's deceased Pacific Coast Extension is basically the Anna Nicole Smith of this forum.  People are fighting over the deceased's remains. 

Put it in the ground.  It's essence is gone from This Earth.  Texas or Bahamas.  It doesn't matter.

Your constant attacks on the Milwaukee Road are the problem. Judging by the Milwaukee's Yahoo group, the CMSP&P must be one of America's most interesting and popular fallen flags. Why do you hate the CMSP&P, is it jealousy or just Michael ?

Most of us on the forum have learned a lot from his postings, and I can overlook his attitude. I wish there were NYC, EL and MP versions of Michael on the forum. I'd even like to see a "IC/ICG Michael". 

 

Oh, I don't hate the Milwaukee Road.  As I pointed out, it would be like hating a corpse.

I disagree, based on evidence, that it was a viable or even potentially viable, enterprise.  I should be able to say so in a discussion without being personally attacked.  I'm not the only one who has been attacked personally by Michael.  It seems to be his way of dealing with almost anyone who disagrees with him.

I try to ignore it now.

I don't think I attack the Milwaukee.   Pointing out that it could rarely turn a buck or that its PCE was in 4th place in terms of tonnage to/from the Pacific NW behind the GN line, the NP line and the UP line is not an attack.     

[nanaimo73]

 The Milwaukee Road's deceased Pacific Coast Extension is basically the Anna Nicole Smith of this forum.  People are fighting over the deceased's remains. 

Put it in the ground.  It's essence is gone from This Earth.  Texas or Bahamas.  It doesn't matter.

Your constant attacks on the Milwaukee Road are the problem. Judging by the Milwaukee's Yahoo group, the CMSP&P must be one of America's most interesting and popular fallen flags. Why do you hate the CMSP&P, is it jealousy or just Michael ?

Most of us on the forum have learned a lot from his postings, and I can overlook his attitude. I wish there were NYC, EL and MP versions of Michael on the forum. I'd even like to see a "IC/ICG Michael". 

 

[greyhounds]

If one were contemplating vacationing in Montana...and wanted to mix in fishing, mountains, trains, and scenery, what would be a good starting point? 

Time of the year best for this?

ed

 I like that attitude. Enjoy your vacation.

The Milwaukee Road's deceased Pacific Coast Extension is basically the Anna Nicole Smith of this forum.  People are fighting over the deceased's remains. 

Put it in the ground.  It's essence is gone from This Earth.  Texas or Bahamas.  It doesn't matter.

Say a believing and thoughtful prayer.  Remember with love.  Continue your own life with joy and not bitterness.  For that too, will end soon enough.

[MP173]

If one were contemplating vacationing in Montana...and wanted to mix in fishing, mountains, trains, and scenery, what would be a good starting point? 

Time of the year best for this?

ed

[MichaelSol]

What were there for industry shipping on the Milwaukee Road's PCE? For instance,what amount did U.S.Gypsum ship out of Heath,Montana? Thanks.

Historically, MILW PCE was forest products, mining, import/export, ag.

US Gypsum shipped between 1950 and 1977 between $1 million and $300,000 of wallboard transportation revenue. Something around a 1,000 carloads annually, typically. Not bad for a little 9 mile spur line in the middle of nowhere.

Just happened to notice, while looking that up on my "Revenue Study" that in 1977, Lines West generated the same amount of revenue per mile of line as Lines East -- $91,257 vs. $91,883. A typical Lines West employee, however, generated $82,980 in revenue, while Lines East generated $59,844 per employee. LW, 139% of the productivity of LE. I doubt that said anything about the employees, but rather about the system efficiency involved.

 

[billbtrain]

What were there for industry shipping on the Milwaukee Road's PCE? For instance,what amount did U.S.Gypsum ship out of Heath,Montana? Thanks.

Let's keep this thread going.

Have a good one.

Bill B

[arbfbe]

I believe in the time line of Durnat Canyon between Butte and Finlen it was mostly MILW steam beneath BA&P 2400v DC trolley.  By the time the MILW 3000v DC locos were in use the MILW had constructed it's own line through the canyon.

 I think Noel Holley's Milwaukee Electrics book does mention the heavier MILW electrics using the BA&P voltages through the canyon for a time, though.  The MILW would not want to stick with that for any length of time since there is a rising grade eastbound through the canyon and limiting the voltage and electrical capacity would limit the tonnage through the canyon. 

UPDATE:  From Charlie Mutschler's book "Wired for Success" covering the BA&P we have the following time line.

The Milw leased trackage rights on the BA&P between Colorado Jct. (Butte) to Cliff Jct. (Finlen) from 1908 to Dec 1914.  The BA&P was electrified by 10/13 and the first regular electrics west of Butte on the MILW in regualr service were in December 1915.

That would seemingly make MILW electrics under BA&P catenary possible though not a regular occurance. 

BUTTE routing:  Though Butte was served by the BA&P, NP, GN and UP by the time the MILW moved westward none of these lines were mainlines.  The NP was the closest to having thru service and indeed their passenger trains were through trains like the MILW's.  Freight was a different story.  All other railroads needed to make a connection with freight traffic but the MILW was a straight pick up in either direction.  The NP only had an 11 mile connection for westbound freight but eastbound loads had to go over the Pass to Logan.  GN loads east were not too bad but westbound loads had to go north east to Great Falls before being routed to the west.  The UP had to take loads in either direction a long way south over a helper grade before they could be sent in the proper direction.   If nothing else the MILW could claim bragging rights for the only mainline in Butte and people in Butte have always been protective of their primary position in Montana economics and politics.  You really have to know some Buttians and understand Butte politics to understand how the MILW would appeal to travelers and shippers from Silver Bow county.   

[MichaelSol]

Were the two systems totally incompatable then, or could the 2.4k BA&P locos also utilize the Milwaukee 3k wires on that portion from Butte to Finlen?

There was an interlock where the two wires crossed at Butte. Once in a while something would stick and the BA&P locomotives would suddenly be raring up and jumping all over the place. "Hi Ho Silver and away" ... with a 6,000 ton ore train in tow. Dangerous situation to be placing a 3000 volt DC feed into a 2400 volt system. Not a lot of room in those little BA&P locos for 3000 volts to be hunting for a way out.

MILW could run just fine off the 2400 vDC, but capacity was a problem. Two Joes, or their earlier counterparts, would swallow the whole BA&P system and probably take it down. Plus, the MILW needed a continuous 3000 vDC trolley between Morel and Janney Substations as Morel was part of the power block that fed the bottom half of the Butte Hill.

 

[MichaelSol]

 

Once electrification proved it's worth, was any thought given to "short cutting" parts of the line e.g. eliminating some of the reverse curves/loop tracks on Pipestone Pass and/or St. Paul Pass with shorter but steeper grades?  Would there have been that much difference (on how it affected the tracks and rolling stock) between a 1.7/2.0% grade and say a 3% or 4% grade with the 3k electrification? 

I take it that the longer St. Paul Pass tunnel proposal lost some of it's urgency once electrification established it's superiority over traditional steam, but did that necessarily negate the desire to reduce overall mileage of the PCE (which the longer, lower St. Paul Pass tunnel and realignment projected would have accomplised)?

Well, the amount of energy required was still the same to move the tonnage -- the electrification was just more powerful and efficient. Doubling up the grade would have removed many of the benefits of the electrification.

The St. Paul Tunnel bypass at Bryson was probably just an internal rate of return question -- at what point could it be justified? According to BN engineering, the Cascade Tunnel generated a negative rate of return from day one, and will for all time; a bad idea, just Ralph Budd's effort to be just as much an Empire Bulder as the old man. The Bryson bypass may have just never generated the return necessary -- especially with the electrification in place.

In essence, the efficiency of the electrification increased the economic hurdle necessary to justify alignment changes.

 

[MichaelSol]

 

Well, the first two surveys, after the Northern Securities decision was handed down in 1901, went only to Butte. That was the entire focus.

So Butte was sort of a point of reference between the plains division and the Pacific Coast division?

By the way, when was the Cadotte Pass line first proposed for the Milwaukee?  Was it after the PCE was completed?

I think Butte represented what the Standard Oil Company thought was the most important destination between the Twin Cities and Seattle.

 My notes on Cadotte Pass are as follows:

"As early as 1906, Milwaukee surveyors had purportedly run surveys that took the Milwaukee mainline from Melstone and not towards the south, to Butte, but northwest to Lewistown, Great Falls, and Missoula.¹ By 1909, Company surveyors in the Blackfoot River country seemed to confirm a Great Falls line that would provide a shorter route through Montana than the southern line through Butte.^2"

^{I also note that prior to the Cadotte survey, "Milwaukee's idea of a second, northerly mainline through Kalispell to Spokane ran into difficulties. Surveys up the Teton River were proving unsatisfactory. Survey parties spent "all summer" 1912 in the mountains east and west of Kalispell, searching for a line from the Sun River through Kalispell to Libby.1 They were unable to find a line that gave them easier grades than Pipestone Pass."}

 

[Anonymous]

 

Well, the first two surveys, after the Northern Securities decision was handed down in 1901, went only to Butte. That was the entire focus.

So Butte was sort of a point of reference between the plains division and the Pacific Coast division?

By the way, when was the Cadette Pass line first proposed for the Milwaukee?  Was it after the PCE was completed?

By 1905, I think they understood that electrification was so advantageous that route was almost secondary -- that comparisons with other roads from a traditional route -- as opposed to technological -- perspective were bound to underestimate the technological advantage that Milwaukee had until June 16, 1974.

Once electrification proved it's worth, was any thought given to "short cutting" parts of the line e.g. eliminating some of the reverse curves/loop tracks on Pipestone Pass and/or St. Paul Pass with shorter but steeper grades?  Would there have been that much difference (on how it affected the tracks and rolling stock) between a 1.7/2.0% grade and say a 3% or 4% grade with the 3k electrification? 

I take it that the longer St. Paul Pass tunnel proposal lost some of it's urgency once electrification established it's superiority over traditional steam, but did that necessarily negate the desire to reduce overall mileage of the PCE (which the longer, lower St. Paul Pass tunnel and realignment projected would have accomplised)?

The Milwaukee did purchase a one-half interest in the BA&P (from James J. Hill) and did, in fact, use the BA&P rails from Butte to Finlen. They built their own line through Silver Bow canyon in 1914 when the impending 3,000 vDC electrification made continued operation under the BA&P 2,400 vDC catenary infeasible.

Were the two systems totally incompatable then, or could the 2.4k BA&P locos also utilize the Milwaukee 3k wires on that portion from Butte to Finlen?

[MichaelSol]

A couple of things to add.  For the ICC to grant permission for the "NewMil" to buy the PCE, the "NewMil" would have had to meet five validity tests:

1. can the "NewMil" be funded

2. is it fair to the creditors of the MILW

3. can it be put into effect by 4/1/80

4. does it incorporate management-labor agreements to boost productivity

5. will it be selfsustaining.

The US DOT told the ICC that the only "test" that the "NewMil" could pass was number 3, it could be up and ready to run by 4/1/80.  The DOT thought that the "NewMil" faced a  cash shortfall of over 600 Million dollars over the next five years.  On 12/31/1979 the ICC voted in a 7-0 decision that the "NewMil" would work.

My notes state as follows:

"On December 16, the ICC held hearings, and on December 31, found that the plan was not feasible because of a lack of financing, over-optimistic traffic assessments, under-estimation of the costs and time factors involved in rehabilitating the Milwaukee Road's western lines, and underestimation of the costs involved in acquiring the necessary equipment to operate the system. In addition, the ICC found that the NewMil plan would leave the old Milwaukee with most of the debt of the Company, and take $533 million worth of assets out of the old Company's estate, which would be an impermissible taking from the shareholders and creditors. ¹ "The Commission has determined that NewMil's plan lacks adequate financing, is not fair and equitable to the Milwaukee estate, and does not propose a railroad that can be operated on a self-sustaining basis," the ICC said. The decision was 7-0.^2"

^{The decision ranged from the ridiculous to the ludicrous. It was the typical case of looking for a variety of rationalizations to prop up their decision. Particularly in the context that this was one of two plans being submitted at the same time to the ICC, the other being the Trustee's. No one supported the Trustee's plan. The ICC had determined that NewMil could not obtain financing. NewMil already had the financing committed from SeaFirst Bank and Lazard Freres. The ICC thought the plan would not be fair to creditors -- yet the major creditors supported the plan. The rehabilitation plan had been worked out in conjunction with two of the best railway engineers in the country. "Most" of the debt would remain with the "old" company as would "most" of the assets. The Commission criticized the lack of a management-labor agreement before there was a management to negotiate an agreement! The ICC made up the $533 million figure out of thin air. Indeed, in most instances, contrary to accepted practice, the ICC did not rely on expert testimony for its conclusions.}

^{Ultimately, the weight of the opinion was the finding of the lack of ability to operate on a self-sustaining basis -- the revenue adequacy standard by which, thirty years later, most railroads have not met -- 30 years apparently not representing "self-sustaining."}

^{Railroads continue to just barely hang on by the standards that the ICC turned down the NewMil proposal.}

[n012944]

Fair enough answer.  Let me rephrase the question then.  Why were they not able to buy the PCE?

The ICC, led by Chairman Darius Gaskins, determined that the proposal offered a rate of return of 10.6% whereas the ICC's annual determination of "revenue adequacy" would have required an 11% rate of return -- which only two railroads in the country were earning at the time -- the first time that the standard had been applied to a railroad in receivership, and which has rarely been met by the most highly successful railroads -- "roaring successes" you might hear -- since that time.

The ICC also noted that the Trustee had actively been driving away business on the west end, and that his actions had compromised the ability of any new system to operate. At the same time, the ICC flatly rejected the Trustee's plan for reorgnization as unrealistic and unworkable. It was an interesting spectacle -- the ICC noted that the Trustee had actively interferred with providing rail service, and had offered a non-starter of a reorganization plan, but at the end of the day, had to leave him in charge because it had no authority over him.

Later, as President of the Burlington Northern, Gaskins pondered that it had been "a difficult decision."

Indeed, if anyone wants an example of ICC incompetence, in the name of revenue adequacy, the ICC rejected a proposed highly profitable road, and defaulted to an ultimate railroad reorganization that promised no rate of return at all. This thread stands for the proposition that there is a strong sentiment of conventional wisdom that argues that the outcome made perfect sense.

So, yes, it was a government decision that throttled a private initiative.

 

A couple of things to add.  For the ICC to grant permission for the "NewMil" to buy the PCE, the "NewMil" would have had to meet five validity tests:

1. can the "NewMil" be funded

2. is it fair to the creditors of the MILW

3. can it be put into effect by 4/1/80

4. does it incorporate management-labor agreements to boost productivity

5. will it be selfsustaining.

 

The US DOT told the ICC that the only "test" that the "NewMil" could pass was number 3, it could be up and ready to run by 4/1/80.  The DOT thought that the "NewMil" faced a  cash shortfall of over 600 Million dollars over the next five years.  On 12/31/1979 the ICC voted in a 7-0 decision that the "NewMil" would not work.

 

Bert

[MichaelSol]

    Once this proposal was shot down, was there no turning back?

The States of South Dakota and Montana stepped forward, which would have preserved the entire line to Marengo, Washington, and BN was looking at purchasing the remainder of the line to Black River Junction.

In essence, this was a second round of additional entities interested in buying the PCE, and additional efforts to preserve the entire line.

Montana, in particular, looked to a federal loan to assist in its efforts, and the agency handling the loan -- USDA -- had virtually approved it.

Then, President Jimmy Carter's staff interceded and told Montana Governor Tom Judge that, since Carter wasn't going to win Montana, which was leaning heavily to Ronald Reagan, "the White House" needed to put federal money where it might "do some good" in the upcoming presidential election. Montana's efforts were shot down.

By that time, the big shippers that had been supporting the PCE even in its darkest, slowest hours -- Cargill, Chrysler, Potlatch, Weyerhauser, Toyota, GM, Champion International, Montana Power Co., Continental Grain, etc. -- began to drift away. It's strong connections with the SP and the British Columbia roads were beginning to fail. It's heavy traffic at Ports of Seattle, Tacoma, Longview and Portland was eroding quickly. The Trustee's continuing denial of service was taking its toll.

Never has a financial outcome depended so thoroughly upon a completely unrelated and thoroughly cynical political manipulation of the federal budget to obtain a partisan objective.

 

[Murphy Siding]

Fair enough answer.  Let me rephrase the question then.  Why were they not able to buy the PCE?

The ICC, led by Chairman Darius Gaskins, determined that the proposal offered a rate of return of 10.6% whereas the ICC's annual determination of "revenue adequacy" would have required an 11% rate of return -- which only two railroads in the country were earning at the time -- the first time that the standard had been applied to a railroad in receivership, and which has rarely been met by the most highly successful railroads -- "roaring successes" you might hear -- since that time.

Later, as President of the Burlington Northern, Gaskins pondered that it had been "a difficult decision."

So, yes, it was a government decision throttled a private initiative.

Thank You.  Now I see the picture a little clearer.  Some weird coincidence, about that Gaskins fella ending up at BN-eh?

    Once this proposal was shot down, was there no turning back?

[MichaelSol]

By all accounts by the end the ROW was a mess and it would have required enormous investment to get it back in order. 

Several studies were done for rehab requirements. The FRA hired the former Chief of Engineering of the B&O, and other agencies hired the retired Chief Engineer of the Southern Pacific. One estimate for rehab of the mainline west of the Twin Cities was $53 million; the other estimate, for mainlines west of Miles City was $51 million.

The highest cost estimate was about $36,000 per mile. Tom Dyer thought it might be as low as $32,000 per mile. The estimates, by senior engineers in the profession, independently arrived at, were surprisingly close. Neither one had any incentive to low-ball their estimates, siince neither was initially hired by by parties associated with preservation effects; rather, to the contrary.

Contrast those estimates with the MILW line, Chicago/Twin Cities, which engineering estimates pegged at $252,000 per mile to rehab with 4R money -- and they got the money! You can conclude that the Chicago mainline was in much, much worse shape ... or that the condition of the PCE mainline was highly exagerated, highly. The rehabilitation of the old NP line over Stampede Pass was on the order of several million dollars per mile of line. Indeed, that short BN project cost more than double the entire cost estimate for the entire PCE mainline -- and they didn't even get stack capacity out of the project. That just shows how bad off that PCE mainline must have really been!

You might wonder why that misnomer exists, and is even perpetuated by some to this day.

The record was very well developed on that point.

In railroad terms, the cost was not "enormous" and certainly not compared with the cost of the other end of the system. I have yet to see anyone complain that the Lines East rehab cost was "enormous."

Compared to the nearly $400 million in extra revenue generated by the Gateways condition alone, the Lines West rehab was indeed "pocket change."

 

[MichaelSol]

Fair enough answer.  Let me rephrase the question then.  Why were they not able to buy the PCE?

The ICC, led by Chairman Darius Gaskins, determined that the proposal offered a rate of return of 10.6% whereas the ICC's annual determination of "revenue adequacy" would have required an 11% rate of return -- which only two railroads in the country were earning at the time -- the first time that the standard had been applied to a railroad in receivership, and which has rarely been met by the most highly successful railroads -- "roaring successes" you might hear -- since that time.

The ICC also noted that the Trustee had actively been driving away business on the west end, and that his actions had compromised the ability of any new system to operate. At the same time, the ICC flatly rejected the Trustee's plan for reorgnization as unrealistic and unworkable. It was an interesting spectacle -- the ICC noted that the Trustee had actively interferred with providing rail service, and had offered a non-starter of a reorganization plan, but at the end of the day, had to leave him in charge because it had no authority over him.

Later, as President of the Burlington Northern, Gaskins pondered that it had been "a difficult decision."

Indeed, if anyone wants an example of ICC incompetence, in the name of revenue adequacy, the ICC rejected a proposed highly profitable road, and defaulted to an ultimate railroad reorganization that promised no rate of return at all. This thread stands for the proposition that there is a strong sentiment of conventional wisdom that argues that the outcome made perfect sense.

So, yes, it was a government decision that throttled a private initiative.

 

[Murphy Siding]

I guess people keep asking that question, because it never seems to have been answered.  If the PCE was the sure fire deal that you say it was, why didn't someone, anyone, snatch it up?  The purchase of the East End, just to keep it out of someone else's hands makes sense.  The fact that no one wanted to buy the PCE, and give BN a run for their money, doesn't make much sense.  Why was that?

A corporation was formed as a consortium of shippers, employees and government agencies. It was specifically given a preference by Congress over any other applicant that might attempt to purchase the line. They made a formal application to the ICC to purchase. They intervened in the bankruptcy proceeding. They obtained the financing committments from private lenders to undertake the project -- something the Trustee had been unable to do. They had pro forma projections and an operating and rehabilitation plan in place. They had the support of Milwaukee's creditors and bankers.

They "wanted to buy the PCE." I don't know how to make that any clearer.

"The fact that no one wanted to buy the PCE ... doesn't make much sense" only if you ignore the fact that someone did want to buy it. And for some reason, you are. Why?

  Fair enough answer.  Let me rephrase the question then.  Why were they not able to buy the PCE?

[MP173]

Ken:

I am not an accountant but have a basic understanding of accounting and financial reporting.  I believe you can determine whether a division of a railroad, or a factory or just about any entity of a larger company is "profitable".

The challenge is to properly allocate revenue and expenses accordingly and finally the overhead costs.  No doubt a railroad would know what it's costs are, not only overall, but by division.  Revenue would generally be allocated based on miles, plus pickup/delivery charges and any terminal expenses at intermediate yards. 

Perhaps we have accountants here that can address this a bit better than me.

I am not a spokesman for the MILW crowd, but I would think that if their traffic density was at a reasonable level that line should have been profitable.  Not by running 1 train each way daily, but if they were running 8-10/day with the majority of the freight being long haul (1000 miles) or so,with the carload rates quoted above ($1400 from Montana, $2k from the coast), that would be an attractive situation.

Now, the problems would have developed when the company allowed the ROW to fall to the levels that occured.  Schedules couldnt be met, derailments cost $$$ and costs generally rose.

Why didnt anyone buy at the end?  Why would then?  By all accounts by the end the ROW was a mess and it would have required enormous investment to get it back in order.  BN had two routes to PNW and UP had theirs.  They knew their traffic was going to increase due to the 8-10 trains a day that vaporized.  In fact by then I am sure the trains were down to a much lower frequency/day.  Buying and rehabbing would have been a lot of $$ and considerable risk.  Plenty of routes to the PNW existed at the time, just not enough business.

I am sure I will be corrected if any of the assumptions are incorrect.

ed

[MichaelSol]

I guess people keep asking that question, because it never seems to have been answered.  If the PCE was the sure fire deal that you say it was, why didn't someone, anyone, snatch it up?  The purchase of the East End, just to keep it out of someone else's hands makes sense.  The fact that no one wanted to buy the PCE, and give BN a run for their money, doesn't make much sense.  Why was that?

A corporation was formed as a consortium of shippers, employees and government agencies. It was specifically given a preference by Congress over any other applicant that might attempt to purchase the line. They made a formal application to the ICC to purchase. They intervened in the bankruptcy proceeding. They obtained the financing committments from private lenders to undertake the project -- something the Trustee had been unable to do. They had pro forma projections and an operating and rehabilitation plan in place. They had the support of Milwaukee's creditors and bankers.

They "wanted to buy the PCE." I don't know how to make that any clearer.

"The fact that no one wanted to buy the PCE ... doesn't make much sense" only if you ignore the fact that someone did want to buy it. And for some reason, you are. Why?

 

[MichaelSol]

OK, so we agree that the double entering of expenses had no real effect on anything.  It was simply a correctable error on the application to abandon.

Management, the trustee and the court were all getting the correct financial information when the decison to abandon the Pacific Coast Extension was made.

The decision was made in mid-1978. The "correct financial information" was submitted long after, and long after the decision had become, because of the Trustee's actions on the ground, irreversible. To suggest that it must have been a surprise to Trustee Stanley Hillman must have been an understatement. Apparently someone papered it over with him by saying -- as on this thread -- it was "just" following an ICC formula. A slick line that fools some of the people some of the time.

Then the Consulting Study came back -- can't make money without the PCE.

"No real effect," ... except on Stanley Hillman's ulcer.

 

 

[greyhounds]

OK, here we go.

The asertation that the Pacific Coast Extension of the Chicago, Milwaukee, St. Paul and Pacific was profitable is not logical or proveable.  The reason is that you can not, with any certainty, determine the revenues of the line.  And if you can't determine the revenues, you can't determine the profitability.....

But this Milwaukee thing needs further explination.  Why, for years, wouldn't the cash pile up if expenses were being double entered into the books?

Unless, of course, the Milwaukee's own people were stealing it blind.

You misread.

The expenses were double entered on the Application to Abandon, not "the books".

 

OK, so we agree that the double entering of expenses had no real effect on anything.  It was simply a correctable error on the application to abandon.

Management, the trustee and the court were all getting the correct financial information when the decison to abandon the Pacific Coast Extension was made.

Then why does anyone make an issue of the double entering of expenses on the abandonment application?  It didn't effect anything.

[Murphy Siding]

      Which leads me to the question that always seems to come up when discussing the Milwaukee Road and the PCE.  If, the PCE was "profitable", but the east end/branchline network wasn't, why did a buyer(s) show up to purchase the east end, but not the PCE?

Shippers, employees and government entities got together to do just that for the West End. There was a buyer. I'm not sure why people keep asking this question -- that buyer's plan  earned the support of Milwaukee's creditors, bankers, and the ICC.

Nobody, and I mean nobody, supported the Trustee's plan. It wasn't seen as viable. The East End -- Milwaukee II -- came into existence by default; the simple fact that the Trustee was in a position to make certain outcomes inevitable. The East End became a sort of "Prisoner's Dilemma". Nobody wanted anyone else to get it.

 

I guess people keep asking that question, because it never seems to have been answered.  If the PCE was the sure fire deal that you say it was, why didn't someone, anyone, snatch it up?  The purchase of the East End, just to keep it out of someone else's hands makes sense.  The fact that no one wanted to buy the PCE, and give BN a run for their money, doesn't make much sense.  Why was that?

[MichaelSol]

      Which leads me to the question that always seems to come up when discussing the Milwaukee Road and the PCE.  If, the PCE was "profitable", but the east end/branchline network wasn't, why did a buyer(s) show up to purchase the east end, but not the PCE?

Shippers, employees and government entities got together to do just that for the West End. There was a buyer. I'm not sure why people keep asking this question -- that buyer's plan  earned the support of Milwaukee's creditors, bankers, and the ICC.

Nobody, and I mean nobody, supported the Trustee's plan. It wasn't seen as viable. The East End -- Milwaukee II -- came into existence by default; the simple fact that the Trustee was in a position to make certain outcomes inevitable. The East End became a sort of "Prisoner's Dilemma". Nobody wanted anyone else to get it.

 

[Murphy Siding]

      Which leads me to the question that always seems to come up when discussing the Milwaukee Road and the PCE.  If, the PCE was "profitable", but the east end/branchline network wasn't, why did a buyer(s) show up to purchase the east end, but not the PCE?

[MichaelSol]

OK, here we go.

The asertation that the Pacific Coast Extension of the Chicago, Milwaukee, St. Paul and Pacific was profitable is not logical or proveable.  The reason is that you can not, with any certainty, determine the revenues of the line.  And if you can't determine the revenues, you can't determine the profitability.

The Application to Abandon did, in fact, use "Branchline" abandonment rules. Apparently the ICC hadn't gotten around to formulating rules for transcontinental mainline abandonment. In this instance, the rules understated revenue.

However, 30%, if I am recalling correctly, of Milwaukee's PCE traffic moved within zones 8, 7 and 6 -- west of Miles City. They weren't making any mistakes "allocating" that.

Further, detailed traffic studies by Reebie & Associates and Booz Allen Hamilton were done on revenue losses. The Application to Abandon, for instance, in its final form, showed $186 million in revenue using the branchline rules. And showed a profit. 

The traffic studies were comprehensive. Milwaukee knew just about exactly what traffic they were going to lose, and what little they were going to keep, on a carload by carload basis.

BAH estimated actual revenue attributable to the PCE would be closer to $240 million, again, if I am recalling correctly, representing about $60 million in net profit over operating expenses. A pretty good estimate because when it was shut down, Milwaukee's net loss shot up by just about $55 million. I doubt that it was just a coincidence.

These numbers were pretty close, as well, to Milwaukee's Planning Department projections rejected by Trustee Hillman in 1978.

To say that a railroad "couldn't figure out" how it earned its money is, I think, patently ridiculous.

 

[MichaelSol]

OK, here we go.

The asertation that the Pacific Coast Extension of the Chicago, Milwaukee, St. Paul and Pacific was profitable is not logical or proveable.  The reason is that you can not, with any certainty, determine the revenues of the line.  And if you can't determine the revenues, you can't determine the profitability.....

But this Milwaukee thing needs further explination.  Why, for years, wouldn't the cash pile up if expenses were being double entered into the books?

Unless, of course, the Milwaukee's own people were stealing it blind.

You misread.

The expenses were double entered on the Application to Abandon, not "the books".

 

[nanaimo73]

  That's what I always understood it to be. Management and stockholders milked the cow dry and want to liquidate the whole thing, but a few were able to save a little bit.

There were 5 senior management members that were charged during the late 1970s with taking money from the Milwaukee Land Company and transferring it to the Railroad.

[greyhounds]

That's what I always understood it to be. Management and stockholders milked the cow dry and want to liquidate the whole thing, but a few were able to save a little bit.

Well, there's a difference between milking and stealing.

The stockholders certainly had a right to milk their own cow. (In this case, the Milwaukee Road "cow")  Whatever they could get out of her was rightfully theirs.  They owned "her", it was their "milk".

But if somebody in "Lines West" management was "cookin the books", and stealing from the stockholders, that'd be a different story.  He would have ben taking somebody elses "Milk".  And that's stealing. 

The question is: "Where did the cash generated by the double entering of the expenses go?"

(For the Record:  I am opposed to any actual abuse of  real cows, or bovines of any other type, or any other animal that God Has Set Upon This Earth and I do volunteer for animal welfare.   And now I will be slammed for referencing God.)

[snagletooth]

ut this Milwaukee thing needs further explination.  Why, for years, wouldn't the cash pile up if expenses were being double entered into the books?

Unless, of course, the Milwaukee's own people were stealing it blind.

That's what I always understood it to be. Management and stockholders milked the cow dry and want to liquidate the whole thing, but a few were able to save a little bit.

[greyhounds]

OK, here we go.

The asertation that the Pacific Coast Extension of the Chicago, Milwaukee, St. Paul and Pacific was profitable is not logical or proveable.  The reason is that you can not, with any certainty, determine the revenues of the line.  And if you can't determine the revenues, you can't determine the profitability.

Now, if a shipment only moved on the PCE, say from Great Falls to Seattle, then we do know that 100% of the revenue can be assigned to the PCE.   But if a shipment moved to or from the PCE to or from other parts of the Milwaukee network there is a very real question as to how much of the revenue do you allocate to the PCE.

Look at the often mentioned traffic between the Pacific Northwest and Kansas City.  How much of the revenue from this traffic belongs to the PCE route and how much belongs to the route past the Twin Cities to Kansas City?  There's no way to know.  So saying the PCE was profitable is simply a function of arbitrarily allocating enough revenue to the PCE.  If you do that, then you'll show the PCE to be "profitable".  But what you "show" means nothing. 

Would the ICC support such an arbitrary allocation of revenue and possibly "show" the PCE to be profitable.  Of course they would.  In a branch line abandonment application a railroad had to "allocate" 50% of the revenue to the branch.  You could haul it 800 miles on a main line, and 20 miles on a branch, but the branch got 50% of the revenue according to the ICC.  Heck Fire, they had to come up with something.  And they did.

As to this double counting of expenses, it needs more explination.

It's not like Enron or MCI.  In those cases profits were overstated.  MCI, for example, capitalized money going out that should have been expensed.  This is the equivalent of you paying someone to mow your lawn and adding it to the value of your house in a loan application because a well kept lawn improves your home's worth.  It's a little hard to catch because nobody really knows what your home is worth until somebody makes an offer.  (The MCI auditors should have done better.)

The alledged Milwaukee "mistake" or "fraud" or "whatever" is very different.  It's alledged to be an understating of profit.  That's a little harder to do.  You see, you've got all this cash on hand that you're not supposed to have.  You supposidly spent it to run the railroad, but it's still there.  You've got something very real to explain.  The books don't balance.

Now it is quite possible that the managers of Milwaukee Lines West were stealing.  I've seen similar. Our manager of Sales Administration double submited bills for country club membership fees.  He pocketed the money until he was caught by the auditors.  We had a TOFC ramp manager in Louisville receive invoices from a trucking company for services they never performed.  He authorized payment and split the money with them.  He went to Federal Prison.

But this Milwaukee thing needs further explination.  Why, for years, wouldn't the cash pile up if expenses were being double entered into the books?

Unless, of course, the Milwaukee's own people were stealing it blind.

[MichaelSol]

One of the big reasons for going through Butte was that a few of the directors of the CM&StP during the time that the PCE was planned and built were also directors of the Anaconda Copper Company - which also had a bearing on why the CM&StP electrified (good market for copper).

     Did CM&StP get rewarded for this effort, by getting traffic from Anaconda?

Don't know how much, if any, traffic Anaconda sent to the MILW. Michael Sol would probably be able to give a much more informaed answer than I would. Also keep in mind that at the time the PCE was built, Butte was by far the largest city in Montana.

During those days, the mighty Anaconda Copper Mining Co. ran the biggest industry facility between the Twin Cities and the Puget Sound, it controlled the majority of the forest products industries between the Dakotas and Washington State, it owned the biggest newspapers in Montana, and it controlled many wholesale and retail operations. Recall, J. Hill's first western terminus was Butte, Montana. The NP built through it, the GN built to it, the UP built to it, and the Milwaukee built through it as Milwaukee's owner, William Rockefeller, wanted his own railroad to serve the Anaconda's interests, as he was one of the primary owners of that company as well, and didn't like the idea of contributing profits to his competitors -- a Rockefeller family trait.

From the limited shipment records of the Anaconda company that I have reviewed, Milwaukee received about as much traffic as the Great Northern and Northern Pacific combined. It was the preferred railroad for the mineral divsion, the smelting division, the Big Blackfoot Milling (Forest Products) division, as well as general wholesale and retail of Hennessey & Co. as well as the Missoula Mercantile -- not subsidiaries, but related wholesalers and retailers throughout the territory.

What I question is not that Butte wasn't worth reaching by Milwaukee rails, but that the profile and alignment of the mainline had to be somewhat skewed in order to go through Butte (and Butte proper still had to be reached by a short branchline!)  It seems that, if indeed the PCE charter called for "the shortest route to the PNW of the northern transcons" (paraphrased), that it would have been a little more judicious to stick to that "shortest line" caveat by routing the mainline through Great Falls and Cadette Pass, and instead reaching Butte by a branchline down from the Blackfoot River valley.

Also on that note, why didn't the Milwaukee just purchase the BA&P line to incorporate it into it's system, rather than building parallel to it through Silver Bow canyon?

Well, the first two surveys, after the Northern Securities decision was handed down in 1901, went only to Butte. That was the entire focus.

By 1905, I think they understood that electrification was so advantageous that route was almost secondary -- that comparisons with other roads from a traditional route -- as opposed to technological -- perspective were bound to underestimate the technological advantage that Milwaukee had until June 16, 1974.

The Milwaukee did purchase a one-half interest in the BA&P (from James J. Hill) and did, in fact, use the BA&P rails from Butte to Finlen. They built their own line through Silver Bow canyon in 1914 when the impending 3,000 vDC electrification made continued operation under the BA&P 2,400 vDC catenary infeasible.

 

 

 

[MichaelSol]

If the expenses were double entered, where were the auditors? 

Michael, what would a carload of general freight fetch in the mid 70's that was from the PNW to Chicago?  $1000? $1500? 

ed

From Montana, probably about $1400, from Seattle, about $1800-$2,100.

[Anonymous]

One of the big reasons for going through Butte was that a few of the directors of the CM&StP during the time that the PCE was planned and built were also directors of the Anaconda Copper Company - which also had a bearing on why the CM&StP electrified (good market for copper).

     Did CM&StP get rewarded for this effort, by getting traffic from Anaconda?

Don't know how much, if any, traffic Anaconda sent to the MILW. Michael Sol would probably be able to give a much more informaed answer than I would. Also keep in mind that at the time the PCE was built, Butte was by far the largest city in Montana.

During those days, the mighty Anaconda Copper Mining Co. ran the biggest industry facility between the Twin Cities and the Puget Sound, it controlled the majority of the forest products industries between the Dakotas and Washington State, it owned the biggest newspapers in Montana, and it controlled many wholesale and retail operations. Recall, J. Hill's first western terminus was Butte, Montana. The NP built through it, the GN built to it, the UP built to it, and the Milwaukee built through it as Milwaukee's owner, William Rockefeller, wanted his own railroad to serve the Anaconda's interests, as he was one of the primary owners of that company as well, and didn't like the idea of contributing profits to his competitors -- a Rockefeller family trait.

From the limited shipment records of the Anaconda company that I have reviewed, Milwaukee received about as much traffic as the Great Northern and Northern Pacific combined. It was the preferred railroad for the mineral divsion, the smelting division, the Big Blackfoot Milling (Forest Products) division, as well as general wholesale and retail of Hennessey & Co. as well as the Missoula Mercantile -- not subsidiaries, but related wholesalers and retailers throughout the territory.

What I question is not that Butte wasn't worth reaching by Milwaukee rails, but that the profile and alignment of the mainline had to be somewhat skewed in order to go through Butte (and Butte proper still had to be reached by a short branchline!)  It seems that, if indeed the PCE charter called for "the shortest route to the PNW of the northern transcons" (paraphrased), that it would have been a little more judicious to stick to that "shortest line" caveat by routing the mainline through Great Falls and Cadette Pass, and instead reaching Butte by a branchline down from the Blackfoot River valley.

Also on that note, why didn't the Milwaukee just purchase the BA&P line to incorporate it into it's system, rather than building parallel to it through Silver Bow canyon?

[MichaelSol]

I am intrigued by the contention that bookkeeping double entry of losses showed the PCE losing money when it was actually making a profit.  Is this an undisputed fact?  Has the error ever been explained?

The bookkeeping error occured in the Application to Abandon. Appendix K. That is, the operating expenses contained in that exhibit had, in several cases, overstated the actual expenses by double entering some expenses. This was discovered by ICC auditors. The Milwaukee had to make four sets of corrections before they "got it right."

This was odd as Lines West always reported independently, and kept separate books of operations -- out in Seattle it was like a separate railroad general office. So, the process wasn't just something they stumbled around trying to figure out how to do for the first time. Of course, that was the first document that the Trustee was going to be actually asked to look at and sign that showed the western operation as profitable.

The Trustee had just spent the previous several months telling everyone it wasn't profitable, and doing everything he could to discourage traffic and shut it down. He was a numbers guy, and perhaps someone was trying to avoid those particular "numbers" and hope no one noticed.

The ICC's Office of Rail Public Counsel had reviewed the Application to Abandon and made the findings about the double-entered expenses. They announced it in a press release to the general public, including the ICC's own revised figures showing net profit on Lines West for the years, 1976, 1977, and 1978, so it became a matter of public record through the Associated Press.  I believe the full Commission noted it in one of their orders.

So, this wasn't any party with an agenda either way -- the fact is that the initial application showed that Lines West lost money when in fact expenses had to be double entered in order to show that. Another way of looking at it was that someone made up extra expenses to justify the claim. I personally reviewed those findings in some detail with Henri Rush and with David Miller at the ICC at the time.

Was it plausibly an accident? Well, all sorts of things went through my mind as to who might have done it and why.

 

[MichaelSol]

One of the big reasons for going through Butte was that a few of the directors of the CM&StP during the time that the PCE was planned and built were also directors of the Anaconda Copper Company - which also had a bearing on why the CM&StP electrified (good market for copper).

     Did CM&StP get rewarded for this effort, by getting traffic from Anaconda?

Don't know how much, if any, traffic Anaconda sent to the MILW. Michael Sol would probably be able to give a much more informaed answer than I would. Also keep in mind that at the time the PCE was built, Butte was by far the largest city in Montana.

During those days, the mighty Anaconda Copper Mining Co. ran the biggest industry facility between the Twin Cities and the Puget Sound, it controlled the majority of the forest products industries between the Dakotas and Washington State, it owned the biggest newspapers in Montana, and it controlled many wholesale and retail operations. Recall, J. Hill's first western terminus was Butte, Montana. The NP built through it, the GN built to it, the UP built to it, and the Milwaukee built through it as Milwaukee's owner, William Rockefeller, wanted his own railroad to serve the Anaconda's interests, as he was one of the primary owners of that company as well, and didn't like the idea of contributing profits to his competitors -- a Rockefeller family trait.

From the limited shipment records of the Anaconda company that I have reviewed, Milwaukee received about as much traffic as the Great Northern and Northern Pacific combined. It was the preferred railroad for the mineral divsion, the smelting division, the Big Blackfoot Milling (Forest Products) division, as well as general wholesale and retail of Hennessey & Co. as well as the Missoula Mercantile -- not subsidiaries, but related wholesalers and retailers throughout the territory.

 

 

[erikem]

One of the big reasons for going through Butte was that a few of the directors of the CM&StP during the time that the PCE was planned and built were also directors of the Anaconda Copper Company - which also had a bearing on why the CM&StP electrified (good market for copper).

     Did CM&StP get rewarded for this effort, by getting traffic from Anaconda?

Don't know how much, if any, traffic Anaconda sent to the MILW. Michael Sol would probably be able to give a much more informaed answer than I would. Also keep in mind that at the time the PCE was built, Butte was by far the largest city in Montana.

[MP173]

If the expenses were double entered, where were the auditors? 

Michael, what would a carload of general freight fetch in the mid 70's that was from the PNW to Chicago?  $1000? $1500? 

ed

[Murphy Siding]

One of the big reasons for going through Butte was that a few of the directors of the CM&StP during the time that the PCE was planned and built were also directors of the Anaconda Copper Company - which also had a bearing on why the CM&StP electrified (good market for copper).

     Did CM&StP get rewarded for this effort, by getting traffic from Anaconda?

[Anonymous]

I am intrigued by the contention that bookkeeping double entry of losses showed the PCE losing money when it was actually making a profit.  Is this an undisputed fact?  Has the error ever been explained?

[erikem]

It just seems on the surface anyway that the Milwaukee didn't take full advantage of "untouched" areas along a logical mainline corridor, areas along the mainline where Milwaukee was either the only game in town or the dominate mainline.  Butte already had NP, UP, and GN; Helena had the NP mainline; and both had to be reached by going through the Belt mountain ranges and the Continental Divide at 5800' to 6500' - meanwhile Great Falls only had a GN branchline at the time, and could have been reached from the east with nary a mountain grade.  Spokane had GN, NP, UP through town, while Lewiston ID had an NP branch from the north and a UP branch from the west, yet Milwaukee chooses to bypass Spokane to the south, thus misses both towns, and just skims the north end of the Palouse grain growing region.  They missed the Tri-Cities, missed Yakima, missed Portland, missed Wenatchee.

One of the big reasons for going through Butte was that a few of the directors of the CM&StP during the time that the PCE was planned and built were also directors of the Anaconda Copper Company - which also had a bearing on why the CM&StP electrified (good market for copper).

 

[Anonymous]

What exactly do you question in their route choice?

I assume you're refering to my concurrence on the Wikipedia entry in which "some historians" questioned the initial route choice......

Since I'm on a roll, I believe in hindsight the best route for Milwaukee, CB&Q, or CNW through Montana to Puget Sound would have been to avoid the Belts and head for Great Falls.  Right there you maintain a Prairie Division profile all the way to Great Falls, and that pesky NP isn't your constant companion.  Then head west/southwest over Cadette or Rogers to Missoula, then over Lolo to the Clearwater River drainage near present day Lowell ID.  That's your primary Mountain Division, Great Falls to Lowell, two passes, roughly 200 miles, and the only time you see another railroad is when you cross over the NP at Missoula.  Then from Lowell you're running water level grade all the way to Benton County in Washington, and if you can't get the Gorge, then head northwest along Umtanum Ridge over the Saddles to Ellensburg (1% grades both ways), and then head over Snoqualmie at 0.7% ruling westbound grade, 1.6% eastbound.  That's your secondary Mountain Division, less grades but more snow to deal with, either way a much better alignment than your competitors NP and GN.

But whatever you do, try to get that North Bank of the Columbia as Priority Number 1.  If you do it'll pay dividends for years to come.

Thank you,Dave.Good overview of Milwaukee's misses.I've been looking over the PCE from Forsyth,Montana to the coast on MSN Live Search (satellite images and such)in 3D.Looks like some changes could have been made with tunnels or even daylighting some areas to reduce or even eliminate curvature and maybe some short sections of grades.Worst choices of all was abandoning the PCE instead of the midwest lines.Looks like Milwaukee Road could have captured a lot of container traffic out of Tacoma and eliminated some capacity issues.

Have a good one.

Bill B

Well, just my opinion.  For what it's worth, I think James Hill made some route choice blunders as well.  He too had the chance to route the GN along the North Bank of the Columbia, or he also could have utilized Snoqualmie Pass if he just had to have a direct line to the Puget Sound, but for some reason he chose to go straight west out of Spokane over Stevens Pass, the worst of all the Cascade passes. 

In retrospect, the Milwaukee was fortunate that Snoqualmie Pass was still available so late in the game, not to mention the fact that Milwaukee was so close to getting the North Bank of the Columbia!  JJ Hill did make up for his poor GN route by incorporating the SP&S along the North Bank before the Milwaukee could act.

As for NP and UP, I tend to be more forgiving of their initial ventures into the Pacific Northwest.  The NP was a pioneer line which seemed to constantly be on shaky ground finance-wise, and constuction techiques were not as sophisticated as they were just a few decades later.  They were wise to utilize the ORN from Wallula to Portland, too bad they couldn't keep that trackage!  As for the choice of Stampede Pass, well.....this was the NP - it's amazing to me that such an abject example of poor routing has become such a stamp of misplaced fatalism for BNSF even today!

UP basically took what someone else had built - ORN, OSL, OWRN, SI - and incorporated them into it's system.  What are you going to do?

[billbtrain]

What exactly do you question in their route choice?

I assume you're refering to my concurrence on the Wikipedia entry in which "some historians" questioned the initial route choice.

Prior to joining this forum, I had several long held views regarding the Milwaukee's route to the Pacific Northwest.  I liked the Snoqualmie Pass section, disdained the Saddle Mountains crossing, and wondered if the north bank of the Columbia Gorge could have been secured if the directors had acted with a little more urgency once the transcon decision was made.  I questioned why the Milwaukee chose to bypass both Spokane and Lewiston, why they chose the St. Paul Pass line over either the Lolo Pass route (used by US Highway 12) to hit Lewiston directly or Lookout Pass and Fourth of July Pass to hit Spokane directly.  Why turn down toward Butte instead of using a shorter route through Helena?  Why didn't they avoid the Belt Mountians altogether by using Rogers Pass via Great Falls?

Well, some of those inquiries were answered by the contributions of forum members, not just Michael but also kenneo and artfbe.  For example, I had no idea that Milwaukee was considering Cadette Pass (just north of Rogers Pass) as a new mainline route to either supplement the Pipestone Pass line or supercede it.  What I still question about this is why go to all the trouble of building via Butte with heavy duty permanent construction?  Why not just build a temp track over Cadette until the longer tunnel could be availed?  A branch line down to Butte to tap the mines would have sufficed, right? 

I also was unaware that Milwaukee had planned a long tunnel underneath St. Paul Pass to reduce the ruling grades from 1.7% both ways to under 1% both ways, as well as eliminate some mileage and curvature.  But again, why the heavy duty permanent construction if the eventual route was intended as a temp line?

Milwaukee built grain branches aplomb in Montana, but seemed to neglect the best grain growing areas of the Palouse in Eastern Washington and North Central Idaho.  Milwaukee also built some branch lines that just seem to defy logic - the line to Port Angeles via car ferry, the branch up the Swan River Valley in Montana, the dead end branch up to Ione Washington, the branch to Hanford WA.  If they had money to build branchlines, why not tap up to Wenatchee and the Big Bend Country of Washington instead of down to Hanford?  Why not build one down into the heart of the Palouse country and down to Lewiston instead of a mostly logging branch to Elk River ID?  Why not build to a connection with one of the Canadian roads instead of dead ending a few miles south of the border?

It just seems on the surface anyway that the Milwaukee didn't take full advantage of "untouched" areas along a logical mainline corridor, areas along the mainline where Milwaukee was either the only game in town or the dominate mainline.  Butte already had NP, UP, and GN; Helena had the NP mainline; and both had to be reached by going through the Belt mountain ranges and the Continental Divide at 5800' to 6500' - meanwhile Great Falls only had a GN branchline at the time, and could have been reached from the east with nary a mountain grade.  Spokane had GN, NP, UP through town, while Lewiston ID had an NP branch from the north and a UP branch from the west, yet Milwaukee chooses to bypass Spokane to the south, thus misses both towns, and just skims the north end of the Palouse grain growing region.  They missed the Tri-Cities, missed Yakima, missed Portland, missed Wenatchee.

I also question the choice of crossing the Columbia River at Beverly instead of farther south.  It just looks rough to cross a bridge located by a natural wind tunnel, then have to start 20 miles of 2.2% grade.  By crossing farther south they could then follow the natural contours of the ridges off the Saddle Mountains and keep the grade less harsh.  But of course, they chose to utilize Lind Coulee to get from southern Spokane County to the river, and of course they took that course because they chose to cross the Bitterroots at St. Paul Pass instead of Lolo.  If Milwaukee crosses at Lolo, they avoid any steep grades from there all the way to Puget Sound, since Lolo gives them a more southerly latitude.

That kind of stuff.

Since I'm on a roll, I believe in hindsight the best route for Milwaukee, CB&Q, or CNW through Montana to Puget Sound would have been to avoid the Belts and head for Great Falls.  Right there you maintain a Prairie Division profile all the way to Great Falls, and that pesky NP isn't your constant companion.  Then head west/southwest over Cadette or Rogers to Missoula, then over Lolo to the Clearwater River drainage near present day Lowell ID.  That's your primary Mountain Division, Great Falls to Lowell, two passes, roughly 200 miles, and the only time you see another railroad is when you cross over the NP at Missoula.  Then from Lowell you're running water level grade all the way to Benton County in Washington, and if you can't get the Gorge, then head northwest along Umtanum Ridge over the Saddles to Ellensburg (1% grades both ways), and then head over Snoqualmie at 0.7% ruling westbound grade, 1.6% eastbound.  That's your secondary Mountain Division, less grades but more snow to deal with, either way a much better alignment than your competitors NP and GN.

But whatever you do, try to get that North Bank of the Columbia as Priority Number 1.  If you do it'll pay dividends for years to come.

Thank you,Dave.Good overview of Milwaukee's misses.I've been looking over the PCE from Forsyth,Montana to the coast on MSN Live Search (satellite images and such)in 3D.Looks like some changes could have been made with tunnels or even daylighting some areas to reduce or even eliminate curvature and maybe some short sections of grades.Worst choices of all was abandoning the PCE instead of the midwest lines.Looks like Milwaukee Road could have captured a lot of container traffic out of Tacoma and eliminated some capacity issues.

Have a good one.

Bill B

[Murphy Siding]

One of these years, I need to plan a vacation to Montana and Idaho to get the lay of the land.  Sounds like a great place.

ed

It definately looks different than these flat cornfields that you and I are used to looking at.

[MP173]

One of these years, I need to plan a vacation to Montana and Idaho to get the lay of the land.  Sounds like a great place.

ed

[Anonymous]

What exactly do you question in their route choice?

I assume you're refering to my concurrence on the Wikipedia entry in which "some historians" questioned the initial route choice.

Prior to joining this forum, I had several long held views regarding the Milwaukee's route to the Pacific Northwest.  I liked the Snoqualmie Pass section, disdained the Saddle Mountains crossing, and wondered if the north bank of the Columbia Gorge could have been secured if the directors had acted with a little more urgency once the transcon decision was made.  I questioned why the Milwaukee chose to bypass both Spokane and Lewiston, why they chose the St. Paul Pass line over either the Lolo Pass route (used by US Highway 12) to hit Lewiston directly or Lookout Pass and Fourth of July Pass to hit Spokane directly.  Why turn down toward Butte instead of using a shorter route through Helena?  Why didn't they avoid the Belt Mountians altogether by using Rogers Pass via Great Falls?

Well, some of those inquiries were answered by the contributions of forum members, not just Michael but also kenneo and artfbe.  For example, I had no idea that Milwaukee was considering Cadette Pass (just north of Rogers Pass) as a new mainline route to either supplement the Pipestone Pass line or supercede it.  What I still question about this is why go to all the trouble of building via Butte with heavy duty permanent construction?  Why not just build a temp track over Cadette until the longer tunnel could be availed?  A branch line down to Butte to tap the mines would have sufficed, right? 

I also was unaware that Milwaukee had planned a long tunnel underneath St. Paul Pass to reduce the ruling grades from 1.7% both ways to under 1% both ways, as well as eliminate some mileage and curvature.  But again, why the heavy duty permanent construction if the eventual route was intended as a temp line?

Milwaukee built grain branches aplomb in Montana, but seemed to neglect the best grain growing areas of the Palouse in Eastern Washington and North Central Idaho.  Milwaukee also built some branch lines that just seem to defy logic - the line to Port Angeles via car ferry, the branch up the Swan River Valley in Montana, the dead end branch up to Ione Washington, the branch to Hanford WA.  If they had money to build branchlines, why not tap up to Wenatchee and the Big Bend Country of Washington instead of down to Hanford?  Why not build one down into the heart of the Palouse country and down to Lewiston instead of a mostly logging branch to Elk River ID?  Why not build to a connection with one of the Canadian roads instead of dead ending a few miles south of the border?

It just seems on the surface anyway that the Milwaukee didn't take full advantage of "untouched" areas along a logical mainline corridor, areas along the mainline where Milwaukee was either the only game in town or the dominate mainline.  Butte already had NP, UP, and GN; Helena had the NP mainline; and both had to be reached by going through the Belt mountain ranges and the Continental Divide at 5800' to 6500' - meanwhile Great Falls only had a GN branchline at the time, and could have been reached from the east with nary a mountain grade.  Spokane had GN, NP, UP through town, while Lewiston ID had an NP branch from the north and a UP branch from the west, yet Milwaukee chooses to bypass Spokane to the south, thus misses both towns, and just skims the north end of the Palouse grain growing region.  They missed the Tri-Cities, missed Yakima, missed Portland, missed Wenatchee.

I also question the choice of crossing the Columbia River at Beverly instead of farther south.  It just looks rough to cross a bridge located by a natural wind tunnel, then have to start 20 miles of 2.2% grade.  By crossing farther south they could then follow the natural contours of the ridges off the Saddle Mountains and keep the grade less harsh.  But of course, they chose to utilize Lind Coulee to get from southern Spokane County to the river, and of course they took that course because they chose to cross the Bitterroots at St. Paul Pass instead of Lolo.  If Milwaukee crosses at Lolo, they avoid any steep grades from there all the way to Puget Sound, since Lolo gives them a more southerly latitude.

That kind of stuff.

Since I'm on a roll, I believe in hindsight the best route for Milwaukee, CB&Q, or CNW through Montana to Puget Sound would have been to avoid the Belts and head for Great Falls.  Right there you maintain a Prairie Division profile all the way to Great Falls, and that pesky NP isn't your constant companion.  Then head west/southwest over Cadette or Rogers to Missoula, then over Lolo to the Clearwater River drainage near present day Lowell ID.  That's your primary Mountain Division, Great Falls to Lowell, two passes, roughly 200 miles, and the only time you see another railroad is when you cross over the NP at Missoula.  Then from Lowell you're running water level grade all the way to Benton County in Washington, and if you can't get the Gorge, then head northwest along Umtanum Ridge over the Saddles to Ellensburg (1% grades both ways), and then head over Snoqualmie at 0.7% ruling westbound grade, 1.6% eastbound.  That's your secondary Mountain Division, less grades but more snow to deal with, either way a much better alignment than your competitors NP and GN.

But whatever you do, try to get that North Bank of the Columbia as Priority Number 1.  If you do it'll pay dividends for years to come.

[Murphy Siding]

'Oh No! Not Again'-Rod Stewart

Yeah,Bring back the Milwaukee as a Chicago to Tacoma transcon with some of the western(Dakotas to Washington)branchlines(get rid of the midwest lines instead).And go back in time and make BN GN instead(with some changes of maintenance of physical plant and equipment).Sorry,I couldn't help myself.It is all interesting tho.

And what is your first name,futuremodal.I dislike refering to someone by their handle.Seems impersonal to me(no disrespect).

Have a good one.

Bill B

Sorry, I'll have to update my file when I get a chance. 

Dave Smith

Yea,futuremodal, you need a good first name, like "Murphy"

[Anonymous]

'Oh No! Not Again'-Rod Stewart

Yeah,Bring back the Milwaukee as a Chicago to Tacoma transcon with some of the western(Dakotas to Washington)branchlines(get rid of the midwest lines instead).And go back in time and make BN GN instead(with some changes of maintenance of physical plant and equipment).Sorry,I couldn't help myself.It is all interesting tho.

And what is your first name,futuremodal.I dislike refering to someone by their handle.Seems impersonal to me(no disrespect).

Have a good one.

Bill B

Sorry, I'll have to update my file when I get a chance. 

Dave Smith

[ChuckHawkins]

What exactly do you question in their route choice? I know very
little about the western roads. If we question their route choice,
because they missed  certain geographical localities, on what
basis should we do so? Did their 1900 based foresight prove bad, and if
so, when?

I think we attach a little more importance to the PCE
in these discussions based on what we now know about Far East trade.
I'm not sure it would have been very relevant to analysis even in the
60/70s. That wouldn't have been obvious 100 years ago. People knew the
PRB coal was in its location for years but the Clean Air act changed
the nature of the situation in a hurry. 

[MichaelSol]

 

Interesting that Wikipedia's history of CMStP&P mirrors much of what Michael Sol has stated regarding some of the misconceptions of the PCE's worth as well as the value of the electrification!  The consensus is clear that the PCE made money while the granger lines lost money, and the PCE retrenchment in favor of a regionalized "Milwaukee II" was a huge blunder.

 

Not really.  If you look at the references, Wikipedia says that it used Todd Jones artical, which in turn thanks Michael Sol for his help in the Jones artical.  So one might say it is Sol's opinion's  recylced a couple of times.

Bert

Until now, I've never seen the Wikipedia entry; looks to cover much more ground than Todd Jones' article in CTC Board. My assistance to Todd Jones was to provide him with the documentary background material from the particular era he was interested in, which I recall was 1974-1977. It was a compilation of about 400 contemporary references from the period, including ICC Reports, Hearing Examiner reports, news articles, financial magazine articles, scholarly studies, and my notes on an electrification study I participated in. I also provided him with some photos of the electrification I had taken for the study.

Todd was an engineer for the Canadian Pacific on the former Milwaukee mainline near Portage. I assume his views were shaped by daily contact and conversation with the former Milwaukee engineers and conductors with whom he worked. I doubt they needed to recycle opinions from anyone. I have never spoken with him in person, and did not see the article prior to publication. In it, however, he appears as a careful writer and a careful observer.

 

[n012944]

 

Interesting that Wikipedia's history of CMStP&P mirrors much of what Michael Sol has stated regarding some of the misconceptions of the PCE's worth as well as the value of the electrification!  The consensus is clear that the PCE made money while the granger lines lost money, and the PCE retrenchment in favor of a regionalized "Milwaukee II" was a huge blunder.

 

Not really.  If you look at the references, Wikipedia says that it used Todd Jones artical, which in turn thanks Michael Sol for his help in the Jones artical.  So one might say it is Sol's opinion's  recylced a couple of times.

 

Bert

[Anonymous]

Well you can always use a Wikipedia entry to back up your argument, no matter what it is, since you can just go and write the entry yourself!!

Are you suggesting Mr. Sol wrote the Milwaukee piece?

What the Wikipedia entry shows is that someone else shares Michael's observations.

[wjstix]

Well you can always use a Wikipedia entry to back up your argument, no matter what it is, since you can just go and write the entry yourself!!

[MP173]

Are we ready for another MILW discussion?

What I really find interesting in the Wikipedia article and the Todd Jones article is the feeling that the CNW merger would have saved the companies by "the consolidation of routes and facilities in many markets they both serviced with ICC estimating savings of $36 million dollars annually..."  Northwestern's study showed $54 million of savings.

With our discussion of the failure of mergers on other threads, it seems a case would be made that the merger would have failed to generate the savings. 

ed

[Datafever]

I never thought about using Wikipedia as the ultimate arbiter of disputes, but I guess we might as well use something referenceable.  Of course, I will expect that if Wikipedia contradicts one of your favorite arguments, then you will also graciously concede defeat, right? 

[billbtrain]

'Oh No! Not Again'-Rod Stewart

Yeah,Bring back the Milwaukee as a Chicago to Tacoma transcon with some of the western(Dakotas to Washington)branchlines(get rid of the midwest lines instead).And go back in time and make BN GN instead(with some changes of maintenance of physical plant and equipment).Sorry,I couldn't help myself.It is all interesting tho.

And what is your first name,futuremodal.I dislike refering to someone by their handle.Seems impersonal to me(no disrespect).

Have a good one.

Bill B