In lieu of an abstract, here is a brief excerpt of the content:

Reviewed by:
  • American Railroads: Decline and Renaissance in the Twentieth Century by Robert E. Gallamore and John R. Meyer
  • Frederick C. Gamst (bio)
American Railroads: Decline and Renaissance in the Twentieth Century. By Robert E. Gallamore and John R. Meyer. Cambridge, MA: Harvard University Press, 2014. Pp. xiii+ 506. $55.

After World War II’s traffic boom, U.S. railroads gradually declined, owing to government’s strangling overregulation and subsidizing of highways, airways, and waterways. Out of ever-diminishing revenues, railroads provided their own capital and maintenance costs for right-of-way (ROW) and paid real estate taxes on it. Through the 1970s, some railroads became bankrupt and others suffered deferred maintenance of ROW and rolling equipment. America’s railroads had entered a potentially fatal financial crisis.

Today, many Americans think the freight railroads are still gasping for financial breath. As Robert Gallamore and John Meyer explain appositely and document well, ever since the large-scale deregulation of railroad commerce with the Staggers Rail Act of 1980, efficient, profitable railroads have flourished—under capable management—no longer fettered by the Interstate Commerce Act of 1887. Indeed, not only is rail traffic expanding today, management can also finance the necessary improvements to handle that growing traffic, building second and third main tracks and enlarged tunnels through revenues. Nevertheless, unaware citizens continue to suffer from government’s historic warping of America’s railroad market.

In 1970 the federal government created Amtrak, with partial taxpayer funding, to assume the burdens of traditionally unprofitable long-distance and regional passenger trains. National service began on 1 May 1971 and this carrier had the sole, problematic responsibility of handling America’s rail passenger services across a profitable “basic system.” “With all this complexity and controversy, it is not easy to offer a summary judgment on whether the Amtrak experiment has been a success or a failure” (p. 338). Presently, federally mandated, unfunded Positive Train Control (PTC), as designed, prevents train-to-train collisions and interdicts many derailments by enforcing speed restrictions and authority for entering areas of ROW work. PTC also prevents derailments from misaligned main track switches. Coded, digitalized information flows bind the North American railroads into one tightly functioning operational and commercial enterprise. [End Page 551]

Prior to World War I, a “progressive” federal government broke up amalgamated railroad companies, for example, the Hill and the Harriman networks. From 1918 to 1920 federal control and operation of railroads under its U.S. Railroad Administration (USRA) experimented with near nationalization. Releasing control in 1920, the government unpredictably proposed combining strong and weak railroads into several networks (Penn Central’s disastrous model?) but the plan remained unapplied. As the railroads declined from overregulation, the government changed direction beginning in 1970 and allowed the emergence of these networks for national well-being.

Railroad mergers in the post-Staggers era had a foundation in the Transportation Act of 1940, which held that such mergers must be in the public interest, which includes rectifying detriment to railroaders’ employment. The wheeling and dealing in some mergers are fascinating. This includes the federally thwarted, end-to-end merger of Santa Fe and Southern Pacific and the consequent acquisition of the vast, torpid SP system by little Denver & Rio Grande.

In the mid- to late 1990s, the Surface Transportation Board, successor to the Interstate Commerce Commission, allowed mergers, creating America’s four freight mega-railroads: Union Pacific, BNSF, CSX, and Norfolk Southern. Consequently, there were cost savings to railroads and customers and more single-line haulage with service improvements. The future might see end-to-end mergers of the big four into two transcontinental systems, with or without inclusion of Canadian National and Canadian Pacific into systems also trans-border.

In an afterword on future policies, principles include: allow markets and tenets of efficiencies to guide ratemaking and congestion pricing; permit railroads to have revenues adequate for reinvestment; and respect railroads as owners of private property. Additionally, exploit railroads’ fuel efficiency and modest environmental impact; support transportation flows of freight and passengers to the safest and most efficient modes; and promote movement of energy development and uses to cost-effective and environmentally sustainable forms. Discussions include: public-private partnerships; risk management, safety...

pdf

Share