Re: Per Diem

Larry Kline

Thanks for the link to the history talk.

The change from daily to hourly per diem had a big negative impact on the finances of the WM. With daily per diem the WM was able to avoid per diem on most cars and had a significant net per diem income from per diem on WM cars on other RRs.

When hourly car hire started that income went away.

Larry Kline
Pittsburgh, PA

--- In, "soolinehistory" <destorzek@...> wrote:

--- In, "Francis A. Pehowic, Jr." <rdgbuff56@> wrote:

This may be off topic, but if so, can somebody steer me to the right group?  In this day of computers and electronic transfers per diem should be easy.  Is there still per diem on freight cars?
In the steam era it would seem a logistical nightmare.  How did they keep track of cars and transfer money?  How often?
The term is "car hire" today, because it's been an hourly rate, rather than daily, since the late seventies. Here is a Power Point presentation that will tell you more than you ever wanted to know:

One thing it doesn't mention is frequency of settlement of charges, which during the era of interest on this list was monthly, IIRC. Remember, back in those days railroads had armies of clerks to handle this paperwork; it was a cost of doing business.

Back in that era, per diem was just a fact of life for most railroads; you paid per diem on foreign cars on your line, someone else paid you per diem on your cars that were off line, and hopefully, if each road owned the proper number of cars, it was a wash. Some smaller roads didn't own enough cars, and per diem was a continuing expense, which meant that there was incentive to manage it. That meant structuring the freight schedules to get as many cars as practical off the railroad before midnight. Little Chicago South Shore & South Bend was a good example, they ran a freight train nightly that was actually called the Per Diem, at least informally. The road did a heavy interchange with the New York Central, and the connection was on the east end of the railroad. Each evening a set of motors would leave Shops (Michigan City) westward after the commuter rush was over, run to Burnham Yard at the west end of the railroad to pick up all the NYC traffic, then head east. They'd stop again in Michigan City to pick up an additional block of NYC traffic that had been gathered during the day, then run like the wind to have the cars on the interchange before midnight. Fun train to try and chase.


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