Mike's Train House

Green Bay and Western

a historical overview part 2

The Green Bay and Western would prove to be a much more stable investment for it's backers than the previous incarnations had been. Finally, after a quarter of a century of speculation and fiscal malfeasance, a financial discipline was brought to bare upon the railroad. In what was then nearly unheard of, the company would be forced to actually pay all it's expenses before giving one red cent to investors. The desired effect was to completely stabilize the operation.

It also meant the end to all of the schemes to expand the line. Short of a merger, the GB&W would remain a small railroad. In the face of reality, local management sought to increase business.

 The car ferries of two railroads now called daily at Kewaunee. There was a limited amount of "overhead" freight traffic going via the ferries to points west of Winona; this freight would increasingly be relied upon to build profits. 

Passenger service on the GB&W was never considered an important source of revenue; nor had it been important on the predecessor roads. There just weren't that many possible customers in a very rural, agrarian society.

By the 1920's, Henry Ford's tin lizzy had become Everyman's car. As automobiles became commonplace and roads improved, GB&W's passenger business, always a money loser, dwindled away. But there was a positive side, too.

Ford Motor Company shipped car, truck and tractor parts over the GB&W via the car ferries, from main factories in Detroit to satellite plants in St. Paul and Iron Mountain, Michigan, and vice-versa. Finished product also moved over Green Bay rails.

Overhead traffic represented approximately 35% of revenue when the Great Depression hit the road in 1930. A great deal of that revenue slipped away, as did locally-generated originating and terminating car loadings. Indeed, things turned very bleak for the Green Bay Route. 

On the operating level, the railroad had always been managed by the same cadre of early employees who had risen up through the ranks. There were some in management with 50-year, and even 60-year employment records with the line! New York management, the ones who really counted, looked outside to find new blood to run the Green Bay and Western Lines.

It was 1934, the height of the Depression, and even with the financial reforms of the 1896 reorganization, bankruptcy and possible abandonment loomed. The New York financiers chose a railroad executive from Texas, who had built a reputation within the Missouri-Kansas-Texas Railroad. The M-K-T had fallen on hard times after World War I, and Homer McGee had helped bring it back to become one of America's top railroads.

McGee assumed the presidency of the GB&W in 1934, and immediately set forth on an inspection of every inch of the railroad, and personally met with every employee at his (or her) work location. He heard their opinions and suggestions on what course ought to be followed in order to restore the line to health. And often enough, he took his employees' advice to heart.

McGee quickly climbed the learning curve at the GB&W. He correctly read into the anecdotal information and personal observation, concluding that for the line to survive and succeed, it would have to abandon it's "country rube" mentality (and image). And it would have to work closely with both Ann Arbor Railroad and Pere Marquette Railroad to fully develop the potential of the car ferry service.

The new leader persuaded the board of directors to give him carte blanche when it came to transforming the line. No reasonable expense was to be spared in bringing the road into the modern era. GB&W bought a Jordan spreader and other equipment, and set about getting the railroad out of the swampy muck it often ran through.

Sixty years of little or no major maintenance to roadbed meant that tracks often sank back down into swampy areas surrounding them. McGee's goal here was to raise the roadbed by at least two feet, with good quality gravel and stone, while providing ditches on both sides of the track to allow water runoff to intersecting creeks and rivers. This task took several years, and was not fully completed until after World War II.

Another goal of McGee's was to install 90 pound relay rail over the entire mainline, about 250 miles total. This would allow for heavier locomotives capable of pulling longer and heavier trains faster. This project began at about the same time as the roadbed elevation program. The last light rails were replaced by 90 lb. ones in the late 1950's.

A further step that had to be taken was the replacement of several old bridges incapable of supporting heavy trains. This was of utmost importance, and took precedence over other infrastructure improvements. The final obsolete bridges were replaced in the early 1940's. Other areas upgraded included signaling.

New locomotives were purchased, including the last steam engines for the GB&W Lines; six thoroughly modern (though small) Alco 2-8-2's, three in 1937 and three more in 1939. And between the two steam orders came a single Alco HH-660 diesel switcher in 1938, the first for the road. Another diesel switcher arrived on the eve of America's entry into World War II.

The war certainly brought changes to the railroad; somewhat increased traffic and shortages of manpower, spare parts and materials. Older locomotives stored long out of service were reactivated. Most infrastructure improvement projects were put on hold "for the duration".            

After the war, GB&W president McGee turned his attention back to renovating his railroad- and dieselizing it, as well. By 1950, all steam was retired in favor of a small but modern fleet of Alco diesel locomotives.

As the postwar American economy soared, so did traffic levels on the Green Bay and Western Lines. During the early to middle 1950's, several new diesel engines were added to the roster to help cope with increased car loadings. Times had never been better for the railroad. Times would also never be as good, again.

By the early 1960's, overhead tonnage was declining. Heavier duty long distance semi tractor-trailer trucks, better highways, and physical limits imposed by car ferries themselves (car height, length, weight), all contributed to declining traffic levels. GB&W had fought back against trucks as well as it could, having it's own LTL (less-than-truckload) trucking subsidiary, the Kewaunee, Green Bay and Winona Transportation Company, from 1940 on. But the KGB&WTC was overwhelmed by competition and gave up the LTL business in 1963.

As the sixties turned into the 1970's, GB&W faced the loss of it's only diesel locomotive supplier, Alco. It also faced continued declining overhead traffic. Some of the lost revenue was replaced by increased originating and terminating tonnage, as central Wisconsin boomed in the paper and agricultural industries from the 1950's through the 1970's. However, red ink began showing up on company ledger books, where none had been seen in thirty years.

Homer McGee retired as president of the Green Bay and Western in 1963, and the powers were turned over to his son, Weldon. The younger McGee had worked for his father since graduating college; he had served in many positions on the GB&W Lines. Weldon McGee's accomplishments include seeing through the merger of the Kewaunee, Green Bay and Western into the GB&W proper, and in overseeing the complete turnover of the first generation of diesel locomotives in favor of much more powerful, "second generation" types. McGee would prove to be a skilled caretaker and negotiator, and properly should be credited with adding 15 years to the railroad's operating independence. Without the actions of Weldon McGee, it is quite likely that the line would have entirely disappeared into the Burlington Northern.

In 1974, BN approached McGee about selling the GB&W for about $3 million dollars. Initially, McGee agreed to the sale, but apparently had second thoughts. Other offers poured in from various sources, and a bidding war began. In the end, although the Interstate Commerce Commission had granted BN the rights to the line, it was a higher offer from the Itel Corporation which snared the stockholders of the Green Bay Route.

GB&W became a subsidiary of Itel Corp. in late 1978. Itel had started out as a computer services firm in the 1960's, then expanded into other businesses such as container and rail car leasing. It was the rail car leasing business that got Itel interested in the Green Bay and Western. Tax  loopholes in effect since a perceived railroad freight car shortage in the early 1970's made it attractive for firms to lease rail cars to shortline railroads. Thus, the proliferation of colorful boxcars during the 70's.

But with deregulation of the railroads in 1980 (and the subsequent closing of said tax loopholes), the leasing business collapsed. Adding to the woes was the worst economic recession since the Great Depression. The GB&W of the early 1980's saw every available siding jammed with stored boxcars of many colors, all owned by Itel. Traffic onto and off of the car ferries also dwindled away, as favorable regulated rate tariffs disappeared.

The situation remained critical for several years. In fact it worsened in 1987 with the suspicious burning of the Winona Bridge across the Mississippi River, which had stood for nearly a century. The bridge was not rebuilt, thus leaving the line without a Minnesota terminal. Things seemed to hit bottom in 1988, when the newly-organized Wisconsin Central took over switching GB&W's largest single customer's Wisconsin Rapids paper mill facility.

In 1989 however, Itel began operating the Fox River Valley Railroad, carved out of former Chicago and Northwestern lines north of Milwaukee, to Green Bay. Traffic levels soon rebounded on the GB&W as new routings to and from the FRV increased. A new joint Burlington Northern-GB&W container-to-flatcar facility in Green Bay generated still more traffic. It looked as though things were once again turning around.

Then the bombshell hit: Wisconsin Central had made a deal to buy both the Fox River Valley and Green Bay and Western from Itel, which was exiting the rail business completely. "Old-line" GB&W's long-time union employees were furious, as "new-line" WC was a non-union railroad. The unions set about to scuttle the deal, but to no avail. In August 1993, the Green Bay and Western Railroad Company passed into the hands of the Wisconsin Central, and thus into the mists of time and history.

Now officially a part of Fox Valley and Western Limited but in truth operated by the WC, the old GB&W is a shadow of it's former self. Cut in half, it no longer has an individual identity. But many of it's former employees stayed with non-union WC, and were largely responsible for the successful union organizing drives there. WC is now a unionized railroad. The spirit of the Green Bay and Western lives on. It's there in those labor contracts; and it's there in the many men and women who run Wisconsin Central trains today.