When traveling north down tree-lined 3rd Avenue in Havre, Montana you will pass by many well-kept historic and contemporary houses. Beautiful wood, brick and stone churches are found nearby on parallel streets to the right. The Hill County Courthouse, also on the right, marks the end of the residential area and the beginning of the city business district in earnest. The vacant United States Post Office and courthouse building circa 1930 occupies roughly a quarter of a city block on the left. A newer USPS building can be found a few streets further to the left and consumes an entire city block. After passing myriad local shops, banks and restaurants, 3rd Avenue dead ends with a semicircle enclosed statue.
Statues are ubiquitous to most cities, better known for their uncanny ability to attract bird excrement than to elicit inquiry of the person portrayed. This statue, sadly, is no exception. Its proximity to the local Amtrak office is an especially cruel irony given the eternal wisdom of the man it was meant to honor. Unlike Amtrak, which will always need copious government subsidies, the Great Northern Railway was purposefully never on the receiving end of any strings-attached government subsidies.
James J. Hill was born in Canada during the year of 1838. Early in life he moved to St. Paul, Minn. Hill learned supply chain management before such a phrase was coined. He worked his way up through all aspects of the transportation business. Through some fortunate acquisitions he was able to lay the foundation of his transcontinental railroad in 1878. He sought the most efficient path to the West Coast with the gentlest gradients so as to minimize fuel consumption. Rails were selected for their durability not just based on the lowest price so as to reduce long-term maintenance costs. Efficiency was always of paramount importance. His genius was to build into each part of the country, a partnership, and help to develop products that could support the newly transplanted citizens. Great Falls resident and world’s oldest man Walter Breuning, who passed away on April 14 spoke firsthand of the win/win capitalist philosophy of James J. Hill.
Breuning recalled that Hill transported farmers for free from Missouri and Kansas to North Dakota and Montana. "He (Hill) wanted to bring farmers in to raise wheat so he could ship it out — and surely it paid off for him."
During the financial panic of 1893, Hill’s railroad was the only transcontinental that was not lobbying congress for a bailout. "The government should not furnish capital to these companies, in addition to their enormous land subsidies, to enable them to conduct their business in competition with enterprises that have received no aid from the public treasury." This quote from Hill is timeless.
In 1864 President Lincoln reluctantly signed a law which "moved the Sierra Nevada Mountains 25 miles to the west." This increased the Central Pacific’s per mile subsidy from $16,000/mile for flat land to double that or $32,000/mile for "mountainous" terrain! Nobel winning economist Milton Friedman summed up the discrepancy of how people treat their own money versus that of others’ in this precise way: "Nobody spends somebody else's money as carefully as he spends his own. Nobody uses somebody else's resources as carefully as he uses his own. So if you want efficiency and effectiveness, if you want knowledge to be properly utilized, you have to do it through the means of private property."
As we approach the 100th anniversary of James J. Hill’s passing, how can it be argued that we haven’t ignored and discarded his hard fought lessons? Would a man such as he have ever considered “public-private-partnerships” as a wise business arrangement? In the age of endless government bailouts for inefficient and incompetent organizations, haven’t we as a society evoked the tears of James J. Hill?
Wouldn’t it be wise to return to profit focussed business models based on consumer demands and not central planning dictates? We must cast off such contrivances as "global warming" and "green energy" with their associated mandates, subsidies and increased taxes and, instead, trust our friends, neighbors and other earnings-driven entities to deliver the products and services to us without government favoritism.
When government agencies act as referees rather than one of the teams on the field, as capitalism is originally designed, we citizens benefit from the efficiency of an unencumbered private marketplace. By doing so, we will surely help to wipe away the tears of James J. Hill.
(Rick Dow is a freelance writer from Havre.)