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PC: Re: Re: PC, Conrail and the Facts of Life
- Subject: PC: Re: Re: PC, Conrail and the Facts of Life
- From: "ERIE LACKAWANNA SD45-2" <ERIE-LACKAWANNA@xxxxxxxxxxx>
- Date: Mon, 27 Aug 2001 14:36:31 -0400
We can thank Robert Moses and all the other Pro Highway politicians for
helping destroy the nations freight and passenger systems pouring billons in
highway and airport construction using rights of ways maintained by the
state and goverment that cost the users nothing where as railroad had to pay
taxes and their own maintenance. In many cases railroads had a direct route
that highways and parkways were built next to them to compete for traffic
which they did. CR did nothing to improve the NJ-NY area service. They did
not want the Poughkeepsie Bridge which PC maintained right to the last day
whch is a competitor to I-84. They sold the Maybrook, NY Freight Yards to a
freight competitor Yellow Freight who has direct access to I-84. The
Maybrook Line was a good candidate for stack trains which were not around
back then and had a more direct route to all of New England and to West
Shore at Kingston. Maybrook was the main freight hub to all points from all
over the country and to New England and CR did not see it as such. CR's way
of thinking was all screwed up and on the wrong track just as Amtrak's is,
another govenment agency like the USPS. Cr destroyed so much that they would
have been out of business by 2000 and CSX and NS rescued them. If CR was
really making all this money we never saw they would not have needed a
bailout by CSX and NS. Some years ago UP planned to buy the system which UP
president Drew Lewis had a UP office in Bethlehem, PA for the rumor that
never happened. CR was is trouble before and this was it as today with CSX
and NS operating system. Same clowns, different circus. CR was known by
many negative names, Con Job, Crook Rail, Cut Rail and more. Names fit them
at the time.
> A brief history lesson...
> Conrail stock had been held in a trust from 1976, was a private
> from the beginning, and was Never "the government". The feds bought
> securities in the corporation to provide cash, but NEVER had a hand in the
> management decisions that ultimately lead to the successful public
> in 1987. (Incidentally, the stock was originally offered at $35, and
> to NS and CSX at over $70. Yeah, Conrail was a real flop.) The boards
> were comprised of railroaders and business people, and even Congress was
> held at arm's length. (Read the legislation that enabled Conrail to form,
> and you'll understand that.)
> If the government had any role in anything, it was the 19th century
> regulations that led to the collapse of the Northeast rail system, and
> near the whole nation's railroads.
> When the northeast industrial economy started to evaporate after the war,
> the regulations forced the railroads to change at a glacial pace, if at
> and at the same time, poured billions of dollars into highways and
> If they had the de-regulated environment you have today, the survivors
> have likely been a solid pairing of the PRR and NW, the NYC and C&O, and
> weak sister would have been a grouping of EL, B&O and Reading. The Lehigh
> would have been absorbed either by the PRR or NYC, and CNJ probably would
> have ended up on the scrap heap, as it pretty much did anyway. The
> probably would have ended up paired with one of the northeast systems.
> is interesting to note that this is more or less what we now have
> the "divorce" of Conrail.)
> The reality is, in an unregulated environment, these probable combinations
> would have still led to layoffs, line abandonments, and facilities
> a helluva lot sooner than 1976. And probably without the plump pensions
> labor gaurantees that Conrail had to honor.
> A lot of these sensible merger talks were underway in the 1950's, and most
> were squelched by the ICC, or killed by useless and draconian conditions
> (can anyone say New Haven?). That's how NYC and PRR ended up in bed
> together in the first place.
> Instead of creating regional systems that competed with each other, they
> created virtual monopolies in each region, which led to disaster. Despite
> its 44,000 mile system, there was virtually no line-haul advantage to the
> merger. New York to Chicago is New York to Chicago. PC created an
> overlapping system that only added overhead to traffic that was still
> to basically the same places.
> PRR-NW would have made considerably more sense, because it would have
> the southeast to the Pennsy, and the northeast to the NW. It also would
> have been of tremendous business advantage, because the Pocahontas Coal
> fields would have provided the cashflow for the PRR to recover from the
> beating provided by the war traffic. For some reason, this type of
> combination scared the bejesus out of the regulators, even though the
> interstate system was providing the same kind of regional and national
> advantage for the trucking companies.
> Don't get me wrong, I miss railfanning my favorite roads as much as the
> guy, but the economics of the time and the government regulators led to
> their demise, not Conrail.
> Look it up in your Funk and Wagnalls.
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