New York, New Haven and Hartford Railroad
The New York, New Haven and Hartford Railroad, commonly known as The Consolidated, or simply as the New Haven, was a railroad that operated principally in the New England region of the United States from 1872 to 1968. Founded by the merger of the New York and New Haven and Hartford and New Haven railroads, the company had near-total dominance of railroad traffic in Southern New England for the first half of the 20th century.
Beginning in the 1890s and accelerating in 1903, New York banker J. P. Morgan sought to monopolize New England transportation by arranging the NH's acquisition of 50 companies, including other railroads and steamship lines, and building a network of electrified trolley lines that provided interurban transportation for all of southern New England. By 1912, the New Haven operated more than of track, with 120,000 employees, and practically monopolized traffic in a wide swath from Boston to New York City.
This quest for monopoly angered Progressive Era reformers, alienated public opinion, raised the cost of acquiring other companies and increased the railroad's construction costs. The company's debt soared from $14 million in 1903 to $242 million in 1913, while the advent of automobiles, trucks and buses reduced its profits. Also in 1914, the federal government filed an antitrust lawsuit that forced the NH to divest its trolley systems, however, in practice this did not ultimately occur.
The line became bankrupt in 1935. It emerged from bankruptcy, albeit reduced in scope, in 1947, only to go bankrupt again in 1961. In 1969, its rail assets were merged with the Penn Central system, formed a year earlier by the merger of the New York Central Railroad and Pennsylvania Railroad. Already a poorly conceived merger, Penn Central went bankrupt in 1970, becoming the largest U.S. bankruptcy until the Enron Corporation superseded it in 2001. The remnants of the system now comprise Metro-North Railroad's New Haven Line, much of the northern leg of Amtrak's Northeast Corridor, Connecticut's Shore Line East and Hartford Line, parts of the MBTA, and numerous freight operators such as CSX and the Providence and Worcester Railroad. The majority of the surviving system is now owned publicly by the states of Connecticut, Rhode Island, and Massachusetts, with other surviving segments owned by freight railroads; many abandoned lines have been converted into rail trails.
History
Predecessors and formation (1839–1872)
The New Haven system was formed by the merger of two railroads that intersected in New Haven, Connecticut: the Hartford and New Haven Railroad, which began service between New Haven and Hartford in 1839 and reached Springfield, Massachusetts, in 1844, and the New York and New Haven Railroad, which opened in 1848 between its namesake cities. The two companies had a history of cooperation; for a time, they jointly leased the New Haven and Northampton Railroad and coordinated their steamship services with each other.An initial merger attempt between the two in 1870 was rejected by the Connecticut General Assembly, largely over fears that the merged railroad would form a monopoly. But the legislature approved a second attempt just two years later, and the New York, New Haven and Hartford Railroad was formed on July 24, 1872. The newly combined railroad owned a main line from New York City to Springfield via New Haven and Hartford, and also reached New London, Connecticut via a lease of the Shore Line Railway.
Expansion and acquisitions (1872–1900)
The company later leased more lines and systems, eventually forming a virtual monopoly in New England south of the Boston and Albany Railroad. In 1882, the railroad leased the Boston, New York and Airline Railroad, the last railroad in New Haven not controlled by the NYNH&H. This new acquisition gave the New Haven Railroad a connection to Willimantic, Connecticut. Two more companies, the Naugatuck Railroad and the Connecticut Valley Railroad, were leased by the New Haven in 1887. With these two leases, the New Haven was in control of 10 of the 22 railroads in Connecticut at the time.Early 20th century (1900–1935)
Around the beginning of the 20th century, New York investors led by J. P. Morgan gained control, and in 1903 installed Charles S. Mellen as President. Charles Francis Murphy's New York Contracting and Trucking company was awarded a $6 million contract in 1904 to build rail lines in the Bronx for the New York, New Haven, and Hartford Railroad. An executive at the railroad said the contract was awarded to avoid friction with New York City’s Tammany Hall political machine. In response to this contract, the New York State Legislature amended the city's charter so that franchise-awarding power was removed from the city council and given to the Board of Estimate and Apportionment, which only became defunct in 1989. Morgan and Mellen achieved a complete monopoly of transportation in southern New England, purchasing other railroads and steamship and trolley lines. More than 100 independent railroads eventually became part of the system before and during these years, reaching 2,131 miles at its 1929 peak. Substantial improvements to the system were made during the Mellen years, including electrification between New York and New Haven. Morgan and Mellen went further and attempted to acquire or neutralize competition from other railroads in New England, including the New York Central's Boston and Albany Railroad, the Rutland Railroad, the Maine Central Railroad, and the Boston and Maine Railroad. But the Morgan-Mellen expansion left the company overextended and financially weak.In 1914, 21 directors and ex-directors of the railroad were indicted for "conspiracy to monopolize interstate commerce by acquiring the control of practically all the transportation facilities of New England."
In 1925, the railroad created the New England Transportation Company as a subsidiary to operate buses and trucks on routes where rail service was no longer profitable.
Financial difficulties (1935–1969)
Under the stress of the Great Depression the company became bankrupt in 1935, remaining in trusteeship until 1947. Common stock was voided and creditors assumed control. During the 88 stations case, the railroad closed 88 stations in Massachusetts and 5 in Rhode Island in 1938, and unsuccessfully attempted to abandon the Boston-area portion of the Old Colony Division. The twelve-year reorganization resulted in "eight Supreme Court decisions, fourteen circuit court decisions, five district court decisions, and eleven ICC reports." During the reorganization, over $300 million was invested in capital improvement, including locomotives and other rolling stock, tracks, bridges, and railroad facilities. The railroad emerged in September 1947 under a reorganization plan approved in federal court, without the vast majority of its previous non-railroad interests, and with a number of unprofitable passenger operations on marginal branches replaced with bus service.In 1948, the company operated 644 locomotives, 1,602 passenger cars and 8,796 freight cars on 1,581 miles of track. After 1951, both freight and passenger service lost money. The earlier expansion had left NH with a network of low-density branch lines that could not pay their own maintenance and operating costs. The freight business was short-haul, requiring switching costs that could not be recovered in short-distance rates. They operated major commuter train services in New York and Boston, but these had always lost money; though heavily patronized, these services operated only during the morning and evening rush hours, and were unable to recover their infrastructure costs. The demise of the New Haven was likely hastened by the 1958 opening of the Connecticut Turnpike, largely paralleling the railroad’s mainline across the state, and the subsequent construction of other interstate highways. With decades of inadequate investment, the New Haven could not compete against automobiles or trucks.
In 1954, Patrick B. McGinnis led a proxy fight against incumbent president Frederic C. "Buck" Dumaine Jr., vowing to return more of the company's profit to shareholders. McGinnis won control of the railroad and appointed Arthur V. McGowan, a longtime acquaintance, Vice President. McGinnis attempted to accomplish many of his financial goals by deferring all but the most essential maintenance. Under McGinnis, Knoll Associates was retained to design a new visual identity for the company. Green and gold trim on rolling stock was replaced by black, red-orange and white, accompanied by a stylized "NH" emblem. Knoll employed architect Marcel Breuer to design the interiors and exterior styling of the three experimental trainsets – the Dan'l Webster, John Quincy Adams, and Roger Williams – that were ordered in 1955. Breuer also designed new station buildings for Rye and New London, neither of which were built, as well as the interior of a never-built design for articulated commuter coaches. McGinnis himself could be found touring the railroad on his hirail equipped Cadillac and encouraging thrift on the part of employees even as his own compensation skyrocketed. When McGinnis departed in 1956, ejected from leadership by furious stockholders, he left the company financially wrecked, a situation exacerbated by severe damage from the 1955 Connecticut floods. McGinnis proceeded to similarly damage the Boston and Maine Railroad before ending up in federal prison.
The railroad's next and final president was George Alpert, a lawyer and previously a member of the railroad's board of directors. Alpert strongly advocated for government action to resolve inequitable taxation, with other modes of transportation exempted from taxes while the railroad paid massive tax bills on structures like Boston South Station.
In 1959, the New Haven discontinued passenger service on the Old Colony Railroad network in southeastern Massachusetts. That year, the company reported close to $11 million in losses. Asked by the Connecticut Public Utilities Commission in February 1960 if the company's survival was in imminent danger, the New Haven's comptroller replied, "Yes, even with the best of management". Continuing financial problems forced the New Haven into bankruptcy on July 7, 1961, and federal court judge Robert P. Anderson assumed trusteeship. The railroad reported it would have only $9,262,000 in funds to cover expenses of $33,480,000 at the year's end. Company president George Alpert blamed "government subsidies direct and indirect to our competitors, and inequitable taxes" for the railroad's deficits, pointing to billions of dollars in federal funding for highways and airports. A final attempt to stave off bankruptcy through Defense Production Act of 1950 funding was torpedoed by Senator A. Willis Robertson's insistence that hearings be held before any money was committed. Trains Magazine editor David P. Morgan's analysis of the bankruptcy in 1961 concluded that the company was doomed; continuing that "The only question remaining is whether the taxpayer or the bondholder is to lose his shirt".
Under the management of the bankruptcy trustees, the move initiated by the McGinnis administration and continued by Alpert to turn away from electrification was reversed. 11 EF4 electric locomotives, only a few years old, were purchased from the Norfolk and Western Railway for a bargain price of $300,000 and put to work handling freight trains. The previously sidelined EP-5 electric locomotives were rebuilt and returned to service. 26 GE U25B and 10 ALCO C425 diesel locomotives were purchased by the trustees between 1964 and 1965, the railroad's last new locomotives.
The trustees asked the Interstate Commerce Commission in June 1962 to mandate that the New Haven be included in the merger of the New York Central Railroad and Pennsylvania Railroad, an active proposal at the time. The other two railroads agreed to this condition in March 1965, with the stipulation that the highly unprofitable New Haven passenger operations not be included. The ICC rejected this proposal, and NYC and PRR later agreed to assume operation of passenger services as well. As the details of a potential merger were worked out, the bankruptcy trustees did their best to keep the railroad from collapsing entirely, but were stymied by how little money was available to address years of prior mismanagement and neglect. With finances deteriorating and no relief in sight, the trustees eventually threatened to liquidate the entire railroad.