Return to History Return to Community A few months ago (Sept. 1998 issue of east Calhoun News), I wrote about the early history of the Twin City Rail Transit system, the state of the art electric trolley system that began in 1891 at a cost of $6 million, the equivalent of billions today (see Uptown Transit - Part 1). At its peak the privately financed system covered over 450 miles. It took Twin City dwellers everywhere: to the heart of either city, to Lake Minnetonka, to White Bear Lake, to Anoka, to Stillwater and beyond and provided direct rail links to the rest of the state and the country. Urban archeologists can find evidence of the TCRT everywhere in Uptown: the oddly shaped building at 31st and Humboldt, built to fit inside the curve of the streetcar tracks; the strangely split alley behind East Calhoun Parkway between 34th and 33rd streets, whose lower level was originally where the trolley line ran (a close look reveals the fence behind it is held up by genuine trolley track); and the steps down to what was once a trolley stop at the west end of 35th street on the old rail bed just east of Calhoun Parkway and north of St. Mary's church. The best evidence, however, can be found at major intersections like Lake and Hennepin, where standing at the Northeast corner and looking toward the center of the intersection one can easily see the curve of the original track beneath the asphalt. At Girard just north of Lake it's even clearer- the asphalt breaks up to show not only the old track but also the spiffy granite paving bricks that all the tracks once lay in. The TCRT system, which today would be called "light rail", was for over fifty years the lifeblood of the Twin Cities, and at one time was the area's biggest single employer. Yet by 1955 the last lines were ripped up and the trolleys were gone.
What happened? One could assume that streetcars were transportation dinosaurs who met their inevitable extinction through simple lack of demand after the arrival of the automobile. But that was not entirely the case. The reason for their demise may well have been due more to corporate and individual greed than it ever was to falling demand.
Beginning in the 1930s an Eveleth, Minnesota-born company known as City Lines, with millions of dollars in backing from companies like General Motors, Firestone Tire and Standard Oil, set about buying up trolley lines all over the country, trashing them and replacing them with conveniently GM made, gas-burning, tire-using busses. It began with small towns like Galesburg, Illinois and culminated in the biggest prize of them all, Los Angeles. Thus followed the destruction of LA's smogless electric streetcar system, which at its peak was the most extensive in the world. The story's faint ghost haunts every endless LA traffic jam and smog-choked day with the unspoken lament, "This didn't have to happen." (For more details, see Jonathan Kwitny's article "The Great Transportation Conspiracy" in the Feb. 81 Harpers and the more recent PBS P.O.V. special, "Taken for a Ride")
Surprisingly, however, City Lines wasn't behind the death of the Twin City Rail Transit company, though its end was equally sinister. The title of an article in the Sept 29, 1951 edition of Collier's said it all: "How Mobsters Grabbed a City's Transit Line". You may remember from the previous article that the privately held TCRT rarely operated at a profit. It's board of directors, headed by Thomas Lowry, was more interested in using the streetcar lines as a spur to development of land many of them not coincidentally owned. Profits were benevolently plowed back into improving and expanding service as the city grew with the streetcar lines. The profits reaped in development and land values more than compensated the prinicipals. Everybody won: the big guys were making big bucks and the average Twin Citian was riding one of the best light rail systems in the world. Fares stayed at ten cents from 1925 to 1948. But there was a flaw in this marble edifice; few other locals had been willing to invest in the company. Lowry had been forced to find investors all over the country to pull in the enormous sum needed to construct the electrified trolley system. By 1948 these investors had seen only one dividend check in twenty years -of one dollar per share. The stock was trading at $10 from a high of $108, though the company itself was valued at over $40,000,000. In other words, the TCRT was ripe for what today would be called a hostile takeover and one soon materialized in the form of New York City businessman Charles Green. Green began buying stock in TCRT and demanded the management stop reinvesting in the system and start paying real dividends. But the company had begun making major renovations of the lines, which between the privations of the Depression and the scarcity of materials of World War II had left the system antiquated and in need of extensive upgrading.
As soon as the war ended, TCRT began replacing the old trolleys with new, ultra-modern "PCC" cars that were smoother, faster and much more comfortable. So when management politely declined his offer, Green began a "proxy war" (CARAG residents; does this phrase sound strangely familiar?) against the company, rounding up enough signatures of stockholders all over the country to throw out the old management and take over in November 1949. Now president of TCRT, Green immediately demanded a fifty percent fare hike, threw nearly 25% of company personnel out of work, cancelled further improvements and slashed service area wide in the dead of winter. A huge public uproar prompted the State Railroad and Warehouse Commission, the only government agency with authority in the matter, to obtain a court order against further cutbacks without a hearing.
Green had teamed up with reputed local hoodlums to help orchestrate his takeover of TCRT, the most famous of whom was Isadore Blumenfield, a.k.a. Kid Cann. Cann was widely believed to be the machine-gun murderer of Walter Ligget, editor of the 1935 equivalent of City Pages, who had repeatedly portrayed him as a gangster. In 1950, when Green sold $250,000 worth of TCRT shares at an estimated $100,000 profit, most were bought up, to Green's dismay, by Minneapolis underworld types associated with Cann, who himself had become a major shareholder. A local lawyer named Fred Osanna had also been a partner in the takeover and had been brought in by Green at Cann's recommendation. He now teamed up with Cann and attempted to take control of the company away from Green. Death threats and allegations of bribery, embezzlement and kickbacks were so thick the State Railways Commission started a full scale investigation along with a Ramsey Country grand jury, the SEC and the New York Stock exchange.
Nothing came of it. Ossana and his faction took over the TCRT in 1951 and Green resigned and returned to New York considerably richer. Leonard Lindquist, chairman of the State Railroad Commission, after months of investigation, reported to the governor, "The activities of this group, both before and after taking control, give good reason to fear that it may exploit the transit company for improper purposes." It did.
The new ultramodern streetcars, in which the old management had only recently invested over 4 million dollars, were sold off for less than half that amount (some to Mexico City, where they operate to this day). All remaining trolley lines were shut down and the old trolleys burned. A light rail system that today would be worth billions was gone within five years, replaced with General Motors busses. Ridership, which had risen from 100 million in 1933 to 165 million in 1949, fell to 86 million in 1956 after the conversion.
After the last lines were shut down, Fred Osanna, as president of the TCRT, bragged to the press that he had completed "the fastest and most massive streetcar-to-bus conversion ever undertaken in any major U.S. city." His rapacity in liquidating the assets of the TCRT in order to enrich himself eventually landed him in jail for fraud.
And the TCRT? After Osanna, control of the company went to (are you sitting down?) Carl Pohlad, who sold it in 1970 to the Metropolitan Transit Commission (MTC) for 7.9 million dollars.
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