Friday, May 9, 2008

History Lesson: Demise of Twin Cities Rapid Transit

Twin Cities Rapid Transit was one of the best streetcar companies in the country before its demise. It's secondly most famous for the streetcar burning photos that many cite when discussing conspiracy theories.

Well part of the story I had never heard before was told on one of my listserves by transit expert and former Deputy Secretary of Transportation for Pennsylvania Ed Tennyson. He states that at one point TCRT had saved up $10 million dollars to buy new streetcars and repair the tracks but got destroyed by Wall Street speculators. Well, I'll let his words tell the story. I'll add links for emphasis:

The Twin City street car to bus conversion was ironically caused by a pro-street car management, a man named Strouse, I think he was. During gasoline rationing he saved up ten million dollars ($ 160 million at today's prices) to buy more PCC cars, re-lay more track, moderninze the rail system.

A shrewd vulture on Wall Street named Green saw all that money in the bank and solicited the stockholder votes to throw out the sfreet car management so Green could disburse all that money to stockholders including himself. His first attempt failed as the stockholder had pride in the company but inflation hit them (and everyone else) so Green prevailed on his second take over attempt. Strouse was fired and the money was paid out to stockholders leaving nothing for renewals.

Wall Street neophytes saw those big dividends and sent the stock price soaring. Green soid his. Buy low and sell high. Local politicians took Green's place, one named Fred Osanna(In the picture above), a political lawyer. He got a promise from General Motors to loan him all the money he needed to rid the city of street cars and they had National City Lines send him their Barney Larrick to manage the job.

Since there would be no more profits, Osanna and Larrick sold all of the copper wires, car baen property and salvage from scrapping cars to their wives or other relatives at a rock bottom price. Their relatives waited a few weeks then sold all the junk on the market for far more than they paid Twin City Rapid Transit for it. Roy Chalk did the same thing in Washington but was careful not to go to jail. Osanna and Larrick both went to jail, for defrauding the other stockholders.

1 comment:

Interrobang said...

Thanks for writing this! I love that picture, in a sick sort of way. Do you have better documentation of the events around Larrick and Osanna? Is there a paper trail?

By the way, to say "conspiracy theory" implies that there weren't conspirators, but a bunch got nailed for it in court (a few different times). Off the top of my head, there was at least US. v. National City Lines, the case documented here, and a case in the 1960s about monopolistic practices relating to rail hardware.