Re: Billboard Reefers

Westerfield <westerfield@...>

Tony - You're right - a slip of the keystroke. - Al Westerfield

----- Original Message -----
From: Anthony Thompson
To: STMFC@...
Sent: Sunday, March 25, 2007 3:07 PM
Subject: Re: [STMFC] Billboard Reefers

Al Westerfield wrote:
> The worst problem in my opinion was that the per diem that the
> railroads had pay to haul long distance shipments in the leased cars
> was so great that the lessees' lease cost was more than covered by the
> per diem. In essence they were leasing the cars for free. Only a
> fool wouldn't take advantage of such a situation. As a result there
> were twice as many reefers as needed in 1930 and the ones sitting idle
> belonged to the railroads. This is also covered in the 1934 ICC
> decision.

Correct, Al, except they were NOT per diem payments, they were
mileage payments. Some lease contracts provided for subtracting the
mileage payments on a car (for that month) from the lease
charge--permitting a literal profit just by moving cars more
extensively. It appears from the ICC testimony that only a few shippers
were aggressively taking advantage of this, but by removing the
legality of such contracts, the ICC intended to avoid the rest of the
shippers (in Al's words) deciding not to be fools.

Tony Thompson Editor, Signature Press, Berkeley, CA
2906 Forest Ave., Berkeley, CA 94705
(510) 540-6538; fax, (510) 540-1937; e-mail, thompson@...
Publishers of books on railroad history

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