The Men Who Loved Trains: The Story of Men Who Battled Greed to Save an Ailing Industry (Railroads Past and Present) | 
 enlarge | Author: Rush Loving
Publisher: Indiana University Press
Category: Book
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Avg. Customer Rating:  25 reviews
Sales Rank: 51128
Media: Hardcover
Number Of Items: 1
Pages: 360
Shipping Weight (lbs): 1.5
Dimensions (in): 9.3 x 6.2 x 1.3
ISBN: 0253347572
Dewey Decimal Number: 385.092273
EAN: 9780253347572
ASIN: 0253347572
Publication Date: April 28, 2006
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Book Description
A saga about one of the oldest and most romantic enterprises in the land--America's railroads--The Men Who Loved Trains introduces some of the most dynamic businessmen in America. Here are the chieftains who have run the railroads, including those who set about grabbing power and big salaries for themselves, and others who truly loved the industry. As a journalist and associate editor of Fortune magazine who covered the demise of Penn Central and the creation of Conrail, Rush Loving often had a front row seat to the foibles and follies of this group of men. He uncovers intrigue, greed, lust for power, boardroom battles, and takeover wars and turns them into a page-turning story for readers. Included is the story of how the chairman of CSX Corporation, who later became George W. Bush's Treasury secretary, was inept as a manager but managed to make millions for himself while his company drifted in chaos. Men such as he were shy of scruples, yet there were also those who loved trains and railroading, and who played key roles in reshaping transportation in the northeastern United States. This book will delight not only the rail fan, but anyone interested in American business and history.
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 One of the most valuable transportation histories of the last decade January 6, 2008
Penn Central. To this day, the name of this corporation sends shudders through the world of finance. When it went bankrupt in June of 1970, it was the largest bankruptcy in United States history, and it held that title for the next thirty-one years. (It took the collapse of Enron in 2001 to supplant it). In The Men Who Loved Trains, journalist Rush loving tells the story of how Penn Central came into being, but even more importantly how a few men picked up the pieces afterward and pulled the railroad industry out of a tailspin that might have proved fatal.
Loving's work is essentially a journalistic book, rather than a scholarly one. It is written in a prose style and has an eminently readable pacing. Yet don't take this for being lightweight; that the author can weave such an unwieldy mess into a fast and cohesive narrative is a testament to his abilities as a writer. In ways, the book follows in the tradition of works such as Tom Wolfe's The Right Stuff.
The story line follows the chronology of the demise of Penn Central, the struggle to pick up the pieces, and the creation, life, and eventual parting out of PC's successor, Conrail. Throughout the work we meet various key individuals; from the fiery Alfred Perlman to former CSX Transportation executive (and future Treasury Secretary) John Snow. Along the way, we come back again and again to John McClellan, tracking his career from entry level PC staffer through to planner for the Department of Transportation and eventually strategic advisory for Norfolk Southern. His career serves as a foil for the events of Conrail's life and death, humanizing a story of corporate battle and macro economics.
And what a story it is! Following the collapse of PC, many pundits were predicting doom for the entire railroad industry. The more optimistic felt that the Northeast lived behind a wall in which railroad transportation simply would never pencil out. Although a government takeover of PC would help keep the trains running, many in the private sector feared it as a dangerous first step towards nationalization. In the end, a select few fought an uphill battle for the creation first of passenger carrier Amtrak, and then of the freight railroad what would come to be known as Conrail.
Like Amtrak, Conrail has a belabored existence for much of its life. It inherited a property that was severely overextended and under-maintained. Only great gobs of public money could solve Conrail's problems, and even then there was no real guarantee it would turn the company around. Throughout its existence, philosophical and political opponents watched and salivated as they waited for the company to trip and fall.
As Loving tells, however, Conrail endured, returning to black ink, and eventually becoming a publicly traded, private sector corporation. Loving tells, too, of the irony that was the end of Conrail; the company became the subject of a bidding war between NS and CSXT, and was finally split between them in 1997, redrawing the Northeastern railroad map along lines that were eerily similar to what Al Perlman had wanted before he was forced into agreeing with the PC merger.
The book attempts to carry the story without bias, in the best journalistic fashion, and most of the time succeeds in doing so. There is, however, a distinct bias in favor of McClellan's employer, NS, and the between-the-lines feeling is that Loving and McClellan are friends. Still, Loving remains remarkable professional, remaining gentlemanly even when dealing with McClellan's arch-rival Snow.
Conrail was arguably the nation's most controversial modern railroad project. The Men Who Loved Trains tells an important tale of railroading, corporate intrigue, and a thousand might-have-beens that make it one of the hallmark railroad history books about the late 20th century, of importance not just to scholars of Northeastern and Midwestern railroad history, but to anyone with an interest in railroads, the politics of transportation, or public policy.
 Should of been called 'Some' Men Who Loved Trains December 3, 2007
Not all the names in the book "loved trains".
Too much of the book centered around on man; Jim McClellan (who apparently was a friend of the author), that I never heard of before, even after reading 'The Wreck of the Penn Central' and 'No Way to Run a Railroad' (two other must reads).
It filled in many loose ends from those books since this was written fairly recently.
It's too bad there was a lack of names mentioned in the last chapter where the blame can be placed regarding the current CSX situation that has been going on for the past 3+ years. Actually, it started in 1999. Conrail should of stayed Conrail.
 Why are the trains so slow in Vermont? October 16, 2007
0 out of 5 found this review helpful
This book is written in a folksy style for railroad buffs who already know the story and want to argue about it. I couldn't read it. All the details were screwy about Perlman's blue eyes and nonsense about every teeny personal detail of meetings that happened 5o years ago. I'd like to know the story but will never with these guys. Maybe they are why the trains run so slowly in Vermont.
Good for all who love trains September 29, 2007
1 out of 2 found this review helpful
As a train lover and a man who grew up along Connecticut's shoreline during the waning days of the New Haven (and an uncle who worked on the NY Central) I found this book an amazing archive of the key players in the demise of the "great" roads and the emergence of the "modern" US railroads. The only drawback was the necessity to understand the terms of stocks, shares, corporate finance and other things financial. So some of this book required some homework (and a lot of reading portions two and three times!) But nonetheless, a great historical railroad document.
WONDERFUL COMBO OF HISTORY, PERSONALITY, HI-STAKES BIZ February 18, 2007
17 out of 26 found this review helpful
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In one way or the other, THE MEN WHO LOVED TRAINS is the book Rush Loving, Jr., a journalist and specialist in business and transportation, has spent most of his career preparing. For a debut book, even a non-fiction one, THE MEN WHO LOVED TRAINS is very effective in covering the modern railroad merger movement yet fun to read with a can't-put-it-down quality and a surprisingly vivid cast of characters. In the early 1960s, Loving begins, the modern merger movement was already underway following Norfolk & Western's acquisition of the Midwestern Wabash Railroad. The N&W brass then asked itself where next to try a merger and the answer was obvious: The Pennsylvania Railroad, "Pennsy" or "PRR" to its friends. The two roads had a kindred history of cross-ownership, complementary coal routes (Pennsy-anthracite / the Norfolk-bituminous), excess Midwestern lines crying for rationalization, nicely meshing home regions (Industrialized Northeast / Upper South) that would eliminate the freight-car handoffs that made so many huge railway yards imperative, similar "command" or top-down military-style departmental operating cultures, even a history of shared passenger livery ("Tuscan Red.") The mighty Pennsylvania, with its extensive Northeastern route system, coveted electrified line from Washington to New York, and far reach into the industrialized eastern Midwest was proud to call itself "The Nation's Standard." Such hubris would play such a large part in wrecking the road and its successor.
The marriage that sounded so good in theory was shot down by the Interstate Commerce Commission, an agency not far from its Progressive Era / New Deal origins that was beginning to look increasingly archaic by the 1960s. (The ICC wouldn't let N&W and Pennsylvania merge, but it had a suggestion of its own: have PRR merge with NYC--the New York Central.) It wasn't until nearly thirty-five years later, 1997, that Norfolk Southern (a merger of Norfolk & Western plus Southern Rwy.) bought nearly sixty percent of Conrail, most of that successor to the old Pennsylvania, later Penn Central routes. Meanwhile rival CSX needed the eastern half of Conrail's (previously New York Central's) famous old "Water Level Route" mainline of New York City - Albany - Buffalo - Cleveland - Toledo - Chicago so desperately that, all told, it settled for just over forty percent of Conrail. The two carriers paid, pledged or put up stock totaling nearly Twenty BILLION dollars, the result of a "never-say-die" debt race. Even the "mere" $600 million less CSX owed did not buy a proportional share relative to the sixty percent NS got. What CSX did get, looked a great deal like the old Central--minus the western half of the Water Level route. Norfolk Southern's acquisitions paralleled even more closely the exx-PRR lines. People still argue about whether NS cheated CSX.
What happened in between makes for much of the history in this yeasty and well-laid-out book, which comes out readable, fun--yet with a moral in the middle. In merger matters the ICC's opinion was law, but even it couldn't keep railroad executives from climbing the corporate ladder. On October 1, 1963, an attorney from charming Bedford, Virginia and previous CEO of the Norfolk & Western (Roanoke, VA), Stuart Saunders, reported to his new job as CEO of the mighty Pennsylvania Railroad (Philadelphia). Saunders was not a railroad guy of the type who rides in locomotive cabs, sets up steam-engine drawn excursions, or likes to talk with the hourly employees. Saunders was a businessman specializing in investment at that precise time in American business culture when it started to look as though the latest management techniques, along with conglomerating a palate of unrelated subsidiaries, would be key to corporate success--knowing a core industry intimately was not quite so high a priority. No doubt that the Pennsylvania Railroad was a step up in grade from N&W, if not in class. October first should have been one of the proudest days of his life. Yet fate intervened in the form of a statement released by the Kennedy Administration, that very day. Doing its own end-run around the stolid ICC, the Administration opined that a merger of Pennsylvania and New York Central was not in the public's interest.
As early as the mid-1950s, many prime American railroads were losing the patronage of businessmen who forsook Pullman comfort for aircraft speed. It was almost inevitable that first-class service would decay. New York Central's Twentieth-Century Limited, favored by celebrities and famous for Alfred Hitchcock's witty portrayal of Eva Marie Saint stowing away Cary Grant in the 1959 film North by Northwest--was cancelled in 1963. Well, actually no. The deluxe services of the train were dropped, the boutonnières for passengers, the red carpet leading to the train, stewardesses (as they were called then) and white-tablecloth diner all got tossed. A train without a name, only a number, kept running the same route. But increasingly less emphasis was put on punctuality or upkeep of equipment. And the shorter the train, the larger the union-mandated crew relative to revenues.
When the mid-Sixties hit, most of the railroads of the Northeastern United States faced a quadruple challenge: Air travel by the general public began to soar owing to the new domestic-route jets. The toll-free, federally funded Interstate Highway System led to bigger trucks, carrying heavier loads faster, and with a truck's traditional advantage of not having to tie up along a specified rail route. Most American railroads -- especially the Eastern lines here discussed -- lacked the money to innovate with the kind of high-techish stuff that now dominates railroad freight travel, especially piggyback trailers and shipping cubes. In fact, many saw their roads deteriorating and couldn't do a thing about it. Finally, Suburbia, cheap gas, more cars per family and the impromptu spirit of the Sixties made for a generation of young people whose parents had relied heavily on trains for intercity travel during World War II, but themselves rarely saw the need for one - sometimes not even the inside of one. America had lost the habit of including rail in its long-distance travel options.
After assuming the CEO post at Pennsy in 1963, Saunders and his opposite number at the New York Central, Al Perlman, spent the next four-and-a-half years or so trying to plan a merger anyway. They tried to anticipate the inevitable headaches that would result when and if the two systems actually were allowed to mesh together in (hopefully) revenue-earning reality, not theory. The Central was a smaller road than the Pennsy, but together a new merged system would have allowed for service cuts and rate consolidation, which is where the American railroad industry, of which most observers predicted only a slow decline, had ruefully settled. Al Perlman is generally portrayed in railroading-business writing such as this as a hot-tempered but good-hearted, with an innovative flair for the operations side of railroading that Saunders lacked. Saunders was a smooth guy, a Southern gentleman by training and a Philadelphia Main Line suburban resident who settled into genteel (and largely exclusive) Main Line historic societies and country clubs with surprising speed, given the customary standoffishness of Main Liners to strangers. He put that suave quality to good purpose in stumping for a PRR/Central merger, eventually winning over reluctant politicians of both parties, labor, most media, and community-leader types. Working all sides, Perlman and Saunders eventually persuaded the decision-makers that a Penn/Central merger would work.
They were mistaken. The new, merged Penn Central's first day was February 1, 1968. Eight hundred and seventy-one days later, in the spring of 1970, it filed for bankruptcy, the biggest American bankruptcy ever. In the brief interim the new Penn Central never really jelled as an operating railroad. In fact, no one in his wildest dream could have imagined how poorly the non-merged merger came down. Freight cars that used to be computer-located (using a type of colored bar-code plaque that was the peak of innovation in the late Sixties) got lost or got sent - AWAY - by yard manages already facing a yard full of mystery freight. Needless to say, the customers stayed away in droves. Penn Central's employees were incompatible Central vs. Pennsy. The computers were incompatible. Scheduling proved incompatible. And the increasingly rickety commuter coaches and dilatory long-distance diesels provided passenger service incompatible to the human spirit.
After the crash and the ensuing bankruptcy of a score of regional Northeast railroads dragged into the maelstrom, it took a long time to find politically acceptable solutions. Yet, by the mid-Seventies, a culture and polity traditionally suspicious to "socialism" found itself with local-government commuter systems, a federally-controlled service to operate the remaining passenger trains (Amtrak); and finally a mopping up and consolidation of the overly vast, tangled and superfluous number of freight railroads (Conrail, 1976).
Not all the news was bad: Conrail's steady recovery and return to profitability pleased its friends and astounded its detractors. The Conrail during this period was run by two bosses with different operating styles and personalities. Stanley Crane was an industry insider, a veteran who knew not only how to run a large rail system but also whom in Washington to talk to for increased funds, relaxed rules, and the like. He was succeeded by the innovative David LeVan, a down-to-earth type who loved to schmooze with the rail crews on the ground and in the cabs of locomotives. At one point it looked as though Conrail would die simply because it didn't have enough federal funding, even though the balance sheet was headed toward profitability. LeVan had to go to the head of Conrail's biggest labor union and ask for a twelve-percent pay cut across the boards. His rep as a "regular guy" got the almost unheard-of consent of the workers.
The Eighties held a combination of ironic developments and surprise. Nineteen-eighty saw the beginning of the end of the hallowed and hated Interstate Commerce Commission; few mourners were present when the ICC finally closed shop for good, in 1995. (That's because in the meantime, Congress had set up a modern agency, the Surface Transportation Board ("STB"), which was far less tied to rigid categories of service, areas of service, rates of service and employees in service.) Since the government-controlled Conrail was still off-limits, big Southern-based carriers forced themselves into bed with partially compatible routes and contrary corporate cultures. The Norfolk & Western's top-down executive structure that would have meshed so well with the old PRR clashed badly with the more congenial and collegial Southern Railway, epitomized by the urbane Graham Claytor and his brother Robert. The two roads agreed to merge, effective 1982.
Part of the reason was fear, not operating economies in and of themselves. In 1980, an incredibly large (and to some observers, awkward) merger tied most other Southern lines together: the predominately east-west C&O/B&O (or "Chessie System") got hitched to the "Family Lines," already an amalgam of coal roads like the L&N and Clinchfield under the protective wing of the mostly route-incompatible Seaboard Coast Lines, whose famous streamliners "Silver Star" and "Silver Meteor" still run today, under Amtrak. In 1986 the corporation took railroad slang to heart and officially christened the railroad and related operating divisions "CSX" for Chessie, Seaboard and that certain "je ne sais quois" represented by the X factor.
Who were the losers in all these goings-on? Marketing and railroad-ops specialists in Penn Central, most of them ex-NYC, the innovative train guys who got shoved aside by the bean-counters. Lyndon Johnson, trying to play catch-up to the Japanese, who decreed that the new experimental Metroliner must attain 150 mph, when in fact the trainset behaved not at all like a bullet train but very much like the souped-up electric commuter train it is at heart. Financial institutions and individual investors who relied on wildly bogus, inflated financial data when they invested in Penn Central. The traveling public who suffered the rapid deterioration of long-distance service in the Sixties and on into the underfunded Amtrak era. Commuters. A labor union that had to take a twelve percent pay cut or risk killing its employer. The American taxpayer, who had to pay for rehabilitation of roads and services that never should have sunk so low in the first place. Last but not least, the remaining two American-headquartered mega-survivors from the Southeast: Norfolk Southern and CSX, which together ran up almost twenty billion dollars in debt after a preventable bidding war over Conrail.
It was Loving's great talent - plus opportunity - that he knew how to portray his more vivid characters. THE MEN WHO LOVED TRAINS is populated with almost as many colorful guys as a novel out of Elmore Leonard or Carl Hiaasen. A "blue-eyed Jew from Minnesota," Al Perlman, ran the New York Central from 1955 until the Penn Central merger in 1968; he ranks high in Loving's esteem for his creativity and custom of forging consensus within the company. But Perlman and his fellow ex-NYC "green hats" clashed in terms of corporate culture with the Pennsy's more buttoned-down "red hats," and those divisions were never really resolved. David LeVan, his duty done at Conrail, left and entered another facet of American transportation: he opened a Harley-Davidson dealership in Gettysburg, PA. Fear a threat of hostile takeover from the South? Say hello to the Claytor brothers, Graham and Robert, who loved railroading so much that they spent innumerable hours in diesel cabs or hunkering with workers on the ground. Robert even qualified to operate the iconic N&W Class J streamlined steam engine, no mean feat for an experienced engineer and almost inconceivable for a suit. A useful connective sinew in this history results from following the career of Jim McClellan, a rising N&W exec with a Forrest Gump-like ability to be in the right place at the right time.
But what narrative is complete without a couple of villains? A big black hat goes to Stuart Saunders, that attorney from the charming small town of Bedford in Virginia. Primarily a bean-counter, it was Saunders who rapidly dieselized the N&W in the late Fifties. It was Saunders who fired Al Perlman from Penn Central in 1969. And it was Saunders who first diversified the PRR's money into anything but railroad maintenance in the mid-Sixties, temporary fixes that made the balance sheet look good but disguised the deteriorating home road's profitability. The strategem worked: undiminished dividends and healthy-looking profits released as "Consolidated Statements of Earnings" perpetuated the myth of the invincible Pennsylvania Railroad enough to pacify the shareholders and keep the investigators at bay. No observer figured out that Saunders' pet investments in utilities and real estate were the real cash-generators and that "The Nation's Standard," its revenues slowly sinking, was getting into a situation of chronic deficit.
Saunders' strange and largely hostile relationship at the recently-turned Penn Central with the company's chief finance officer, David Bevan, got the line into some serious fiscal cheating, yet little came of it. When Saunders' investments could no longer pump up the railroad's earnings statements enough to declare a profit, Saunders turned to Bevan with suggestions that Bevan made come true. Thirty years before the event, Penn Central's "creative accounting" eerily anticipated Enron: the threat to fire an independent analyst unless he rosied up pessimistic conclusions. Buying and selling various parts of the physical rail infrastructure with the help of shell corporations and tax dodges, while the real railroad saw none of these changes. Toward the very end, Saunders and Bevan came close to paralleling Lay and Skilling: they booked money onto PC's ledgers--money that had no origin. Nobody but the federal government can introduce additional money into the American economy. To do otherwise--in effect, pose as financiers--was and is very illegal. And except for a conflict-of-interest hearing into the "finance club" Bevan and a few friends set up in 1962, the two executives largely escaped censure or punishment.
This book deserves a wide readership among the general public, along with railroad people and railroad enthusiasts; also people who like a good, well-written and real corporate saga along the lines of BARBARIANS AT THE GATE should like THE MEN WHO LOVED TRAINS. The book (out of Indiana University Press) is a good sturdy product, enlivened with before-and-after route maps in the frontispiece and back of book, respectively. These colorful charts come courtesy of America's largest-circulating Railroad magazine, TRAINS of Waukesha (suburban Milwaukee), Wisconsin. Twenty-seven ninety-five is not an unrealistic retail price but Amazon and others offer online discounts.
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