Highways are also not beholden to stockholders like freight railroads are. Hating railroads has been popular since the turn of the 20th Century. But doing so also ignores that governments provide the infrastructure for the competition. This is the problem. We have no national transportation policy nor do we invest in our railroads like we invest in highways, airports, and waterways.
So, we agree. Much of the Milwaukee Road route should have been kept by a nationalized operation. I have said that a proper "USRA" operation would have combined the NP and Milwaukee to get the best bits of each, and scrapped the GN.
I'll make a point you may not appreciate because of your myopic focus on for-profit freight operation: when passenger routes are designed, grades are much less of a worry. Curves are much more of a worry, of course. The same is true with light freight, which again, you weren't thinking about in the 1980s because you'd lost all the business to trucks.
The primary worry for a passenger route, however, is actual access to cities. And for most freight routes, this is also the primary issue.
The NP route and the Milwaukee Road route both have pros and cons in different places, with the NP route arguably being better. (The NP route, of course, was downgraded and mothballed in parts.) They both actually stop in cities on the way, though.
The GN route has no intermediate points. (OK, fine. Grand Forks.) It's fundamentally a "flyover" route. And that makes it fundamentally a *bad route*. (Yes, it probably has the best Rockies pass. This is why NP's Rockies pass was abandoned. But that's a small part of the route.)
This is the same underlying problem as the Erie route in the East, which was scrapped for worthlessness and which basically nobody misses. (The Lackawanna route was weak, and exceptionally curve-filled, but there are cities along the way which still want service back. Not so much on the Erie.)
The survival of the GN route is a *historical accident*, due to short-term thinking and very specific oddities in the business environment at the time the Milwaukee was being scrapped and the NP downgraded -- specifically, the fact that nearly all business had been steered to trucks by government policy, and railroads were taking the scraps of the heaviest and slowest traffic, and were also abandoning most of the short hauls even on that traffic -- and the company which owned it made it their priority because it was the route the management had started out on -- BN management was GN management.
It's not a route which actually supports anything much in the states it passes through, though. It's left BNSF in a funny position, begging governments for handouts to upgrade a route which doesn't provide much local service. It usually gets the handouts.
The GN route in Washington will be removed or seriously altered within my lifetime, though, because the flooding, mudslide-covered beach section is fundamentally non-viable. Pity GN/BN/BNSF ripped out all the parallel routes from Seattle north. I wonder what the reroute will end up being; it's impossible to afford the old dismantled parallel routes now that they're highly expensive urban Seattle real estate. Beach routes are an attractive short-term choice which never works out well in the long run.
The survival of the GN route through North Dakota, Montana, Idaho, and Washington is just as much an accident as the survival of the BNSF route across Iowa, where the Iowa Interstate route (ex-Rock Island) is clearly the better route, but was just owned by the wrong company at the wrong time.
So regarding the Pacific Extension: The financials, once they were unearthed in bankruptcy court, showed that the Pacific Extension was the only profitable part of the Milwaukee Road. Hilariously, the worthless money-losing granger lines and the line east of Terry, MT, which have the underlying problem of *not actually having any cities en route*, were mostly picked up by other companies after the final bankruptcy, because they hadn't been scrapped. The conclusion is that the profitable line would also have been picked up by someone if they hadn't been lying about the accounting, mismanaging it, and eventually scrapping it.
Mark, you may never have been an investor; it does scare investors off when management presents books claiming that a business is losing lots of money, *even if it isn't true* (as in the case of the Pacific Extension).
Mark, the facts don't support you, even on the narrow question of whether the Milwaukee management's behavior was short-term sensible. It wasn't. There's no world in which abandoning the only profitable part of your railroad while retaining the unprofitable part makes the slightest bit of sense on the planet, even if the profitable part is less profitable than your competitors. Give it up.
The Milwaukee Road is an example of the fact that sufficiently incompetent management can wreck pretty much anything. There are numerous other examples.
They were in a bad position for some of the same larger reasons the Rock Island and eastern railroads were in a bad position: passenger-centric, online-traffic-centric railroads were all in trouble at the time due to aggressive government subsidization of roads and trucks; routes with curves and grades always have some disadvantage -- but the Milwaukee Road was not suffering from the larger problems as badly as the eastern roads or the Rock Island, and managed to inflict an astounding amount of their own problems on themselves. Their own management was their worst enemy. You may want to give them some slack for not seeing the future (the oil crises), but they couldn't even see the present (with their inaccurate accounting books).
It is interesting to think about why the Milwaukee wasn't included in the GN/NP monopolist merger, and it probably should have been; the answer is clearly merely historical accident. BNSF ended up buying up the line east of Terry. If the Pacific Extension had been intact, they probably would have bought it too. It could effectively be used to form an extra track on the NP route from Three Forks to St. Regis. Using Snoqualmie and Stampede tunnels directionally would have many advantages; the Milwaukee route from Ellensburg to Lind would be a shortcut with far fewer curves than the river-following NP route, though missing Yakima and Pasco. The St. Paul Pass route would probably still have been abandoned, certainly (the very nearby NP route was also abandoned), but the rest of the route? No way.