RAILWAY FACILITIES AND TERMINALS***


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THE COUNTRY’S NEED OF GREATER RAILWAY FACILITIES AND TERMINALS

Address Delivered by

Mr. JAMES J. HILL

At the Annual Dinner of the Railway Business Association, New York City
December 19, 1912



The subject of national transportation is many-sided. One aspect of it
takes precedence in one community or in the opinion of one interest,
while for others some different phase ranks all the rest. But every
interest and every community should understand that the main need
today of transportation and of the many activities connected with and
dependent upon it is an increase of terminal facilities. It is no
exaggeration to say that the commerce of the country, its manufacturing
and agricultural industry, its prosperity as a whole and the welfare
of every man in it who engages in any gainful occupation can escape
threatened disaster only by such additions to and enlargements of
existing terminals at our great central markets and our principal points
of export as will relieve the congestion which now paralyzes traffic
when any unusual demand is made upon them. Our natural material growth
will make this their chronic condition in the near future unless quick
action is taken.

If you increase the size of a bottle without enlarging the neck, more
time and work are required to fill and empty it. That is what has
happened to the transportation business. In 1907 traffic was blocked
on nearly all the principal Eastern railway lines. It took months
to convey an ordinary shipment of goods from one domestic market to
another. The dead-lock was broken partly by a panic that lessened the
volume of business and partly by the efforts of railway managements
to add, by increased efficiency, to the moving power of facilities at
command. We neither anticipate nor desire perpetual business depression.
While the limits of efficiency have not been reached, we know that it
cannot be made to cover the demands of our growth in population and
production. The records of any large city will prove this. The tonnage
of the Pittsburgh District, for example, by railroad alone, grew from
64,125,000 to 152,000,000 in the ten years between 1901 and 1911. It is
both practical and patriotic to ask what is to be done.

First, let us examine the following table, compiled from the reports of
the Interstate Commerce Commission, showing the recent growth of the
transportation business in the United States:

                                     Increases Per Cent.
                        1895 to 1905.   1905 to 1910.   1909 to 1910
 Mileage                     21              11               1.5
 Locomotives                 35              22               3.
 Passenger Cars              23              16               3.3
 Freight Service Cars        45              23               3.
 Passenger Mileage           95              36              11.
 Freight Ton Mileage        118              37              16.6

Business is beginning to feel the swell of a revival. The freight ton
mileage of the country was less by seventeen and a half billions in 1909
than in 1907, and very little more than in 1906. Contrast this with the
growth of the single year between 1909 and 1910. The freight ton mileage
grew in that year eleven times as fast as trackage, and five times as
fast as equipment. This ratio will be subject to increase rather than
decrease. It will be much greater in this year of large crops and added
tonnage. If any manufacturer were confronted with such conditions, it
would be clear to him that he must either refuse business or more than
double his plant. The railroad cannot refuse business. If it could do
so legally, that policy would still mean national panic and individual
ruin. It must enlarge its plant. Just what this means in the expenditure
of billions of dollars on new track and rolling stock I demonstrated
more than five years ago, and the facts have now been accepted by
all authorities. But even the existing plant cannot be worked to its
capacity without larger terminals. Hence the supreme importance at the
very outset of this factor of the transportation problem.

This matter is vital not only to the railroads, but to every business
man. It is the immediate concern of every large city. Cities can grow,
they can escape decline, only as the movement of business between and
through them is kept free. When the people find that their business
cannot be handled, they must either move away or cease producing and
consuming. They will decentralize their traffic, so far as that can be
done; and the inability of the railroads to prevent this, by reason of
conditions imposed on them from without, will work injury to all the
great markets which have arisen through the free play of economic forces
and the wise judgment of the builders of our prosperity. No city can
afford to place its trade, which is its life, on a false basis. When the
commerce naturally tributary to it is handicapped by poor terminals, or
overloaded with too heavy charges on account of the excessive cost of
enlargement, it will go elsewhere. There are a dozen places between the
Maine coast and Norfolk that could be made available for relief. A city
can never grow great enough to defy safely the demands of the laws of
trade and its proper accommodation. Should the decentralization plan be
forced on traffic, some of our greatest cities would not merely forfeit
their natural share in national growth, but they would surely decline in
business, wealth and power.

Interest in this question should be not local only, but national. A
railroad terminal performs the same function as a harbor. It is actually
the largest and most valuable harbor used by the nation’s commerce.
Probably no greater volume of rail and water traffic is transferred in
any city anywhere than in Duluth-Superior. On the land side almost the
whole of this is carried by three railroads. It is received, transferred
and discharged without congestion in the busiest seasons and with
expedition because the terminals there have been specially created for
the work they have to do. The nation has properly made the provision
of adequate harbors its care, and expended millions of dollars on our
seaboards and the Great Lakes to ensure ample facilities for loading
and unloading cargoes. It is not to be supposed or desired that the
nation should furnish the money to provide those great harbors known as
railroad terminals, although they are vastly more essential to the free
movement of trade. But it should smooth the way and make easy the task
of those whose business it is to provide them.

When traffic is blocked and the railroad yards of the principal cities
are filled with cars that cannot be moved, the railroad suffers the loss
of a portion of its earnings; but the business man loses a larger share
of his trade, and the workingman his employment. No industry can do more
than protract a starved existence when the currents of transportation
cease moving freely. When the commerce of an industrial empire whose
magnitude is partly indicated by the clearing house exchanges of
$102,000,000,000 in New York City alone during the past year is blocked,
the whole nation suffers.

Whenever we have a big crop or a general revival of business, the
country hears most of the danger of a car shortage. The public assumes
that if enough cars are provided they can be moved on schedule time from
point of origin to destination, wherever these may be. This is not the
real trouble. What is really needed is the greater movement of cars. The
average movement of a freight car is about 24 miles, or two hours, per
day. Delays in loading and unloading by shippers are partly responsible,
but much of the lost time is consumed in getting into, out of or through
terminal points where there is not room to handle the cars. More cars
intensify instead of reducing the trouble. No other business could
endure the loss of the use of its machine plant for twenty-two hours out
of the twenty-four. One thousand cars will cover nearly eight miles of
track. Each car must be switched, loaded or unloaded, or all three. This
multiplies the trackage requirement.

A thousand cars are a fleabite compared with the daily movement in the
busy season. The railroads of the United States carried 1,849,900,101
tons of revenue freight in 1910. At the average load of 21.5 tons per
car, it would take 86,041,865 cars to move it. Nearly all of these
pass through some large terminal, most of them several times in