01-09-2009, 06:02 PM
I like you last line...buggy whip manufacturers are the great example. After the arrival of highways, cheap cars, and trucks, local service became kin to buggy whips...few wanted to use it...and there was no money to be made off of it. Many roads went bankrupt because of it...and the ICC forcing them to commit suicide. Many investors got burned by that...but that is the risk of investment...there is no free lunch...you gamble, you might get burned. Railroads such as the Nickel Plate used to turn nice profits off of the business that the big boys chase now...long haul, "fast" freight. The downside to that is if you become dependent upon competitors for your business (such as the Erie-Lackawana merger robbed the NKP of its key partner as a bridge route)...or the Colorado Midland being unable to compete with the D&RG. Since trucks cannot come close to competing with trains for medium and long haul business on price, the business is relatively secure. I believe that the railroads understand better than most railfans that the economics of transportation have changed and they know how to make money today (and tomorrow).
It is always easier to sit back and long for the way things were...but there are always reasons for why things happened as they did.
Nearly every Colorado RR book covers the 1893 silver panic in Colorado. It is the single most important event in all of Colorado RR history. Most of the authors I've read just simply don't understand it at all. They complain bitterly about the short sightedness of the Federal government, and what a stupid decision it was...of course it is because the local economy was devastated and railroads went into receivership. No one was/is worse about this sort of thing the David Digerness in the Mineral Belts (which are outstanding books). They completely fail to see why the silver subsidy was canceled...too much silver was being mined and the rest of the country was fitting the bill for the excesses of Colorado's mining industry. The government was robbing the rest of the country (which didn't have our income tax) to pay for saloons, prostitutes, and personal fortunes. Sure, people suffered because of it, but the unfairness that was being served to the rest of the nation was ended. The railroad authors fail to realize that it was a major reason in why their beloved narrow gauges remained narrow gauge...and it has long given them something to gripe about.[/quote]
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Yet government subsidies continue on a massive scale to this day, still robbing the taxpayers. If it was wrong in the 1800's, it's wrong now, perhaps more so. There has never been any evidence to show that government involvement improved anything.
My point was that by attempting to dictate to the market how it must work in order to receive service, the railroads might better serve themselves and their investors by working to service the needs of the customers. FedEx and UPS are driving the US Postal Service to destruction by using that exact formula. Railroads drive potentially large customers right into the hands of their competitors by saying: "We don't serve your region."
No one ever made money by saying "no".
It is always easier to sit back and long for the way things were...but there are always reasons for why things happened as they did.
Nearly every Colorado RR book covers the 1893 silver panic in Colorado. It is the single most important event in all of Colorado RR history. Most of the authors I've read just simply don't understand it at all. They complain bitterly about the short sightedness of the Federal government, and what a stupid decision it was...of course it is because the local economy was devastated and railroads went into receivership. No one was/is worse about this sort of thing the David Digerness in the Mineral Belts (which are outstanding books). They completely fail to see why the silver subsidy was canceled...too much silver was being mined and the rest of the country was fitting the bill for the excesses of Colorado's mining industry. The government was robbing the rest of the country (which didn't have our income tax) to pay for saloons, prostitutes, and personal fortunes. Sure, people suffered because of it, but the unfairness that was being served to the rest of the nation was ended. The railroad authors fail to realize that it was a major reason in why their beloved narrow gauges remained narrow gauge...and it has long given them something to gripe about.[/quote]
************************************************************************************************************************************************
Yet government subsidies continue on a massive scale to this day, still robbing the taxpayers. If it was wrong in the 1800's, it's wrong now, perhaps more so. There has never been any evidence to show that government involvement improved anything.
My point was that by attempting to dictate to the market how it must work in order to receive service, the railroads might better serve themselves and their investors by working to service the needs of the customers. FedEx and UPS are driving the US Postal Service to destruction by using that exact formula. Railroads drive potentially large customers right into the hands of their competitors by saying: "We don't serve your region."
No one ever made money by saying "no".