AHC: Rail nationalization in the U.S.

Your challenge, should you choose to accept it, is to create a scenario in which either...
  • The U.S. rail industry is completely nationalized
  • The U.S. rail network is nationalized, while trains are operated by private carriers
This situation must last for at least 10 years in peacetime, though war may serve as an initial impetus (in OTL the rail industry was nationalized from 1917 to 1920 as a result of World War I, but support of continued nationalization was apparently quite limited).
 

missouribob

Banned
Nuclear war in the 1950s leads to a statist economy in the United States that nationalizes critical national industries as a rational response for reconstruction. By 1980s ATL privatization would be back on the table.
 
Find some way to put even greater pressure on the railroads in the 1960s and '70s so that you see more of them collapse, and perhaps several attempt to follow the New York Central's and Pennsylvania's example of consolidating to try and survive only to meet a similar fate. That could perhaps leave you with either a mega-Conrail emerging or several regional-sized ones, the tricky part however is then not having the government privatise them later.
 
Find some way to put even greater pressure on the railroads in the 1960s and '70s so that you see more of them collapse, and perhaps several attempt to follow the New York Central's and Pennsylvania's example of consolidating to try and survive only to meet a similar fate. That could perhaps leave you with either a mega-Conrail emerging or several regional-sized ones, the tricky part however is then not having the government privatise them later.

This is a good direction. Perhaps a greater opposition among the railroads to support rail transportation of containers could lead to even greater loss of business to coastal shipping and trucking (as it is, the railroads were at best lukewarm to the idea, and there were several actively opposed voices).

The natural response to railroads losing money would be consolidation into one or a few larger companies, which could trigger anti-trust lawsuits, which could possibly leave the whole thing so toxic that no company will touch it and the federal government has to step in to avoid the death of rail?

Not the most plausible scenario I've seen on this board, but also not the worst.
 
The Populist-Progressive Era seems like the most likely time--especially if Bryan is elected president. However, as I noted in a post a few months ago:

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BTW, to give an example of the kind of thing that could stand in the way of federal ownership of the railroads during the Populist and Progressive eras: When Bryan came our for government ownership in 1906, the idea got a chilly reception not only from the press (as might be expected) but also (though more quietly) from some leading southern Democrats who feared that it might endanger railroad segregation in the South.

Bryan was bitter about this, telling some southern lawmakers "You...are opposed to government ownership because you are afraid your Jim Crow laws against the negroes will be abolished by the general government. As if your personal objections to riding with negroes should interfere with a great national reform." Michael Kazin, *A Godly Hero: The Life of William Jennings Bryan*, p. 147. https://books.google.com/books?id=GUzEO18oGYUC&pg=PA147 But he bowed to political realities, assuring Democrats that he had spoken for himself alone on government ownership and that he would not insist on its being included in the 1908 platform (though he did urge that the idea at least be kept in mind if regulation proved insufficient).

From all this I think it clear that if elected in 1896 or 1900 or 1908, Bryan would favor stricter regulation of the railroads, but not government ownership. At most he might hint at the latter as a last resort; as he was to note in 1906, even those who disagreed with him on government ownership should keep in mind that the *threat* of it would exercise a restraining influence on the "railroad magnates." (Kazin, p. 146) https://www.alternatehistory.com/fo...t-in-united-states-rail.406918/#post-13942284

**

The alternative, as noted, is after 1917. Now in OTL there was no serious possibility that the nationalization of the railroads would continue in peacetime because the "return to normalcy" Republicans were totally opposed to it. But what if Hughes or another Republican is elected in 1916 and proves to be very unpopular because of disillusionment with the war and *any* plausible peace treaty, with the postwar economy, etc.? See https://www.alternatehistory.com/forum/threads/not-nostrums-but-neutrality-harding-in-1916.419819/ for why I think any Republican elected in 1916 will be vulnerable in 1920. In that case, you might get a quite radical Democratic president--maybe even Bryan![1]--elected in 1920 on a platform including government ownership of the railroads.

[1] Some might say that with victory in sight, the Democrats would never take a chance on Bryan for a fourth time in 1920. But that ignores that Hughes (or whoever else the Republicans elect as president in 1916) might seek to blame the US involvement in the war on Wilson, to try to deflect from his own unpopularity (and that of the war) by 1920. Bryan--unlike a "Wilsonian" candidate such as Wilson himself or McAdoo-- would be in a good position to profit from both anti-Wilson *and* anti-GOP sentiment, by pointing out he had resigned from Wilson's cabinet to protest the drift toward war. This could even win him some Irish- and German-American voters unhappy about his views on Prohibition (which in any event was not nearly as unpopular in 1920 as it was to become).
 
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You need to get a genuinely left-wing federal government in power in the United States, one sufficiently powerful to keep the judicial branch from blocking the entire project. Not the conservative administrations and congresses willing to implement reforms that the USA got during the Progressive and New Deal/ Great Society eras.

And nationalization at the state level is not enough, as they wouldn't be able to keep the judiciary from blocking it. It has to be the federal government.

The best way to do this get the Socialist Party in power at the federal level. And the best way to do this is a massive Donk screw, which means no Wilson Administration and no Palmer Raids, and people opposed to the Republicans outside the South gradually start voting Socialist instead of Democratic. It could maybe be done if the post-1912 Progressives manage to great an enduring party that winds up allying with the Socialists, though that is harder. And these both have massive butterflies beyond railway nationalization.
 
You need to get a genuinely left-wing federal government in power in the United States, one sufficiently powerful to keep the judicial branch from blocking the entire project. Not the conservative administrations and congresses willing to implement reforms that the USA got during the Progressive and New Deal/ Great Society eras.

And nationalization at the state level is not enough, as they wouldn't be able to keep the judiciary from blocking it. It has to be the federal government.

The best way to do this get the Socialist Party in power at the federal level. And the best way to do this is a massive Donk screw, which means no Wilson Administration and no Palmer Raids, and people opposed to the Republicans outside the South gradually start voting Socialist instead of Democratic. It could maybe be done if the post-1912 Progressives manage to great an enduring party that winds up allying with the Socialists, though that is harder. And these both have massive butterflies beyond railway nationalization.

I'm not sure I agree with this. I think it is possible without a socialist govt in power, in fact it may be more possible. National defense is mandated by the Constitution, and if the RR prove unable, or difficult, or even inefficient, the Feds may step in and take over, nationalizing the lines but allowing private carriers. What happens if there is a strike by RR workers during wartime? River barge traffic hits a major bridge, triggering a collapse, and taking months to fix during wartime, or the run up to wartime, putting a scare into the War Dept? It may also be that the RR are ill equipped to take major amounts of heavy military equipment, leaving the military in the lurch, when they should have been able to do so (I've seen this IRL btw), then you'll definetly get a movement to take over the lines. The point I'm making in this long winded fashion is that the RR only have to screw the pooch once, and the Politicians will lay blame at their feet, to take over the RR lines. Which party doing so won't matter, both are perfectly capable of acting in their own self interest, especially if they believe it to also be in the nations interest.
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I'm not sure I agree with this. I think it is possible without a socialist govt in power, in fact it may be more possible. National defense is mandated by the Constitution, and if the RR prove unable, or difficult, or even inefficient, the Feds may step in and take over, nationalizing the lines but allowing private carriers. What happens if there is a strike by RR workers during wartime? River barge traffic hits a major bridge, triggering a collapse, and taking months to fix during wartime, or the run up to wartime, putting a scare into the War Dept? It may also be that the RR are ill equipped to take major amounts of heavy military equipment, leaving the military in the lurch, when they should have been able to do so (I've seen this IRL btw), then you'll definetly get a movement to take over the lines. The point I'm making in this long winded fashion is that the RR only have to screw the pooch once, and the Politicians will lay blame at their feet, to take over the RR lines. Which party doing so won't matter, both are perfectly capable of acting in their own self interest, especially if they believe it to also be in the nations interest.
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As I mentioned in the OP, this actually happened under a Democratic administration (except in OTL was outright nationalization).

The thing is, it was always intended to be a temporary measure and public support favored a return to private ownership after the war. Furthermore, it was not repeated in 1941-1945.
 
Make the measure revenue neutral, or even better, revenue positive, and it will stay. Remember the infamous telephone tax of 1898 that was supposed to end after the SpanAmWar, and didn't, then finally was ended only to be brought back for WWI? And we paid that, on and off, for how many decades? Whenever the govt. needs money, it will attempt to find it. If the lines are govt owned, and the companies private, and the need is there, they will be taxed, and the justification will be at the end, national defense.
 
  • The U.S. rail network is nationalized, while trains are operated by private carriers
I think this is the more interesting possibility. :)
That's broadly how things are in the UK, the government owns the physical tracks and infrastructure via a semi-independent body Network Rail who then levies access charges on the private passenger and freight companies?pl

How profitable were the railroads during the Great Depression? If the business is struggling to turn a decent profit then 20 year Treasury bonds paying a reasonable rate of interest with the balance on maturity might be an attractive offer for owners. Find some way to nationalise them in the mid-1930s then from there to WWII and for the duration that would be roughly a decade. Manage to keep them in government ownership until freight and passengers start moving onto the roads en masse and there might not be many too many buyers potential buyers to sell it off to. That's a lot of things to string together though.
 
Didn't Bryan have that idea? Maybe turn the Progressive Era into a Populist Era dominated by populist Democrats, and this may be the case.
 
Have Humphrey win the 1968 election and be in charge when the Penn Central crisis hits.

teg
 
You need to get a genuinely left-wing federal government in power in the United States, one sufficiently powerful to keep the judicial branch from blocking the entire project. Not the conservative administrations and congresses willing to implement reforms that the USA got during the Progressive and New Deal/ Great Society eras.

And nationalization at the state level is not enough, as they wouldn't be able to keep the judiciary from blocking it. It has to be the federal government.

The best way to do this get the Socialist Party in power at the federal level.

A Democratic Party sufficiently radical to nationalize the railroads is a long shot, but is at least conceivable, given that Bryan advocated it for awhile. It is certainly much more plausible than having the Socialist Party come to power.

BTW, I don't think the courts would be a problem, provided the US government paid the railroads just compensation. Remember, a supposedly conservative Supreme Court overwhelmingly upheld the "socialistic" TVA in 1936 (well before FDR's "court-packing" proposal). https://en.wikipedia.org/wiki/Ashwander_v._Tennessee_Valley_Authority Moreover, the courts had always held that railroads were "public" in the sense of being subject to regulations that would not have been permissible for other businesses: "That the business of common carriers by rail is in a sense a public business because of the interest of society in the continued operation and rightful conduct of such business, and that the public interest begets a public right of regulation to the full extent necessary to secure and protect it, is settled by so many decisions, state and Federal, and is illustrated by such a continuous exertion of state and Federal legislative power, as to leave no room for question on the subject." https://en.wikisource.org/wiki/Wilson_v._New/Opinion_of_the_Court

There were, incidentally, precedents for state-owned railroads: https://en.wikipedia.org/wiki/Western_and_Atlantic_Railroad
 
If this is to occur prior to the 1940s, could any interurban/trolley lines end up included in such a program?

In OTL they were exempt from the U.S.R.A. in World War I, and were generally regulated differently that steam/diesel railroads.
 
I'm not an expert by any means, however I have read a little bit on the US railroads (particularly the Pennsylvania RR).

If you wanted the RR's to succeed then the government regulations needed to be removed, not added too. If the RR companies had total autonomy to make their own operating decisions without federal government regulations I believe we would have had a much more vibrant private RR system in the US.

Most RR companies failed because they were;
  • Forced to maintain passenger service that failed to be profitable
  • Had government restricted price controls on passengers and freight
  • Were not allowed to own trucking or shipping companies (so they could never grow vertically)
  • Had government set wage and hours controls on workers
  • Were required by government to staff trains with certain workers (Engineers, firemen, conductors) even though some trains didn't need them. (ex a fireman for a diesel engine)
Nationalizing the lines might make some sense, because then you can charge each company the same rate for usage, but ultimately I'm against that because it doesn't provide competition, which drives innovation which ultimately provides better service at a lower price.
 
I'm not an expert by any means, however I have read a little bit on the US railroads (particularly the Pennsylvania RR).

If you wanted the RR's to succeed then the government regulations needed to be removed, not added too. If the RR companies had total autonomy to make their own operating decisions without federal government regulations I believe we would have had a much more vibrant private RR system in the US.

Most RR companies failed because they were;
  • Forced to maintain passenger service that failed to be profitable
  • Had government restricted price controls on passengers and freight
  • Were not allowed to own trucking or shipping companies (so they could never grow vertically)
  • Had government set wage and hours controls on workers
  • Were required by government to staff trains with certain workers (Engineers, firemen, conductors) even though some trains didn't need them. (ex a fireman for a diesel engine)
Nationalizing the lines might make some sense, because then you can charge each company the same rate for usage, but ultimately I'm against that because it doesn't provide competition, which drives innovation which ultimately provides better service at a lower price.

Of course the argument against that is that railways are natural monopolies that can't really benefit from competition.
 
Of course the argument against that is that railways are natural monopolies that can't really benefit from competition.

Rail infrastructure is maybe (probably?) a natural monopoly, but rail service has no reason to be; consider, for example, in the New York region, Amtrak owns the rail lines from New York to Philadelphia, but New Jersey Transit also runs trains on them. There's no compelling reason why, for example, the rails shouldn't be owned by the government or a government-owned company, with private passenger and cargo lines paying usage fees to run on top of them. This splitting of infrastructure and service is quite common in Europe, not just for rail but also for things like cell phone service and internet access, though it's very uncommon in the US.
 
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