An important read: ‘American Railroads’: A 20-century history of regulatory error

August 11, 2015

James Coston, Chairman of Corridor Capital has this note: “Bob Gallamore, with whom we became familiar when he was Director of the Northwestern Transportation Center and Professor of Managerial Economics and Decision Sciences in the Kellogg School of management at Northwestern University, served as Deputy Federal Railroad Administrator in the Carter Administration, and held positions at the Union Pacific Railroad and the United States Railway Association. Bob has co-authored a fascinating book, American Railroads, that focuses largely on the impact of government regulation on the U.S. railroad industry.”

 

American Railroads
Decline and Renaissance in the Twentieth Century

By Robert E. Gallamore and John R. Meyer

Harvard University Press. 506 pp. $55

Reviewed by Glenn C. Altschuler

In 1900, railroads were the go-to mode of transportation in the United States, for passengers as well as freight. More than a century later, railroads are out of sight, out of mind. They are also-rans, it seems, to cars, trucks, tankers, and airplanes.

In American Railroads, Robert E. Gallamore, an emeritus professor of management at Northwestern University, and the late John Meyer, an emeritus professor at the School of Government at Harvard, explain the long decline of railroads. Detailed, sophisticated, occasionally technical, and provocative, their book provides a superb and often fascinating analysis of the economics, technological change, and the impact of public policy on an iconic American industry.

Gallamore and Meyer review the disastrous merger of the Pennsylvania Railroad and the New York Central, the provisions of the Staggers Rail Act of 1980, the privatization and profitability of Conrail, and the mixed results produced by Amtrak. They then maintain that the greatest errors in 20th-century transportation history were made by government regulators. Their adversarial policies, predicated on an exaggerated conflict between railroads and specific business interests or social goals, distorted consumer choices, subsidized competitors, and taxed away profits needed for investment.

Read the full review at philly.com by clicking here.

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