CARRIERS: When If Ever a Profit?

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Meanwhile the airlines began to drain the cream of the Pullman business from the 2,000 U. S. Pullman cars. Today, the number of airline travelers between New York and Chicago is almost equal to the total combined average carried by the Twentieth Century and the Broadway Limited. And airline passenger mileage is about equal to 9.5% of the railroad's Pullman passenger mileage. Few years ago the railroads suddenly came to life, tried to head off the bus and airline business. On U. S. roads went fancy day coach trains. Pullman accommodations were improved. Schedules were speeded up. as they could have been long ago. But it was too late. The bright young men of the bus and airline business had too much of a jump on the conservative old men in the railroad game.

Renaissance. Dreary is the prospect, shocking the record of U. S. railroading by the norms of successful capitalist operation established by such corporate pace setters as General Motors, Chrysler, Ford, Bethlehem, National and Inland Steels, General Electric, Du Pont, Monsanto Chemical, Union Carbide. Stagnant is the condition of U. S. communities and heavy industries which throve on purchases by U. S. railroads. Strictly boycotted by ambitious capital and ambitious youth is the U. S.'s former No. 1 industry. Meanwhile, basic units of the nation's transportation system—like bonds of the Rock Island—go begging for two to 15¢ on the dollar.

A classic example of the practice—neglect your property before bankruptcy, rebuild it (during bankruptcy) out of unpaid interest—is Baltimore & Ohio, which reduced maintenance over 25% in 1938 in order to make as good a showing as possible. U. S. capitalists with idle money to invest remain more impressed by the B. & O. rule than stray examples of new methods like the Great Western and the Southern.

Yet the eventual transformation of rail management is not beyond hope. In the bankruptcy-ridden Middle West, C.&E. I. President O'Neal, like Chicago Great Western Trustee Walter have demonstrated what smart management can do with even marginal roads. President Scandrett of the over-capitalized, wretched Milwaukee has built up his property, won kudos from Moody's for paring maintenance much less than other roads when the 1938 recession cut revenues. Southern Railroad's Ernest E. Norris recently set a precedent by buying new equipment, making money on it and retiring some debt.

But for the most part U. S. railroading's renaissance waits for the day when railroads cease to regard officers under 55 as babes-in-arms.