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The 1890s-1920s saw the rapid growth of a new industry in North America - the interurban railway. A well-known definition of the term classifies an interurban as a railway that...
  1. Was powered by electric traction, with power delivered through an overhead wire and/or an electrified third-rail
  2. Focused primarily on hauling passengers (though many also hauled freight)
  3. Utilized equipment that resembled streetcars/trams but with higher capacity and speed
  4. Operated over a combination of city streets (often shared with local streetcars) and private rights-of-way

Unlike modern passenger rail, which is primarily focused on moving passengers from city-to-suburb or city-to-city, interurbans typically connected cities and towns, running through large, intermediate sections of then-undeveloped countryside. The electric propulsion afforded interurban equipment the ability to quickly start/stop in populated areas or city streets, yet also reach high-speeds in the open, rural segments. They provided a cleaner, faster and more frequent alternative to the steam railroads of the day.

Within a mere three decades, the interurban industry had reached its peak, and from that point on it entered a gradual decline from which it would never recover. Several factors were at play in the death of the interurban. During the initial "boom" period, many interurban lines had grown too rapidly in areas where there wasn't a sustainable market for the service (they have often been referred to as the "dot-coms" of their time). As roads began to improve and automobile ownership became more common, the presence of large rail vehicles (sometimes including entire freight trains) in city streets gradually came to be considered a nuisance. Electric utility companies had built many interurban lines to spur residential growth, but the Public Utilities Act of 1935 forced them to sell off their transportation holdings - many of these lines were subsequently bought by transit companies who rapidly replaced electric rail service with cheaper, more flexible motor buses. The onset of the Great Depression saw the final attempts by the struggling interurban lines to regain ridership - smaller systems were consolidated and merged into larger networks, while faster, modern equipment was ordered and delivered. Unfortunately, these efforts ultimately proved fruitless.

The bulk of the interurban industry was wiped out in the economic despair of the 1930s. Those lines which managed to survive experienced a brief reversal of fortunes during World War II, as gasoline rationing led to a nationwide increase in train ridership. This was only a temporary reprieve, and most surviving interurban lines succumbed to the rise of the automobile and the construction of the Interstate Highway System in the 1950s. The final "bustitution" of Los Angeles' Pacific Electric Railway in 1961 and the total abandonment of Chicago's North Shore Line in 1963 are generally considered to have marked the end of the "Interurban Era" in the United States.

Now that we've gotten the history lesson out of the way, here is where you come in...

With a P.O.D. that can occur as far back as the latter half of the 19th Century, your objective to have a state government or a collection of counties/municipalities, decide that these interurbans are a valuable public utility, and develop some sort of mechanism to either subsidize or directly assume their operations, ensuring that this network survives the Great Depression and the post-war "Car Culture". I do not believe that this would be possible at the national level, but I am curious if it can somehow be done regionally. It is a tall order regardless, but isn't the challenge part of what makes Alternate History fun?
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