Abstract: Saving the Railroad Industry to Death: The Interstate Commerce Commission, the Pennsylvania Railroad, and the Unfulfilled Promise of Rail-Truck Cooperation

Albert Churella

Abstract

During the 1920s and 1930s, the Pennsylvania Railroad tried, unsuccessfully, to become a multi-modal transportation company with investments in truck lines, busses, and air travel. Historians, political scientists, and economists have often blamed this "failure" on the intransigence of either stubbornly traditional railroad managers or overly bureaucratic regulators. Neither assessment is correct, as illustrated by the PRR's involvement with trucking between the two World Wars. The PRR used trucks for pickup and delivery operations (store-door service) and as part of intermodal container operations (what would today be called container-on-flat-car service). Both experiments were phenomenally successful at reducing operating costs and increasing revenue. The PRR's weaker competitors, unable to match the PRR's investment in these services, protested to the Interstate Commerce Commission. The ICC, while unable to regulate trucks effectively until the adoption of the 1935 Motor Carrier Act, saw the issue in terms of the chronic weak road-strong road problem. By progressively restricting the PRR's ability to use trucks, the ICC was attempting to save the weaker railroads from ruin, holding that the health of the entire railroad industry was more important than the efficient operations of one carrier.

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