United States Railroad Administration
After the end of World War I, while some in the United States advocated for continuing nationalization, ultimately the railroads were returned to their previous owners in early 1920.
Although the carriers had made massive investments in the first years of the 20th century, there remained inadequacies in terminals, trackage, and rolling stock.
Inflation struck the American economy, and when in 1906 Congress empowered the Interstate Commerce Commission (ICC) to set maximum shipping rates,[2] the rail firms had difficulty securing revenue sufficient to keep pace with rising costs.
[3]: 515–16 European nations engaged in World War I ordered $3 billion of munitions from United States factories; and most of this production was routed through a few Atlantic port cities.
Terminal facilities in these cities were not designed to handle the resulting volume of export tonnage, though German destruction of Allied cargo ships was ultimately a bigger problem.
[3]: 513 The railroad unions (commonly called "brotherhoods"), desiring shorter working days and better pay, threatened strike action in the second half of 1916.
To avert a strike, President Woodrow Wilson secured Congressional passage of the Adamson Act, which set the eight-hour work day as the industry standard.
Also, government departments sought priority for shipment made on their behalf, and congestion in freight yards, terminals, and port facilities became staggering.
The takeover measures were to go beyond simply easing the congestion and expediting the flow of goods; they were to bring all parties—management, labor, investors, and shippers—together in a harmonious whole working on behalf of the national interest.
USRA pooled all rolling stock, terminals, port facilities, and shops to reduce congestion in Chicago and New York City.
[10] Wilson appointed his son-in-law, Secretary of the Treasury William Gibbs McAdoo, as Director General of the newly formed USRA.
During the 1920s the railroads, with rates and routes set by the ICC, were facing increasing competition from other modes of transportation: trucking and airplanes.
