The Gulf, Mobile and Northern in
ROADWAY AND EQUIPMENT
GULF, MOBILE AND NORTHERN was definitely not a prize railroad, by
national standards, when President Isaac Burton Tigrett accepted control
from the federal manager on March 1, 1920.
It was not held in high regard even by the low-income Mississippi
farmers who lived along its lines, except as a source of cash money to
be obtained via the damage-suit route.
GM&N of 1920, like its more famous and prosperous descendant, the
Gulf, Mobile and Ohio (GM&O), was a product of merger,
consolidation, and construction.
The newest part of the 409 miles of main line was the 40 mile
span from Middleton, Tennessee, to Mr. Tigrett’s home town of Jackson,
Tennessee, county seat of Madison County.
This stretch was so new in 1920 that the engineers were still
working on ballasting and still trying to stabilize some of the most
troublesome deep cuts through the Tennessee hills.
sector from Middleton south to Pontotoc, Mississippi, was the oldest
part of the line. It was
begun in 1871 and was built in large measure by the efforts of the
colorful Colonel W. C. Falkner, Confederate military hero, author, and
businessman. The labor to build most of these 62 miles of line was
provided by Mississippi convicts, who were leased by the state to
Colonel Falkner for subsistence and a few cents per day “rental.”
The first 24 miles, built between Middleton and Colonel Falkner’s home
at Ripley, Mississippi, were constructed for the purpose of moving the
produce of the territory to market via connections with the Southern
Railway (Southern). The next 38 miles, from Ripley down to Pontotoc, were built
as part of a larger scheme to connect Ship Island, Mississippi, with the
industrial North via Ripley and Colonel Falkner’s road.
Politics and personalities interfered, the grand project
collapsed, and its properties were split.
The southern section became known as the Gulf and Ship Island
Railroad (G&SI), which built into Jackson, Mississippi, and later
became part of the vast Illinois Central (IC) system.
long after Colonel Falkner built his sector of the future GM&N,
another Southern promoter began work on a master rail plan. F. B. Merrill and associates, of Mobile, Alabama, saw that the great
pine timber regions of South Mississippi were ready for the logger’s
axe. Moreover, a prime
market existed for this unexcelled long-leaf pine lumber in the North
and East, where usable lumber was fast being cut out.
In 1890 a railroad was chartered to tap much of the virgin timber
area near Mobile. The road,
as proposed, would run to Jackson, Mississippi; and, in the minds of the
promoters, would extend eventually to the great rail terminus of the new
West, Kansas City, Missouri.
1902, the Mobile, Jackson and Kansas City, as the new railroad was
called, had built all of 50 miles of line to the new city of Merrill
Mississippi, located in the swampy bottom lands of the Pascagoula River. Later, the road was built on to Beaumont and Hattiesburg,
Mississippi; but about this time Merrill passed from the scene, and the
objective no longer was Jackson and Kansas City, but Chicago.
The new directors saw that the narrow-gauge 62 mile Gulf and
Chicago, as Colonel Falkner’s line was now known, would be in the
direct line north; therefore, they bought control from the Falkner
family. The Gulf and
Chicago and the Mobile, Jackson and Kansas City were operated by one
management, even though some 240 miles of Mississippi farm and forest
land separated the two parts.
several years of construction effort, during which the Gulf and Chicago
was widened to standard gauge and countless lawsuits were fought, the
rails were finally joined at Pearl River Bridge, near the village of
Burnside. The New Orleans,
Mobile and Chicago Railroad was organized to succeed the Mobile, Jackson
and Kansas City, which collapsed soon after the “silver spike” was
driven. The new line
inherited the connected track and not much else.
It is correct to say connected, rather than completed, because 54
miles of line were still unballasted in 1917, nearly ten years after
construction of the road.
New Orleans, Mobile and Chicago itself collapsed in 1913 and finally was
succeeded by the GM&N, which took charge from the receivers on
January 1, 1917. Before the
end of 1917, control of the property passed, as did that of most other
railroads of the nation, to the federal government.
Thus it was not until 1920 that the GM&N really had a chance
to show what it could do with the line.
addition to its 409 miles of main line, the GM&N in 1920 had three
branches, none of which was regarded as a permanent connection by the
incoming managers. The most
prosperous of these was the Blodgett branch, which was the newest of the
three and was still being extended in 1920.
It ran eastward from McLean Junction to Piave, Mississippi a
distance of 28 miles, and opened up an extensive timber area between the
GM&N and the Mobile and Ohio Railroad (M&O).
Its timber tonnage soon gave out and it was given up.
Both the Hattiesburg branch and the Ellisville line, 6 ½ miles
long were quickly disposed of also.
segment of the GM&N, which was treated almost as a branch although
it was a separate company, was the 30-mile Meridian and Memphis Railway.
The GM&N had bought all of the stock and all of the bonds of
this road in 1918 and it was operated as a part of the main road giving
entry into Meridian, in 1920, the largest city in Mississippi with a
population of 23,399.
good description of the physical characteristics of the GM&N as of
June 30, 1917, was prepared by the Valuation Section of the Interstate
Commerce Commission and was still quite accurate for 1920. Pertinent excerpts from the ICC report are reproduced below:
PHYSICAL CHARACTERISTICS OF ROAD
The maximum grade on the Mobile division between Mobile, Ala.,
and Louisville, Miss., is 1.4 per cent northbound and 1 per cent
southbound. On the New Albany division between Louisville, Miss., and
Middleton, Tenn., the maximum grade is 1 per cent in either direction.
The ruling grades do not exceed 1 per cent.
The maximum curvature between Mobile, Ala., and Louisville,
Miss., is 4°; while between Louisville, Miss., and Middleton, Tenn., it
About 35 per cent of the crossties are creosote treated.
The untreated ties are pine and oak.
The number of ties per mile of main track is about 3,200.
The main line from Mobile, Ala., to Laurel, Miss., is laid
principally with new 70-pound rail; from Laurel to Louisville, Miss.,
with new 70 and 85 pound rail; and from Louisville, Miss., to Middleton,
Tenn., with new 70 and 85 pound and relay 70 pound rail.
The branch lines are laid chiefly with new 60 pound rail.
The main line is
ballasted chiefly with gravel. Other
materials used are principally cinders and sand.
About 54 miles of the main line at various locations and
practically all of the branch lines are earth surfaced....
physical property of the GM&N in 1920 had changed little since 1917,
except that the property had been undermaintained because the line was
not considered to be vital to the war effort.
Both roadbed and equipment were in bad repair at the time that
the road was returned to its owners, but the condition of the roadbed
was more critical than the equipment.
One of the best examples of the weakened condition of the roadbed in
March, 1920, was the increase in expenditure which had to be made in
1920 over the year 1919. According
to the Annual Report for 1920 the Company had to install 85,254 creosote
crossties, whereas in 1919 only 4,602 creosote ties were used.
The total number of treated and untreated ties was increased from
154,798 in 1919 to 215,184 in 1920.
The amount of bridge material and piling which the Company was
forced to use showed an even greater percentage increase than did the
crosstie installation. In
1919 the road used 884,561 feet of bridge material, but in 1920 this was
increased to 2,651,335 feet. Pilings
used in 1919 amounted to 42,764 feet; in 1920 this figure was raised to
135,176 feet, an increase of more than 200 per cent.
ALABAMA TERRITORY SERVED BY THE ROAD IN 1920
was always the site of the GM&N’s home office and one of its
biggest tonnage producers. Its
1920 population of 60,771 was about 10,000 more than in 1910.
This meant that in 1920 Mobile was almost three times as large as
Meridian, the GM&N’s second largest city.
In addition, the port of Mobile was the biggest single source of
tonnage for the railroad, if one excepts the lumber tonnage produced by
all the sawmill communities in Mississippi in combination.
Except for brief wartime spurts in shipbuilding and navigation,
Mobile was in the commercial doldrums for many of the years following
the Civil War. For a number
of reasons, Mobile had been declining in importance in relation to the
other Gulf ports, in spite of the fact that she was one of the oldest
and had been quite prosperous earlier.
Table I shows the deterioration of her harbor activities.
Waterborne Commerce, Both Foreign and Domestic,
Compared with That of New Orleans, for the Years 1905-20
%Mobile of N.O.
93,613,242 10,513,863 1,066,634,876
Annual reports of the Chief of Engineers, U.S. Army for the years
1906, 1911, 1916, and 1921.
Data for 1921 are found in Part 2
Data for prior years are found in reports on activities for
Mobile and New Orleans.
facilities in Mobile in 1920 were extensive but not organized for the
highest possible use. The
city and port of Mobile are located on the west bank of the Mobile
River, some 33 ½ miles
from the Gulf of Mexico. Within
the downtown city, the Mobile River empties into Mobile Bay, which is
wide and very shallow over most of its area. The lower part of the bay deepens considerably and opens into
the Gulf through a rather narrow pass called Mobile Bar. By June, 1914, a ship channel had been dredged from Mobile
Bar to the docks of the city, with a usable minimum depth of 26 ½ feet
at low tide. In 1920 this
still was the usable depth, but a U.S.
Department of Engineers project was under way which, when
completed in 1921, would deepen this channel to 33 feet at the Bar and
30 feet up to the city docks. North
of Mobile the channel of the Mobile, Tombigbee, and Warrior rivers
extended for 443 miles to the coal fields of North central Alabama.
The Inland Waterway, across the Gulf, was of little benefit
except for petroleum products for the city.
facilities at Mobile were owned in large measure by the railroads
serving the area. The
M&O and the Southern jointly owned or used the best wharves and
docks in the city. The
Louisville and Nashville owned about 1 mile of the commercial
waterfront, much of which was well located but was not in active use.
The Alabama, Tennessee and Northern (AT&N) was a newly
consolidated road in 1920 and had little in the way of port facilities.
The GM&N owned an extensive area of waterfront south of the
city, but only a small part of that was developed.
The city of Mobile owned some dock and wharf space, but this was
used chiefly by barge traffic on the various waterways.
Turner-Hartwell Dock Company owned the best private facilities in
the area and was, in fact, servicing the GM&N and the L&N to
some extent. There was no
belt or harbor rail system in 1920, and some felt this to be the
greatest defect in the port structure.
spite of this rather dark picture, there were a few bright spots
pointing to a possible change in Mobile’s future.
Many local people were aware that their businesses were not
growing and for a number of years had been agitating for a change.
As early as 1914 the Mobile Chamber of Commerce had carried the
problem of railroad confusion and lack of co-operation to the Interstate
Commerce Commission in Finance Docket No.
5899, Mobile Chamber of Commerce et al. v. Mobile and Ohio
Railroad et al.
November 30, 1914, the Commission ruled in favor of the city of Mobile
and ordered the railroads serving the port to make certain changes to
prevent continued discrimination. The
M&O and the Southern were ordered to set up reciprocal switching in
the entire port area and to allow any and all carriers to serve ships
through the docks owned by the two roads.
The L&N was ordered to issue through bills of lading for
cotton shipments through Mobile in exactly the same way it served
Pensacola, Florida. This victory for Mobile over the private desires and programs
of the competing railroads went a long way toward opening up the port
facilities for better development.
It also pointed the way for growth of Mobile’s port by means of
concerted action to obtain better facilities and to make better use of
those improved docks and wharves.
effort by the people of Mobile had its effect on the state of Alabama.
Since Mobile was Alabama’s only port, it was not too difficult
to get the state to assist the city in its development program.
No action was taken prior to 1920 but the State of Alabama voted
to construct new facilities and this led to the building of the new and
modern Alabama State Docks, which were completed in 1929, to serve all
phases of the port’s development. Through these projects, and others which the awakened city
developed later, the port of Mobile after the depression of the 1930’s
began to live up to its possibilities.
territory in Alabama other than Mobile offered little in the way of
traffic for the road. Mobile
County, through which the rails ran, had a rather poor sandy loam soil,
once largely covered with pine timber but cut out long ago.
As a farming section the county was destined to be a producer of
vegetables, milk, butter, and eggs for the city of Mobile, rather than a
producer in large quantity of any of the major crops that provide rail
MISSISSIPPI TERRITORY SERVED BY THE ROAD IN 1920
some 90 per cent of the GM&N’s main line and branch mileage in
1920 was in Mississippi, the economic prospects of Mississippi would
tell heavily on the future prospects of the GM&N.
National comparative averages might not show it, but in 1920
Mississippi was in the midst of the second boom in the state’s
hundred-year existence. It
is true that her income and economy rose and fell somewhat in keeping
with the rest of the nation, but these two booms were separate from that
movement. The first boom
period was before the Civil War when the lands of the state were new and
fertile and cotton was still in such demand that there was no production
question, except as to the amount which could be grown.
The years 1861-65 ended that period; it has never returned, in
spite of occasional years of high cotton prices due to war, the boll
weevil, or other outside influences.
The second boom period of major proportions was occasioned by the
exploitation of the tremendous stands of virgin pine and hardwood timber
which originally covered well over two-thirds of the entire state.
This period began roughly about 1890 and lasted until the end of
the national building boom in 1928-29.
The GM&N was constructed as a common carrier in the early
part of this era; and the foreseeable end of this boom, due to
exhaustion of the timber, made its future appear not too bright.
like most other land areas of equal size, is divided geographically,
economically, and politically into smaller sections or unofficial
subdivisions for comparative purposes.
Because of the distance between Tennessee on the north and the
Gulf of Mexico on the south, it is easy to divide the state
geographically into North and South Mississippi.
This basic division, because of geologic and economic
differences, has been carried into the social and political life of the
state. The Alabama and
Vicksburg Railroad (A&V) ran approximately 25 miles below the
geographic center, but for practical purposes it served as the dividing
line. This railroad, one of
the oldest in the state, ran from Vicksburg, on the Mississippi River,
through Jackson, the state capital, to Meridian, near the Alabama line.
These three towns were, in 1920, and had been for the past 40
years, the largest in the state.
more sectional unit in Mississippi should be mentioned here, because it
has always been used for comparative purposes when the wealth of
Mississippi is discussed. By
far the richest agricultural part of the state is the Delta.
People not familiar with the geography of Mississippi immediately
think of the Mississippi River delta, located well below New Orleans,
and therefore question the name. In
reality, it is derived from the fact that the Yazoo River flows into the
Mississippi just above the Vicksburg hills; hence, the area, strictly
speaking, is the Yazoo Mississippi delta, but by popular usage the state
has adopted the shortened name.
Delta, elliptical in shape, by common description “begins in the lobby
of the Peabody Hotel in Memphis and ends on Catfish Row in Vicksburg.”
This is a distance of approximately 175 miles; its widest point,
between Greenville on the Mississippi River and Greenwood on the Yazoo,
is about 60 miles. The
Delta comprises only about one-fifth of the land area of the state but
consistently produced close to one-half of all its agricultural wealth.
This very rich agricultural region produced no tonnage for the
GM&N however, because the IC had seen its value long before 1920 and
had pre-empted its railroad facilities.
Delta was Mississippi’s richest farming section; South Mississippi
was, in general, the poorest from an agricultural standpoint. Bolivar, the richest of the Delta counties, produced
agricultural crops worth $23,115,000 in 1920.
This was just about twice as much as all the crops in the seven
South Mississippi counties through which the GM&N ran.
The entire GM&N territory, that is the sixteen counties
served by the road, produced $38,900,000 in agricultural crops, whereas
two Delta counties, Bolivar and Coahoma, together produced crops worth
timber production, however, the situation was reversed.
South Mississippi and the counties just north of the Alabama and
Vicksburg Railroad supplied the bulk of the timber Mississippi produced,
as well as the bulk of the GM&N’s tonnage.
Of the road’s sixteen counties, ten could be classed as major
timber producers, and these ten counties had about 11 per cent of the
state’s population in 1920. According
to the Census of Manufactures for 1919, these ten counties
received 22 per cent of the industrial wages paid in the state.
These counties produced manufactured goods valued at 21 per cent
of the state’s total, and 23 per cent of the value added by
manufacture was credited to these ten counties. Since approximately 64 per cent of Mississippi’s industrial
wage earners were engaged in logging or sawmilling, it is apparent that
forest products played a tremendous part in the economic life of this
sector of GM&N territory.
had been a major producer of the nation’s lumber for many years, and
for a number of these years the exhaustion of this valuable resource had
been foreseen by students of the industry.
As early as 1909, C.E. Dunston
of the United States Forest Service made a survey of forest conditions
in Mississippi and issued a warning about “the approaching exhaustion
of the timber supply.” It
is reproduced in Figure I.
six counties located north of the timber area of the GM&N were
devoted almost exclusively to agriculture.
The 1919 total of industrial wages paid in these six counties,
with a total population of 102,772 in 1920, was only $513,000. Winston County, the northernmost of the GM&N’s major
timber-producing counties, had industrial wages of $546,000, with a
population of only 18,139.
to Dunston’s 1909 study, the timber which had originally stood on much
of the land in these six counties had long since been cut. Two of the six, Choctaw and Webster counties, were served by
older railroads than the GM&N; hence, timber in these counties had
already been exploited prior to the development of this road. The four remaining counties were in a tier of high arable
lands which had been cleared first, when the northern part of
Mississippi was opened to settlement.
The town of Pontotoc had become the headquarters for federal land
sales in this area soon after the Treaty of Pontotoc, which was signed
in 1832. The county of
Pontotoc was in the midst of this ridge land, which was highly fertile,
but which was, unfortunately, much subject to erosion.
Lowe, state geologist for Mississippi for many years, made the
following comment about this Pontotoc Ridge region: “All the soils of
this region are so mellow that they wash readily, and everywhere in the
older cultivated lands, extensive erosion has scarred the slopes,
rendering much of the land worthless.” This was the area served by
Colonel Falkner’s narrow-gauge road, which had been built through the
heart of these counties to afford a means of moving the cotton crops of
an earlier era to market. This
accounts for the fact that the more northern part of the GM&N in
1920 did not run through the best timber left in these northern
mention has been made of mineral wealth along the GM&N in 1920, for
the reason that there was virtually none producing tonnage or revenue
for the road at that time. The
oil of South Mississippi was not to be discovered until some 20 years
later; and prior to World War II comparatively little use was made of
the clays and limestone rocks which make up the other potential mineral
reserves known to exist in the state. Mineral
production in Mississippi was so low that the Census Bureau lumped
Mississippi production with that of Louisiana - the only state so
treated - and no statewide records were kept.
ON FOREST CONDITIONS OF MISSISSIPPI
Mississippi State Geological Survey,
Bulletin No. 7,
APPROACHING EXHAUSTION OF THE TIMBER SUPPLY.
- According to the Census Report for the fiscal year 1908,
Mississippi ranks third in the production of lumber in the country. It ranks third also in the production of yellow pine lumber,
being surpassed in this respect by Louisiana and Texas.
In the production of hardwoods it ranks tenth in oak, second in
gum, fifth in Tupelo, eighth in hickory and ash, tenth in yellow
poplar, and first in cottonwood.
general the average prices received for lumber in Mississippi are
higher than in other States. The
average price for yellow pine, cypress and hickory lumber is higher
than in any other State. For oak lumber higher average prices are received only in New
York and Indiana, where oak is very scarce and therefore expensive.
This indicates both that the quality of the lumber in
Mississippi is better than in most States, and that the transportation
and market conditions are unusually good.
Census Reports for 1907 and 1908 further demonstrate that the great
timber resources of Mississippi are being rapidly depleted.
In 1907 more lumber was manufactured in the State than ever
before, and Mississippi held fifth place among the States in its
production. In 1908, in
common with all the great lumber States, Mississippi produced less
lumber than in the preceding year, owing to the general business
depression, but it advanced from fifth to third place.
It is interesting to note that, while in 1907, 823 mills
reported a cut of 2,094,485,000 board feed, in 1908 there were 905
mills which cut only 1,861,016,000 board feet.
This perhaps indicates that the number of small mills in the
State probably is increasing which is generally the case in regions
where the timber supply is being exhausted. The large mills are forced to go out of business for want of
a supply, but the small isolated bodies of timber are capable of
sustaining numerous small portable mills, most of them.
of the longleaf pine land is held by large lumber companies, many of
which operate mills cutting from 35,000,000 to 200,000,000 board feet
a year. Comparatively
little timber land is being held by companies or individuals as
investments, because it would be necessary for stumpage prices to
double within the next ten years if the owners were to realize an
income of even eight per cent.
Usually these large mills are heavily bonded, and the interest
on the bonds must be paid.
This is the chief reason for the extensive exploitation of the
the past two years the average lumber prices have been so low that
longleaf operators have barely met expenses.
This was caused chiefly by the decrease in lumber consumption,
due to the general business depression of 1907 and 1908, but partly,
also, by an overstocking of the market, since the large mills, on
account of their bonded indebtedness, were compelled to continue
operating as long as lumber could be sold at any profit whatever.
It is apparent therefore, that the large mills will continue to
log their holdings as rapidly as it can be profitably done.
The majority of large lumber companies do not count on
operating longer than from twelve to fifteen years.
Only a few mills control enough stumpage to last twenty-five
years, and in the entire longleaf pine region in Mississippi there are
not more than two mills which can continue cutting at the present rate
for forty years.
the best indicator of the general lack of retail trade in Mississippi
territory served by the GM&N is the fact that in 1920 only four
towns in the entire area had a population over 2,500.
One of these, Hattiesburg, with a population of 13,270, could not
correctly be called a true part of GM&N territory, as it was at the
end of a failing branch line.
Meridian, also, was off the main line of the road, but it was
much more vital to the road than was Hattiesburg.
This left Laurel, with a population of 13,037 and New Albany,
which just edged into the 2,500 class with a census count of 2,531.
All the other Mississippi station points ranged below this
figure, indicating that basically they were supply points for the farm
and timber areas surrounding them.
TENNESSEE TERRITORY SERVED BY THE GULF, MOBILE
AND NORTHERN IN 1920
County, Tennessee, through which the GM&N ran after leaving
Mississippi, was quite similar in topography and economic development to
the North Mississippi counties immediately south of it.
Its total of $4,113,000 for agricultural crops put it ahead of
Tippah County’s $3,316,000 but slightly behind Union County’s
$4,207,000. Its $42,000 in
industrial wages was behind Tippah’s $52,000 and not quite half of
County presented a better-balanced economy than most of the counties
along the GM&N. Agricultural
crops in Madison were valued at $5,824,000; and, in addition, Jackson,
the county seat, was a thriving small city.
Most of the $2,501,000 in industrial wages paid in 1919 went to
the citizens of Jackson, but its force was felt throughout the county.
Jackson’s population had increased almost 20 per cent to 18,860
in the decade 1910-20. Many
of its men worked in the railroad shops in the city or in other
year-round occupations which helped to stabilize the county income to a
The GM&N had built its line into Jackson, Tennessee, because of the
extensive northbound rail connections there.
It also was the largest community in its area of Tennessee east
of Memphis and was geographically central to north south paths in its
region These factors made it a logical northern terminus for the
expansion minded GM&N.
THE GULF, MOBILE AND NORTHERN’S TRAFFIC
CONNECTIONS IN 1920
of the economic conditions existing in GM&N territory during l920,
the road could not hope to increase its local freight business very
remained the other source of tonnage which exists for most roads, its
business done with connecting roads.
The possibilities were these: (1) to get longer hauls and/or
better rate divisions; (2) to get business being handled by other
carriers; (3) to create new services or develop new customers for export
or import business. Since
this chapter is concerned with the status of the GM&N in l920, the
matters which are of interest here are the connections the GM&N had
with other roads and the possibility of increasing traffic at each
l920 Mobile was served by the M&O, the Southern, and the L&N as
well as the GM&N and the AT&N.
Since all of these roads hauled in a northerly direction, the
only hope the GM&N had of receiving tonnage at Mobile from these
roads was the small amount of material that might be destined for some
point served exclusively by the GM&N.
of Mobile, the first interchange connection was at Evanston,
Mississippi, with the Mississippi Export Railroad, which in 1920 was
known as the Alabama and Mississippi Railroad Company.
This small road began at the then minor port of Pascagoula,
Mississippi, which was also served by the L&N.
For this reason, the connection at Evanston, while worth
protecting, was not expected to become very profitable to the GM&N
in the near future. The
G&SI connected with the GM&N at Laurel and also at the
almost-abandoned branch line town of Hattiesburg, but it could not be
expected to be of prime benefit to the GM&N because it ran northward
to Jackson, Mississippi, where it connected with the IC.
It could get a longer haul for itself by shipping over its own
lines to Jackson, Mississippi, than by turning over northbound freight
to the GM&N at Laurel or Hattiesburg.
Furthermore, at both these points the GM&N had to face the
competition of the NO&NE, which previously has been mentioned as a
subsidiary of the Southern.
Alabama and Vicksburg Railway connected with the GM&N at Newton,
Mississippi some 30 miles west of Meridian.
This point held little value for the GM&N because the Alabama
and Vicksburg connected at Meridian with the M&O, as well as with
the Southern, and at Jackson, Mississippi on the west with the IC. Thus, the Alabama and Vicksburg could seek for itself the
best deal to be offered by the IC, the GM&N, the M&O, or the
Southern on northbound traffic. Southbound
freight which the Alabama and Vicksburg controlled could be shipped via
the Southern or the GM&N to Laurel, or via the M&O or the
GM&N to the port of Mobile.
GM&N subsidiary, the Meridian and Memphis, joined the main line at
Union and because of this fact was a potentially valuable connection for
getting freight into, and out of, the city of Meridian, Mississippi.
At that point, however, the GM&N had to meet the competition
of the M&O and the Southern on northbound freight and on southbound
freight to Mobile, Laurel and Hattiesburg as well.
Mississippi, was the next interchange point, and the road crossed at
this point was a branch line of the IC.
Naturally, the GM&N could not expect any through freight
business from this connection. North
of Ackerman, the next connecting point was Mathiston, where another of
the Southern’s Mississippi subsidiaries crossed the GM&N.
This road, later known as the Columbus and Greenville, ran
between those two points. The
only freight interchange the GM&N received from this line was on
local business, since the M&O’s line was only 26 miles away at
West Point, Mississippi.
of the few really helpful connections of the GM&N was at New Albany,
Mississippi, where the St. Louis-San
Francisco (Frisco) line from Memphis, Tennessee, to Birmingham and
Pensacola crossed the GM&N.
The GM&N could expect to get a fair distribution from the
Frisco on Mobile-bound freight or on freight bound north from Mobile
which the Frisco could control.
Even this junction was not without competition, however, for the
M&O’s line also crossed the Frisco at Tupelo, Mississippi, some 26
miles southeast of New Albany. The Frisco also had the opportunity of hauling on to
Birmingham and giving the freight to the L&N at that point. This New Albany connection was of great value to the
GM&N, however, for through business.
Before the Jackson extension had been finished in 1919, almost no
through freight went north of New Albany.
Tennessee, where the GM&N crossed the Southern, was the next
interchange point on the line. The
GM&N could expect no advantage at Middleton, however, for Corinth,
Mississippi, also on the Southern, was only 24 miles away.
Since the Southern’s subsidiary, the M&O, served Corinth,
all north-south business which the Southern could control would be
turned over to the M&O at this point.
The only other point of contact was Jackson, Tennessee, the
northern terminus. Here
the GM&N had physical connection and close working ties with the
Birmingham and Northwestern, which for all practical purposes extended
the line of the GM&N to Dyersburg, Tennessee thus enabling the
GM&N to connect at Bells with the L&N.
At Jackson, the GM&N also had connections with the IC and the
Nashville, Chattanooga and St. Louis (NC&STL), which ran northward
to the Ohio River crossings at Cairo, Illinois, and Paducah, Kentucky.
its extension into Jackson, Tennessee, the GM&N was enabled to bid
for business from St. Louis or Chicago to Mobile over four routes: (1)
the IC; (2) the L&N; (3) the NC&STL; and (4) the Frisco at New
Albany. By the same token,
the GM&N was in a position to “auction off” any tonnage which it
might control to one of these same four roads.
GM&N had little to hope for from many of its interchange points.
Its main chance to survive, therefore, was aggressive
salesmanship coupled with superior handling of shipments.
The salesmanship was lacking in 1920, as well as the type of
roadbed and equipment which would allow superior handling.
One of the first orders of business on the part of the new
management was to correct both of these defects as rapidly as possible.
CORPORATE STRUCTURE IN 1920
corporate structure of the GM&N in 1920 was almost unbelievably
simple as compared to the average railroad Company.
Bonded indebtedness was almost nil, the only bonds outstanding at
the beginning of the year being $27,000 of an issue put out in 1898 by
the predecessor’s predecessor, the Mobile, Jackson and Kansas City. The stock in the company was split between $11,072,50 common
and $11,494,400 preferred. Both
kinds of shares had equal voting rights, which in the year 1920 was of
little value to the individual owner of stock.
In the 1915 reorganization plan whereby the GM&N succeeded to
the property of the New Orleans, Mobile and Chicago Railroad, a voting
trust was set up to control the affairs of the new company from January
1, 1917, to January 1, 1922.
The members of the reorganization committee had been made the
trustees and became, in turn, the nucleus of the Board of Directors.
This committee had chosen certain other men to serve with them,
notably I. B. Tigrett, banker and part-time railroad president, to
represent Jackson, Tennessee, and W. H. Coverdale, an eminent consulting
engineer and specialist in railroad reorganizations.
Because of this tight control, it was possible to achieve a
closeness of contact between the Board and the management which was to
serve admirably in making quick decisions on corporate policy.
It was almost as if this group of men owned the railroad
personally. Whatever policies they felt would best serve the long run
future of the road could quickly be put into practice.
ease of decision on the part of the Board was offset by the fact that,
if personalities did not limit the actions of the Company, financial
matters did. Fortunately,
there were no bonds on which to pay interest, for there was almost no
money available for that or any other purpose.
According to the corporate balance sheet for December 31,1919,
the company had about $152,000 in current assets and about $820,000 in
current liabilities. Mr.
Tigrett’s first task on assuming control was to secure funds
from outside sources so that the road could continue current operations.
The credit of the company was so bad that the two largest banks
in Mobile refused any loans for any purpose, even on a short-term basis.
Mr. Tigrett recounted the fact that what was then the smallest
bank in Mobile, but which became the largest, did offer to lend between
$50,000 and $100,000 dollars on rather stiff conditions.
The loan was never completed because government funds on longer
terms were made available before matters became acute enough to require
recourse to this short-term bank credit.
The management of the GM&N appreciated the offer, however,
and in later years large funds were kept on deposit in the bank partly
in appreciation of this offer of assistance.
primary reason that the Mobile banks were unwilling in 1920 to lend
money even for current operations was the fact that, in spite of wartime
inflation of the economy, railroad expenses in general and GM&N
expenses in particular were running well above receipts.
As long as the U.S. Treasury was behind the Director General of
Railroads, expenses were secondary and performance was the main
objective. The private companies, however, were not so blessed with a
seemingly inexhaustible treasury; and the GM&N was in more trouble
than most other roads because it had never had a chance to build a
surplus after it began operations in 1917.
Thus, the railroad had to try to maintain service, increase
expenditures for maintenance of way and equipment, and increase
expenditure for traffic solicitation while expenses of current
operations were higher than income from transportation service.
This was true at a time when the road had almost no call to pay
fixed charges. It was fortunate indeed that the reorganization, begun in
1915-16, had eliminated the road’s bonds.
Otherwise, a new bankruptcy certainly would have occurred at this
is little doubt that a combination of three government moves which were
made early in 1920 to assist weak railroads allowed the company to
continue its program of improvement.
The first of these was the government guaranty for a six-month
period of earnings of all railroads which elected to accept the
guaranty. The second act was the establishment of a loan fund
from which railroads could borrow for operating purposes under certain
conditions. The last
of these government moves was an offer of the War Department to sell
certain railroad equipment which had been built for wartime delivery to
Russia. Transfer had
not been consummated prior to the Russian withdrawal from the war;
therefore, the government had surplus stocks on hand, and the GM&N
was able to obtain some of the equipment, which was sold on generous
may be assumed that the physical plant which the GM&N owned would
not have been dismantled immediately if these government measures had
not been taken, but it is doubtful that the management which I. B. Tigrett
headed would have survived 1920 if these aids had not been available.
MANAGEMENT PROBLEMS IN 1920
doubt, the number one problem in March, 1920, was to build a cash
position which would maintain a permanent operating structure. Even if the Board of Directors and the stockholders were
aware of the difficulties to be faced and foresaw a period of deficit
operations to build the road into a permanent carrier, this particular
road could not continue to function without operating capital. This may well have been the deciding factor in the
“temporary” choice of Mr. Tigrett, a banker first and a railroad
manager second, to be the President of the GM&N in 1920.
second major problem had been faced and answered prior to 1920 by the
Board of Directors, but any new management, of necessity, would have to
determine its own answer to the question.
The desire of the Board was to build up this road, constructed
primarily as a log hauler, into a permanent diversified common carrier.
The Board had made this choice when it built the 40 miles of road
into Jackson, Tennessee, to escape the problem of a “dead-end
street” at Middleton. This
decision, however, had to be reconsidered by management after the end of
the war and in the light of new competitive conditions.
the decision to continue the struggle to grow was reached, an entire
host of related problems arose. The
first of these was the matter of reducing operating expenses as rapidly
as other conditions would allow. Aside
from building morale for a growing organization, the separate problem of
keeping a functioning force of employees was a deterrent to a very rapid
decrease in the size of the payroll, largest single expense item. Wage increases, which had just been won from a sympathetic
federal manager, could not be taken away precipitously without the
inevitable reaction of strikes and possibly more serious consequences.
addition to the problems offered by the need to decrease expenses below
revenues, the GM&N faced the necessity of rapidly improving its
roadbed and equipment so that it would meet the standards necessary for
of an adequate work force to staff the road was essential but this new
company also had to confront problems of morale and worker ability.
Any growth program which the GM&N might devise would suffer
if not collapse, unless the employees were able to carry out that plan.
For these reasons, the GM&N management had to find ways
quickly to evaluate its key employees and to help train most of its
people for increased responsibilities.
Also, the road had the problem of bringing in additional people
to be placed in new positions which older employees could not fill
GM&N management recognized at the start that it had to try to
replace its diminishing timber tonnage and also to increase other
freight traffic at the same time.
It was decided that the most likely way to bring about this
increase of traffic was to enhance the value of its traffic connections
with other lines as much as possible, to seek the greatest help from the
lines it joined. Great
effort was made to help the entire territory increase its productivity
and to build a more valuable economic and social life in the area served
by the road. But the
strongest effort put forth by the GM&N was to draw through traffic
to its lines by the best possible arrangements of its traffic
with the road’s desire to increase traffic to the highest possible
level was the need to reduce its per ton cost of hauling this freight
and its per passenger cost of travel to the lowest possible figure.
other problems, which to some might be considered side issues, had to be
faced by the 1920 management team.
The first of these was the extent of damage suits, particularly
in the state of Mississippi.
In the period from 1890 to 1930 there was a tremendous amount of
feeling in Mississippi against “furriners” and against
of this feeling probably came from the hatred of the carpetbaggers of
the Reconstruction Period. Much
of it, however, was quite similar in its origin to the feeling that
resulted in the Jesse James and other robberies of railroads of the
Middle West in an earlier period.
were rare in Mississippi, but the feeling of animosity induced some of
the people to try to profit financially at the expense of large
corporations. In many
sections of Mississippi, railroads were the only corporations known to
the people, so these roads often received the full force of these
manipulations. Damage suits
against railroads were very common occurrences during this general
period. There was
considerably less physical violence in the Mississippi method, but the
railroads probably suffered greater damage in the long run.
The record does not show that the Board called on Mr. Tigrett to
halt these practices on the GM&N; but soon after he was made
President he personally assumed charge of a campaign to cause the road
to be accepted more as a good citizen and less as a target for damage
last of the problems which management faced was that of dividend
payments on the stock of the company.
Since there were no bonds to draw fixed charges, prior claim went
to the preferred stock. Mr.
Tigrett apparently felt that he should not and would not continue long
in control of the affairs of the Company if regular dividends could not
be paid to preferred stockholders at an early date.
His later career proved that Mr. Tigrett constantly regarded as
his first responsibility the proper functioning of the road as a service
agency to the territory traversed.
He also kept sight of the corollary principle that, if possible,
some return should be made to the investors who helped provide the
facilities to render the service.
concluding this chapter on the GM&N of 1920, a brief look at the top
executives is in order. The
Executive Committee, which in large measure was the governing
body was composed of W. H. Coverdale, M. Hely-Hutchinson, J. W. Platten,
A. H. S. Post, F. W. Scott, and I. B. Tigrett.
Of this group, Mr. Coverdale was the best informed in railway
operating matters, while Mr. Scott of Richmond, Virginia, was a close
second, especially in financial matters.
has been said about Mr. Tigrett and much more will be said because he
was the symbol of the management of the GM&N-GM&O for 33 years.
He never really worked alone, but he almost always was able to
find or develop the right man for most of the difficult tasks they had
to face. In all of
those 33 years he was the rallying point of all persons who contributed
to the growth of this rail system.
Undoubtedly, his greatest contribution was his ability to lead
and mold his assistants into top-flight performances as railroad men and
Tigrett celebrated his forty-first birthday in 1920. He had moved to Jackson, Tennessee, in 1903, had become
cashier of one of the banks there, and had, in the intervening 17 years,
become a highly respected young banker.
During the two years 1909-11, he had served as acting President
of his alma mater, Union University, located at Jackson.
In 1912 he was elected President of the Birmingham and
Northwestern Railroad, which was built with Jackson capital as a means
of strengthening trade in the area between Jackson and Dyersburg. When the GM&N wanted to build into Jackson, Tennessee, it
sought for its Board of Directors a local man who had influence in the
banking community, and I. B. Tigrett turned out to be the man selected.
Because of its interest in the new railroad and its faith in
“Ike” Tigrett, Jackson bought $100,000 in common stock of the
GM&N after the extension from Middleton was completed.
In 1919, when it became apparent that the government was to
return the railroad to private control, W. H.
Coverdale, who had become well acquainted with the younger man,
nominated Mr. Tigrett for the presidency.
This was a compromise move, and Mr. Tigrett was chosen to run the
road “till someone better qualified could be selected.”
The choice may have been temporary to some, but Mr. Tigrett said
that as far as he could remember no one ever challenged his leadership
at a Board meeting. One thing at least is on the record: Mr. Coverdale
never, as long as he was on the Board, opposed any major policy that Mr.
Tigrett proposed for the road. Many
men have made their influence felt on the GM&N over the years, but
perhaps no others have had more to do with the growth than these two.
Mr. Coverdale had the strength of character and the professional
standing to help convince the ruling New York financial circles that the
GM&N had a fighting chance, and Mr. Tigrett in these early years
worked early and late to prove that Mr. Coverdale’s confidence was not
to Mr. Tigrett, the one man above all the other officers of 1920 who had
more influence on the growth of the GM&N was the then Comptroller,
F. M. Hicks, President of the GM&O in 1952.
Frank Hicks had early gone to work with Mr. Tigrett in railroad
affairs. While he was still
in his teens, he was made station agent at the village of Crockett
Mills, Tennessee, on the Birmingham and Northwestern.
He worked his way up through various posts on the Birmingham and
Northwestern, and when Mr. Tigrett went on the Board of the GM&N, he
saw to it that his young assistant was put to work on the larger road.
Since that beginning he moved ahead to the number two spot in the
GM&O. He is the man who
stayed in Mobile much of the time to put into practice the policies of
his friend and mentor, who never moved away from his adopted home of