(no subject)

[Vigrass, Bill]

I have been marginally involved in "The Lake Shore Electric Railway Story"
and even in their heyday, they did not earn real dividends.  LSE was proud
of their earnings per train mile,the best of any midwest line yet they did
well to pay their bond interest.

In the earliest days of electric railways there must have been enthusiasm
much like recent dot.coms.  

Bill V.   

-----Original Message-----
From: Fred W. Schneider III [mailto:fschnei at supernet.com]
Sent: Friday, February 09, 2001 1:44 PM
To: pittsburgh-railways at dementia.org; Scott R. Becker; Sondra Furedy;
BILL VIGRASS1; bbente at transport.bombardier.com
Subject: (no subject)


An example follows of the lunacy of investors in trolley lines:  

Found a note early in a January 1901 Lancaster New Era yesterday that
might be of interest.  Of 96 electric railway companies in the state of
Pennsylvania in 1900, 20 made enough money to pay dividends to the stock
holders.  Three-quarters of the companies were over-built,
over-extended, over-capitalized, or whatever, and simply could not make
money.  

Was 1900 a particularly bad year?  Not at all.  Prosperity in 1900-1901
was almost without precedent. The economy was roughly on par with
1993-2000.  In fact, the economy was so good that unions were being
formed right and left as the working man tried to get some of the money
that the investors were "stealing from the little man."  US Steel had
net earnings of $55.0 million dollars between April and September 1901. 
But the worker might have gotten $1.50 to $2.00 a day.  Strikes were
happening everywhere.  Remember Homestead?  Steel workers and machinists
as well as coal miners were particularly prone to walk out.  Trolley
companies in Reading, Scranton, Albany come to mind was being hit by
strikers ... Scranton got it twice in two years.  

I think what we are seeing is proof that no one could make money hauling
passengers.  Public transportation simply is not essential, in the
consumer's mind, like housing, food, medicine, toilet paper, a
tombstone, and your own chariot. 

With Carrie Nation and her henchwomen (is that a word?) running around
smashing saloons, maybe all those people who put money in trolley lines
should have instead invested in oak bars and bar mirrors. 

Or perhaps we should have accepted much earlier that public transit was
a failure and just let government run it in 1900 instead of 1965.   We
could also have turned all the canals into public service / public
employment projects.