In 1893, James J. Hill completed the first transcontinental railroad built without federal subsidies and then saved that railroad from collapse in what was up to then the worst recession in U.S. history even as railroads all around the Great Northern fell into bankruptcy. This made him into a celebrity, something like the Steve Jobs of his day, and in the 1900s he gave lectures all around the country about railroads, transportation, and soil conservation.
Click image to download an 11.0-MB PDF of this 24-page booklet.
Many of those lectures were printed in 6″x9″ pamphlets like this one, probably paid for by Hill or the Great Northern and distributed by his publicist and eventual biographer, Joseph Pyle. I have a book binding together 30 or 40 of those lectures, but unfortunately it can’t easily be scanned.
This particular pamphlet, which was printed in 1918, two years after Hill’s death, was not so much a lecture as testimony before the Interstate Commerce Commission, which was meeting in Minneapolis on December 20, 1906. Like Apple, Hill’s railroads came under fire for monopolistic behavior, but this testimony was only indirectly a defense of his practices and more directly an analysis concluding that the country needed to build up to 50 percent more miles of railroads than it then had — hardly the goal of a monopolist.
Hill observed that the Great Northern moved more ton-miles per mile of road than most other railroads in its region, including the Burlington, the North Western, the Rock Island, the Soo Line, and the St. Paul. The only railroad to exceed the Great Northern was the Northern Pacific. He didn’t mention that the main reason the Great Northern moved so many ton-miles per mile was that it had lines into the Misabe Range from which it hauled iron ore.
I’m not sure that this claim really contributed to Hill’s main argument anyway, as it implied that part of the growing traffic demand could be met by increasing the efficiency of the other railroads. But he believed enough in the need for more miles that he was double-tracking many Great Northern routes and in 1912 he started building a second main line across Montana, known as the Montana Eastern, in anticipation of increased traffic.
Hill says that the U.S. had 93,671 miles of railroads in 1880 and he indicates the annual percentage growth since then. Calculations based on his numbers must recognize that he used simple interest, not compound interest, to calculate his growth rates. Based on these numbers, the U.S had nearly 227,000 miles of railroads when he testified in 1906.
Hill’s prediction of the need for more railroads was correct up to about 1916, when railroads grew to a peak of 254,000 miles. But in 1906 he was only beginning to realize that the costs of rail construction had dramatically increased since the 1880s and 1890s. This would come to plague him as he built the Spokane, Portland & Seattle between 1906 and 1910. This suggests that increasing the capacity of the existing rail network would made more sense than expanding that network.
After 1916 new technologies like automatic block signals and centralized traffic control would dramatically increase the capacity of any route mile to move ton-miles of freight. Hill failed to foresee these technologies. He also didn’t anticipate the effects of the opening of the Panama Canal in 1914 would greatly reduce the demand for transcontinental freight movement, which killed his Montana Eastern plans.
As a result of increased capacities, the railroads today carry more than four times as many ton-miles than they did in 1906 or 1916 despite the fact that route-miles have fallen to 160,000 miles. Still, this pamphlet offers insight into rail problems in 1906.