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Story - ICC Proposed Railroad Consolidation Plan - 1929

In accordance with the provisions of the Railway Transportation Act of 1920, the Interstate Commerce Commission created and proposed a plan in 1929 to consolidate railroads throughout the United States. This plan was formulated about ten years after the United States Government turned the railroads back over to their private ownership following the nationalization during World War I. The plan was apparently not well received by the railroads or bu Wall Street. The plan was covered in detail by Moody's Steam Railroads.

In its 1932 edition, Moody's begins its coverage of the plan by saying: "Almost against its better judgment, it would appear, the Interstate Commerce Commission in December, 1929 finally complied with the mandate of Congress, as outlined in Section No. 5 of the Interstate Commerce Act, to submit a plan for the consolidation of railroads into a limited number of systems. That the plan is important is not denied, but that its publication was not immediately followed by consolidation developments of importance is not surprising."

Moody's went on to capture the thinking of the times. "Railroad consolidation began early in the history of railroad transportation, the stimulating force being the fact that from almost every standpoint it is better business to operate a thousand miles of continuous track under one management rather than under ten. Other factors were, of course, from time to time influential: the desire to reduce competition, the fear of greater competition, stock promotions resulting in profitable financing, and, finally, the natural and human trend toward growth and expansion." For the purpose of this web article, we will examine the plan as it pertained to Michigan.  

The ICC proposal actually called for 21 "systems" nationwide, plus about 100 "terminal properties" which would remain independent. Of these systems, the following were proposed to operate in Michigan:

Of the remaining "terminal railroads", the following were designated to own lines in Michigan:

The following is a more complete description of each system:

SYSTEM NO. 3 - NEW YORK CENTRAL

At the time this plan was created, the New York Central system had recently consolidated most operations of the Michigan Central, Canada Southern, Lake Shore and Michigan Southern, Big Four and Cincinnati Northern into the parent organization (though they were operated for many more years as divisions with central offices located in several states).

In addition to operating these consolidated lines, the following railroads were to be folded into the New York Central system under the ICC plan:

 

SYSTEM NO. 4 - PENNSYLVANIA 

In addition to the Pennsylvania's routes into Detroit, from Toledo and the Grand Rapids & Indiana, the plan called for a number of lines to be brought into the Pennsylvania.  They were:

 

SYSTEM NO. 5 - BALTIMORE & OHIO

At the time of this plan, the Baltimore & Ohio had trackage rights for passenger trains on the NYC from Toledo to Detroit.  The following railroads were to be added to this road:

 

SYSTEM NO. 6 - CHESAPEAKE & OHIO/NICKEL PLATE

It should be noted that at this time the C&O did not operate in Michigan as the Pere Marquette was an independent operator (it was ultimately merged into the C&O in 1947).  The C&O was slated to receive the following lines under the ICC plan:

 

SYSTEM NO. 7 - WABASH/SEABORD

This system was eliminated under modifications to the plan because of the financial instability of both roads.  The Wabash was included in the Pennsylvania Railroad plan.

 

SYSTEM NO. 11 - CHICAGO & NORTHWESTERN

The C&NW was already operating substantial trackage in the western part of Michigan's Upper Peninsula, mostly for mining, lumber and passenger train operations.  The following Upper Peninsula line was to be added to the C&NW as a part of this consolidation plan:

 

SYTEM NO. 13 - MILWAUKEE

The Milwaukee was also an important carrier in the western U.P. with a direct route north from Chicago.  The Milwaukee was to gain the following roads under this plan in Michigan:

 

SYSTEM NO. 20 - CANADIAN NATIONAL

The CN owned the Grand Trunk Western Railroad which already had vast trackage in the lower part of Michigan's Lower Peninsula.  Added to the CN were the following lines under this plan:

 

SYSTEM NO. 21 - CANADIAN PACIFIC

The Canadian Pacific Railway was to receive the following roads in the ICC plan:

 

REMAINING TERMINAL RAILROADS

Terminal railroads would also be consolidated into groups.  Only those terminal railroads with railroad properties in the vicinity of Michigan are listed:

It is fascinating to consider how railroads would be different today if this plan would have been implemented by the Interstate Commerce Commission. Some of these merger plans ultimately happened over time, but others took a very opposite turn.