The Railway Game was written by J Lakasiewicz, Carleton University, Ottawa, 1976. It focuses on Canadian railways, but the names of the railway lines could easily be exchanged to any European and the United States railway. In one of the chapters concerns the story of a proposed rationalization in St. Louis. The City of St. Louis is in the geographical center of the US with the Mississippi River flowing through it. When the US was entering in its railway age, the driving cities were Philadelphia and New York. The New York lines typically went north to Albany and then straight as possible to Buffalo, Cleveland and Chicago and then the rest of the US. The Pennsylvania line which linked to Philly went to St. Louis and then to the rest of the US. The St Louis marshalling yards was the second largest American rail centre in 1974. The yard served 19 companies operating 63 marshalling yards and a network of connecting lines. The rail yards occupy prime city center land. The book refers to a report which says the connecting efficiency is lower than it can be and if the operations were consolidated in a master yard the transit time would be reduced by over 50%. The issue being discussed is when freight is picked up on one place, the railway car often travels on a second railway line before reaching its destination or it needs to be reconnected.

The railway yards are operated by the railway companies but they are all competitors who do not wish to spend great amounts of money to help each other. At the time in the 1970s, the cost was $150 million, that easily translates to a billion in today’s numbers. Railway companies came after the boats and typically occupy downtown land, and to do a master yard, new lands need to be acquired outside of downtown. The problem of course is in the meantime, highway builders built highways near the railway lands and it the railway goes for a long time, few people have wanted to live near a downtown highway. To solve a problem of operational efficiencies creates bigger problems in the downtown of the city.

Linking to dividend paying stocks, in many cases, the companies have large infrastructure connected to the operations of the company for example factories. In order to keep the profit margins, plants are closed which have existed for a long time in a community, that affects people, but it may be good for the company. Very often as a profitable company, the plant has been a good corporate citizen to the community besides offering long service jobs. As long as senior management worries about the impacts on the community and offers to help, then they are doing their jobs. If your company shuts operations and moves the machines in the middle of the night, then you may want to sell because solutions are often complicated, not easy.

There are more questions than answers, till the next time – to raising questions