What is really needed is a study be a fair and impartial group of economists with all possible analysis tools on the total effect on the USA economy, including such things as costs of standby alternatives, tourist dollars, etc. of eliminating long distance service, maintainwhat we have but in good repair, and increasing it by filling in gaps such as Chicago - Florida and Colorado - Texas and increasinf service so Cleveland had a train at a decent hour. This should be completely independent of corridor high speed studies, but account for the effect on such studies and their effect on LD.
PNWRMNM Don, Further on historical matters. The rail carriers passenger problem after 1920 was not that it was jointly produced with freight. The problem was that even with the freight business paying for all of the jointly used fixed plant, the passenger business could not support itself. That would not have been a problem had the railroads been treated like any other business and simply been allowed to cut off the loosing trains. The passenger problem would have been gone by 1970 had that been the case. Mac
Don,
Further on historical matters. The rail carriers passenger problem after 1920 was not that it was jointly produced with freight. The problem was that even with the freight business paying for all of the jointly used fixed plant, the passenger business could not support itself. That would not have been a problem had the railroads been treated like any other business and simply been allowed to cut off the loosing trains. The passenger problem would have been gone by 1970 had that been the case.
Mac
I'd bet that if the rail carriers had been allowed to develop as multi-modals, you'd see a more tightly integrated rail/air/bus passenger network now with each mode doing what it does best with seamless connections between modes. The high density corridors would be mostly rail, the long distance legs between major cities, air, and the low density spokes, bus.
-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/)
oltmannd PNWRMNM: Don, Further on historical matters. The rail carriers passenger problem after 1920 was not that it was jointly produced with freight. The problem was that even with the freight business paying for all of the jointly used fixed plant, the passenger business could not support itself. That would not have been a problem had the railroads been treated like any other business and simply been allowed to cut off the loosing trains. The passenger problem would have been gone by 1970 had that been the case. Mac I'd bet that if the rail carriers had been allowed to develop as multi-modals, you'd see a more tightly integrated rail/air/bus passenger network now with each mode doing what it does best with seamless connections between modes. The high density corridors would be mostly rail, the long distance legs between major cities, air, and the low density spokes, bus.
PNWRMNM: Don, Further on historical matters. The rail carriers passenger problem after 1920 was not that it was jointly produced with freight. The problem was that even with the freight business paying for all of the jointly used fixed plant, the passenger business could not support itself. That would not have been a problem had the railroads been treated like any other business and simply been allowed to cut off the loosing trains. The passenger problem would have been gone by 1970 had that been the case. Mac
Lets imagine that congress did not outlaw rail control of other modes, as they did.
Historically several railroads did operate steamship services as extensions of their systems. We know that Great Northern suppled most of the founding capital for Greyhound Bus lines. Many railroads had affiliated truck lines before 1935, but after that time they were not allowed to develop. IIRC a couple of the railroads invested in airlines before that too was disallowed.
I think we would agree that left to themselves some of the railroads would have continued to be, and developed into, multi modal transportation companies. Your question seems to be, assuming no other change than that. what might reasonably have happened in the passenger side of the business?
I am 99% confident that the rail passenger business would not have been able to compete against the highway and the airplane any better than it did in fact. I think an excellent case could be made that the last round of private rail passenger equipment would have happened about 1950 as opposed to 1955. My reasoning is that the railroads would have known from their own data that airplanes and busses earned more on the investment than rail cars and locomotives.
Probably by 1960 the carriers would have pushed harder to exit the passenger business than they did in fact, so that they could invest in profitable bus and air services. Perhaps they would have had an easier time of it since they would have been providing service by other means.
By the during the 1960's and 1970's, when railroad earnings were in the tank due to freight rate regulation by the ICC, the rails may well have had to sell off or spin off air and bus operations. The situation is very similar to SPTCO having to sell off Sprint since it could not finance the high cost of growing the business out of anemic rail earnings.
I guess my conclusion is that multi modal ownership would have not made much difference on the passenger side. Passenger trains could not compete in the general marketplace in the 1960's and they can not now. Despite that 50 years worth of evidence that passenger can not compete, I believe that a rational case could be made between Boston and Washington, and perhaps out to Harrisburg. I even think that if ATK took care of what line they own, they could probably make the political case for the new lines required to create a true High Speed system in the one area that may be able support it based on real economics as opposed to public works projects. The plain fact is that in the NEC the question is which public works projects do we want, HSR, more lane miles, or more airports.
Wheher we will be able to pay for any of this is a separate question that based on my past experience with the moderators seems to be out of bounds.
Mac: Don't you think it also quite possible that if there had been integrated passenger transport, long distance rail services would have been switched to air, but short-haul (unprofitable) air services might have been switched to more rail and bus?
C&NW, CA&E, MILW, CGW and IC fan
schlimm,
If there had been integrated passenger providers there would have been one city ticket office, later one web site, that provided access to all of the company's offerings. I think that the integrated provider would have had very little ability to stear a customer to one mode or another. The company would have had the ability to discuss options, I agree, but the prospect would make his own choice 99 times out of 100. Long distance travel did go to air and would have gone to air with integrated providers as you seem to posit would have happened in your question.
As to unprofitable short haul air service, there is no natural reason for it to be unprofitable if enough folks are willing to pay a high enough ticket price, or if the FAA is willing to subsidize some routes as it did and may still do. Expensive doe not equal unprofitable, in fact it is often the opposite. The unfettered market would deal with unprofitable service of any kind by shutting it down regardless of whether or not the carrier was modally integrated.
In answering Don's question I specifically did NOT assume free entry and exit for any modes. The late 1970's Carter era Airline deregulation was the first time since the 1930 somethings that entry into and exit from air lanes, was deregulated. Exit from the airline businees in total was always possible via bankruptcy.
Given the high cost structure for short-haul flights and their marginal (if any) advantages for the customer in terms of convenience and speed, it seems likely that the approach adopted by the imaginary integrated transportation firm would have retained few, if any short flights. My point (and sam1's) is, of course, that Amtrak, if it were run in a more business-like manner (rather than having to provide senseless LD and other services in return for congressional votes), should adopt the same approach.
schlimm.
I agree on both points.
Mac: If folks of pretty widely divergent political views, like you, me, don, Paul M, sam1, harvey, phoebe and blue streak, can agree on this point, maybe Congress and Amtrak can as well? Just dreaming!!
Yes you are. Congress is rarely about rational public policy. It is about buying votes for incumbents with the taxpayer's money, and ATK is just the tip of the iceberg.
The Interstate Commerce Commission ruled the PRR and Sante FE could not own Grayhound Bus and PRR could not own an airline and that Norfolk and Western could not own a trucking company and the list goes on...there was no way that the government would allow an intigrated and rationalized transportation system.
And deregulation of the airline industry saw hundreds of communities lose first class service which was replaced by smaller "commuter" airplanes which led to loss of services as the smaller planes did not, and still don't, attract as many passengers as a "big" plane did.
Dave's idea of an unbiased review and planning session is a great idea...but probably not really possible. The only thing we can hope for is a committee charged with being unbiased and will be honest enough to try to be.
RIDEWITHMEHENRY is the name for our almost monthly day of riding trains and transit in either the NYCity or Philadelphia areas including all commuter lines, Amtrak, subways, light rail and trolleys, bus and ferries when warranted. No fees, just let us know you want to join the ride and pay your fares. Ask to be on our email list or find us on FB as RIDEWITHMEHENRY (all caps) to get descriptions of each outing.
MY point is that transportation is related to the total economy and some things are worth subsidizing for their effects on the total economy. If it had not been for Mineta's bottom line approach to the Amtrak subsidy problem, 1000 lives would have been saved at Katrina, because Gunn would have called Bush to overrule NO's Mayor and put those people on the 22 car train that left almost empty.
If it were not for Amtrak long distance, a substantial portion of foreign tourist business to the USA would move to Canada or just not exist. The similar impacts must addressed before ridding Amtrak of mony-losing long distance services. It even impacts government expenses such as health care.
PNWRMNM oltmannd: PNWRMNM: Don, Further on historical matters. The rail carriers passenger problem after 1920 was not that it was jointly produced with freight. The problem was that even with the freight business paying for all of the jointly used fixed plant, the passenger business could not support itself. That would not have been a problem had the railroads been treated like any other business and simply been allowed to cut off the loosing trains. The passenger problem would have been gone by 1970 had that been the case. Mac I'd bet that if the rail carriers had been allowed to develop as multi-modals, you'd see a more tightly integrated rail/air/bus passenger network now with each mode doing what it does best with seamless connections between modes. The high density corridors would be mostly rail, the long distance legs between major cities, air, and the low density spokes, bus. Don, Lets imagine that congress did not outlaw rail control of other modes, as they did. Historically several railroads did operate steamship services as extensions of their systems. We know that Great Northern suppled most of the founding capital for Greyhound Bus lines. Many railroads had affiliated truck lines before 1935, but after that time they were not allowed to develop. IIRC a couple of the railroads invested in airlines before that too was disallowed. I think we would agree that left to themselves some of the railroads would have continued to be, and developed into, multi modal transportation companies. Your question seems to be, assuming no other change than that. what might reasonably have happened in the passenger side of the business? I am 99% confident that the rail passenger business would not have been able to compete against the highway and the airplane any better than it did in fact. I think an excellent case could be made that the last round of private rail passenger equipment would have happened about 1950 as opposed to 1955. My reasoning is that the railroads would have known from their own data that airplanes and busses earned more on the investment than rail cars and locomotives. Probably by 1960 the carriers would have pushed harder to exit the passenger business than they did in fact, so that they could invest in profitable bus and air services. Perhaps they would have had an easier time of it since they would have been providing service by other means. By the during the 1960's and 1970's, when railroad earnings were in the tank due to freight rate regulation by the ICC, the rails may well have had to sell off or spin off air and bus operations. The situation is very similar to SPTCO having to sell off Sprint since it could not finance the high cost of growing the business out of anemic rail earnings. I guess my conclusion is that multi modal ownership would have not made much difference on the passenger side. Passenger trains could not compete in the general marketplace in the 1960's and they can not now. Despite that 50 years worth of evidence that passenger can not compete, I believe that a rational case could be made between Boston and Washington, and perhaps out to Harrisburg. I even think that if ATK took care of what line they own, they could probably make the political case for the new lines required to create a true High Speed system in the one area that may be able support it based on real economics as opposed to public works projects. The plain fact is that in the NEC the question is which public works projects do we want, HSR, more lane miles, or more airports. Wheher we will be able to pay for any of this is a separate question that based on my past experience with the moderators seems to be out of bounds. Mac
oltmannd: PNWRMNM: Don, Further on historical matters. The rail carriers passenger problem after 1920 was not that it was jointly produced with freight. The problem was that even with the freight business paying for all of the jointly used fixed plant, the passenger business could not support itself. That would not have been a problem had the railroads been treated like any other business and simply been allowed to cut off the loosing trains. The passenger problem would have been gone by 1970 had that been the case. Mac I'd bet that if the rail carriers had been allowed to develop as multi-modals, you'd see a more tightly integrated rail/air/bus passenger network now with each mode doing what it does best with seamless connections between modes. The high density corridors would be mostly rail, the long distance legs between major cities, air, and the low density spokes, bus.
I agree the LD passenger train cannot compete. But, what if the game was changed so that there wasn't any competition?
If the RRs had been able to own airlines and bus companies, then the whole notion of passenger trains competing with airlines and bus travel becomes moot. There would not have been any competition between modes, only between companies that supplied passenger transportation.
Investment within a company supplying passenger transportation would flow to the place where it would provide the most bang for the buck.
If the RRs had invested in air travel instead of LD streamliners and fed that long-haul air network to with rail short-haul, then we'd likely have more, short-haul corridors having been developed. WIth few exceptions, the LD train network would have died off in the 50s and the money being consumed keeping it alive could have been diverted to corridor development.
The LD air routes would be concentrated into a small number of hubs with rail and bus feeding them. I can imagine that, in many cases, each road would attempt to establish their own hub in a region, so your choice of travel wouldn't be mode of travel, but which RR/airline.
Perhaps, if things had developed this way, the look and feel of suburban life might be a bit different - organized along rail corridors instead of ring roads.
I wonder if one company could own rail, steamshjips, airlines, trucking companies, hotels, etc, if it would'n't become too big and unwieldly to the point it could implode. Wait...that did almost happen in Canada. Canadian Pacific did it all but seperated or spun off different things in different directions because it could not all be handled from one place.
We are finding centralized and big is economical in the investment sense it is not so in the operational, efficient, and producive sense in our big business, one guy gets all the toys, investment community. In railroading, UP upon merger with SP, found this out first trying centraiized control of the whole company to dividing into operational segments (I don't mean just running trains). Broadcasting...especially radio...has come under the same scrutiny in the wake of recenty flooding from tropical storms in the northeast where locally owned and operated radio stations were better able to serve the emergency needs of the communities than multi owned out of town operated big investment firms. Banks are spinning off branches much like the railroads spun of branches and segments. Big might just be too big to handle and survive much less prosper.
But if railroads had been allowed to form alliances or partnerships with other modes, it might be a different story. We used to call it rationalizing....passenger train to point M then bus to Z for instance. Trucking companies buying space on trains is another opportunity which has come to the forefront.
Another underlying point is the public perception of cost vs. services. Farmers and others ran to the government to protect them from railroad's rates; passengers expected the same protection. In New York City for example, the five cent subway fare instituted by Astor in the early 1900's was enforced by City Councils and the State Legislature for half a century pushing the subway system from private enterprise to government ownership and operations. What if the fares were allowed to be raised over that 50 some odd year period and private enterprise were to have been able to survive and the public would have learned and accepted the cost vs value of the service? Would there be a different attitude toward the cost of travelling any and all modes of transportation today? Would there be a different attitude toward "subsidizing" any or all modes of transportation? Highway use? Fuel taxes?
Then there was the mail contracts....railroads were the main and most efficient way of moving mail from town to town, state to state, etc. And while labor intensive, many will argue (I think rightfully) that the sorting of mail enroute on railway, highway, and waterway routes was more efficient and reliable than today's hubs where mail is transported up to three or four times the distance than normal. (Mail a letter today to an address a block away and it may travel to one or two sorting hubs travelling hundreds of miles and maybe taking one, two, or more days for delivery. In 1961 my mother would give the local Denville, NJ postman a letter in the late afternoon; it would go to the local NJ post office, pouched for a train to Dover, NJ by 5PM; pouched on that five mile ride for DL&W's #7 leaving Dover about 9PM; be pouched for the HPO from Binghamton to Ithaca; arrive Bingahmton before midnight and on its way to Ithaca; it was in my mailbox at Ithaca College by 8AM the next day. Today, from Denville to sorting terminal 30 miles east, then truck to Syarcuse, NY sorted and trucked to Binghamton to Vestal and to my home maybe on the second but often on the third day). This was looked at as a subisdy to the railroads and not as a service to the people so, literally, it was zipped. So with the problems the Postal Service is having today, this could mean something in cost and efficiency in that going back to rail could cut costs, increase efficiency and help the cost of providing rail passenger service while providing rail passenger service.
The concept of transportation...of all modes working together...is complex and often, too often, boxed in minds based on prejeduce or familiarity or dependence on one mode or by geography or whatever other influcence one may be subjected to.
Again, as Dave said, we need an unbiased panel to study and reccommend, one that has a grip on history, economy, environment, business, utility, government, and enterprise at least.
While your scenario is plausable, I think it is more plausable that an integrated passenger carrier would feed long haul air with busses rather than trains.
I think you are in Atlanta. How far is it from the Southern's passenger station to the airport? If SOU brought folks to Atlanta by train they would have had to bus them to the airport anyway introducing yet another seat change with its associated delay and cost. I think an intergated SOU would have gathered passengers up from their train stations, where they already had ticket sellers, and bussed them direct to the airport.
Remember that the modal competition would exist even with integrated carriers. The Interstate System would have been built and that is where the vast majority of medim distance traffic went in fact and would have gone in our imaginary world. Convenience and only counting the cost of gas made the car king. Integrated common carriers would not have affected that fundamental dynamic.
Modal competition would simply have moved from between companies tied to a single mode to WITHIN companies having unfettered investment choice. That is the reason I think new rail car purchases would have stopped earlier under this system than happened in fact. Another way to say this is that the last purchases of passenger cars, say post 1950, were made as matters of corporate pride rather than a clear eyed appraisal of the business case. Since the states and the feds had been building and imporving highways since before the 1920's, and highways had been siphoning off passenger and high revenue freight for that entire time, it would have been reasonable to assume that process would contine. I make this criticism in a whisper because no one bought new cars after the act to build the interstate system was made. Of course by then the fleet had been modernized sufficiently to make it into the 1970's.
Henry,
Your example of the ill effects of rate regulation on the subway system was absolutely correct. The lession to be drawn should be that the government has no business regulating rates for it drives the regulated businees to the public sector.
Mac, you are assuming the Interstate Highway system we know today, the Eisenhower Interstate Highway system, would have been build no matter what. But it was built by the governmen at taxpayer expense at the behest of the so called Highway Lobby consisting of auto manufactureres, big oil, and construction companies and suppliers as well as the military. What if they hadn't prevailed and the system was not built but monies put elsewhere? Then we'd have a different situation today than we have because a different lobby group would have prevailed, maybe air, maybe rail, maybe even bicycles for the sake of rhetoric!
True, but for the purpose of the discussion with Don I clearly stated that we would imagine only one change, that of integrated carriers. Building or not the Interstate Highways is a separate question. These thinks are complex enough taken one at a time that to throw in another one or two or three removes them, in my opinion, from something we can talk about in the limited space/time we have here to the relm of multi million dollar analysis that will serve no purpose.
For what it is worth, I think two reasonably credible alternatives to taxpayer financed interstates after WWII was taxpayer funded roads of ever better quality, a process then under way for 40 years OR a network of toll roads designed built and operated under govt direction. Think certificate of public convenience and necessity for a national toll road network. IIRC the interstate bill raised gas taxes to pay for the system. Under a toll road system presumably gas tax would not have been raised but tolls would have been charged for specific use. I suspect that long run cost of a toll system would have been higher than the govt/gas tax system due to costs of the regulatory system and the costs incurred to collect the tolls.
The public decision to use federal government funds and power to attack the evil railroads was made about 1916. That horse was long out of the barn by the mid 1950's. As an automobile driver I prefer paying via gas tax to paying via tolls, particularly since I think the toll road system would cost more due to structural ineffeciencies. In addition there are costs in time and efficency in stopping to pay tolls, this is harder to quantify but still a real cost to drivers and the economy.
Reality and rhetoric always clash somewhere. The concept of private toll roads was seminal to the Colonies and the US but had to be taken over by governement because of lack of and uneven maintenance by private owners and outright abandonment by the private owners; there was also the need for Post Roads, roads upon which the Post Office could efficiently ship mail. Plus there was the problem of land ownership, need for eminent domain, etc. As for attacking railroads at the Federal level, that goes back well into the 19th Century when organizations like the Grange were formed by farmers to fight railroads which led to the ICC; and again the granting of charters and the public subscriptions to bonds by governemts.
As for what is the cheapest form of transportation, it is the one that gives the purchaser the best return on his tariff be it speed of transport or whatever else the purchaser's expectations and need are. In effect, this boils down to a continuous discussion of rhetoirc based on political viewpoints more than by practical economic applica;tions.
Henry, the 1916 date refers to the creation of the Federal Bureau of Roads and the begining of federal expenditures for roads. I was refering to that specific attack only.
I disagree strongly with your last statement, at least in the short term. Any player in any market does what he thinks is in his best interest at the moment. That is pure economic calculus and it works just as well in transporation as in any other market.
The rhetoric and politics comes when someone wants a change in the law, that is to say change public policy. When a change is made all parties will respond as quickly as they can and as best they can to the new facts. I would be much happier politically if changes in policy were generally made toward more freedom as opposed to the real case which has generally been to restrict our freedom at the cost of an ever growing ever more expensive government. The railroads happen to be an example of a far larger trend.
PNWRMNM Don, While your scenario is plausable, I think it is more plausable that an integrated passenger carrier would feed long haul air with busses rather than trains. I think you are in Atlanta. How far is it from the Southern's passenger station to the airport? If SOU brought folks to Atlanta by train they would have had to bus them to the airport anyway introducing yet another seat change with its associated delay and cost. I think an intergated SOU would have gathered passengers up from their train stations, where they already had ticket sellers, and bussed them direct to the airport.
I think it would have played out differently. If the RRs had owned the airlines, they would have placed the tracks and the airports in the best possible location for both. SOU and CofG run very close to Hartfield-Jackson at it is, but I don't think you'd have seen one big, integrated airport in Atlanta. Perhaps there would have been a couple or perhaps several airports. After all, ATL had two major passenger stations downtown at one point. How about an SOU - CofG airport on the south side and an combined SAL - L&N - Georgia Road airport on the west side of town?
You seem to be assuming that the integrated transportation companies would have built their own airports. I do not think that would have been the case.
First, a disclaimer, I am not an airline historian. My basic assumption is that simply having a series of integrated carriers would NOT have affected public policy decisions to use public money to build public airports. I am 99% sure that several public airports had been built before the rail carriers were forced out of the airline business.
From the integrated carrier's point of view why build a private airport if the taxpayers are willing to do it for you? That strategy would make the airline cost structure even more highly weighted to fixed costs than it otherwise would be. Carried to its logical conclusion there would be multiple, and generally underutilized airports, rather than the current public model of one very busy facility. Setting aside the tendency of public projects to be more expensive than an identical private project, I think the collective we would have incurred a higher investment in airports than what actually happened.
My hunch is that airports would have developed similarly to union train stations. Atlanta had many RRs but only two main, shared stations, for example. If the RRs were in the airline business at the end of WWII, they would be the logical bidders on the Army Air Corp bases that became the backbone of commercial aviation as we know it now. They could have used the money they put into streamliners. The fledgling airlines at the time had much more limited access to capital.
The Union airport concept is reasonable. How do you think the airports would have developed under your scenario?
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