- Historic Sites
Essay: One-way Ticket To Oblivion
Februrary 1968 | Volume 19, Issue 2
Their plant dwindles. “There is much surplus railroad mileage in this country today,” Stuart T. Saunders said in 1962. (Mr. Saunders is chairman of the board of the Pennsylvania Railroad, the biggest in the country.) When a railroad company rips up a mile of track, it stands to gain as much as five thousand dollars in cash for salvaged material and will annually save three thousand dollars in maintenance costs and as much as two thousand in taxes. Moreover, the land can then be profitably sold, perhaps to the government ( i.e. , to the taxpayers) for use as a highway, after which the press agents for the railroad can complain bitterly about tax-free competition from trucks, buses, and automobiles. The total mileage of track diminishes steadily, from 430,000 in 1930 to less than 373,000 today.
Their industry’s share of the gross national product dwindles, too. In 1930 railroad revenues accounted for 5.9 per cent of the gross national product; in 1966 they accounted for only 1.4 per cent.
Enough of these somber statistics. The picture seems plain enough: a giant industry, vital to the national economy, has for a half century been on the skids to—what? Receivership? Bankruptcy? Nationalization? The signal blocks ahead are hard to make out.
Any examination of the strange and foolish plight of the railroads will uncover vaulting ambition, dumb luck, sly cunning, gross stupidity, incomprehensible arrogance, and naked greed—in short, all the characteristics that have caused the American to be so universally loved and admired. One further statistic, however, emphasizes the curious contradictions inherent in the industry: despite the fact that the railroads seemed to have been staggering along on very unsteady pins, in 1966 their shareholders were paid $502,000,000 in cash dividends, the highest in the industry’s history.