May 8, 2015|ENO CENTER FOR TRANSPORTATION
May 8, 2015
This week’s ETW Document of the Week is from 40 years ago – the briefing papers prepared for President Ford in late April 1975 when he was asked to make the key decisions about his Administration’s proposals to save the freight railroad industry.
At an April 24, 1975 meeting with his senior advisers (including chief of staff Donald Rumsfeld) and his economic team (including luminaries like Alan Greenspan and Arthur Burns), Ford was briefed on the dire financial situation of the freight railroads and asked to make the final decisions about the form of the rail rescue package he would submit the following month in H. Doc. 94-155, which would eventually become the Railroad Revitalization and Regulatory Reform (4R) Act of 1976 (Public Law 94-210). The proposal sent by Ford to Congress the next month proposed deregulation of the freight railroad industry and a $2 billion loan guarantee program for freight railroads to finance rationalization and streamlining of routes and facilities (almost $8.75 billion in today’s dollars).
The meeting is also as interesting for what Ford rejected – he did not approve a request from Transportation Secretary Coleman to propose a separate $1.25 billion grant program to improve freight railroad mainline routes (with an emphasis on those that carried coal). That program would have been worth about $5.5 billion today, and Secretary Coleman proposed to finance it by rescinding unobligated highway program contract authority.