OUR RAILROADS
TO-MORROW

OUR RAILROADS
TO-MORROW

BY
EDWARD HUNGERFORD

NEW YORK
THE CENTURY CO.
1922

Copyright, 1922, by
The Century Co.
Copyright, 1920, 1921, 1922, by
Curtis Publishing Co.
PRINTED IN U. S. A.

CONTENTS

OUR RAILROADS TO-MORROW

OUR RAILROADS TO-MORROW

CHAPTER I

IN INTRODUCTION

Do you chance to recall the story of Frankenstein, of the man-made monster, who, having been created, arose to slay the man who had created him? The railroad to-day is in much the position of the man who created the Frankenstein. Having in no small sense created the modern world, having riveted its very sinews of commerce together, it now stands in apparent danger of collapse. The world over, it is at least in peril of bankruptcy. Everywhere it is in trouble. One of the greatest if not indeed the greatest of factors in our social and commercial structure to-day is flying the signals of distress. Its perplexities are upon all tongues. Their solution seemingly has become the problem of all men. The railroad is almost the single great unsolved economic problem of the entire world to-day.

The sweep of a great war, the débris of men and of human understanding that followed in its wake, the new and independent position of labor everywhere, the vast increases in fuel and in raw material costs—all have contributed to the serious embarrassment of our railroads. But never to their breakdown. Please remember this. It is a common phrase these days to allude to “the breakdown of the railroads.” But it is an incorrect phrase, decidedly incorrect.

Even in Russia, where transport conditions to-day are the worst anywhere in the world, there has not been a complete railroad breakdown. The Russian railroads after nearly a decade of overburden are to-day functioning—after a miserable fashion, to be sure, but functioning none the less.

For, truth to tell, a necessary railroad structure may never break down completely. It may descend into the valley of deep woes, it may crawl on its stomach in the despair of seemingly hopeless disease, but it may never quite die. That is out of the possibilities of the thing. Dying, a railroad dying? It must never die. A factory, a merchandising establishment, even a whole town may struggle along fitfully for a number of years and then decide to quit, leaving but a forlorn group of ruins as a memento of vanished enterprise. But a necessary railroad may never quit. When a rail highway of any real importance ceases to operate, civilization itself, begins to crumble. For a railroad is a not alone life but also a life-giver. Upon it depends virtually all the life of the community it serves, not merely commercial life but political and social as well. Which means that the mere suggestion that the railroad structure should cease to function is unthinkable. And here thrusts to the front the vexing problem of how not only to enable it merely to live but to enable it to live in the fullest strength, to grow apace withal, to more than keep pace with the growth of the community that it is designed to serve.

For nearly a hundred years now we have been upbuilding the railroad structure of the world. America pioneered in its creation. Our fathers and our fathers’ fathers cannot now remember the day when the call of the iron horse was not heard across the land. The railroad train has become part and parcel of our lives. And even though in these days with our motor cars at the curb we may have come to scorn the railroad train for our own short travels, we know full well that it brings the milk to our doorstep, the coal to our bins, the provender to our larders. It helps weave the fabric upon our backs, build the shoes upon our feet, form the hats upon our heads. At every corner, every turn, we are dependent upon the railroad. Therefore there is not a man or a woman in the entire United States to whom its present plight should not be of the keenest interest and importance.

We were promised a complete solution of our transport troubles with the hurried passage two years ago of the Esch-Cummins Bill, now known officially as the Transportation Act. Have we reached that solution, or anything like unto a solution?

You do not have to ask the average man twice for an answer to that question. He knows. If he is a business man he knows doubly well. He knows that for the last ten years our American railroad system has been in something of a decline. A decade ago it was at the zenith of its efficiency. For eighty years it had been climbing upward; for the last ten it has been slipping backward. Oh, yes, I do know its war record. It was a fine record and one of which every American should be duly proud. There is hardly a physician, however, who has not seen a patient, terribly sick, under the stress of great emergency rise magnificently to a definite situation of supreme importance. So four years ago rose our sick man of American business. And now he has gone to bed more ill than ever before while many doctors quarrel about his case.

And still he functions. The sick-abed man of our American business still renders the all-necessary service that none but him really can render. Fortunately perhaps American business itself at this moment is not in the very best of health. One shudders to think what would happen if industry all the way across the land were again in its top notches of production. It is not the least of the perplexing phases of this all-perplexing railroad problem of ours—the question, when traffic shall again rise (as it certainly will) to normal volume, to say nothing of any abnormal volume, of how our weakened railroad structure will meet it.

That it recently withstood severe tests is of course no indication that it could again withstand such strains. All the way across the land our railroad functioned in the recent ordeals through which it has passed—which of course is not saying that it could do this again. It quite naturally worked at its best in the western sections of the land, where there are both less congestion and comparatively larger rail transport facilities. Yet as one came east he found the American railroad still meeting its responsibilities bravely and with a real degree of efficiency. One crossed the Missouri, the Mississippi, the Maumee, and still found the railroad functioning—the stout, pliable rod of its energy bending but never breaking. He came further east still, crossed the Susquehanna and then the Delaware, and still the rail carrier functioned. He came to the Hudson and found the battered and overburdened railroad machine still meeting its obligations, after a fashion at least.

Our railroad machine did not break even in New England, where conditions are and for a long time past have been almost at their worst; where for nearly two decades a high-grade community has been forced to pay penalty, and pay generously, for a grave accumulation of railroad errors. It was in New England that American railroading really began, with the construction in 1808 of a crude wooden railed line at Quincy, Massachusetts, whose horse-drawn cars brought granite from the quarries down to the water’s edge, whence it might go by sloop to Charlestown, where the tall shaft of the Bunker Hill monument was beginning to arise. It was in New England too that the first real railroad enterprise and development were shown; by the middle of the forties a group of energetic and profitable small companies rapidly expanded and offered genuine transport to six of the busiest and most rapidly growing States of the Union.

It is in that same New England that when one comes to-day he finds the picture of our national railroad machine almost at its very darkest—the stations dirty, unpainted, neglected; the passenger-cars and the locomotives in similar or even worse condition; the morale of the rank and file of railroad labor low in many different ways. Remember that it is not like this everywhere else within the land. It is particularly different out in the West. Take California; out there the stations almost invariably are clean and brightly painted, the broad lawns that surround them are in the pink of perfection, while the trains that enter and leave the stations are in full keeping with them. Engines, and the passenger-cars behind, are alike clean, fresh-painted, efficient in every detail of their appearance. Paint certainly does wonders. The cherry-red electric trains of the Southern Pacific never seemed brighter or more immaculate. I rode a little more than a year ago on a huge steam locomotive of the El Paso and Southwestern railroad. The brightness of her appearance, the efficiency of her performance, seemed to belie the fact that it was eleven years since she had left the big shop in Philadelphia where she had been born.

Always it is as one comes further east that the American railroad machine grows more and more shabby, until in New England we see it at its worst. Our entire railroad structure, speaking nationally and subject only to a few exceptions, is worn down a bit. It is a shoe outgrown. It pinches. It pinches hard. Yet nowhere does it pinch harder than in New England. I hinted but a moment ago of the transportation machine there, twisted and bended and torn and all but completely broken. I spoke of the desolate appearance of many of the trains and of the stations. The Boston and Albany, it is true, has been something of an exception to this rule. The present condition of the Springfield station does not prove the exception however. Always a wealthy road, the B. & A. is compelled by its State charter to return to the Commonwealth of Massachusetts all of its earnings in excess of an annual 8 per cent. It is hardly necessary to add that even in its most prosperous years the excess earnings went into the property. And in consequence the patrons of the road benefited. But that was yesterday.

It was yesterday too that Boston possessed a suburban service in which she could at least display some slight evidences of satisfaction. That yesterday is now quite gone. To-day the service is unquestionably the very worst in all this land. It is doubtful if any other large American city would tolerate for a month the sort of suburban service which to-day is doled out to the Boston metropolitan district. Ancient and dilapidated cars, pulled by equally ancient and dilapidated locomotives, are the sad lot of the Boston commuter. The records of the railroad companies themselves show that some of these ancient coaches date from as far back as the early eighties; many of them go back into the nineties. Nightly the trains are crowded, not only to the extent of their seating capacities, but well beyond them. Nightly the abominable overcrowdings of the New York subways are repeated throughout the Boston suburban zone, and with far less excuse.

In its appropriate time I shall discuss the large possibilities of electrification as it applies in particular to the Boston suburban zone. For the moment consider this New England corner as the darkest corner of a transportation picture which to-day has but few patches of brilliancy. As one goes from east to west however the picture brightens perceptibly. Do not forget that it is at its very worst in New England and perhaps at its best in California.

For the moment the freight service, nationally speaking at least, is not subject to the same criticisms as the passenger. (To the depleted passenger service we shall come in good time.) This for the simple reason that the traffic is not being produced across the land. A sadly depleted transportation structure easily can take good care of a sadly lessened freight traffic. But let our wheels of industry begin really to hum again and contemplating the present condition of our carriers, I shall fear a reversion to the conditions of the winter months of the early part of 1920, when one box-car took forty days to go from Boston to Chicago, a trip that easily should have been made in a fortnight, while another car but a few days later took fifty days for the same journey!

Yet, to be entirely fair, these runs were made in a winter which, by the official records of the weather bureau, was the worst that the country had known in thirty-six years.

All right. Let us be fair. We shall go back three years to 1917 before government control and the really big labor problems had been wished upon the railroads. The New England roads even then were already having a fearful time of it. The Boston Chamber of Commerce sent out questionnaires to the big shippers of the district asking for specific reports on all of the car-load shipments that they were making. When the questionnaires came back to it, all filled in neatly on the dotted lines and in the blank spaces, they showed the definite record of 2625 cars, quite enough to be fully representative of the entire situation. One New England land shipper reported that the fifty-nine cars which he had had in Chicago movement had ranged from thirteen to eighty-seven days in transit. (Remember, if you will, that a fair average for that journey is fourteen days.) One hundred and sixty cars bound to his siding from various Western points had together consumed 6709 days in transit. A reasonable time for their journeys would have totaled 2550 days. Detentions due solely to railroad delays had in his one case come to the considerable figure of 4159 days.

For the entire 2625 cars—in almost every case from the primary grain-markets of the West—the total transit time came to 109,569 car-days. Again the law of fair average time comes into play. Let me explain briefly how it is made. To the shortest time in transit between two given points an arbitrary of 50 per cent. is added. This makes the fair average. In practice it results that the average time to Boston from points east of a line drawn through Buffalo and Pittsburg is fixed at seven days. Two weeks are allowed from points west of that line and east of the Mississippi, three weeks from those east of the Missouri and thirty days from places as far distant as Montana. With this rule as a measure and taking the individual routings of each of these 2625 box-cars, the fair average time of all of them came to a total of 40,753 car-days. Subtracting this time from the total transit time as you have just had it, we get in a few months at the beginning of 1917 a railroad detention of 68,996 car-days, or an average waste of 26.2 days for each car. If this waste could have been avoided there would have been an additional use of 9856 cars for one week each, or 3285 cars for a three weeks’ period. The hard-headed railroad executives who continue to argue against a too elaborate car-building program must understand these figures and their full import. Nor can their brethren in the field be entirely blind to the success of the Car Service Commission of the American Railway Association in making an extensive and vastly bettered use of the freight equipment immediately at hand at that time and available all the way across the country. It takes a lot of time and money to build any considerable quantity of new freight-cars. It does not take much of either to make a better use of the cars already in operation. And this is the very thing that had been done to a certain extent, up to the beginning of the present business slump.

It would not be just or fair to assert or even to imply that all of the car delays which we have just seen occurred within the boundaries of New England. It is just as fair to assume that many of them came to pass in Montreal, or in Toronto, or West Albany, or East Buffalo, or Altoona, or Brunswick, as in West Springfield, or Cedar Hill, or Mechanicville. But when this point has been stated the fact still remains that the New England roads to-day are and have been for a number of years past fairly typical—certainly not exceptional—of the condition that prevails in certain other sections of the land, particularly upon the so-called “weaker lines.” The great trouble is that in New England there are virtually no strong roads. They are all down in the doldrums. Even the last series of rate advances by the Interstate Commerce Commission, which gradually are proving very profitable to many of the already strong railroads in the southwestern corner of the United States, have failed to bring relief to the already weakened properties in its northeastern corner.

In the course of this book I shall refer more than once to the deplorable New England situation. I have referred just now to the fearful delays to freight originating there in the last fairly normal period of private operation, giving full heed to the fact that many if not most of these delays occurred outside of the actual New England territory, in order to emphasize the absolute unpreparedness to-day of our national railroad structure should great freight traffic demands be made upon it once again. In a merely introductory chapter I cannot expatiate at length upon the reasons that have led to this bad condition nor attempt to give the methods by which it may possibly be corrected. I merely am trying to paint in brief a picture that has all too few high lights. In the course of this book I shall attempt gradually to fill in some of the details.

All these things, and many others too, are upon the face of our present railroad situation in this country. When one goes beneath the surface matters are even worse. If one is a security-holder in rails he does not have to study Wall Street reports to see the saddening decline in dividend payments—either average or cumulative. It is he who long ago began to smell the rat. And the news that in the railroad the employer and the employee have been slipping further and further apart until a seemingly unbridgeable gulf has come to exist between them, that the executive personnel of our railroads of to-day is growing on in years with little or none to replace it, that no steps whatsoever are being taken to bring our railroad structure up to the necessities of to-day—to say nothing of to-morrow—is not news to him.

Perhaps the most pathetic of all these declines is that of the fine tradition of American railroading—the thing which in war days we learned to call morale. It was that tradition that used to make the farmer’s boy, as he stood in the field and watched the express sweep by, yearn to become a railroad president. In a less romantic and far more concrete form it enabled the old-time railroaders to fight against fearful conditions at times—against the blizzards of midwinter in the north, the blazing midsummer of southern deserts, flood, pestilence—come what might, that old-time railroader was ready for it.

It was the survival of that tradition, the fine fiber of its long-created morale, that enabled our railroads to make such a fine war-time performance. And it is its lessening, the gradual passing of the old-time railroader with none of his caliber to replace him, that is one of the tragedies of our railroad situation of to-day.

To Americans these things still will come as more or less of a surprise. They may have felt themselves fairly remote from actual railroad responsibility. They may have been depositors in the saving-banks downtown or holders of policies in the insurance companies, and yet have quite forgotten the millions of dollars of railroad securities in the strong-boxes of these great fiscal institutions. The financial ramifications of the railroad as well as its social and commercial ones are far-reaching indeed.

Once again, it is because of this intertwining of the railroad with the every-day life of the American community in its every phase and relation that the growing seriousness of its present predicament becomes a matter of so large national import. Our transport problem is no academic matter. It is very real, very human, very close to every one of us. I did not overstate when I said that the railroad to-day was life itself to us. And because it is life, our life if you please, its present serious problem is very much our business.

If we should go back and begin at the beginning we should find our American railroads in their beginnings small individual units, in many cases personal properties, like a store or a bank or a factory, and seldom correlated. Even the gages of our pioneer roads did not always agree, and in at least one case purposely so. The early builders of the Erie felt that by laying down a six-foot gage for their enterprise they would succeed in keeping their freight-cars and other equipment on their own property and under their own eyes. In this purpose they succeeded admirably. They also succeeded in keeping the freight-cars of other railroads, bringing valuable interchange merchandise, off their rails, with the eventual result that that railroad, twenty years after it was first laid down, was forced at great trouble and expense to bring its track to the standard width.

There was much that was crude and experimental about those early roads—a condition that was of course bound to exist. The traveler who went abroad upon them quickly became aware of all this. In the beginning he would change cars four or five times between Albany and Buffalo; and when fifteen or sixteen years later the railroad had extended itself all the way out to Chicago there were three or four more changes to be made. To-day a solid train from New York or Boston to Chicago or St. Louis is so much a part of our regular order of things as to cause no comment whatever. Yet even to-day one cannot ride across the North American continent from the Atlantic Ocean to the Pacific without a change of cars—that is, not in the United States. In Canada he can do it quickly, easily, comfortably. Of which much more in good time.

The lack of convenience in the handling of freight was equal to if not greater than that in the handling of passengers. Of through routes there were none. Freight bound from five hundred to a thousand miles or more was repeatedly transferred and retransferred. The fact that until the late seventies two such important links of the important New York-Chicago routes as the former Lake Shore and the New York Central and Hudson River railroads had gages varying a little more than an inch, and so necessitating an elaborate mechanism at Buffalo for the transfer of the trucks beneath the freight-car bodies, shows the fearful lack of rail correlation everywhere across the land. Indeed it was hardly a decade before, that a state of near civil war had been precipitated at Erie, Pennsylvania, by the efforts of the Lake Shore railroad to standardize its gage through that town. The townsfolk, urged and led forward by local hotel-keepers and bus-drivers, had stoutly resisted the change.

In railroad rate-making and accounting of every sort conditions were even more chaotic. There were no standards. You could hardly expect a group of several hundred widely separated and highly individualistic railroads to have uniform bookkeeping practices when in many instances there were not enough standards in the building of their cars to enable them to be coupled together into a single train.

And yet with all of this wretched system, or lack of any system whatsoever, those little railroads of yesterday had many, many things in their favor. Their very individuality was an asset. The fact that they were owned and operated by men who lived upon their lines or very close to them was a still greater asset. The railroad executive of those days understood from first-hand knowledge and intimate personal contact the problems as well as the opportunities of the communities that he was trying to serve. And a third and still greater asset was the close personal relationship that he might enjoy with his employees. On a railroad owning from twelve to twenty locomotives he might know, and almost invariably did know, not only each of those engines individually but the men who ran them. In fact in those days it was customary for a locomotive to be named and to be assigned to a permanent crew of engineer and fireman, who immediately began to take a surpassing pride in the upkeep of their craft—in keeping her boiler black and shiny and her brasses and her nickel-work gleaming like new.

In these days the brass and the nickel and all the rest of the former gay trimmings have departed from the locomotive. Its boiler is no longer shiny. On the average American railroad, locomotive upkeep has become an all but forgotten art. The names and the individuality have gone from its engines. They are assigned to crews out of the roundhouses in a very systematic and utterly unsentimental way. Yet something very definite has been lost.

You could scarce expect a modern railroad president whose system may own three or four thousand locomotives to know any considerable number of the men who operate them. Yet here is the loss. On that little road of yester-year the president not only knew his engine crews by name—generally calling them by their first names—but his conductors, his station-agents, his telegraphers too. And knowing them, understanding them, working with them in almost every case, there was no labor-union problem to confront him. There were no unions then for the simple reason that there was no necessity for them. The labor-union upon the railroad with all of its problems for the management came definitely as an effect of its super-consolidation. And the railroad tradition began to fall.

Even after the first steps in the inevitable consolidation of our various lines had begun, when for instance the six railroads in the three-hundred-mile stretch between Albany and Buffalo had been merged into the first New York Central, this intimate sense of personal relationship remained for a long time.

The statue of William Bliss, president of the Boston and Albany railroad, which stood for many years in the lobby of the old Kneeland Street Station in Boston, typified it. When the Boston and Albany was the Boston and Albany it was the pride not only of its employees but of all New England. But when, in accordance with the general railroad practice of the moment, the Vanderbilts took it over upon a long lease and painted out the old name, placing “New York Central” upon the cars and locomotives, New England rose in its anger, and it was not appeased until a shrewd executive, going to Boston from New York, reversed the new order of things and painted the beloved old name back again upon the equipment. After which serenity ruled once again along the lines of the “Albany,” as the Boston people to this day love to call it.

What’s in a name? More than you can imagine. I asked a shrewd brotherhood man once what the New York Central had sacrificed in operating efficiency when it had chosen to paint the names “Lake Shore,” “Michigan Central,” and “Big Four” from its western constituent lines, and he said that he guessed—it really is anybody’s guess—that 50 per cent. would be about right. The Pennsylvania system, with a great deal of real wisdom and long vision, not many months ago decided to divide itself into four large regional operating divisions, all to be known however under the general title of Pennsylvania System. Yet an old passenger conductor with whom I have ridden these great many years between New York and Philadelphia confessed to me his great personal regret at the passing of the fine old name, “Pennsylvania Railroad.”

“I feel as if I had buried an old friend,” said he. So felt others, and a little later the Pennsylvania dropped the “system” from its official name and came back as the good old Pennsylvania Railroad once again.

A few miles further south the people are still grieving over the loss of the “Cumberland Valley,” one of the earliest railroads of the land—incidentally a Pennsylvania constituency and one which until the recent change had held its name and its individuality. Across the land the thing repeats itself again and again. Away up in the northwestern corner you will find people to-day lamenting the renaming of their chief railroad system into the Union Pacific.

“We were proud of the name ‘Oregon-Washington Railway,’” said one of the really big men of that community not long ago. “It was a good railroad and we felt that in no small sense its goodness reflected that of this particular corner of the U. S. A.”

If this feeling comes to the patrons of these railroads how much more distinctly must it come to their workers? In subsequent chapters in a pleading for a division of our national railroad structure into shorter operating units, despite the ponderous suggestions of the Transportation Act, I am going to refer to the fact that in this country a half-dozen or so of the small railroads (“small” at least in a comparative sense) are the best operated and hence the most profitable lines in the land. And incidentally, despite the great tangle of red tape that the government system of railroad control has spun about them, they still enjoy comparatively friendly relations with their labor.

With the fundamental idea of railroad consolidation one can have no quarrel whatsoever. It was inevitable. It came logically and sequentially—in some ways before many folk were really aware of it. When a very few years after the close of the Civil War the merger of the Grand Trunk railroad was accomplished—a single system of nearly four thousand miles, stretching all the way from Portland, Maine, by way of Montreal and Toronto to Detroit (a little later, on to Chicago)—America stood aghast. And yet what were four thousand miles to be compared with a single system of twelve thousand miles of main-line track—nearly one-twentieth of the total mileage in the United States, upon which moves one-seventh of the traffic of the nation? And yet here is but one of three or four big twelve-thousand-mile systems that our land holds.

In our Yankee version of the English language we dearly love that word “big.” Yet is it not now a fair time to ask what that bigness has really cost us? Granted that with a certain amount of real aid from the state it has given us through rail and through car routes of an amazing multiplicity—even though one cannot cross the United States from the Atlantic to the Pacific in a through car, unless it be a freight-car—that it has simplified vastly our tariffs, our ticketing and our way-bill systems, it certainly is failing to-day in many, many instances to give us the high degree of service which our railroads themselves have educated us to expect. As I said at the beginning our transport service to-day is appreciably poorer and the rates a great deal higher than they were a decade ago, while the personnel problem of our railroads, in their executive ranks as well as in the ranks of the great mass of their labor, has become a matter of real alarm.

In this book I am going to give scant attention, if any, either to the scandals or to the triumphs of railroad finance for a half-century past in this country. Neither am I going to hark back to the evils of multiple and ofttimes conflicting regulation of our carriers by the Federal and the forty-eight State governments. Both have been pretty thoroughly treated over and over again. And so we shall assume, first that the railroads must be properly financed in order to function at all, and second that the principle of regulation by the state is so thoroughly established by this time as to be removed from the field of controversial argument; while the perplexing factor of many and ofttimes annoying conflicts between the State regulatory bodies, or between them and the Federal Interstate Commerce Commission, is being solved automatically by the steadily increasing usurpation of the individual rights of the various States by the centralized government at Washington.

The problems upon which I shall prefer to linger in this book are those that concern the physical side of our national railroad structure, future as well as present, its operating problems as well as its purely human ones, in these last including not merely the very human problem of the men and women who work upon the railroad but those who ride upon it or otherwise become its patrons. Granting the great importance of its questions of finance and of state regulation, I still feel that these last are of still greater portent to its future. With these properly solved, finance and regulation, to a large extent at least, will solve themselves. A national railroad structure well operated, with efficiency, with economy, with vision, with a broad human relationship, will not have to worry very much about the sale of its securities or about interference from fussy regulatory bodies. I think that this may be fairly set down as a fundamental fact in our argument.

As to what constitutes good operation, efficiency, economy, vision, broad human relationship, there will of course come more than one opportunity for an honest difference of opinion. It is in the sincere effort to gain the real current of forward-looking opinion upon these great questions of our national transportation problem that the writer for the last sixteen years has traveled many thousands of miles across the United States and Canada and has interviewed hundreds of people in railroad circles and out. For more than a dozen years past he has foreseen the present crisis. The coming of the World War hastened it a bit perhaps but the crisis was inevitable. A drifting policy, which ofttimes was no policy at all, followed by both the railroad and the various groups of persons that assumed to control it, has brought us almost to the edge of supreme catastrophe.

Go back with me once again to the beginning. Remember if you will that the railroad in the United States to-day is a little more than ninety years old. For eighty of those years it was in a state of steady and healthy development and progress. For the last ten or twelve of them it has not only been in a state of arrested development but narrowly approaching entrance into a state of decadence.

For eighty years the American railroad grew, and grew heartily. It financed its own growth and, consisting very largely of independent units, financed itself quite readily and as a rule locally. It kept its physical facilities, track and rolling-stock and all the rest of it, abreast if not ahead of actual traffic requirements. About the beginning of the present century, as presently we shall see, it began to feel the burden of greatly increased material costs, and of taxation also. It met these added costs, without any very visible addition to its revenues, by holding rather tightly down on its pay-roll and by adopting large operating efficiencies and economies. For a while these sufficed. They had to suffice. Appeals to the State and Federal regulatory commissions for increased rates were generally vetoed pretty promptly. Since the establishment of the Interstate Commerce Commission in 1887 these regulatory boards had increased steadily in strength and in prestige. They felt their oats. And many did not hesitate to deny the applications of the roads for rate increases.

In 1906 something happened which in later years was to loom large in American railroad history. Congress, under a considerable pressure from President Theodore Roosevelt, passed the so-called Hepburn Bill, radically amending the Interstate Commerce Act and giving the I. C. C. an almost unbridled authority over railroad rates. The Interstate Commerce Commission could not itself authorize changes in the tariffs of the carriers but it could, and frequently did, veto any changes that the roads themselves saw fit to make.

Parenthetically it may be stated that even though this increase of power granted to the big Federal commission stirred up something of a competitive energy on the part of the State regulatory commissions to supervise more carefully than ever before the operation of the railroads through their respective bailiwicks, it also marked the long beginning of the end for the State boards; as far at least as our steam railroads are concerned. As I have said already, it is still another of our difficult national question-marks in which the old, old problem of States’ rights again shows its disagreeable face. Eventually it probably will be ended by shearing these State boards of virtually if not absolutely all of their supervision over interstate railroads; and the I. C. C. long since has shown marvelous ways in which this phrase may be extended to cover even the tiniest of apparent intra-state lines.

The passage of the Hepburn Bill put the first quietus upon the development of the carriers. Soon after, they began to cease large additions to their plants, even though the nation that they served went steadily ahead in its development, by leaps and by bounds. Yet for full ten years after 1906 the net earnings of the carriers continued to increase, in pace with the great growth of the nation and its industries in those selfsame years, until under the war stress of 1916 and 1917 they had come to the astounding total of almost a billion dollars a year “net operating income,” which under the rigorous accounting systems of the Interstate Commerce Commission signifies the amounts available for paying interest and dividends and making permanent improvements. In other words the deterioration of the national railroad structure had begun well before the maximum of net earnings had been reached, and by the end of 1917 had reached so serious a stage as to threaten a possible breakdown—I am using this last word advisedly—or at best a fearsome congestion and uselessness, in the face of one of the gravest national crises that the United States has ever had to meet.

Confronted with such a possibility President Wilson did not hesitate. He took no chances. With the supreme powers which were his as the war leader of the nation he reached out and took over the railroads and made them a direct agency of the national conduct of the war, under the name of the United States Railroad Administration, placing them under the direct and autocratic control of William G. McAdoo, secretary of the treasury and a man with not only a large knowledge of railroad finance but with a degree of success as an actual railroad operator—of the short but busy Hudson and Manhattan rapid transit lines connecting New York, Jersey City, Hoboken, and Newark.

There has perhaps been no single activity of the Wilson administration and its conduct of the war more seriously discussed and criticized than its control of the railroads. Even the gigantic expenditures and manifest blunders of the Shipping Board have been passed quickly by, to linger upon those of Mr. McAdoo and his fellows in the Railroad Administration. Yet when all has been fairly considered the Railroad Administration in its brief twenty-six months of life accomplished some very creditable things, and some not so creditable—some of these obvious, some others most unexpected and strangely outré. It was obvious for instance that a highly centralized, automatic, and supreme control could obtain large operating economies by completely obliterating competition and could by appealing to the traveler and the shipper in the role of a sadly harassed government, obtain a coöperation that no private agency might ever obtain.

Because the brief history of the Railroad Administration enters so very vitally into any consideration of the railroad situation in the United States both to-day and to-morrow, I shall come to it for the next chapter of this book. For the final paragraphs of this, consider once again the present lowered efficiency of our rail transport in this country. That it has been bettered in some of its phases since its relinquishment by the government I shall not deny; that it has been bettered in some of the most vital of them I shall dispute until the end. The proofs are too easily at hand. And so the reading of them may lead us into a really intelligent understanding of the situation.

What’s the matter with our railroads?

That question is being asked hundreds of times each day by business men all the way across the land—from Portland, Maine, to Portland, Oregon, from north to south and back again. These men, keen in their perception of many of the great and perplexing problems assailing the United States at this moment, frankly admit their lack of an understanding of the railroad one. They are torn by a vast conflict of statements and of opinions. Skilled propagandists succeed only in adding to the confusion. Apparently nowhere is an independent voice raised in the interest of the common citizen of America, the man who perhaps is not a wholesale user of our overland transport but who realizes from personal contact each time he makes a shipment of his goods or goes himself abroad into the land that our national railroad has suffered a vast deterioration within the last decade, that it no longer functions with anything like the high efficiency that it had attained say twelve or fifteen years ago.

What’s the matter with our railroads?

It is a fair question, and one that demands a fair answer. Why should not our railroad structure in the United States to-day be rendering service at least as good as that which it rendered but ten or twelve years ago? Is it man failure, either in the lists of the rank and file or in those of the executives? Is it, as has been charged frequently, interference by the Federal and State governments or, to put it in a gentler fashion, over-regulation by these same agencies? Is there lack of intelligence or vision or human understanding? If so, just where are these lacks?

It is to the answering of these questions that the writer puts his sixteen years of intimate and personal study of the American railroad and, as he has just promised, takes up that problem on April 5, 1917, the day that the United States of America officially entered the World War overseas.

CHAPTER II

THE UNITED STATES RAILROAD ADMINISTRATION

Long before the clear Washington morning had broken which succeeded that stormy April evening of 1917 when the United States first entered the World War, the railroad executives themselves had been feeling that there would need to be correlated and coöperative effort to make the rail transport system of the country adequate to meet the new and added burden to be laid upon its already sadly bended back. Not many weeks after that terrible August, 1914, the United States was feeling the reflection of the world disturbance, although feeling it in some unexpected ways. In August, 1914, few people in this country if any dreamed of the tidal wave of industrial production that was soon to all but overwhelm us, when Bridgeport turned (almost overnight, it seemed) from a sleepy Connecticut manufacturing town into an overcrowded metropolis wherein people by the hundreds slept nightly in the railroad station, and the new county almshouse was transformed into an overflow hotel; when Akron, Ohio, ran wild with prosperity, growth, and overcrowding; when drowsy old Bethlehem, Pennsylvania, became a bedlam of industry and Chester, Pennsylvania, the same; when Detroit, well used to rapid growth, now leaped ahead toward the million mark; and when so also in a large degree did Wilmington, Delaware, and Youngstown, Ohio, and Trenton, New Jersey, and Rochester and Schenectady, New York—dozens of other communities like them. Manufacturing plants worked night and day and doubled and trebled and quadrupled themselves in a matter of mere months; half-abandoned shipyards sprang into life and extension; mines were dug with a furious speed into the rich subsurfaces of mother earth—production everywhere. And everywhere the chief burden of all this was coming upon the back of the American railroad, and coming at a time when it could ill afford any overload.

As even a casual student of the situation easily understands, for the six or eight years before the advent of 1914 most if not all of the railroads of the United States had been in a period of serious retrenchment. Soon afterwards the beginning of the present and national increases in the cost of living had become an appreciable burden to them, not so much (as we shall see before we are done with this book) in their wages as in their cost of coal and other materials. They had endeavored to meet this increase in one expense in the conduct of their business by cutting down in other expenses. “Economy” and “efficiency” had become real catchwords to them. In both of these they accomplished much. At least so it seemed in 1914. Their economies up to that time, compared with the ones that have been achieved since then, were almost as nothing.

So the railroads were none too well equipped to meet the strain of greatly increased business that the war overseas thrust upon them. Their supply of locomotives and cars was inadequate. The track equipment upon which they ran their terminals and yards and their shop facilities were, if in good repair, at any rate in most cases no longer generous. And that prized possession of the American railroad of yesterday, the morale of its men, the thing that I shall call “the fine tradition of our American railroading” again and again and again before I am done with this book, was already on the wane.

So to an economic agent already sadly overburdened if not actually crippled was to be given also the serious and the urgent business of transporting soldiers and sailors and their munitions, a United States army of a size never before conceived, supplies in a vastness heretofore deemed incredible. Long before Woodrow Wilson’s signature was dry upon the dreaded declaration of war the War Department experts were making detailed plans for the enlistment, the training, the supply, and the transport of the new army that was to go overseas. They involved many things, most important among them the creation of thirty or forty great concentration and training camps and huge ports of embarkation.

To meet these needs the already swollen manufacturing industry of the land was spurred into fresh efforts of production. More factory buildings went up, more shipyards were established—we were talking about the “bridge of ships across the Atlantic” those days—more abandoned mines were put into activity once again.

All these things were a fearful burden upon a national railroad structure that was from the beginning inadequately equipped for a proper handling of them. Yet how did the national railroad structure meet this added burden set upon its badly bended shoulders? The answer is—like a good American citizen. Up to that April night, without a really efficient or concrete central body, it already had sought to create one. It took the ancient and somewhat archaic American Railway Association, shook new life into it, and on April 11, 1917—six days after the war declaration—established at Washington what was known as the Railroad War Board. For the personnel of this board the national railroad structure sought out some of the very best of its executives: Fairfax Harrison of the Southern railway, Hale Holden of the Burlington, Julius Kruttschnitt of the Southern Pacific, Howard Elliott of the Northern Pacific, Samuel Rea of the Pennsylvania, and Daniel Willard of the Baltimore and Ohio. The first five of these men were made into the active war board and immediately moved themselves to Washington where they set up a permanent headquarters. Mr. Willard already was prominently identified with the business of the organization of this country’s part in the World War as chairman of the Council of National Defense, which was then doing a very great work of hurried preparation for the conflict, but which President Wilson afterward saw fit to relieve of most of its power and responsibility.

At the request of the American Railway Association Mr. Willard became an ex officio member of the Railroad War Board and was in constant consultation with it. So did Edgar E. Clark, a valued member of the all-powerful Interstate Commerce Commission at that time and a veteran railroader of wide experience, having risen to the rank of conductor and in time become the head of the great brotherhood of that branch of railroading.

The Railroad War Board came into being committed to the idea of a single continental railroad in the United States as a war-time measure; please mark this fact for future reference. Indeed that efficient and economical idea had been in the heads of some of our practical railroaders for a good many years before the coming of the World War. But any steps that they might take toward it then seemed to bring them afoul of the Federal statutes—particularly the so-called Sherman Law—and in imminent danger of the penitentiary. Now, however, there seemed to be the faint ghost of an opportunity to gain some of the obvious practical advantages that naturally would inure from a centralized control of our national railroad structure.

Three great things, however, the War Board lacked. The first was the financial backing of the Government. No matter what broad plans for efficiency it might and did adopt—and that they were effective plans the statistics of their results most clearly show—the railroads lacked the financial resources to go into a market where rising labor and raw material costs were being reflected directly in tremendously increased prices for locomotives and cars and rails and every other what-not that goes to the making and maintaining of a railroad. On the contrary they watched the value of their securities drop as they listened to the demands of their employees for higher wages.

Beyond the War Board’s local authority, it had no real centralized control, no genuine supreme power. After all, it was but a group of men—big men, powerful individualists, each of them. They had been reared in powerful roads, roads of great traditions. They had been competitors, powerful competitors. Coöperation, at the best, was no easy pathway for them.

Remember always that the Railroad War Board lacked authority. It could not even compel its own member roads to fall in line and stay in line toward the formation of the single national railroad system. And as for the shipper, it could only go to him on bended knee and beg his coöperation. And of all the shippers the Government was perhaps the worst of all. It is our own beloved Uncle Samuel who is a most obdurate and unreasonable old fellow when he takes it into his head to become a patron of the railroad. If he is a passenger and in gold lace and khaki he may come into the train and demand that it be stopped and started to suit his own convenience. That frequently is done. And as a shipper he was forever letting his boys—Food and Fuel and Ships and a lot of others too—place priority orders upon their shipments, to the immense complication of the entire railroad situation.

The Railroad War Board began slipping in November, 1917. The hard early winter of that year finished the job. The inspectors of the Interstate Commerce Commission at various terminals and division points (themselves none too friendly to the War Board) began filing by telegraph their reports of delayed cars and trains, and the members of that commission, at the suggestion of the President, began framing a bill supplementing the measure of August, 1916, which had permitted him to take over the lines in case of a national emergency, and outlining the plans for the step as well as for the protection of the security-holders of the properties. The plan was in Mr. Wilson’s hands early in December and he decided that McAdoo—who seemed to stand in an impartial and aloof position from all the properties and who had not only a rapid transit electric railroad experience at least, but remarkable acumen in financial matters—ought to have the job. McAdoo sought to decline it. I honestly believe that he never wanted it. The President insisted. The weather grew more inclement, the railroad rod bent further than ever before. Then on the eve of Christmas something happened. A great American railroad stood in the shadow of bankruptcy. Other receiverships were to follow upon its heels. Such a calamity was unthinkable. The die was cast. The White House moved, and moved quickly. McAdoo accepted his new responsibility and on December 28, 1917, became director-general of more miles of railroad than any one man—even the late E. H. Harriman—had ever even dreamed of controlling.

William Gibbs McAdoo took hold of his new job with a pretty firm grasp. He said that he was going to “do things” and apparently he meant to keep his word. With one stroke of the pen he abolished the abominable priority orders and with another he doubled the demurrage charges upon freight-cars—two vastly important executive steps toward a bettering of the entire railroad situation. The rapidly retiring Railroad War Board, confronted by the increasing conditions of congestion upon the roads, at the eleventh hour sent an urgent request to the various lines that they at once reduce their passenger services at least (it had been suggested that their entire public service be suspended for several days)—suggestion which in some cases was acted upon with more enthusiasm than judgment. There was many a division superintendent who saw a chance to take a death-crack at that unprofitable, unhealthy, money-eating 11:08—or was it the 5:15? In other days a stern State commission probably had stood to forbid him, in the public interest, removing a train which might have had an average of seventeen passengers a day. Now the authority of the State commissions, even to a large extent of the all-powerful Interstate Commerce Commission, had largely been superseded.

The Pennsylvania, which for many years past has had the major share of traffic between New York and Washington, had asked a little time before to have its fastest express between the two cities, the almost internationally famous Congressional Limited, made an excess-fare train, like the Merchants’ Limited from New York to Boston or the Twentieth Century from New York to Chicago. The commission, on the very eve of McAdoo’s accession, refused. The road withdrew the world-famous train despite the fact that it was running to capacity and announced that thereafter all trains between New York and Washington would carry but one parlor-car each.

Now it happens that this route was and still is of tremendous commercial importance, not alone for the movement of freight but for the movement of men, big and little, in government service as well as in essential private business, back and forth between Washington, Baltimore, Philadelphia, and New York, and the great territory that lies behind all of these cities. McAdoo’s quick judgment saw the need of clean, comfortable, quick transit for these men and ordered the famous train back again, even though it did not then regain its historic name nor quite all of its parlor-cars, nor run at quite as brisk a pace as heretofore.

McAdoo is no fool. Even his bitterest enemies—and he has plenty of them—will admit that. His moves from the very beginning of his overlordship of the railroads were generally marked with extreme shrewdness. And although he does not coöperate well he showed himself possessed of a genius for organization as well as for coördination. Yet almost as soon as he stepped into the office on the ninth floor of the new Interstate Commerce Commission building that had been hurriedly set aside for the use of the director-general of the railroads, he impressed into service the various working subcommittees of the Railroad War Board, but courteously and promptly dismissed that Board itself.

With the Railroad War Board out of the way the director-general moved quickly toward finding a substitute for it. At the beginning he said that he was going to try to surround himself with the ablest and most experienced railroaders in the land—an advisory board, which would be in effect a railroad cabinet, divided so as to include a man from each of the great interests already concerned in national rail transport, one representing operation, another maintenance and equipment, another finance, another traffic, another public service and accounts, another law, still another labor.

Yes, labor. Labor at last was to sit in the high council of railroad transportation. That had a new sound in the game. Yet McAdoo was quick to include it in his plans. And at that time he added:

“I am putting in men of no partisan views—partisan neither to capital nor to labor. In every case I have tried to select men who will inspire confidence. I want men of broad vision.”

The man who dug the great tunnels under the Hudson River when every one else had pronounced the project as chimerical could hardly stand accused himself of any lack of vision. Moreover McAdoo’s selections in nearly every case justified his words. He began by choosing as his right-hand assistant and general adviser Walker D. Hines, an extremely able New York lawyer, who in the forty-seventh year of his life was chairman of the board of the Santa Fé. On the average road the chairmanship of the board of directors is likely to be a sort of sanitarium for retired executives. Not so with the Santa Fé. Its late president, E. P. Ripley, the man who was instrumental in bringing it out of bankruptcy and up to its place as one of the greatest single systems in the United States, ten or twelve years ago was seeking a young man who could represent the road in New York, and represent it with the proper authority. He found such a man in Hines, then barely turned forty, and he never regretted his choice. Moreover Hines, in a brilliant legal connection with the Louisville and Nashville before going to the Santa Fé, had begun to acquire his remarkable knowledge of railroad conditions in virtually every section of the land.

The Santa Fé has always had much good motive-power, human and mechanical. McAdoo chose two of this first class, Hines and Edward Chambers, its former vice-president in charge of traffic. These men formed the beginning of his advisory cabinet. To them he added gradually several others—Henry Walters of Baltimore, chairman of the board of the extremely sound and conservative Atlantic Coast Line; John Skelton Williams, controller of the currency, who had been not only the president but really the creator of the Seaboard Air Line; Carl R. Gray, at that time president of the Western Maryland railroad and now occupying a similar post upon the Union Pacific; and Judge John Barton Payne, who also had served as chairman of the Shipping Board and as secretary of the interior.

Offhand these looked like good appointments; in reality too they were good appointments—able men in every instance; men of the broadest experience. But the men on the inside—those who have a thorough understanding of the wheels within wheels in the working of the big national railroad machine—saw more in these appointments than a mere search for transport ability.

“Walters and Williams,” they said, “Atlantic Coast Line and Seaboard Air Line. It’s a hard dig at Fairfax Harrison.”

They were referring of course to the brilliant young president of the Southern railway, who was the chairman of the Railroad War Board, constituted, you will remember, as a war measure by the railroads themselves. In that job, and against no small odds, Harrison had won a fair measure of success. He felt keenly the slap at him in the McAdoo selections; he felt another when he was virtually deposed from the control of the railroad which had been his great pride and ambition, and young Mr. Markham brought down from Chicago to be the McAdoo generalissimo of all the roads in the southeastern corner of the land at Atlanta. Yet that last thrust was hardly greater than the first, when the ranking heads of the two railroads which had been the hottest enemies of the Southern in that which it regarded peculiarly as its own territory were lifted to eminence, while the president of the Southern was permitted to retire to Richmond as merely its corporate head, without one atom of authority over the operation of his road.

Those who know Fairfax Harrison know how these two blows must have cut. He is a man of intense pride as well as patriotism, a railroader who almost plays the lone hand but plays it very well indeed. A gentleman to the core, born of the gentlest of Virginia blood and lineage—his father private secretary to Jefferson Davis, his mother a gifted American novelist, his brother one-time governor-general of the Philippines—his pride in his family has for years past been exceeded by his pride in the railroad which, as a logical successor to the late Samuel Spencer, he had been upbuilding. Fairfax Harrison himself is a literateur of no small merit. He has made translations of the classics, while to him has long been ascribed the composition of an essay in Latin on the proper carving of Virginia ham. Yet I dare say that in none of his literary excursions has he ever reached greater charm than in the booklet which he wrote eight or nine years ago on the tragic sacrifices made by the men of the Southern who strove to keep their road open and in operation during the terrific floods of 1913.

Yet Harrison was not the only man to be reduced menially as well as physically by the director-general of railroads. Carl R. Gray, himself one of the most lovable men in the business, was then president of the Western Maryland. He came to it from a high office with the ’Frisco. That railroad, originally a small local affair largely financed by the city of Baltimore and for many years terminating at Hagerstown in the Cumberland valley, had been built, largely by Rockefeller capital, through to Cumberland and Connellsville (by connection to Pittsburg), paralleling the main stem of the Baltimore and Ohio for virtually the entire distance. It was a real thorn in the side of the B. & O. Mr Gray was quickly elevated to a high post in the Railroad Administration. This was a distinct thrust at Daniel Willard.

It will be recalled that the distinguished figure of Daniel Willard, president of the Baltimore and Ohio, loomed large in the Railroad War Board. Mr. Willard was doomed to feel the displeasure of official Washington. Just why, I never have been able to understand. He went to the service at the very outbreak of the war and gave himself unreservedly to Mr. Wilson and his associates. And at the very hour of the Armistice he was in army khaki, prepared to sail overseas to undertake the operation of the entire system of French railways, which were beginning to go down under their terrific burden of more than four years.

Yet Mr. Willard’s reward for all of this was removal from the actual operation of his road. Samuel Rea, the president of the Pennsylvania, suffered a similar fate. Yet this was not all. An official order was sent out from Washington to the effect that these presidents were to be deprived of the use of their official cars—the phrase “private-car” long since has come into disrepute; it smacks too much of junketing. A fairly circumlocutious method was offered by which these gentlemen could occasionally avail themselves of their cars. They declined to avail themselves of so patronizing an offer. Mr. Rea’s car finally was assigned to an operating officer of the Railroad Administration; Mr. Willard’s gathered dust for two long years in a corner of the train-shed of Camden Station, Baltimore.

Mr. McAdoo’s answer to the quiet but strenuous protests that went to the supreme authority at Washington against his treatment of Mr. Willard and Mr. Rea was extremely disingenuous. He disclaimed personal feeling and said that his act was the following out of an established policy. Officially that policy was thus stated in his own words:

Inasmuch as “no man can serve two masters,” and the efficient operation of the railroads for winning the war and the service to the public is the purpose of Federal control, it was manifestly wise to release the presidents and other officers of the railroad companies, with whose corporate interest they are properly concerned, from all responsibility for the operation of their properties.... All ambiguity of obligation is thus avoided. Officers of the corporation are left free to protect the interests of their owners, stockholders, and creditors, and the regional and operating managers have a direct and undivided responsibility and allegiance to the United States Railroad Administration.

He then went ahead in accordance with this announced policy and appointed Federal managers for the larger roads, incorporating into their direction smaller lines, closely affiliated or connected with them. But in almost every case the president of the railroad became its Federal manager, invariably at a lower salary than the private corporations had paid. Mr. Harrison, Mr. Willard, Mr. Rea, Mr. Kruttschnitt, and Mr. Underwood (of the Erie) were extremely conspicuous exceptions to this rule.

I am setting down these intensely personal episodes in the conduct of the Railroad Administration under its first director-general solely for one purpose—they have had a very large bearing on the present-day plight of our railroads of the United States. The bitternesses that were then engendered have not ceased. I do not feel that Mr. Harrison or Mr. Willard or Mr. Rea, to-day restored to their old positions and influence, now harbors a single grievance against Mr. McAdoo because of them. The damage that he did has all been done, in the thrust against the morale of the rank and file of our American railroad organization. McAdoo talking to the men from the rear end of his own private-car at Pueblo and at El Paso and telling them that at last they were come into their own rights did not begin to do the damage that the whispered rumors, running here and there and everywhere, of what the director-general was doing to the former big bosses of great railways did to our old-time traditions of railroad respect and discipline.

In giving labor a seat in his cabinet McAdoo did a big thing. In making speeches such as those at Pueblo and at El Paso he did a far smaller thing, to put the matter very lightly indeed. In the innuendo of his attitude toward a group of important railroad presidents a very great wrong was done unquestionably.

The functions of the director-general’s cabinet were national. In addition to its members the steersman of the craft chose regional directors, at first (and with but a few changes thereafter) as follows: for the extremely congested lines north of the Ohio and east of the Mississippi, A. H. Smith, president of the New York Central; for the lines of the Southeast, as we have just seen, C. H. Markham, president of the Illinois Central; and for those of the rest of the country, R. H. Aishton, president of the Chicago and Northwestern. Later Mr. Aishton’s huge territory was subdivided and three sub-regions made of it. In a similar fashion New England also was made a sub-region, and James H. Hustis, the very popular president of the Boston and Maine, placed in charge of it, after him came Percy R. Todd of the Bangor and Aroostook, an executive equally experienced in New England railroading.

Mr. Smith was the very first of these men to be chosen. He received a telephone request to come to Washington one day late in December, 1917. Boarding a midnight train, he was in McAdoo’s office the next day. The director-general of the railroads notified him that he had been drafted to work out the fearfully congested situation in the Northeast. Without a word of comment Smith turned on his heel, walked to a desk in the corner of the room, and, picking up a block of paper, began inditing detailed telegraphic instructions to the presidents of the roads in his new jurisdiction as to their part in the great drama of national control whose opening scene was so close at hand. A little later he returned to New York. And at noon on December 28, 1917, the exact time set by President Wilson for the curtain to rise on government operation of the continental railroad system, Mr. Smith stood in his window on an upper floor of the Grand Central Terminal, and, looking down at the maze of tracks below him, trains coming, trains going, began the dictation of a short statement as to the history, the size, and the strength of the property he headed.

“I want it to go into the record,” said Smith. “The opportunity might not come again.”

He turned immediately to the work in hand. There was plenty of it to be done. The great city around about the terminal was on the edge of panic. There was a fuel famine and no promise of relief. New York at last was paying the penalty of her medieval, not to say archaic, system of distribution. At last the war was very real and very close at hand. They were saying that many of the schools would have to close, that there was a possibility the theaters would have to shut down each Monday night. Poor New York! She did not then know that the worst was yet to come!

All this occurred with 300,000 tons of coal upon the Jersey side of the Hudson River opposite the city, while in the midst of a winter of almost unprecedented bitterness an ancient lighterage system struggled with ice hardly less thick than that which once sufficed for a footpath for Henry Ward Beecher from New York to Brooklyn, and could bring less than 30,000 tons of coal a day across the river. Nor was this all—no, not even a reference now to the freight upon the Jersey meadows. Know now that the greater part of that accumulated 300,000 tons of coal was in cars and that production at the mines actually was being slowed down by the delay in the return of these cars.

“Open the Pennsylvania tubes to the coal trains!” shrieked the radicals of Manhattan. “Give us fuel trains and food trains instead of Florida Limiteds! Put them through at the rate of fifty, one hundred, one hundred and fifty a day, if needful!”

Some of these lost their heads. Smith did not lose his. Neither did he impose any more humiliation upon the head of his great competitor. He does not do business that way. Instead he gave careful heed to the terminal possibilities of the Pennsylvania, the traditional and very real rival of the road he himself headed.

“We may possibly make a freight use of the tubes,” he said quietly, “but it will be a moderate use. I shall limit the length of the trains to thirty-six or thirty-seven cars, which really is no train at all. For I do not want to see one of those fifty-ton battle-ship coal gondolas jumping the track in a tube which was not designed for it, and so completely blocking the line. I am going to be in a position to hand the terminal back to the Pennsylvania in quite as good condition as I found it.”

Then he made further explanations. After all the Pennsylvania tubes, thrusting themselves across the island of Manhattan, are even in an emergency of little or no freight use to it. They are too deep to be of freight service to the heart of metropolitan New York. To Brooklyn, with a population almost equal to that of Manhattan, to Queens, and to the Bronx they eventually were made of some slight service.

This was not the big part of Smith’s job, however. He made a quick survey of the entire situation in his big district; trains and cars cluttered here and there and everywhere. For the final thirty days of private operation the situation steadily had been growing worse. In the districts roundabout Pittsburg and Philadelphia and New York it had become intolerable. Take, if you will, the industries in those vast manufacturing districts and consider them multiplied tenfold, their influx of fuel and of raw material increased in like proportion, and so with their output. Add these industries one to another and see them in units of tens of dozens of trains, of hundreds and thousands of coal-cars and flat-cars and box-cars. And on the other hand, see all of these poured upon railroads that had been steadily growing weaker for eight or ten years—more rapidly weakened, however, in the last four months than in the entire three years that preceded them. Bear in mind their tremendous loss of man-power through the draft, consider the gradual wearing down of engines and cars and tracks and terminals toward the breaking point, and wonder not then that we had congestion and much worse east of the Mississippi and north of the Ohio.

Throughout that autumn of 1917 we watched the bending of the rod of the railroad just as we had watched it bend and then recover again through the two hard winter seasons that have preceded this one. It bent further this winter than ever before—the traffic was so much greater, and the facilities with which to meet it so much weaker. No wonder that freight moved slowly, more slowly, most slowly, and in many cases finally ceased to move at all; that upon the Jersey meadows outside of New York were 30,000 car-loads of merchandise that could not be moved up to that port and to the ships waiting to carry it overseas. At one time 150 ships stood waiting for coal alone in New York Harbor. And overseas was a great war in its critical stages. No wonder, though, that coal began coming in dribblings to hearthstones that were whining for tons of it, that finally it ceased coming at all for whole days, while great and ordinarily comfortable American cities shivered and watched their death rates mount higher than they had mounted in many a year.

It was a man-sized job that confronted A. H. Smith. Like a real railroad man he handled it. He went in at once upon it. He began to do things. He issued immediate embargoes against shipment into the New York district of anything save food, news-print paper, live stock, perishable freight, and freight consigned to the Government. He did more. With a great map of metropolitan New York and its railroad terminals spread before him he began ordering freight concentrated west of Buffalo and Pittsburg and south of Washington into the trunk-lines which variously best serve the great group of cities that constitute the metropolitan district of New York. The Baltimore and Ohio for instance has exclusive terminal facilities upon Staten Island, which with its many shipyards and wharves is an important freight consignment point. In ordinary times, when the situation was dominated by competitive conditions, a car-load of freight offered the New York Central at Toledo or Detroit would be carried on its lines to New York and then floated to Staten Island by car-ferry. In this non-competitive war situation, in this hour when the temporary continental railroad system of the United States was being born, such a car would be taken by the New York Central from Toledo or Detroit to the Baltimore and Ohio at some point west of Pittsburg, and then over it to Staten Island by the shortest possible route.

What Smith was doing in New York his fellow regional directors in Atlanta and in Chicago also were doing. Order was being worked out of chaos. The great railroads of the United States, even temporarily and very hastily welded into a single national system, showed good results of efficiency and economy, just as some of their far-sighted private operators had predicted more than two decades ago. Released from the shackles of the Sherman Anti-Trust Law—Congress had refused such a release to the Railroad War Board but quickly granted it to McAdoo—and from the conflicting regulatory commissions all the way across the land, they were able to simplify and unify their facilities—even though many times at public cost and inconvenience—in a way that enabled them not only to handle the pressure of war traffic and in an admirable fashion but also to show great economies upon their cost-sheets.

To come to actual cases: It was good railroading when the centralized Washington administration began assembling various sections of various lines so as to gain not only more direct routes between important traffic centers but lines of lowest possible gradients as well. In the West particularly, great progress was made in this direction. For instance in the old days of competitive railroading the Southern Pacific quite naturally operated its through route from Dallas or Fort Worth to Los Angeles and San Francisco over its own tracks through San Antonio or El Paso. Of course the old-time and somewhat unfortunate Texas and Pacific had a far shorter route from Dallas and Fort Worth direct to El Paso, but the competitive situation, the fact that it was the Texas and Pacific and not the Southern Pacific, prevented it from getting much volume of traffic for its short line. Under government unification the T. & P. line came into its own, with the result that 500 miles were taken off the through route between the important North Texas cities and southern California—with great resultant time and operating economies.

Similarly, there arose a war-time assembled through line from the oil-fields at Casper, Wyoming, to Montana and Puget Sound points, 880 miles shorter than the route which the competitive situation formerly forced. Freight from southern California to Ogden was hauled 201 miles less than by the pathway formerly used; while the Railroad Administration route between Chicago and Sioux City was 110 miles shorter than the old, and 289 miles were saved in the through traffic between Kansas City and Galveston and Houston. Multiply these examples and it is easy to see how in a period of sixty days in the summer of 1918 nine thousand freight-cars were so rerouted as to effect a saving in mileage traveled by each car of about 195 miles, or a total saving of about 1,754,805 car-miles.

To be ranked with this sort of operating economy was the work undertaken by Regional Director R. H. Aishton at Chicago when early in the spring of 1918 he began consolidating train movements so that instead of the several competing trunk-lines coming down from out of the Northwest, each operating competing through freight-trains each day into the great terminal and interchange yards at St. Paul, and there shifting and resorting their cars incredibly for distribution between the six trunk-lines leading for another five hundred miles down into Chicago, through trains were operated solidly from the Puget Sound points through to Lake Michigan. For through freight the great railroad yards upon the line between St. Paul and Minneapolis represented no more of a stop than was necessary for changing engines, cabooses, and crews. Moreover these through trains were distributed in alternation between the Northern Pacific and Great Northern lines from the Pacific coast down to the Twin Cities, but because of its superior mileage and gradient conditions they were handled on to Chicago almost exclusively by the Northwestern.

Nor was Chicago—with almost inevitable traffic congestion, despite the fact that it now bears upon its western rim the largest interchange and clearing-house yard for freight-cars in the entire world—a railroad point big enough to break this simple scheme of through service. Take the export corn specials out of the Missouri valley. One of these trains, let us say, consisted of thirty-one cars from Omaha and five cars from Sioux City, all moving under special government permits, and was routed intact from Omaha to Philadelphia. It came east over the Northwestern to a point well outside of the Chicago congested district. There it was turned to the tracks of the Elgin, Joliet, and Eastern, one of the outermost of the belt-line railroads which encircle Chicago. The Elgin, Joliet, and Eastern in turn delivered the train—intact and unchanged, you will remember—to the Nickel Plate, which at Buffalo handed it to the Lackawanna, which in turn carried it as far as Scranton, giving it there to the Central Railroad of New Jersey and the connecting Philadelphia and Reading for prompt handling through to tide-water and a waiting ship at Philadelphia. There was no switching and but little delay en route, and the train generally went through from the Missouri to the Delaware in considerably less than a week. Such a prompt through movement, with its saving of time and money, was quite unheard of in the days of competitive railroad management.

All the reroutings and consolidations of this sort by no means had been confined to the western portions of the land. In the East many others were made, particularly in the congested sections of war-munitions manufacture, where, in addition to great numbers of war brides and shipyards and camps and cantonments, requiring not merely outbound shipping facilities but large quantities of raw materials and fuel, there had been a vast movement of coal for both domestic use and export. In the handling of this coal ingenious savings were made, both in the routings and in the details of train operation. Roads and portions of roads, formerly in bitter competition, were joined together in a way only possible under absolutely unified and autocratic control. And in some cases the routings were so made as to divert the great streams of through freight traffic, in order to avoid areas already badly congested. Thus Atlantic-bound freight coming up into St. Louis from the Southwest was sent far to the north and even through Canada before it reached the seaboard. A glance at the map and a fair understanding of the present traffic situation will show the necessity of this. The lines that reach into the coal-fields of eastern Kentucky and West Virginia and western Pennsylvania were much burdened these months. It hardly was fair to ask them to carry much through freight upon their already heavily laden shoulders. And the Pittsburg district, with its various narrow impasses made by broad rivers and sharp-sided mountains, is a railroad abomination—a fearfully congested traffic gateway which, by reason of those selfsame rivers and mountains, is hardly capable of radical enlargement, even at great cost.

The railroads that run along the south shore of Lake Erie, ample as are their facilities, already had a full load of traffic from Chicago, the West, and the Northwest. So the traffic from St. Louis and the rich country back of it must needs cross the Chicago currents and go to the north of Lake Erie. The Wabash—one of the least understood and most abused railroads in America—in those days first began really to justify the fine strategy of its position. It became the main factor in bringing St. Louis freight up to Detroit, where it no longer crossed into Canada by ferry but through the great tunnel which the Michigan Central completed about twelve or fourteen years ago; and by sweeping easily along through the gradeless tangents of the Province of Ontario that freight re-entered the United States at the Niagara frontier, and so on to New York or Boston by any one of a half a dozen uncongested traffic routes.

These things apparently could not have been done under private management; at any rate they were not done under private management, although it is but fair to say that some of the far-sighted railroaders who sat at the table of the former Railroad War Board—which had attempted at the eleventh hour to consolidate the lines and so save the obvious perils of government operation, even as a temporary war measure—had the vision of these very consolidation economies. They had the vision but not the power. Too many powerful considerations bore in upon them and bore them down. Regulation, which was not fair regulation, the inability to finance the lines with rates fixed and expenses increasing by leaps and by bounds, competition refusing to bury itself even in emergency, even traditional jealousy—all these things prevented the Railroad War Board, constituted by the roads themselves to have a sort of supreme authority, from accomplishing its real purpose. These things were accomplished by the United States Railroad Administration and William G. McAdoo, as director-general of railroads, almost at the very beginning.

I have set down these operating details of the United States Railroad Administration under its first director-general at some length, not because of any desire to glorify Mr. McAdoo but because I may want to refer to them again in the final chapters of this book when I am endeavoring to show the folly and the waste of many of the phases of our competitive system of railroading in the United States. Failure as it was in many ways, the McAdoo episode was perhaps valuable after all as a laboratory experiment in rail transport. I am not sure but that as such it was worth every cent that it cost; and its cost was not small. For some years past, before the coming of the war, a certain proportion of our railroaders had been getting into something of a rut, to put it lightly. McAdoo came along and, if he did nothing else, succeeded in shaking them well out of that rut. Yet it is but fair to recall again that the Railroad War Board might have done the same thing had it possessed two great powers that the United States Railroad Administration possessed—absolute authority and virtually unlimited financial resources. McAdoo, on the one hand, might order new locomotives by the hundreds and box-cars by the thousands—no matter what the price, we were at war—and upon the other, he could—and did—raise the railroad tariffs, both freight and passenger, to a point hitherto deemed virtually prohibitive. He raised the rates all the way from 25 to 35 per cent., and the railroads but two or three years before had found the Interstate Commerce Commission deaf to their appeals for mere 5 and 10 per cent. advances.

CHAPTER III

THE UNITED STATES RAILROAD ADMINISTRATION (CONTINUED)

I bear no brief for Mr. McAdoo. On the contrary I have been one of his most persistent, although, I trust, consistent, critics. In the columns of the “Saturday Evening Post” and other widely circulated publications I have tried to set down fairly, impartially, and thoroughly both the accomplishment and the shortcomings of that remarkable organization, the United States Railroad Administration. And with this final chapter written I shall close for myself, I hope forever, the recital of its history.

It is but fair to say that even though McAdoo’s great economies of operation through radical consolidation and reroutings were obvious, it took courage, none the less, to put many of them into effect. Tradition, the sentiment built up through long years of hot competitive practice, local pride and local spirit here and there and everywhere, had to be met and overcome successfully, even though the war-time issue was to come into the reckoning. McAdoo has never been known for lack of courage. He reached out here and he reached out there and generally he attained his desires.

“You talk about Fairfax Harrison. Of all the men in authority in Washington, it was McAdoo who really played the lone hand.” So speaks a man who from the very beginning of the war overseas made a careful study of the Administration and its human components. He speaks the truth—and does not.

“The trouble with McAdoo,” says a radical who is immensely interested in the entire railroad situation, “was that he was in the hands of the old railroad gang and controlled body and soul by them.”

He also speaks the truth, and does not. I presume that we may translate the “old railroad gang” into the group of experienced and very able and honest railroad executives that the first director-general gathered about him, and who without exception rendered him efficient service. Mr. McAdoo himself says this. And he ought to know.

In the preceding chapter we saw some of the sweeping changes and economies that were wrought in the freight operation of the railroads under governmental control; the passenger ones were even more dramatic. We have already seen how at a fell swoop the excellent service between New York and Washington was smashed almost into smithereens, and how the good horse-sense of the first director-general came to the rescue then and there and restored a service that would enable men to travel back and forth between these cities on their war-time errands in a degree of comfort sufficient at least to render them best able to carry on their press of unusual duties. Other services were not so restored. The Broadway Limited, the crack twenty-hour train of Mr. Rea’s Pennsylvania railroad, was an early sacrifice. In May, 1918, Mr. McAdoo approved of a sweeping economy in the western portion of the country, the territory west of Chicago and St. Louis. In this great slash alone estimated yearly savings of 11,728,000 passenger train-miles were made. These savings were accomplished chiefly by abandoning duplicate and expensive fast train services (please also note this for future reference) between Chicago and the Pacific coast cities and assigning, supposedly to the shortest and most direct route in each case, the fastest through service. Under this scheme the Santa Fé became the preferred route between Chicago and Los Angeles; the quite logical grouping of Chicago and Northwestern, Union Pacific, and the former Central Pacific division of the Southern Pacific, from Chicago to San Francisco; the Burlington and the Northern Pacific to Portland, and the Milwaukee to Seattle.

These selections were made arbitrarily. They cost many heartaches, however. The Rock Island—the shortest route between Chicago and the important railroad gateway of El Paso, and but thirty-five miles longer between Chicago and Los Angeles—watched the decapitation of the Golden State Limited, which it had worked so hard to upbuild, with feelings of great bitterness and regret. It felt down in the bottom of its heart that it had been discriminated against. When peace came again—if ever it should come again—and the railroads were restored to their private operators—if they ever were to be restored again—the Golden State Limited would have to start once again at the very bottom of the ladder.

The most notable consolidations of passenger service under the government administration came, however, in the central portions of the land. In the district about Chicago under private and competitive control there was (and to-day is once again) a great waste of through passenger-train service. With six competing railroads from Chicago to the Twin Cities, six to Omaha, six to Kansas City, four to St. Louis, and three to Cincinnati, and with almost every one of these roads trying to maintain a service as good as its competitors, if not better, there was and is a vast preponderance of through passenger-trains, many times to the cost of weaker or branch lines, even of well-to-do-systems. It is not at all uncommon for a branch line, particularly if it passes through a non-competitive district, to be paying with its all-too-few and overcrowded local trains for the extravagances of the underfilled through ones upon the main line. The little wheezy locomotive and the two forty-year-old battered day-coaches of the down local to Willettsburg or Sand Corners was and still is the upkeep of the lordly limited all-Pullman and aristocratic from the point of its crack new locomotive to the far tip of its brass-railed observation-platform. Do not forget that. And also do not forget that a good proportion of the voting population of any State lives upon the branch lines, which may have accounted in the past for some pretty radical railroad legislation and regulation. Here is a point that the average railroad operator, with his nose close down to freight ton-miles, may overlook. He may have and frankly express a contempt for the passenger service but it is at all times the chief point of actual contact between the railroad and its patrons.

Moreover from Chicago to the group of cities a night’s ride distant from it in several directions the plethora of superb trains moved in competitive squadrons. By that I mean, even though there were on four railroads between that city and St. Louis before the coming of the war fifteen fast through trains in each direction, there were to all practical purposes but three or four. For competition so bunched the trains that there was an important group of through expresses leaving Chicago at noon and another important group at midnight, with two or three less important slower expresses at nine in the morning and again at nine in the evening. An intelligent centralized management would seemingly have found it possible so to distribute fifteen through trains that there would have been a through train from Chicago to St. Louis—or the reverse—almost each workaday hour. The through service between New York and Washington and between New York and Boston is so distributed.

Even under centralized control, however, such an even distribution of passenger-trains between midland cities of the United States is not entirely possible. For even in the case which we have before us, there are important connections to be reckoned with, both at Chicago and at St. Louis. These trains must be met, and if the best through passenger-trains for the Southwest leave the St. Louis Union Station at about nine o’clock in the evening, the resident of Decatur, which is on the main line of the Wabash, and of Springfield, which is on the main line of the Chicago and Alton, should in all fairness have an equal chance at them.

Yet, despite this hindering factor, the McAdoo centralized authority succeeded in cutting the fifteen through trains in each direction down to nine and in slightly spreading the leaving times. The result apparently worked little hardship to the through traveler of war-time days between Chicago and St. Louis. The train on which he rode might be a little longer and a little better filled than usual, but its running-time and its equipment, save for the probable elimination of the observation-car, were virtually unchanged. And 15,706 train-miles and 9,538 tons of coal were being saved in Chicago-St. Louis passenger service each month.

But how about Monticello?

Monticello, Illinois, is not a big town, as big towns go. Yet it is an enterprising county-seat of some 2,000 people situated on the Chicago-St. Louis main line of the Wabash just a few miles north of Decatur. And it has definite rights. Do not forget that. In the old days of ante-bellum private control—sin-filled and really wasteful competitive control—there were four through trains and two locals through Monticello in each direction each day. And the Monticello banker or merchant who wanted to run down to St. Louis and come back at night had an easy affair of it. But with the government train consolidation he could get up in the middle of the night and catch the 2:30 train south or else wait for the next express at 4:05 in the afternoon. The Government was not particularly worried about him.

Let me repeat. Monticello has definite rights to adequate railroad transportation. And this holds true whether that transportation comes from the Government or the individual. Monticello—ten thousand Monticellos, if you please—has a considerable voting population. And once the real war emergency was passed and the Armistice safely signed, ten thousand Monticellos began asking if government operation was going to offer them no better relief from the ills of private operation. It was as nothing to them that there had been a saving of trains and of train mileage between Chicago and St. Louis with no apparent diminution of the service between those two metropolitan cities; they simply knew that there had been a great lessening of their own service. And while they were willing to accept such a lessening as a part of their war sacrifice they did not intend to accept it as a permanent transportation condition, either from the Government or from private capital.

This general plan held, however. There are some pretty big and powerful Monticellos between Chicago and the coast. Denver is one of them, Omaha is another, Kansas City a third. And because, to make a single instance, any one of these cities demands a fairly quick and efficient service to Portland and the Puget Sound points, it was necessary after a time to modify to some extent the simplified route plan and to give these intermediate points through train service, or at least through Pullman service.

These changes and others like them have brought great savings in passenger mileage. That cannot be denied, even though one is tempted to add a doubting corollary as to the shattering of the finest passenger service that any land ever has received. The war crisis demanded curtailments. The railroads themselves had recognized that, even before the coming of the McAdoo administration. From May 1, 1917, up to the end of that year their War Board succeeded in reducing the passenger service by 28,656,983 train-miles. Yet this was not a circumstance to the slashing done by the Federal Administration. In September, 1918, McAdoo reported to President Wilson that he had succeeded in eliminating passenger-trains to the extent of 47,420,000 additional miles a year, a really astounding total.

But in all probability the most popular economy of this sort that McAdoo succeeded in bringing about was in the consolidation of passenger terminals across the land, all the way from the biggest towns down to the very smallest. He began at the top in the city of New York. The Pennsylvania railroad since the opening of its wonderful new station in Seventh Avenue in that city in November, 1910, quite naturally had held it exclusively for itself and for its subsidiary, the Long Island railroad. In that tight stand it was right from every competitive point of view. It had taken the great engineering problem and its financial risk entirely upon its own shoulders; shrewd railroaders had shaken their heads dubiously as they contemplated the daring move; and there was no reason why it should share the fruits of its enterprise with its competitors.

But the competitive situation had been eliminated. Therefore McAdoo did not hesitate in personally ordering that the highly competitive Baltimore and Ohio, as well as the non-competitive Lehigh Valley (which up to that time had been using the old Pennsylvania station in Jersey City), should bring its through trains into the Pennsylvania terminal on Manhattan Island. (Incidentally, at the eleventh hour of the existence of the Railroad War Board the Pennsylvania had proffered the use of its station for this purpose.) The tickets of the B. & O. and the Pennsylvania between New York and Washington and intermediate points were moreover made completely interchangeable.

The Pennsylvania people did not enjoy these orders, even though they had proffered the station at New York. But they were good soldiers. The country was at war, and they complied readily with war-time orders, no matter how unreasonable they may have seemed to them.

In a similar fashion the Southern Pacific people made wry faces over the order that admitted the Santa Fé into their ancient train-shed and “mole” at Oakland, opposite San Francisco. Their position was not so well taken however. Even in the competitive era the fast ferry-boats of the Santa Fé, coming from its rail terminal at Richmond, had entered the same terminal with the S. P. at San Francisco—the great union ferry-house at the foot of Market Street. And had not the Santa Fé, as the longer route, been compelled as a war measure to sacrifice its two pet trains between San Francisco and Los Angeles and San Diego, the precious Saint and the Angel?

These consolidations—there were many similar ones in the freight terminals as well—went on all the way across the land. Where there were two or more engine-houses in a place fairly close together, and it was humanly possible so to do, they were consolidated. Trackage at terminals was simplified; for instance at Chicago the trains of the Baltimore and Ohio and Pere Marquette systems, which formerly had entered their passenger stations by a rather circuitous route, were now sent in to them over the tracks of the Pennsylvania, and a saving of approximately seven miles and forty minutes of running time made.

Certain captious critics of Mr. McAdoo’s constructive policies have seen in these terminal and other physical consolidations of the several carriers a deep-laid plot to “scramble the railroad eggs,” which means so to weld the properties together that they could not be easily separated again. Despite the fact that the “unscrambling” has indeed been no particularly easy task, I do not see in McAdoo the deep-dyed villain that so many others perceive. I think that he consolidated these terminals and other operating devices in the interest of real war-time efficiency and economy, and for no other reason. That would seem at this time to be an impartial verdict upon his actions.

I am also setting these things down in some detail because they too are essential to a proper understanding of the final results of the nation’s first sweeping experiment in centralized and governmental railroad control. The most of these operating economies were the accomplishments of the Railroad Administration of the sort which some time ago I characterized as obvious. Now consider a few of them that were strange—marvelously strange, you may prefer to put it:

The Railroad Administration sought as one of the first of its economies the consolidation of the various city ticket-offices that competition long ago had set out in the larger cities of the land, as well as the complete abolition of the so-called “off the line” offices—agencies in cities more or less remote from the actual territory of any given railroad. So far, so good. So far was obvious and sensible economy. If an office here and an office there had been retained for the essential travel needs of the roads and their office forces and furniture had been brought together wherever it was necessary, the others being either abandoned or temporarily closed, there would have been no complaint. But the “winning of the war” took the strange effect in most of the large cities of the land that the Railroad Administration hired new office space—in Chicago it took virtually the entire ground-floor of a huge new sky-scraper on a ten-year lease at $65,000 a year—and installed elaborate and expensive new mahogany office equipment. In New York alone four of these great new offices were fitted out, and many of the smaller and cheaper offices, abandoned, stood idle for months, while the rent went merrily forward.

These things were inexcusable. So were many others. Apparently the ordinarily astute first director-general made a great mistake at the outset. He did not realize perhaps that he was attempting to do two things at once—trying to solve an acute war problem as well as a great economic one that had been gathering urgency for nearly a decade before the coming of the World War. That at least is a kind construction to place upon his policy. And if it was indeed his policy it was not so very different from that which was followed those days by many other large activities down at Washington. Apparently we have not yet learned that almost any war problem is separate and distinct from those of our great social economic questions that are forever showing themselves in one form or another. For instance a good many of us confused the problems of the capitalization and labor of the railroads with that of taking them over as an emergency war measure, just as we repeatedly mixed up all sorts of social and economic problems with the making of an emergency war revenue tax.

Such apparently is also a fair construction to place upon Mr. McAdoo’s remarkable activities in setting great forces of designers and draftsmen at work to create new “standardized” locomotives and cars for our temporarily nationalized railroad system. He made a widely circulated statement that he had found “2303 different styles of freight-cars and almost as many different descriptions of locomotives” and that these presently would be reduced by his experts to twelve standard types of freight-cars, and to six standard types of locomotives of two weights each. Unquestionably our railroad freight equipment has stood and still stands greatly in need of much standardization, although the roads themselves long ago established enough of this to permit common operation of their cars. But I doubt if such a standardization program had any real part in an emergency war plan. I never have been able to reason that out to my own satisfaction.

Nevertheless McAdoo was satisfied with his own idea and in 1918 alone ordered 1430 of his standard locomotives and about 100,000 of the freight-cars, at prices enormously above those of peace days. The engines and the cars eventually were delivered. That they were good engines and good cars I do not doubt. But they have never enjoyed any marked popularity with the railroad operating people. They are a conservative lot, these old hard-shell railroad executives who still hang on to a remarkable degree all the way across the land. You cannot lead them easily to new ways of thought.

All these fine frills, introduced in the midst of one of the most acute national crises ever visited upon this country, cost the Railroad Administration much time and much money—much useless time and much money that might have been used to better advantage in other directions. Digress for a moment with me and compare the great and bulky operations of the Railroad Administration with those of its prototype across the Atlantic, the war-created Railway Executive Committee of England.

The war wreaked no ravages elsewhere in England more striking than those that were wreaked upon her railways. She was quick to realize the supreme importance of her rail carriers to her in her crisis. And so she reached out within a fortnight after the outrage of Louvain and, with the authority that had been given her long years before by Parliament, took over the rail lines and began operating them for the national weal. There was no policy of vacillation on her part. It was a situation that she had anticipated and solved several years before the coming of the war.

Even before 1912 there was in existence an English body known as the War Council of the Engineer and Railway Staff Corps. This council consisted of the general managers (in England the post of general manager compares with that of the president of an American railroad) of the railways that in the event of war with a Continental power would have the most to do with military traffic. The council made elaborate and definite war plans. The possible invasion of the east coast was anticipated and detailed plans—even to the working out of actual train and engine schedules—were made for the evacuation if necessary of the population of east coast towns and cities and the movement of troops and heavy guns up to them. This council by 1912 had developed into the Railway Executive Committee, which was composed of the general managers of the twelve most important railway systems of Great Britain. It in turn formed an integral part of a Board of Communications, which included representatives of the War Office, the Admiralty, the Board of Trade, and the Home Office. Among these representatives was Sir Eric Geddes, then first lord of the Admiralty, a young Englishman of great promise and energy and to-day the British minister of transport.

The Railway Executive Committee went to its job quickly and without ostentation. While it sought to unify the operation of John Bull’s railways so that he might help win the war most efficiently and most promptly, it had no false or grandiloquent ideas of creating a single national rail system overnight. It did not seek to tear down in a day what had taken the patient labor of years to upbuild. It sought not to standardize either baggage-cars or locomotives or dining-car meals. It even escaped having a director-general. Its printed forms were few and modest. It had no press-agent, no propaganda. Few people outside of railway and army circles even knew of its existence. At the height of its endeavors it employed in its joint efforts a total force of not more than eighteen officers and clerks, who occupied two floors of a very small office-building directly across the way from the Houses of Parliament. It was an extremely simple enterprise. But it functioned and functioned extremely well.

Eighteen employees, as against more than twelve hundred at the very beginning of the United States Railroad Administration. Even to-day, two years after it has ceased to function, there are still several hundred retainers faithfully hanging on to their official jobs.

Mr. McAdoo might find some shrewd lawyer’s way of proving his “standardized” locomotives and freight-cars a necessity for the winning of the war, even though the elaborate consolidated ticket-offices would not be so easy to explain. But just why orders should have emanated from his offices to place his name as well as his title upon every piece of printed matter issued by the United States Railroad Administration—even to the dining-car menus and even to each third mile upon the scrip-books issued for passenger travel—is particularly difficult to understand. Particularly so, as a war measure in a war for democracy, at any rate. The hub of the troubles with Mr. McAdoo seems to have been that he regarded a war crisis as a fit moment for an experiment in the details of a centralized railroad operation for the United States.

The chief criticism launched against the first director-general of the Railroad Administration is in regard to his handling of railroad labor. The more conservative the mind that you scratch upon this extremely delicate topic the more violent the immediate reaction. “Barron’s Weekly,” published by the “Wall Street Journal,” regards Mr. McAdoo’s attitude toward railroad labor as that of an arch-tyrant. But that is merely typical Wall Street attitude and to be dismissed as such. I had, as I have already said, very little sympathy with the director-general’s addresses to the men at Pueblo and at El Paso, where he assured them that at last they had come into the rights which had been denied them and that hereafter they were to receive the square deal. That was unnecessary. More than unnecessary, it was unfair. And more than that, it was an extremely dangerous doctrine to be preaching, particularly at that time. I cannot see how it possibly could do one single thing toward upbuilding railroad morale, the thing needed at that moment more than anything else. It could scarcely do else than lower that shattered morale still further. And it is possible that Mr. McAdoo regrets at this moment that he ever gave utterance to those two speeches, patting railroad labor on the back when railroad labor should have been congratulating itself that it was not conscripted and sent into the trenches. This is said with all deference and with a high regard for railroad labor in the United States.

On the other hand McAdoo did a most commendable and forward-looking thing when he gave labor a fair place in his official cabinet. Then and there he played a trump card that private ownership and operation of our railroads forever and a day had failed to play. He played another when at the very beginning of his term of office he put the entire question of wages in the hands of a competent commission headed by the late Franklin K. Lane, of whose fairness and ability there could be no question whatsoever. Mr. Lane knew men; he also knew railroads. He was perhaps the one man in the United States who might have taken the Railroad Administration and made an unqualified success of it. The ablest member of the Wilson cabinet, he was compelled to take a back seat in the big war drama. His capabilities and his experience were virtually ignored.

The Lane Commission went more carefully into the question of railroad wages than any one had ever before gone. It did what no individual railroad or group of railroads ever had the intelligence or the courage or the fairness to do—attempted to make some sort of impartial analysis of living costs to the railroader, and to use these as a basis for the fixing of his wage. The question of compensation never has been placed upon a scientific basis.

The whole question was so big and so vital that even despite war-time pressure the Lane Commission took until May, 1918, to render its decision in favor of considerable increases to almost every type and rank of railroad worker. It unquestionably was a fair decision. Some that followed may not have been so fair; McAdoo unquestionably was led far afield himself by some of his advisers in elaborate and almost absurd attempts at standardized wage and working agreements. Yet at the time he took over the railroads for the Government the rank and file of railroaders unquestionably were underpaid—in certain cases grossly underpaid, and with their living costs rising by leaps and by bounds.

This entire question of railroad labor, its rights and its wage, is so involved and so complicated in detail that I am going to leave it for another portion of this book. It is enough to say here in review of the McAdoo administration that on December 15, 1917, thirteen days before he assumed control, the total number of employees upon the Class I roads of the land (87 per cent. of the railroad mileage of the country; all save the lines with gross revenues of less than a million dollars a year) was 1,703,685; on January 15, 1919, four days after he had relinquished control, it had grown to 1,843,530—an increase of 139,846, or 8.2 per cent. Yet the pay-roll expense, which had been 61.48 per cent. of all operating costs in 1917, had only risen to 65.62 per cent. It was not until the following year that an average increase of nearly 50 per cent. in railroad wages was granted, in the face of a still generally increasing cost of living.

But by the next year McAdoo was out of the job. The Armistice had been signed on November 11, 1918, and immediately thereafter Mr. Wilson gave heed to Mr. McAdoo’s protestations that, the war-time emergency having passed, he was no longer needed and that he must go out into the world to recoup his shattered personal fortune. Accordingly he ceased to be director-general of the United States Railroad Administration on January 11, 1919, and was immediately succeeded by his right-hand assistant, Walker D. Hines, whom we have seen already as the one-time chairman of the board of the immensely important Santa Fé railway system.

Hines is in many ways the very antithesis of McAdoo. There is nothing dramatic or spectacular about him whatever. On the contrary he is what he began to be, a typical corporation lawyer, cool-headed, judicial, shrewd, and honest. He probably would tell you himself that he broadened a good deal down in the offices of the Railroad Administration. I could see the changes. He became vastly more human; his Washington experience seemed to quicken his sympathies and to broaden his understanding of men.

His job was vastly different from that of McAdoo. The job, like the man, now lacked fireworks. There were no longer troops and their munitions to be moved double-quick to the seaboard; instead there was the rather leisurely return of the boys in khaki to their homes. Industrial production across the land was slackening, not quickly but appreciably. Oddly enough, however, railroad revenues still were increasing; they were not to reach their peak until near the end of 1920. Total operating revenues of the Class I roads, which were $4,014,142,743 in 1917, and which had increased to $4,880,953,480 in 1918, came to $5,144,795,154 in 1919. In 1920 they reached, under the stimulus of tariff increases ranging from 20 to 50 per cent., the enormous summit total of $6,171,493,301. In the first ten months of 1921, the most recent figures at hand, they were but $4,672,651,346, as compared with $5,082,819,687 for the same ten months of 1920.

It was under the Hines administration that most of the national working agreements were made, to which the private railroad operators were to take such extreme exception after the return of the properties to their control. But again I must ask you to defer comment or criticism until we have taken up the entire question of railroad labor as a sizable problem by itself. It is enough to say here that Hines encountered a very considerable opposition when he raised wages generously, and raised rates not at all.

The fact remains, nevertheless, that Mr. Hines had in his stewardship a very thankless job at the best; it is always hard to follow a prima donna upon the stage. And McAdoo was some prima donna! Yet in loyalty and in energy Hines gave place to no one. He took the thankless job and made the best of it. He undermined his health by his devotion to it and received no praise from any quarter. His best reward must come in his own knowledge that, all in all, he did a good job, with difficult timber—the best of the subordinates of the Railroad Administration already were leaving it for future peace-time jobs of permanency—and with no encouragement whatsoever. And when the United States Railroad Administration ceased its active career upon March 1, 1920, and handed the railroads back to their owners for operation, I fancy that none was more rejoiced than Walker D. Hines.

What then was the net result of our first—and possibly our last—national experiment in the government operation of our huge railroad plant?

Even to-day, fully twenty-four months removed from the experiment itself, that is a difficult question to answer quickly and fairly. It is even difficult to say that, regarded merely as an experiment, it was a fair test. Certainly no laboratory expert deliberately would choose the critical final hours of a great war as an ideal time for dispassionate experimentation. It was in such hours that McAdoo, who was the head and front of the entire experiment, worked. When his successor came to high office the entire country was in the “let-down” that swept across the land as the very natural sequence of great national tension and endeavor.

The distinguished writer upon railroad economies, William J. Cunningham, James J. Hill professor of transportation at Harvard and himself for a time a subordinate executive of the Railroad Administration, does not believe that the experiment was a success. In a recent issue of the “Quarterly Journal of Economics” he says:

Finally we ask ourselves whether our recent experiment in Federal control affords an adequate test of the desirability of a permanent policy of public ownership and management. The answer is plainly in the negative. The results in 1918 were favorable. In 1919 they were unfavorable. They were favorable in 1918 because at that time we were actively engaged in war, every influence of patriotism supported the Railroad Administration, and the organization was held at concert pitch by the critical military needs. The unfavorable results in 1919 may be attributed in greater part to the pronounced reaction from war-time strain, to the serious decline in traffic, and to the disintegration of the organization in a too prolonged closing period. No one should question the expediency of the Government’s action in taking the railroads in the emergency. The centralization of power and the more effective coördination with other branches of the Government in the crisis made possible effective results in the utilization of equipment and facilities, which would have been much more difficult under private management. But it is not proper to treat that period as the test of what might be expected under normal conditions. As regards the unfavorable year, 1919, it would be as unfair to make that a test of government operation as it would be to take the present period of subnormal traffic and disturbed economic conditions as the final test of private management.

Those who advocate nationalization and look upon the results of both years as favorable to government operation must concede that they are to be credited to railroad men who rose to the emergency. The proponents of nationalization who are disappointed in the results of the two years attribute the failures to the fact that the real management during the greater part of Federal control was in the hands of men who were brought up under private management and who therefore could not or would not avail themselves of the advantages of unification.

It is plain therefore that nothing definite can be proved from the results of 1918-19. A real test of government operation is possible only if carried on over a longer period—one in which business conditions are normal and in which political expediency would have normal play. The period under review was so abnormal that the results are valueless as guides to what might be expected from similar control or complete government ownership when normal conditions return.

I do not agree entirely with Professor Cunningham. I am not a “government ownership (or operation) man,” but I feel that the experiment of the United States Railroad Administration, despite the tremendously difficult conditions under which it was operated, and also despite the fact that it was made at a very inopportune and inappropriate time, did have much real value. Unquestionably the time set for the experiment was far too short. Both Mr. McAdoo and Mr. Hines went on public record as saying that there be at least five years of peace to show their plan at its full worth.

But even in twenty-six brief and hectic months many things were developed that should be, that must be eventually, of great value to the present private operators of our railroads. Of many of these things as well as the possibilities for their development, this book will have to tell. The Railroad Administration at least pointed the way to them. In view of that, shall we not be broad enough to overlook its errors and its mistakes, and yet call it a real advance toward the solution of a national problem that advances sluggishly to that end?

CHAPTER IV

THE RETURN OF PRIVATE OPERATION

Before the roads could be actually handed back to their owners for operation once more, it was highly necessary of course that a definite plan be formulated, not only for the method of transfer but for the protection of the roads against the deficit that was piling up steadily against them. Congress, which hates to be definite about anything, wrestled with the problem through dreary and seemingly endless weeks, and then in the last few days—nay, even hours—before the date set for the return of the properties—March 1, 1920—passed the hastily constructed and far from satisfactory Transportation Act, which speedily went to President Wilson at the White House and there was signed by him.

There has been so much discussion, so much argument pro and con, about this measure that I am going to present a carefully made resumé of it, originally prepared for a group of business men who sought to make a most impartial study of the measure. The act itself provides that the railroads of the United States shall be operated by private corporations under a comprehensive system of government regulation. One of the very best things about the act is that in its very essence it represents a fair interpretation of the feeling of the majority of the American people after two years of government operation. That that majority did not take into account the great difficulties under which both McAdoo and Hines worked is not germane to the present point. It saw their mistakes—the waste as well as the many efficiencies of the Railroad Administration—and it demanded a prompt return to private operation. Under the pressure of this public opinion—some of it very skilfully aided, to be sure, by inspired propagandists—the members of Congress who framed the Transportation Act were almost unanimous in their honest belief that in the hands of private corporations the railroads could be operated more economically and more efficiently and would give better service than would be possible under government operation. The Transportation Act came as a very natural sequence to such a belief.

The most important provisions of the act are:

(1) That on March 1, 1920, Federal operation shall cease and the railroads shall be returned to private operation.

(2) That under a new rule of rate-making the railroads shall be assured adequate revenues; and adequacy shall be defined in the first two years as a net return of 5½ or 6 per cent. on the fair value of the property as determined by governmental authority.

(3) That during the transition period the Government shall aid in restoring the financial stability and the credit of the railroads:

(a) by continuing the government guaranty of a standard return for six months after the roads are returned to their owners;

(b) by creating a revolving fund of $300,000,000 from which the roads may obtain under certain conditions short-term loans to meet their most pressing needs;

(c) by extending the carrier indebtedness for capital expenditures made by the government during Federal control for a period of ten years with interest at 6 per cent.; and

(d) by the creation of a reserve fund containing one-half of the excess earnings of those railroads whose net earnings exceed the 6 per cent. specified in the rule of rate-making.

(4) That the rates and services of interstate carriers shall continue to be regulated by the Interstate Commerce Commission; that the commission shall be enlarged by the addition of two new members, making eleven in all; and that the commission shall have authority:

(a) to make inquiry continuously concerning the transportation facilities and services of the whole country, and when and how they should be improved; the state of the credit of all common carriers; and the new capital which the public interest may require any carrier to secure;

(b) to permit the consolidation of two or more carriers provided that such consolidation is in harmony with a comprehensive plan (previously adopted by the commission) for consolidating all of the railroads of the country in a limited number of strong competing systems, and also provided that, in the opinion of the commission, the proposed consolidation is in the public interest;

(c) to fix interstate rates that shall be just, reasonable, and adequate;

(d) to determine the valuation of railroad property;

(e) to prescribe a uniform accounting system for all carriers;

(f) to exercise exclusive jurisdiction over capital expenditures and the issuance of securities by carriers;

(g) to prohibit the extension of present lines or the construction or acquisition of new lines by any carrier until it has obtained from the commission a certificate of public necessity and convenience;

(h) to require the construction of docks and rail connections between rail and water carriers;

(i) to provide when necessary for the redistribution of traffic and for joint use of terminals;

(j) to exercise jurisdiction over the use, control, and supply as well as the movement, distribution, and interchange of locomotives and cars and also over the supply, movement, and operation of trains; and

(k) to order a carrier to install automatic train-stop or train-control devices.

(5) That the wages and working conditions of railroad employees shall be regulated by a Railroad Labor Board composed of three representatives of the carriers, three representatives of the employees, and three representatives of the public; and that disputes between the carriers and their employees in regard to rules or working conditions may be referred to railroad boards of labor adjustment—local, regional, or national—voluntarily organized between the roads and their employees, or if such boards are not voluntarily formed, such disputes shall be decided by the Railroad Labor Board.

Like almost all hastily constructed and compromise measures the Transportation Act falls considerably short of being an entirely satisfactory solution of a difficult problem. Perhaps the best that can be said of it is that it is probably the best that could be expected out of Congress. It is not fair as yet to assume that it is a failure. But on the other hand how can it be to-day accounted a real success? It has not returned to the carriers its promised 6 per cent. upon their capital. Please notice that I say “promised,” not “guaranteed.” The last word is incorrectly used in too many instances. The Transportation Act endeavors to fix rates that will bring in 5½ or 6 per cent. to the railroads; at no time does it guarantee them. And even this set figure of 5½ to 6 per cent. expired March 1, 1922, two years after the enactment of the statute. Thereafter the adequacy of the return is left to the judgment of the Interstate Commerce Commission. Quite a difference from a 6 per cent. guarantee!

To-day railroad stocks lie virtually inert within the market. Gun-shy investors in Wall Street, and elsewhere too, will have nothing of them. They know the facts. Despite the radical advances made in both passenger and freight-rates since the adoption of the much-heralded Transportation Act, earnings have not measurably increased. The slight net return earned in the last ten months of 1920—but 3.3 per cent., as against the expected 6 per cent.—was wiped out by the poor business of the first two months of 1921; with the result that the net result of the first twelvemonth of private operation was an actual slight deficit. As a year, 1921 was absolutely the worst in the history of American railroading. The total net return for the twelve months ending November 1, 1921, was less than 2.75 per cent.—considerably less than the promised 6, or even 5½.

The situation to-day is hardly improved, despite desperate efforts on the part of the roads to reduce their operating expenses. What they have accomplished along these lines, aside from a further lowering of the reduced service that they are rendering these days, is shown in the fact that by June, 1921, they had brought their wages and transportation costs to eighty-two cents out of each dollar that they earn, and by October it was seventy-four cents. Less than a year before this was slightly over ninety-five cents. By the present time it is just above seventy. The roads themselves are now inclined to attribute much of their financial depression to two things; to the vast industrial slump with its obvious effect upon their revenues, and to their huge pay-rolls. Ingeniously they argued this last point before the Railroad Labor Board out at Chicago in the early summer of 1921 and succeeded in getting a cut of some $500,000,000 in their huge annual wage-bill. But the average railroader of the rank and file still is paid considerably over 100 per cent. more than in 1913. (In exact figures his average pay to-day—on an eight-hour day basis—is $1700 for the twelvemonth, as compared with $761 nine years ago.) This is the figure, along with the figures representing his increased fuel and tax and material costs, that he uses when he justifies the increase of his carrying charges.

Yet the potent fact remains that the high rates are not only not attracting business but actually are driving it away. The long-haul use of the motor-truck, to which I shall refer in more detail in due time, is not due in these days of industrial depression to a lack of box-cars or to yard congestion, but is a protest against the existing rates. And that the railroads themselves are not deaf to these protests is shown by the fact that under the guise of “revising” their freight charges they are actually beginning to lower them. I am inclined to the belief that the partial failure at least of the Transportation Act must have taught all the wise men at Washington, and also a goodly number of our fairly wise railroaders, one distinct thing: You can lead a horse to water but you cannot make him drink. Which, being freely translated, means that you can raise railroad rates to a point where traffic begins to fade away, to find other pathways for itself, or to cease altogether. This is particularly true of passenger rates. A nation-wide rate of more than three and one-half cents a mile, with a heavy increase in the Pullman rates to keep pace, is not a particular inducement to travelers. Moreover the persistent refusal of our railroads to create a lower class of fares than the standard, with a slightly lowered quality of service, give the would-be traveler of modest means no alternative whatever, except possibly to ride in a small motor-car, or to stay at home. A good many of them are riding in motor-cars these days; and a good many more are staying at home. The passenger revenue of our railroads in 1921 was 23 per cent. less than in the preceding year. Which is commended to the attention of official Washington.

Consider now the railroads handed back on March 1, 1920, to their old-time owners—Fairfax Harrison returning from his temporary habitat at Richmond to his familiar offices in the Southern Railway building in the city of Washington, Mr. Rea, Mr. Willard, Mr. Underwood, and others who were temporarily deposed from power triumphantly returning to it. Triumph is the word. The Southern signalized its return to its own by having its new time-tables, fashioned with their familiar yellow covers and with the odious words, “United States Railroad Administration,” glaringly missing, ready upon that memorable first day of March. It did more. Upon its lines it terminated instanter the use of the Railroad’s Administration passes which had been given rather freely to the henchmen of that branch of Federal service. Other roads quickly ended the life of those passes; but generally gave their holders time to get home with them. Not so with the Southern. For it the U. S. R. A. cardboards ended their value at midnight on February 29, 1920. After that they were good as souvenirs, and as nothing else. The unlucky wight who chanced to hold one, and no other pass, paid his fare from midnight on.

Personal feelings again came into play. One Federal manager of an Eastern railroad, who had had the audacity to move his former chief, the corporation’s president, out of an office that the old man loved, lost his job for his temerity. He was not the only executive who lost his job. R. H. Aishton, who had been president of the Chicago and Northwestern railway at the time of the creation of the United States Railroad Administration, and whose rare ability as an operating executive had been recognized by McAdoo in his appointment to the post of the regional director at Chicago, did not return to his old position. It is understood that he incurred the disfavor of Marvin Hughitt.

Mr. Hughitt is the last of the old guard of American railroad executives. He was born near Auburn, New York, in 1837, has lived in Illinois since 1854, and at eighty-five years of age is still the active controlling influence in the great Northwestern property. He has, to my knowledge, but one senior in the whole business, Chauncey M. Depew, chairman of the board of the New York Central railroad, who is eighty-nine years old; but Mr. Depew long since was very glad to relinquish the reins of operating detail of that great Vanderbilt property to younger and more energetic men.

Not so with Mr. Hughitt. His grip upon the Northwestern has been a firm one indeed. He has held his road to many old-time traditions. The lemon-yellow color of its passenger-coaches; the English fashion that it has of running its trains to the left upon double-track and not to the right, as is the ordinary American fashion; its generous, not to say profuse, local and suburban service—all of these are Hughitt. Since the death of the late Henry Clay Frick of Pittsburg and New York some years ago, there has been no one to oppose him. Frick could and frequently did. It is hard to conceive of any one successfully opposing Mr. Frick.

With Mr. Hughitt absolute dictator of Chicago and Northwestern there was none to oppose his arbitrary dictum in regard to Mr. Aishton. The fact that Aishton had been reared upon the property, that his record upon it was not only good but great, apparently counted for nothing. He was dropped. He had offended “the old man.” That was a heinous offense for which there was no possible excuse. Aishton’s powerful friends in the railroad world rallied to his defense. They elected him president of the American Railway Association at a salary reputed to be equal to that paid him by the Northwestern.

Apparently it is not only McAdoo who can afford to indulge his whim in personalities.

Before the Railroad Administration ceased its actual operation of the roads it began the restoration of much of the pre-war service, particularly of the passenger service. Soon after the signing of the Armistice and the removal of military pressure upon the carriers the important through trains that had been removed—the Broadway Limited and the Congressional chief among them—were returned to their former schedules, although not in every case with the same high degree of service as before. It was not, for instance, until the return of private control that the fastest trains between Chicago and the Pacific coast brought to their pre-war standard of approximately sixty-nine hours. The McAdoo administration as a war measure had lengthened this schedule to seventy-two hours.

Yet it was McAdoo who, once the war emergency was passed, removed the half-cent-a-mile extra charge that he had established against people who rode in Pullmans or other forms of sleeping and parlor-cars and left the fare at a flat three cents a mile—where it should have been suffered to remain in the interest of the railroads themselves.

The Interstate Commerce Commission raised it to 3.6 cents a mile, upon hints from the private operators of the roads. It is but fair to add, however, that there are certain members of the commission who long ago had conceived the idea that the passenger-rates were not bearing their proper burden of the costs of railroad operation. It is these men who have to-day steeled their hearts against any lowering of passenger-rates to a point where the service might at least have some competitive attraction against that of the automobile, publicly or privately owned or operated. In all this discussion at the moment of the possible lowering of freight-rates nothing whatever is being breathed of a readjustment of passenger-fares, with the single exception of a recent bill passed in the United States Senate for the enactment of a Federal statute compelling the roads to sell mileage-books at a low wholesale rate. This neglect of itself is, I think, a most unhealthy sign. While the 23 per cent. lowering of passenger revenues in 1921 as against 1920 is a fairly definite expression of that unhealthiness.

To my mind this is not entirely a question of the proper equalization of operating costs to revenues; the question of setting the tariffs of charges to a point where business shall again be attracted to the railroads, to my way of thought, is the real kernel of the problem. That is the way that the average merchant or manufacturer would look at the similar problems that confront him. To get the business the rates must be made attractive. If it then becomes necessary to reduce operating costs so as to exist at the lowered revenues, then the business man will move heaven and earth to reduce his costs.

Apparently the Interstate Commerce Commission does not see the question in this light. One understanding the complexion of its membership would hardly expect it so to see it. The commission is absolutely honest and, to a large extent, able; but it is generally dull. It has no traffic sense; no sense of salesmanship. It has no vision. It always looks backward, rarely forward. Being composed almost exclusively of lawyers,—long ago it was recognized apparently that it would be a fearful thing to place an honest, far-sighted, energetic railroad executive in its personnel,—it spends a great deal of time seeking for precedent. Therefore it hardly can be expected to look forward.

“What is the precedent?” it keeps asking. “How has it always been done in the past?”

This is one of the very great reasons why our railroads to-day are not marching forward in step with the progress of the other great businesses of America, why so often they are called, and with such a deadly truth, “the sick man of American business,” why they have lost so much of public confidence and of public support, why the morale not only of the rank and file but of many of the executives as well has come to so low a pass.

The railroads of the United States to-day, deprived of so much of their initiative by the Government, should at least be able to look to that Government for some real qualities of inspiration and of leadership. Such qualities they need. Such qualities are not being given to them. The sick man needs medicine, physical and mental, not abuse. The Interstate Commerce Commission should be made into a doctor who can cure as most good doctors do cure these days, not by nostrums alone, but by good cheer and inspiration.

One or two things more, if you please, before we are done with this chapter.

The railroads generally wormed themselves out of the joint terminal arrangements which McAdoo had made for them, and made in almost every instance to the great comfort of the traveling public. The Southern Pacific expelled the offensive big Santa Fé and the almost equally offensive little Western Pacific from its ancient station and “mole” at Oakland opposite San Francisco. The Pennsylvania prepared to do the same thing with the Baltimore and Ohio and the Lehigh Valley at its station in New York. This last move was not carried out. I had something to do myself with preventing it.

The question arose in my mind at the termination of Federal operation: What will the Pennsylvania do with its chief competitor there in its fine station upon Manhattan Island? Will it do the obviously competitive thing and thrust the Baltimore and Ohio out, along with the Lehigh Valley into the bargain? A little questioning developed the fact that that was its precise plan. The question of rental charges did not enter into the situation. The Pennsylvania was not direct in its explanation; it did not say, as it might honestly have said: “We built this big, expensive station as a competitive move, and we do not purpose to share the fruits of our enterprise with a competitor who did not share the great risk of the undertaking.” It merely said that there was not room in the station for the fourteen daily trains of the Baltimore and Ohio and the eight of the little Lehigh Valley. It was handling 175 of its own trains there, and about 275 of the Long Island in addition, but it could not find room for twenty-two other trains.

Here was railroad competition showing its most disagreeable side to the public weal. The man who lived at Martinsburg, West Virginia, or Cumberland, Maryland, or virtually any of the other non-competitive points of the Baltimore and Ohio was to be penalized henceforth in the name of competition. Having enjoyed great comfort and facility under the non-competitive plan of the United States Railroad Administration in the use of the Pennsylvania Station in the heart of Manhattan, he was now to be shoved back into the old station at Communipaw, just below Jersey City, with its slow and cumbersome ferry connections across the Hudson River. It was not likely that he would henceforth become an enthusiast over the competitive system of railroading.

The whole thing seemed so absurd that I took it upon myself to mention it in the public prints. That apparently did the trick. Publicity ofttimes does. The Pennsylvania changed its position; in a big and graceful and generous way it waived what apparently were its obvious competitive rights in the situation, and invited both the Baltimore and Ohio and the Lehigh Valley to remain at least for some years to come in its great New York passenger terminal. The invitation was accepted with alacrity.

Most of the consolidated ticket-offices still remain, although there is a constant disposition among the more independent of our separate railroads to break away from them. Theoretically offering far better facilities to the traveler than the separate city offices, practically they rarely do this. For one thing, despite their brave show of mahogany and other fine forms of office fittings, they frequently are under-manned, particularly in seasons of heavy travel. And a man in a hurry going to one of them frequently is compelled to wait an outrageously long time. The fact also remains that the so-called weaker lines that use them seem so submerged as hardly to have a fair chance at the competitive traffic. A small railroad can make a large showing with an attractive office in the heart of a big city. Relatively it outshadows its neighbor.

Where the individual roads have remained in the consolidated offices up to the present time, it has been largely the result of a laudable desire to stand by their fellows. The Railroad Administration forced some one line in each large city to assume the rental of the consolidated offices. In Chicago, for instance, the ten-year lease (at $65,000 a year) of the consolidated ticket-office fell upon the broad shoulders of the Burlington. With the exception of the Northwestern system, which showed a particular antipathy to the late Railroad Administration, virtually all the large roads have remained with the Burlington.

There is moreover an economy argument in the consolidated office that is not without its appeal to the railroad executive. The only question in the mind of his traffic expert is whether the economy argument is not completely overcome by the additional business to be gained by a red-hot competitive little separate office. Of course if all the lines coming into any large city should maintain red-hot competitive little separate offices the gain would be theoretical rather than real. There might be some passenger traffic actually created by the brave showing of the separate offices, but I think that it would be negligible.

The convenient universally interchangeable mileage-book that McAdoo installed (with his name printed upon each third tiny coupon) has been retained with all of its universal privileges, up to the present time at least. But no longer with the name of McAdoo brightly displayed. It still represents no saving to the purchaser over the price of individual separate tickets, though offering a certain convenience in the checking of through baggage, in making Pullman reservations and the like. Yet the putting through of the Senate bill authorizing the Interstate Commerce Commission to reduce its price bids fair at last to lead toward a correction of this precise phase of the situation. Gradually a pretty well-defined feeling is being developed that railroad passenger-fares in the United States to-day are entirely too high. “Not more fares but more riders” is a slogan which a young man who is developing traffic for street railways is using, with telling results. His slogan is quite as applicable to the steam railroads. They apparently have brought their passenger-rates to a point where the riding, always a variable and uncertain quantity, no longer is attracted to their trains. And this is an hour when the motor-car is steadily gaining strength as a competitor of the railroad.

The flat abolition of the stop-over privilege which some enthusiastic railroad traffic expert urged upon McAdoo is now being slowly worn down again, at least to the point where most of the stop-over privileges that were in existence in pre-war days have now been restored. The traffic departments of our various railroads all the way across the land at last are beginning to unbend. The traveler is beginning to regain his old-time privileges.

We do progress.

CHAPTER V

THE PRESENT-DAY SITUATION

Yet our progress is by no means rapid; it easily may be described in the one word “halting.”

In the opening chapter of this book I directed attention to the ravages in the service of our national railroad structure that any man can readily find for himself. To discover, specifically, how the passenger train service across much of the land has been depleted he has but to turn over the pages of that ponderous tome, the “Official Guide of the Railways of the United States.” The many, many trains of yesterday that are missing to-day even after the partial reparations to this important branch of the railroad’s social obligation to the nation that the Railroad Administration made after the war crisis show the deletions that have been made. There too he might find how the speed of most of the trains that remain is slackened.

I have no argument to present for the excessively fast train in the United States; it is a risk and an extravagance that we can well afford to do without. One of the shrewdest moves that the New York Central and the Pennsylvania systems made was, some seven or eight years ago, when they lengthened the running time of their fastest New York-Chicago trains from eighteen to twenty hours. There is little doubt that the New York Central, at least, could operate a train between these two cities in sixteen hours or in a very few minutes in excess of that time by the use of the long straight tangents of its Michigan Central subsidiary across the southerly portions of Ontario and Michigan. But at what strain upon the men back of the enormously efficient machine, at what great risk to life and property!

Despite the proverbial reputation of the American for great haste in everything, we have had but little desire in this country for extreme high-speed trains such as our friends overseas take such keen delight in boasting about. A few years ago the world was running riot on train speed. We had our two rival eighteen-hour expresses between New York and Chicago, to say nothing of the once famous Empire State doing the 440 miles between New York and Buffalo in exactly eight hours. It was that train which a short distance west of Rochester once reached the unofficial speed of 112½ miles an hour, and held it for several minutes. There were a dozen mile-a-minute expresses between Camden, opposite Philadelphia, and Atlantic City, divided between the Pennsylvania and Reading systems. The latter road, in connection with the Central Railroad of New Jersey, ran fast expresses each hour of the day between Jersey City, Communipaw Station, and the Market Street terminal in Philadelphia, a distance of ninety miles, in an hour and fifty minutes. And the management of the New Haven was purposing to establish a four-hour train between New York and Boston—229 miles.

In those days our British cousins were maintaining our pace, or possibly going it a little better. Competing roads on each side of Great Britain all the way from London up to Aberdeen, its northernmost large city, were at each other’s throats. The London and Northwestern and the Caledonian railways, working together, operated a train from London to Perth which on the greater part of its run was scheduled for actual operation at 49½ miles an hour and which was given but two hours and five minutes for the 117¾ miles between Carlisle and Stirling. Finally the competition reached a point where these roads—the so-called “West Coast route”—had a regularly scheduled train from London to Aberdeen, 540 miles, in eight hours and thirty-two minutes. This was considerably better than the East Coast route—chiefly the Great Northern, the Northeastern, and the North British railways—ever succeeded in doing. Their best regular schedule, even though their route was seventeen miles shorter, was eight hours and forty-two minutes.

The best regular trains on the crack Chicago and Alton, the shortest route between Chicago and St. Louis, take to-day seven hours and forty-five minutes to traverse the 284 miles intervening between those two important cities. It is 451 miles across level country from Chicago to Kansas City by the double-tracked Santa Fé—a distance ninety miles less than by the West Coast route from London to Aberdeen—yet the Santa Fé’s best train between Chicago to Kansas City takes eleven hours and twenty-five minutes for the run. And even then it is not permitted to carry passengers; the best passenger time is five or ten minutes longer. I do not think that we Americans can be called speed crazy.

Great Britain also has now slowed her trains down. She progressed that way before the beginning of the war. A nasty accident or two close to the beginning of the century was responsible for the change; while the war itself, as in this country, slowed the fast train schedules to a vast extent. Now her service is back to its old general standard of reasonable (but no longer excessive) high speeds in almost every direction out of London. There are abundant service expresses running in an even four hours between that city and both Manchester, 184 miles, and Liverpool, 193 miles. Competition is supposed to have forced this service. Competition is forever supposed to be forcing service. Yet on the non-competitive Great Western railway I rode, but a few months ago, from London to Bath, 104 miles, in an even two hours, while across the Channel, I had ridden, but a few weeks before that, over the war-struck Eastern railway of France ninety miles from Paris to Rheims in just sixty seconds less than an even two hours.

We have slackened our running time appreciably in the United States these days; very wisely, I think, in the case of the twenty-hour trains between New York and Chicago. As a matter of fact the Twentieth Century Limited, doing the 979 miles of the longer high-speed route between those two cities, from 2:45 o’clock one afternoon (Eastern time) to 9:45 o’clock the next morning (Central time), still makes a remarkable train performance. The Pennsylvania still has two or three of the mile-a-minute flyers in service between Camden and Atlantic City—59.7 miles in fifty-seven or fifty-eight minutes. The Reading has one or two of its flyers left, not only between those points, but between Philadelphia and Jersey City.

Yet this is about all of the mile-a-minute work. From here the slackening in time is appreciable until we come to the comparatively slow performances of the high-grades between Chicago and the cities that lie back of it. The New Haven no longer talks about a four-hour train from New York to Boston; it has lengthened its schedule between those cities. There also has been a slight lengthening of the one-time high-speed schedules between New York and Washington. There has been a let-down. The once proud Empire State Express now takes nine hours instead of eight to go from New York to Buffalo, while out upon the Pacific coast the tremendously high-speed expresses of the Santa Fé between San Francisco and Los Angeles, the Saint and the Angel, which we saw but a little time ago being summarily dropped by the McAdoo administration, have never been restored. They are not likely to be restored.

The Southern Pacific takes thirteen hours and one-half for its best express between San Francisco and Los Angeles, a run of 475 miles. But a moment ago we saw the West Coast system of England doing 540 miles in eight hours and thirty-two minutes, and keeping it up month in and month out. Similarly the S. P. takes twenty-nine hours and ten minutes for its best train between Portland and San Francisco, a distance of 773 miles. It is 517 miles from Paris to Marseilles; the best regular express train between those two cities makes the run in twelve hours and thirty-three minutes. It is 652 miles from Paris to Nice; a regularly scheduled passenger train does it to-day in seventeen hours. And yet the French railway executives promise that they will do much better.

In these things we are not progressing. Take once again the worst of our national transport picture, the vexed New England situation. I have just referred to the slight lengthening of the time of the fast trains between New York and Boston, rather than any expected possible shortening of their schedules. The New York-Boston services of both the New Haven and the Boston and Albany roads are not typical, however, of the service that is being given New England these days; if it were there would be no large cause for complaint. It represents in fact the very top notch of the passenger service of the six most congested States in the Union, the very States which by all right and sense should to-day be enjoying the best passenger service, not the worst.

We have seen already the deplorable state into which the suburban service in and out of Boston has long since fallen. Boston is not all of New England, even though some Bostonians may so believe. Take the case of the Fitchburg. The Fitchburg started off as a railroad with good prospects. For it was bored the spectacular Hoosac tunnel (4¾ miles in length), upon the completion of which the Fitchburg became the short-line between Boston and both Troy and Albany. The lordly Boston and Albany meanders magnificently through the high hills of the Berkshires, and takes much longer for the process.

Unfortunately the little Fitchburg road never had much of a chance for its money. The close traffic alliances between the Boston and Albany and the New York Central, which preceded the actual leasing of the one road by the other, gave it little or no chance for through freight between New England and the West. Its short mileage and well-built line availed it nothing. Eventually it fell into the hand of the Boston and Maine and became, in large part at least, a local line, taking from the New York Central and the Delaware and Hudson such freight as the Boston and Albany would not or could not take. Yet for years it kept up a brave show. It ran between Boston and Buffalo and Chicago and Detroit and St. Louis sleeping-cars a-plenty. It had an excellent dining-car service too.

The dining-cars are gone from the Fitchburg these days. It has become indeed a very secondary stem of the Boston and Maine. Two parlor-cars ply their way daily on slow trains between Boston and Troy; recently a Boston-Buffalo sleeper was added to the service. The road has lost not only its name but its personality and its service too.

What is true of the Fitchburg is equally true of the erstwhile Housatonic. Equally true also is the fact that twenty-five years ago the best train between Pittsfield and New York made the run in an hour’s time less than the best train on that line consumes to-day. There were more trains too, just as there were more trains then on the New Haven and Northampton line, the Connecticut River, the New England, the Boston and Providence, and a dozen other little individual roads that long since lost their name, their prestige, their individuality, and, what is far more important, their intimate personal touch with their patrons and their employees.

The main line express trains of the New Haven between Boston and New York, either by the way of Springfield or by Providence, have not lost their excellence to-day, neither have the main line express trains of the Boston and Albany nor the Boston and Maine’s trains to Portland and points far beyond, although there are none too many of them and they are none too generous in their accommodations. It is in the branch line trains, just as in the branch line stations, that the New England passenger service has not progressed but has distinctly retrograded.

Descend beneath the obvious. Ignore even the sickening decline in railroad dividends, whether average or cumulative—the records of Wall Street will give you all that you want of these—and come to the deterioration of the roads as shown in hard and unsentimental figures. The condition of the locomotives and cars of almost all of our railroads had begun to decline seriously even before the days of the Railroad Administration. When that supreme governmental organization came into being it pledged itself to return to the carriers their properties at least as well and as fully equipped as upon the day it took them over. It did not quite succeed in doing this. The extent to which it failed, by the statistics referring to freight-cars alone, was as follows: In 1917, the year of private railroad operation immediately preceding those of government control, our national transport structure had 2,479,472 freight-cars, which was much less than it should have had. The roads had failed to build enough equipment to keep pace with the overwhelming increase of traffic, which almost at the very beginning of the World War had been thrust upon them. Under almost all circumstances they found it necessary to “scrap” or otherwise remove from service approximately 100,000 worn-out cars each year. For several years before 1914 their construction of new cars had barely more than kept pace with this annual loss.

Yet under governmental operation things went from bad to worse; despite its orders for 100,000 box-cars the Railroad Administration did not buy enough cars to keep pace with those that were being scrapped. In 1918 the total freight-car equipment of our carriers had declined to 2,397,943, in 1919 to 2,361,102, in 1920 to 2,352,911—in other words a total decline since 1917 of 125,561—while the normal increase of our transport plant called for an increase of at least twice this number of cars and certainly admitted no decrease whatever.

In this connection, I think that it is at least worth a paragraph in passing to notice that in the seven years ending with 1913 our railroads increased their freight traffic 39 per cent. In those same years they added 315,000 freight-cars and 8,100 freight locomotives to their existing equipment. In the seven years that ended with 1920 the traffic increased again—virtually in the same ratio, 38 per cent.—but only 143,000 freight-cars and 4200 freight-locomotives were added to the total rolling-stock. In 1921 but 20,000 new freight-cars were purchased and but 250 locomotives of all types. It is no wonder that many of our railroaders now view with real apprehension any return of heavy traffic.

Moreover not only the number but the condition of the individual cars has declined. A small Eastern city which I know very well indeed is a brisk point in interchange freight. It is also a water port of fair importance, to which a large number of coal-cars come in the average summer and autumn. Last autumn I noticed that many of these cars were in a pathetic state of disrepair. The yardmaster explained it to me.

“The first time they come through from the mines,” he said, “they will have their hoppers braced with a bit of timber so as to keep all the coal from spilling out upon the tracks before they even reach here. Somehow that timber will get lost before the car gets back to the mines again. The mine-bosses will put in a flooring this time. Fine business, that! The hoppers won’t work at all then, and thirty tons of coal have to be shoveled out by hand—at the present price of labor!”

Think of this single all-too-typical instance many times multiplied; combine this fact with that of the great decrease of freight-cars of any sort upon our rails to-day and you begin to get the measure of the true condition of our sick man of American business. To-day approximately 354,000 of the freight-cars of the United States are reported as being in bad order. And while a “bad-order” car may be, and frequently is, used for some forms of rail traffic (as for instance a leaky grain-car utilized for the shipment of automobiles) the fact remains that nearly 15 per cent. of our total freight-car equipment stands in great need of large repairs or of replacement, while 19 per cent. of our locomotives are so far gone that they have been thrust upon the sidings virtually abandoned. In another chapter we shall see how these locomotives might be rejuvenated and put to work again, more efficient than ever before. For this one however consider them nil and valueless to the American railroad.

It was partly to remedy conditions such as these as well as to provide for the return of the roads to private operation that the Transportation Act was passed. For there is not only a great rolling-stock shortage but virtually little or no extension of our railroad structure. As recently as in the decade from 1901 to 1911, 52,000 miles of brand-new line—a larger route mileage than that of almost any other nation in the world—were laid down. Since 1911 there have been virtually no new railroads in the United States. The comparatively small San Diego and Arizona railroad was completed but a year ago, but this was more than offset by the abandonment and removal of such lines as the Buffalo and Susquehanna and the Colorado Midland, to take two instances out of several. In 1920 only 314 miles of new railroad line were built in the United States, while 536 miles were abandoned. In 1921 service was discontinued on 1626 more miles of railroad. For six years past our total rail mileage has been going backwards, not rapidly but steadily and perceptibly; the small amount being constructed each year is being rapidly overbalanced by that which is being torn up. Our sick man of American business is a very sick man indeed.

Up to a decade ago our railroads were still busy increasing and enlarging their terminals, double-tracking their single-track lines, and three-tracking and four-tracking their double-track ones. The Union Pacific was achieving the distinction of being the first long-distance double-track line in the great West; in the East the Erie, the Lackawanna, and the Baltimore and Ohio were completing their remarkable series of cut-offs. All this has ceased, even though the necessity for its continuation has not ceased. For if the country does not absolutely stand in need of new trunk-lines to-day there still is a vast and unanswered demand for feeder branches in many, many corners of it, for duplication of tracks upon existing and badly overcrowded single-track and double-track lines. New York, Buffalo, Cleveland, Cincinnati, Pittsburg—other important cities as well—fairly cry aloud for a revision and extension of their terminal facilities, and cry in vain.

Rates have been increased, comparatively recently, to a point, as we have seen, not only higher than the most imaginative of our rail traffic experts might have dreamed five years ago but, as I have remarked already, to one where the traffic instead of being attracted to our carriers is actually being driven away from them; and some of the wiser executives have come to the point of asking the Interstate Commerce Commission for a modification of rates. From a niggardly policy of former years toward the railroads in regard to rates, this body, in professed obedience to the Transportation Act, raised them to the prohibitive point. Now it is beginning to see the error of its ways and, as we have seen at the behest of actual railroaders, is lowering certain of the freight charges, although not in any general or particularly scientific fashion. Recently the commission responded to a large public pressure by permitting the roads to reduce their freight rates on farm products 10 per cent. for a test period of six months, with the possibility that further freight rate reductions will be made.

And finally, as we all know, wages are now being reduced. Already they have been brought down half a billion dollars a year, and in all likelihood they will be even further lowered. As to the justice or wisdom of all this we shall talk presently. The fact remains here and now that a generous step has been taken in bringing down the greatest single item of the cost of conducting railroad transportation, while some of the other costs, chiefly materials, to-day are being reduced automatically by the steady fall in market quotations of supplies of every sort. The situation slowly but surely is working itself through.

On the other hand, what does the public demand in this railroad situation? What is the opinion of the Man on the Station Platform? Surely he has a voice in the matter. He rides on the train, if not daily as a commuter, then perhaps as often as every week or every fortnight. He talks. He observes. He forms conclusions. And some of these last might be accepted as fairly indicative of his needs as a constant patron of the railroad in both its freight and its passenger services.

The Man on the Station Platform believes first and foremost that transportation in this country, as well as in all others, is not merely railroads or motor-trucks or canal barges—not even aëroplanes, if you please—but a scientific correlation of all of these agents of transport. He believes that each must have its own field in which it reigns supreme because in that field it is the cheapest and the most efficient form of transport. And therefore in that field should be recognized as supreme and so developed.

I share these beliefs of my friend who stands on the shady platform awaiting his up-local. I cannot see these agencies in the long run and in the fullest understanding as competitors but as correlators, if such a word may safely be coined. Each should supplement the other. In the full understanding of modern business competition has little real value; in the conduct of public utilities it has none whatsoever. We learned long ago that in gas-works or in water-works, in telephone service, even in the traction facilities of our largest metropolitan cities, it was no lasting help in the long run but merely an added expense burden upon the community, and so should be eliminated or at least brought down to its lowest possible level.

Here then is perhaps the greatest of the burdens that the man outside of the railroad can wish to see removed from it. There are others: the neglect of the fine intensive salesmanship of transportation, which should have been brought to the fore years and years ago; the opportunity for the development of electric traction, of the container system of handling goods, which oddly enough brings us back again to the correlation of the several agents of American transport and the elimination of our absurd competitive plan.

All of these things will have had our attention before I am done. The question is one that demands a great deal of attention. The condition of our rails, instead of growing stronger each day, daily grows more precarious. It is obvious that this condition cannot long continue—the service greatly reduced and impaired, the men sullen and ofttimes working at direct cross-purposes to the management, the rates raised to the point where traffic begins to refuse to come to the stations, the financial condition so depressed that railroad securities will not sell under the absurdly uneconomic prevailing conditions, no thought whatsoever being given to the morrow.

Out of this miserable mass we must raise a program, definite and distinct and statesmanlike, as sound as the program under which we changed our money situation from periodic chaos to vast and proved stability. It must be a program of progress, not a continuation of the absurd artifice of competition years after every other business has found that its economic strength comes in correlation and not in competition, but a genuine progress—progress in the physical fiber of our railroad structure, using the electric motor, the gasolene motor, the industrial terminal, the package container, a dozen other steps as well; progress in the really fine science of selling transportation; progress in human relationship. In such progress there is nothing chimerical, nothing even remotely approaching the fantastic. And in such progress, and nowhere else, can one hope to find a solution of our railroad problem of to-day that even approaches permanency.

CHAPTER VI

THE MAN FACTOR OF THE PROBLEM

Progress in human relationship may be, I think, safely permitted at least the consideration of priority in any understanding of our surpassing railroad problem. For it may also be set down as fairly axiomatic that unless we progress in this phase of transport we cannot expect to go ahead in any other department of it. In its tense importance to the larger question this very human problem can be regarded as foundation-like. Upon it the railroad structure may yet build. Without it, it certainly must fall.

For more than two decades past, imagination, virility, foresight have been upon the wane in our railroads of the United States until to-day with these qualities quite gone upon many of them, the debacle of our national transport machine becomes a doubly depressing picture. The man with an idea may be needed upon our carriers but, as we shall see gradually, he is not often wanted there. They are ruled by conservatism; conservatism carried to the last degree. Yet only yesterday the man with an idea was at a premium in our railroading; our roads themselves were known for their daring, their strength, their progress. To-day too many of the men who operate them are the abject slaves of a system; the only ideas that they safely may advance are those leading to immediate economies. Immediate expenses, even with great and far-reaching economies as their ultimate result, are quite taboo. The railroader no longer may think. Apparently he may only execute.

What is the reason for this—for the human debacle of our carriers following so closely upon the physical, and in many cases responsible for it? Has the American railroader lost his ability to think and to act upon original lines? Has he sunk, with the debris of much of his once proud transport system, almost to the limits of degradation?

A hundred answers will be made to these questions. Some of them will come from banking interests—shrewd men, in banking. These will bear upon the degree of regulation to which our rail carriers are subjected to-day.