Revisiting The American Streetcar Scandal

3rdrail wrote: In many cases, lines eliminated were still heavily patronized, with expensive hardware in place (often brand-new), which went to the scrap yard not long after.

On the one hand, a line might have been heavily patronized because political interference in the market kept the price (and thus profits) too low. On the other hand, the fact that they had put in new hardware (a capital expense) implies that they thought the profits would be sufficient to cover the amortization of the capital expense. Usually when a company doesn't have enough profits, they stop making capital investments. So given the facts that 3rdrail quotes, I'd have to say that the reason those streetcars were eliminated was not insufficient profit.

Let's get beyond the generalities and look at specifics: How many of the following "PCC cities" had any connection with NCL? Birmingham, Boston, Brooklyn, Chicago, Cincinnati, Cleveland, Dallas, Detroit, Johnstown, Kansas City, Minneapolis, Pittsburgh, St. Louis, Washington, Montreal, and Vancouver? The answer is none, of course, yet for whatever reasons (some, like DC, political), each abandoned all or (in the case of Boston) most of their rail systems. No, it wasn't all evil NCL. There were numerous other reasons. (And in fact, evil NCL retained heavy-volume car lines in such cities as Philadelphia, Baltimore, and Los Angeles, some of which survived into the public ownership era.) Being uncomfortably deep into senior citizenship, I'm old and creaky enough to have known numerous transit industry people in the late '40s and '50s, and they all told essentially the same story.

For reasons that have been alluded to earlier, it's impossible to compare the financial performance and general economics of regulated, stockholder-owned transit companies of the past with present light rail operations. Now, most light rail lines are very lucky if fareboxrevenues cover half of their direct out-of-pocket costs. In most cases, capital costs are not considered at all. Given the economics past and present, I think we're indeed lucky to have what we have, and to be experiencing such a heartening revival.

I will only address two systems I know well - Boston and San Francisco - both non-NCL organizations. Boston lost no more than 15 to 20% of it's trolley lines between 1940 and 1950, certainly not most, but also added lines, during and after 1922-1949 (the years of the conspiracy up to the verdicts in the case) with the Mattapan High-Speed Line (1929) and the Riverside Line (1959). It is interesting to note that both are along private right of way. Both are still in place, and PCC's reportedly will continue to run once again on the High Speed Line shortly, following line improvements. In fact, the 40's are considered to be the height of electric transit in the Boston area. The loss of East Boston trolley service was in large part due to the opening of the Sumner-Callahan tunnels for autos into previously isolated East Boston-1940, and electric rapid transit extensions (Orient Heights-1952 and Wonderland-1954) with pantograph equipped subway cars with trolley dimensions (to fit through the old trolley tunnel under the harbor). San Francisco's system thrived as well, with the exception of some trolley lines being converted, and a somewhat successful attempt to rid the city of cable cars, prior to cable activists protestations. (Cable cars being more akin to trolleys than busses). Replacements in both SF cases were often trackless trolleys, due in part to their hill climbing/descending abilities.

To restate something, or to clarify, there is no doubt that teh "old" way of financing a trolley line wouldn't cut it today, and it didn't cut it then. There's no doubt that the automobile did serious damage to trolley lines, and in fact, personal conveyance likely was the death knell for anything marginal, and not buses.

That said, there is something to this, though.

Using to wide a brush here weakens whichever sides' argument it's used with.

Dave Becker

Nobody will seriously argue that NCL wasn't aggressive in replacing streetcars with buses. My only point, though, is that during the late '40s and '50s, bus substitution was carried on industrywide, regardless of a specific company's ownership or control. NCL was neither unique nor, in some cases, the worst offender. And whatever its policies, NCL was really a minority player among large-city transit systems. NCL largely specialized in smaller cities where streetcar operation already was a lost cause. It may be instructive to list the major cities that NCL controlled vs. all such cities. You'll find that NCL really wasn't the huge influence that many people think.

So why did everybody convert? Sometimes there were strictly local factors, such as political attitudes -- Manhattan and Washington being egregious examples. But more often, it was a lethal combination of common industry ills, such as:

- Huge postwar capital needs, to rehabilitate and replace rolling stock, track, and electrical distribution systems. (Sure, many cities had modern PCCs, but not nearly enough to replace equipment dating to the 1920s and earlier.)

- At the same time, cities were spreading outward, necessitating even more capital investment for line extensions.

- And, of course, thanks to accelerating auto use, ridership was nosediving, and nobody could predict how far down it might eventually go.

- All of this combined to make large, long-term capital investments highly risky, and even if the transit companies themselves were optimistic, their moneylenders were not. (Overall, in fact, the industry's financial performance had been declining since World War I, something that left the moneylenders even less impressed.) In this unstable and uncertain environment, buses were the best financial hedge, since they could be depreciated faster and, if need be, be resold relatively easily.

- Besides all that, streetcar operation had several well-known economic disadvantages, e.g.:
-Maintenance of track and electrical distribution systems
-At least some degree of responsibility for costs of repaving and street upgrading.
-Usually, responsibility for snow clearing within the track areas
-Usually too, taxes on all the fixed plant

And the reasons go on. In Baltimore, for example, the demise of the streetcar was hastened not just by NCL, but by an extensive and radical redesign of the city's street traffic patterns, which would have required enormous expeditures to relocate routes -- even if a hostile city traffic commissioner had allowed it. Many other cities had similar situations as postwar vehicle traffic demanded widening, repaving, and realigning streets -- and, at the same time, as the public (and thus the politicians) became impatient with streetcars "obstructing" freer traffic flow.

So now the question: If you were a transit manager in this era and environment, responsible to your stockholders and responsive to the politicians who controlled your franchises and fare structures, what would you do?

Some very interesting points made above. My belief is that NCL was clearly illegally designed as a trolley "eliminator". I think, however, that one has to ask what is probably the more important question which is : How much of an effect did this have on a nation-wide scale ? On a seperate, but connected note, I once read about a study that concluded that housing values were maintained which were on a trolley line. Values declined on lines where busses were substituted. The theory was that rail and wire gave the impression of permanence to a line (and a neighborhood) whereas busses did not. In Boston, we are in the process of going through protests due to the "Silver Line" busses taking over what was the Orange Line "El". It seems as if it's a similiar story revisited.

Your question is a great one. As mentioned previously, no one is currently making a profit on transit, although there may be some occasional interests that do. The difference is that ones I am familiar with had stockholders and had to turn a profit, and today, many are publicly owned by cities, etc.

I liken some of it to how, in the academic world (I'm thinking of K-12 schools), Apple has always basically given away its computers to schools, helping to get a whole generation of people used to their product, making them more likely to buy them on their own later. Never mind that the Macs at my school are horribly underpowered (imagine buying a new Dell with only 128MB of memory, and that's about right) and thus crash much more than a "real" mac you might buy on your own. There's a marketing strategy at work here.

I think that's what was going on here, where it was the engine manufacturer, the bus builder, the tire supplier, etc.

Dave Becker

Just to note regarding Boston. By 1940, more than half of the city system had already been abandoned or converted to Trackless Trolley or bus.
Even very heavy lines were successfully converted in the 30s (Dudley-Allston for instance), Plans to convert much more were ready and only the war prevented the prompt conversion of almost all but what today remains. The suburban system, was all gone except Quincy and Stoneham and they were due to go in a year or two. Certainly this was no high point in Boston trolley history. The great thing, repeated in many other cities was how well the war traffic was handled by the remaining cars but, the handwriting remained on the wall and as soon as supplies were available the program continued. Only the subway saved what remains and those lines are definitely not the favored by those who must ride them.
Also, in those days Boston liked Macks, ACFs and Whites so, did those companies have mini-conspiracies?
I've heard stories about the marketing practices of the remaining car builders and they aren't inspiring. Maybe if they had 'sold' equipment instead of making it a priviledge to buy from them, it might have been a slightly different story.
LS

I should have specified the beginning 40's during WWII as the period of relative prosperity for the Boston Elevated Railway, when general rationing and austerity brought about a resurgence in ridership.

Leo, I would love to hear more (either in person or on this site) about the subject you brought up about how equipment builders seemingly defeated their own purpose in the manner in which they conducted business. That's a subject which I, personally, have never heard before, and probably most have not as well. It sounds fascinating.

Leo, yes, regardless of what the manuifacturer was, the same issues were present. Remember it was more than just GM doing things here.

Also, you are no doubt correct about the attitudes of the car builders. That arrogance you mentioned (I'd love to know more too) is symbolic of railroads and railroad equipment makers. Just look at how ALCO treated customers compared to newcomer GE...and you'll see how correct you are there.

Dave Becker

The trouble with car builders and thet part of the industry that liked street railways was that all of them had a rearguard action mentality. When I was in high school I used to go into the Park Square building fairly often to use the old Boston Elevated Library. I would get to talk to the people who ran the system at the time including, on a few occasions, the G.M., Mr. Dana. If I had a picture in my hand, they would tell me about it and how it related to the system. They would also tell me about the better days it represented. No one could imagine that ridership would come back. Holding on to a few lines was the best case imaginable. (Just as the New Haven men could never imagine that South Station would ever again be too small). So, they were thinking about what they could save, trolleys and service in general. I suspect that GM while selling buses felt the same way and thought it would all be cars someday but, remember, the ones who sold buses didn't sell cars and had to be good at their particular job so, they did their best. One man's business plan is another man's conspiracy. Trolleys and trackless were a sideline for most of the carbuilders too, they all made freight cars and that was the money part. sometimes a car order for PCCs for instance meant they couldn't build something else, simpler but equally profitable so, they didn't make it easy for the buyer.
Much easier to sell 100 AAR standard boxcars than 25 PCCs. All sorts of
things were going on at once but, someone was going to sell a lot of buses and you know who was good at advertising.

I just read this article in "Market Urbanism" by Stephen Smith and thought that it would be worth re-opening this four year old thread as the topic is timeless, anyway. Mr. Smith's opinion is that the streetcars, in fact, were not targeted as commonly believed. He has some interesting thoughts. What do you think ?
http://marketurbanism.com/2010/09/23/th ... tcar-myth/

I think the American Streetcar Scandal is pretty much fiction. Most logically, why would a publicly held corporation, even if several of its big stockholders were oil, bus and tire interests, scrap profitable trolley operations unless they could make even more money with rubber tired operations. But the record doesn't show that. National City Lines didn't even come into being until the late 1930s and lots of small and even medium sized operators had already disposed of their trolley operations. National City Lines was the largest stockholder in several large properties but it was their succesor public owners that finished off the trolley. Los Angeles Transit Lines still had the 5 rail lines and 2 trolley coach when the Los Angeles Metropolitan Transit Authority acquired it along with Metropolitan Coach Lines and the San Pedro, Long Beach and Watts lines of Pacific Electric. The public authority disposed of those operations, not NCL or MCL. St. Louis Public Service was another NCL controlled property but it sold out to BiState (a public authority in St Louis and over into Illinois) and the public authority finished off St. Louis rail operations. Baltimore was another NCL controlled company and it was the constant push by Baltimore's Harry Barnes, traffic commissioner, to get trolleys off the streets to speed traffic. NCL did not have anything to do with Detroit, New York City or Chicago, all of which went all rubber-tired under public ownership. The much loved, by some people, Mayor of New York, LaGuardia viewed trolleys as old-fashioned and exerted pressure on the several operators within the city to motorize. The trolleys outlived him by a few years, but not many. Washington, DC went all bus at the direction of Congress which got miffed at Capital Transit's reaction to a strike. This is the same institution that is now trying to take us out of our cars and back onto the bus or trolley. Twin City Rapid Transit (Minneapolis-St Paul) was a victim of a hostile takeover and its assets plundered. Some of the plunderers were hauled into court and did jail time.

Once a true believer in the scandal, I myself have come to doubt it also. There was a trend in America at the time to "go modern" and look to the future. A futuristic or "modern" vision did not have to be better than the "old fashioned" version that occasionally in a side by side comparison would surpass the modern version. Modern was touted everywhere- by mayors, the president, Walt Disney, our neighbors. Many new things were an improvement and I think that the American public mentally connected "new" with "improved". What they didn't see were the factors which affect technology such as efficiencies, population expansion and reduction, and law. The "modern" bus didn't concern itself with those old-fashioned things called tracks which restricted movement. It could go anywhere it pleased. The freedom of being inside your own personal vehicle sounded (and is) great to most, compared with riding in a public conveyance which doesn't afford as much privacy and takes you where it wants to go...until you sit in rush hour traffic burning your hard earned paycheck out the tailpipe.

I believe the intent ( to replace streetcar systems with bus systems which would consume the products of the "conspirators") was real enough. . . whether it rose to the level of being a criminal conspiracy, or was really a scandal will always provoke disagreement. Whether the actions of NCL did anything more than to hasten the inevitable is also questionable. As has been indicated in earlier posts, in the period up until the mid 1970's, the gasoline, and later diesel, bus was considered to be much more flexible than the streetcar and therefore much more desirable as a mode of urban public transportation. NCL really didn't cause this view, they merely exploited it. Nevertheless, NCL did take many actions which were intended to replace streetcars with buses--- again, how much of a scandal this really was is questionable.