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American railroad executives since the end of World War II have learned — the hard way, as usual — how little real salvation there is in the expedient of the massive merger. They might have studied to good purpose the experiences of the English railways, which were forced to consolidate into four great systems under legislation passed in 1921. Dr. Channon has done so, and tells a dreary story that scouts the idea that great cost savings flow all but automatically from consolidations. His discussion of the Great Western's failure to introduce railway cars capable of carrying 20 tons of coal, at a time when the typical American coal car carried a payload of more than twice that amount, will be variously interpreted by both sides in the controversy over the decline in British entrepreneurship since 1870. Dr. Channon throws much light, moreover, on the problems of managerial organization, a subject that claims considerable attention in current business history.
When the United States entered World War I, economic interest groups were far better developed and vocal than they had been at the beginning of the Progressive era. Resolving differing views of equitable policy as entertained by these groups resulted in government economic planning for prosecution of the war effort that, so far from being expertly organized and scientific, was confused and ad hoc. Further dramatic proof of this generalization is provided by Professor Guth in his essay on the marketing of fluid milk and its surplus during the war emergency. Producers had been moving towards marketing cooperatives, with all the risk of violation of antitrust laws that entailed. Much of the volume of milk sales had become concentrated in the previous three decades in a few large dealers who were economically strong, especially in the major milksheds. And a new force, the consumer groups, emerged to try the patience of all concerned with orderly marketing of milk in a time of rising production costs, including Herbert Hoover and his subordinates in and around the Food Administration. Quickly dismantled after the Armistice, the mechanisms they worked out nevertheless became the foundation for massive intervention in a highly demoralized industry after 1933.