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Regulating Transportation of Hazardous Substances: Railroads and Reform, 1883–1930

Published online by Cambridge University Press:  13 December 2011

Mark Aldrich
Mark Aldrich
Affiliation:
MARK ALDRICH is Marilyn Carlson Nelson Professor of Economics at Smith College.
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Abstract

The increase in volume of explosives and other hazardous materials transported by rail during the nineteenth century resulted in a growing number of accidents. In response, the Pennsylvania Railroad developed some of the first regulations governing the transport of such materials. In the twentieth century, a combination of enforcement difficulties and competitive pressures led the company, working through the American Railway Association, to press for industry-wide rules and enforcement, which resulted in the Association's, Bureau of Explosives. Similar motives impelled the carriers to seek federal regulation, which began in 1908. The Interstate Commerce Commission provided the legal authority in this public–private partnership, whilethe bureau took the lead in inspecting shipments, encouraging improvements in shipping techniques, and developing rules that formed the basis of all modern regulations of hazardous shipments.

Type
Articles
Information
Business History Review , Volume 76 , Issue 2 , Summer 2002 , pp. 267 - 297
Copyright
Copyright © The President and Fellows of Harvard College 2002

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References

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10 The description of the Wells Fargo explosion is from Gelder, Arthur Van, History of the Explosives Industry in America (New York, 1927), 326–7.Google Scholar The 1866 law is in U.S. Statutes at Large 14 (1868): 81. Brief debate on the bill focused on recent explosions. See Congressional Globe, 39th Cong., 1st Sess., 2635. The Worcester explosion is described in Massachusetts Board of Railroad Commissioners, Annual Report, 1870 (Boston, 1871), 27–8; “A Nitro Glycerin Accident,” Railroad Gazette to (11 Jan. 1878): 21; “A Terrible Accident,” Railroad Gazette 15 (24 Aug. 1883): 564.

11 The 3,300 figure is from the remarks of James McCrea, “Report of the Committee on Transportation of Explosives,” American Railway Association (ARA), Proceedings 4 (25 Oct. 1915): 406.

12 On the importance of the railroads, and specifically the Pennsylvania, in the development of modern management, see Chandler, Alfred Jr., The Visible Hand: The Managerial Revolution in American Business (Cambridge, Mass., 1977).Google Scholar

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14 On the origins of the Pennsylvania's regulations, see Dudley, Charles B., “Remarks,” Engineering News 61 (1 Apr. 1909): 341.Google Scholar

15 Placement of the sign is from House Committee on Interstate and Commerce, Foreign, Hearings on HR 7557, To Promote the Safety of Transportation of Explosives (Washington, D.C., 1908), 47.Google Scholar

16 The disasters are from “Report of the Committee on Conducting Transportation on the Transportation of High Explosives,” 29 Apr. 1895, box 407, Pennsylvania Railroad Collection, Hagley Museum and Library (hereafter PRHM). See also American Railway Association Bureau of Explosives (ARABE), Annual Report of the Chief Inspector, 1909 (New York, 1910), app. 2.Google Scholar For other companies' regulations as of 1905, most of which are described as similar to those of the Pennsylvania, see “Compilation of Replies to Circular 603,” ARA Proceedings 4 (1903–06): 470–8.

17 “Report of the Committee on Conducting Transportation on the Transportation of High Explosives.”

18 Ibid., quotation on p. 3.

19 The naphtha explosion is reported in James McCrea to A. J. Cassatt, 13 May 1902, and in McCrea, “Memorandum,” 13 May 1902 (which contains the estimates of fatalities and injuries), presidential correspondence of A. J. Cassatt and James McCrea, 1899–1902, file 31/31, box 20, MG 286, Pennsylvania Railroad Collection, Pennsylvania State Archives (hereafte PRSA). See also “Many Deaths from Naphtha Explosion,” New York Times, 13 May 1902, 1.

20 Manufacturers of explosives are from an ARA survey in “Report of the Committee on Transportation of Explosives,” ARA Proceedings 4 (25 Oct. 1905): 446–51. The carrier with the next largest number of manufactures on its lines was the Central Railroad of New Jersey, with sixteen.

21 There is an immense literature on the conditions under which private firms will supply public goods. See, for example, Buchanon, James, The Demand and Supply of Public Goods (Chicago, 1968)Google Scholar; Demsetz, Harold, “The Private Production of Public Goods,” Journal of Law and Economics 13 (Oct. 1970): 293–306CrossRefGoogle Scholar; Coase, Ronald, “The Lighthouse in Economics,” Journal of Law and Economics 17 (Oct. 1974): 357–76.CrossRefGoogle Scholar See too Zandt, David Van, “The Lessons of the Lighthouse: ‘Government’ or ‘Private’ Provision of Goods,” Journal of Legal Studies 24 (Jan. 1993): 47–72.CrossRefGoogle ScholarMore recent studies include Stephen Pirrong, “The Efficient Scope of Private Transactions–Cost-Reducing Institutions: The Successes and Failures of Commodity Exchanges,” Journal of Legal Studies 24 (Jan. 1995): 229–55.CrossRefGoogle Scholar See also Banner, Stuart, “The Origin of the New York Stock Exchange, 1791–1860,” Journal of Legal Studies 27 (Jan. 1998): 113–40CrossRefGoogle Scholar; and Pashigian, Peter and Gould, Eric, “Internalizing Externalities: The Pricing of Space in Shopping Malls,” Journal of Law and Economics 41 (Apr. 1998): 115–42.CrossRefGoogle Scholar

22 “Report of the Committee on Conducting Transportation on the Transportation of High Explosives,” quotations on p. 6.

23 For the Senate version of the bill, introduced by Senator Stephen B. Elkins of West Virginia, see Senate Committee on Interstate Commerce, Hearings on S 4319, Transportation of Explosives (Washington, D.C., 1904).Google Scholar For the House bill, introduced by James Sherman of New York, see House Committee on Interstate and Foreign Commerce, Hearings on HR 11964, Prohibiting Common Carriers Engaged in Interstate Commerce From Transporting Gunpowder and other High Explosive Compounds over their Lines Except Under Certain Conditions (Washington, D.C., 1904).Google Scholar In the hearings on H.R. 11964 (p. 4), McCrea said, “[I]n the preparation of this bill I endeavored to go into the matter as fully as I could.” For British regulations, see The Explosives Act of 1875, 38 Vict. C 17, and Annual Report of Her Majesty's Inspector of Explosives, 1875 (London, 1876).

24 One manufacturer, the Masurite Corporation, appeared to oppose the regulation, claiming that it would jeopardize the company's trade secrets. The ICC took no public stance on the bill.

25 House Committee on Interstate and Foreign Commerce, Hearings on HR 11964, quotations on pp. 4, 6, 8.

26 House Committee on Interstate and Foreign Commerce, Hearings on HR 11964, quotation on p. 20.

27 On DuPont as a powder maker, see Chandler, Alfred Jr. and Salsbury, Stephen, Pierre DuPont and the Making of the Modern Corporation (New York, 1971)Google Scholar; and Wilkinson, Norman, Lammot DuPont and the American Explosives Industry, 1850–1884 (Charlottesville, 1984).Google Scholar For the company's early interest in safety, see Stabile, Donald, “The DuPont Experiments in Scientific Management: Efficiency and Safety, 1911–1919,” Business History Review 61 (Summer 1987): 365–86.CrossRefGoogle Scholar Remarks of the DuPont representative are in House Committee on Interstate and Foreign Commerce, Hearings on HR 7557, To Promote the Safety of Transportation of Explosives (Washington, D.C., 1908), 48.Google Scholar

28 “Report of the Committee on Transportation of Explosives,” ARA Proceedings 4 (5 Apr. 1905): 356.

29 For the Harrisburg disaster, see Interstate Commerce Commission, Accident Bulletin 16 (Washington, D.C., 1905): 10–11.Google Scholar Its cost is from ARABE, Annual Report of the Chief Inspector, 1909 (New York, 1910), app. 2.Google Scholar

30 Untitled editorial in Engineering News 53 (25 May 1905): 553; “Train Hit Dynamite; 163 Reported Dead,” New York Times, 11 May 1905, 1; “20Dead, 100 Hurt in Dynamite Wreck,” New York Times, 12 May 1905, 1. The editorial is “Transporting Explosives,” New York Times, 13 May 1905, 8.

31 A search of the Reader's Guide to Periodical Literature reveals no interest in the regulation of explosives on the part of any of the popular press. Neither the New York Tribune nor the World editorialized on the Harrisburg disaster, although both reported it fully. In Boston both the Globeand Herald followed similarprocedures. In Cleveland, the Plain Dealer editorialized, in “The Harrisburg Disaster,” 12 May 1905, 8, that the accident was unavoidable. Lack of interest by both the popular press and labor groups probably reflected the comparatively few accidents that resultedfrom explosives. ICC data reveal over 120,000 injuries and fatalities from railroad operation in 1907, only 132 of which occurred from transporting explosives. For a discussion of railroadsafety during these years, see Aldrich, Mark, Safety First (Baltimore, 1997), ch. 5.Google Scholar

32 The Pennsylvania's review, which lasted all afternoon, and yielded a forty-eight-page transcript, is “Informal Discussion of Moving Explosives,” 19 May 1905, file 41, box 408, PRHM.

33 “Official Explains Wreck,” New York Times, 11 May 1905, 2.

34 “Informal Discussion of Moving Explosives,” quotation on p. 7.

35 Ibid., quotations on pp. 8, 10.

36 Ibid. The revised regulations are “General Notice 174A,” dated 19 June 1904, which superseded “General Notice 174,” dated 25 Sept. 25 1899, both in box 411, PRHM.

37 These developments are reported in “Report of the Committee on Transportation of Explosives,” ARA Proceedings 4 (25 Oct. 1905): 404–7. In the same volume, see also “Laws—High Explosives,” 463–8; and, for railroad regulations, “Compilation of Replies to Circular 603,” 470–8. That Roosevelt was involved in the decision to delegate Dunn to the ARA is recounted in Edgar Marburg, “Charles B. Dudley, Biographical Sketch,” Memorial Volume, 11–42.

38 For a biographical sketch of Dunn, see ARABE, Annual Report of the Chief Inspector, 1936 (New York, 1937), 14–15.Google Scholar I have been unable to discover whether Dunn's work as an ordnance officer had made him known to DuPont or other manufacturers.

39 For biographical data on Drinker, see National Cyclopedia of American Biography (NCAB), vol. 15, 114; for McKenna, see Who Was Who, vol. 1, 315; for Munroe, NCAB, vol. 29, 334.

40 “To the Committee on Transportation of Explosives of the American Railway Association,” and “Report of the Committee of Experts,” ARA Proceedings 4 (25 Oct. 1905): 446–51, 452–5.

41 For state and city regulations, see “Laws—High Explosives,” 463–8, and for railroad regulations, see “Compilation of Replies to Circular 603,” ARA Proceedings 4 (25 Oct. 1905): 463–8 and 470–8.

42 “Report of the Committee on Transportation of Explosives,” ARA Proceedings 4 (25 Oct. 1905): 404–7. That these rules generated no opposition at all was probably because they were voluntary and placed most of the burden on shippers.

43 “Report of the Committee on Transportation of Explosives,” ARA Proceedings 4 (19 Mar. 1906): 595–8.

44 The original bills submitted by the American Railway Association were H.R. 16011 and S. 4844. See “Report of the Committee on Transportation of Explosives,” ARA Proceedings 4 (19 Mar. 1906): 596. The 1866 law is reprinted in House Committee on Interstate and Foreign Commerce, Hearings on HR 11964; House Committee on Interstate and Foreign Commerce, Hearings on HR 7557 To Promote the Safe Transportation of Explosives (Washington, D.C., 1908).Google Scholar

45 Probably the decision to limit the scope of the bill reflected its sponsors' realization that inclusion of “other hazardous substances” might well have stirred up the entire chemical industry, as indeed occurred when the bureau later extended its rules to cover such substances (see below).

46 For the revised bill with amendments, see “Shipment of Gunpowder, etc.,” U.S. 59th Cong., 2nd Sess., H.R. Report No. 6746. This bill became the basis for S. 2611 and H.R. 7557, submitted by Representative James Sherman and Stephen Elkins in December 1907 to the 60th Congress, 1st Sess.

47 McCrea's assessment of the bill is from McCrea to Dudley, 12 Mar. 1908, presidential correspondence of A. J. Cassatt and James McCrea, 1899–1902, file 65/33, box 50, MG 286, PRSA.

48 For lobbying efforts of the Pennsylvania, see also John Cassels and S. C. Neale to MeCrea, 5 Dec. 1907, S. C. Neale to McCrea, 14 Jan. 1908, and identical letters from McCrea to Elkins, Senator John Kean, and Senator Foraker, all on 12 Mar. 1908. All in presidential correspondence of A. J. Cassatt and James McCrea, 1899–1902, file 65/33, box 50, MG 286, PRSA.

49 For the hearings see United States 60th Cong., 1st Sess., House Committee on Interstate and Foreign Commerce, Hearings on HR 7557, To Promote the Safe Transportation of Explosives (Washington, D.C., 1908).Google Scholar The ICC took no public stance on the bill.

50 For the sequence of ICC regulations and bureau rules, see “Report of the Committee on Transportation of Explosives,” ARA Proceedings 5 (19 Oct. 1908): 477–8. The rules and regulations are codified in ARA, The American Railway Association Rules and the Interstate Commerce Commission Regulations for the Transportation of Explosives and the American Railway Association Regulations for the Transportation of Inflammable Articles and Acids (1909).

51 For the extension of authority to regulate other hazardous substances, see ICC, Thirty-Fourth Annual Report, 1920 (Washington, D.C., 1920), 74–7Google Scholar, and Thirty-Fifth Annual Report, 1921 (Washington, D.C., 1921), 47–8.

52 For the lobbying effort, see Charles B. Dudley to Alfred Gibbs, 27 Feb. 1907, James McCrea to William Howard Taft, 7 Mar. 1907, and McCrea to Taft, 3 June 1908. The latter is the source of the quotation. All in presidential correspondence of A. J. Cassatt and James McCrea, 1899–1902, file 62/10, box 49, MG 286, PRSA.

53 Membership is from ARABE, Annual Report of the Chief Inspector, 1907 (New York, 1908).Google Scholar Nonmembers are from an untitled article in the Railroad Gazette 44 (10 Apr. 1908): 494–5.

54 ARABE, Annual Report of the Chief Inspector, 1907 (New York, 1908), 9.Google Scholar

55 In 1913, in part to present a coordinated front to deal with the bureau and other regulatory bodies, the manufacturers formed the Institute of Makers of Explosives. See Van Gelder, History of the Explosives Industry, app. 1.

56 Dunn, B. W., “Origin and Work of the Bureau of Explosives, American Railway Association,” Engineering News 61 (1 Apr. 1909): 340–1.Google Scholar

57 This story is taken from Dunn's remarks in “Report to the Committee on Transporting Explosives,” ARA Proceedings 5 (26 Sept. 1907): 86–8.

58 For damages, see “Explosions,” Railroad Gazette 43 (16 Aug. 1907): 185 (General News Section), and “Untitled,” Railroad Gazette 43 (15 Nov. 1907): 577.

59 ARABE, Annual Report of the Chief Inspector, 1907 (New York, 1908), quotation on p. 7.Google Scholar

60 The statistics remained unofficial. The ICC never published data on explosions or the casualties therefrom. Of course the condemned shipments represented a tiny fraction of all explosives shipped—1,468 kegs of powder amounted to about 0.02 percent of the total.

61 ARABE, Annual Report of the Chief Inspector, 1907 (New York, 1908), quotation on p. 5.Google Scholar

62 ARABE, Annual Report of the Chief Inspector, 1909 (New York, 1910), 9.Google Scholar

63 The annual report of the chemical laboratory was routinely included in the bureau's annual reports. Impact tests at Altoona and tests for exudation by the bureau's chemical laboratory are reported in ARABE, Annual Report of the Chief Inspector, 1908 (New York, 1909), 11–12Google Scholar, 20–9. Improvements in waterproof wrappers for dynamiteand tests of acetylene tanks are in ARABE, Annual Report of the Chief Inspector, 1909 (New York, 1910), app. 3.Google Scholar

64 ARABE, Annual Report of the Chief Inspector, 1910 (New York, 1911), app. 10.Google Scholar

65 Membership is reported in bureau annual reports.

66 “Share in the direction” is from ARABE, Annual Report of the Chief Inspector, 1908 (New York, 1909), 10.Google Scholar

67 to E. B. Thomas [President of the Lehigh Valley], 9 Nov. 1907; and General Manager to W. H. White [President of the Richmond, Fredericksburg, & Potomac], 8 June 1908; presidential correspondence of A. J. Cassatt and James McCrea, 1899–1902, file 68/27, box 51, MG 286, PRSA.

68 Dunn's circular is in ARABE, Annual Report of the Chief Inspector, 1912 (New York, 1913), 5.Google Scholar

69 ARABE, Annual Report of the Chief Inspector, 1909 (New York, 1910), 7–8.Google Scholar

70 “Report of the Committee on Transportation of Explosives,” ARA Proceedings 5 (19 Apr. 1909): 619, and (18 May 1909): 623.

71 McCrea to W. W. Atterbury, 11 Apr. 1911, presidential correspondence of A. J. Cassatt and James McCrea, 1899–1902, file 62/10, box 49, PRSA. With little fanfare, this informal arrangement whereby the ICC essentially delegated rule-making power to a private association was given formal congressional approval in 1921. For a discussion of the 1921 law, see United States Senate Committee on Commerce, Science, and Transportation, 96th Cong., 1st Sess., Hazardous Materials Transportation: A Review and Analysis of the Department of Transportation,'s Regulatory Program (Washington, D.C., 1979).

72 ARABE, Annual Report of the Chief Inspector, 1908 (New York, 1909), 10–11.Google Scholar

73 For the meeting with cardboard producers, see ARABE, Annual Report of the Chief Inspector, 1914 (New York, 1915), app. 6.Google Scholar

74 See “Report from Chemical Laboratory,” ARABE, Annual Report of the Chief Inspector, 1913 (New York, 1914), app. 2.Google Scholar

75 U.S. Bureau of the Census, Annual Survey of Manufactures (Washington, D.C., various years).

76 ARABE, Annual Report of the Chief Inspector, 1908 (New York, 1909), quotations on p. 4.Google Scholar

77 The number of placarded cars is from “Report of the Committee on Transportation of Explosives,” ARA Proceedings 5 (19 Oct. 1908): 480–2, and (18 May 1909): 621.

78 Revisions of the flashpoints and quantities are from ARABE, Annual Reportof the Chief Inspector, 1909 (New York, 1910), 5.Google Scholar

79 Revision of the proposed rules for the location of gasoline storage tanks from ARABE, Annual Report of the Chief Inspector, 1919 (New York, 1920), 91–111.Google Scholar

80 The drug manufacturer is from ARABE, Annual Report of the Chief Inspector, 1908 (New York, 1909), 4–5.Google Scholar

81 The embargo is from ARABE, Annual Report of the Chief Inspector, 1914 (New York, 1915), 14.Google Scholar

82 The circular and organizational chart are from ARABE, Annual Report of the Chief Inspector, 1919 (New York, 1920), app. 6A.Google Scholar

83 ARABE, Annual Report of the Chief Inspector, 1920 (New York, 1921), quotation on p. 4.Google Scholar

84 The tests of gas cylinders are in ARABE, Annual Report of the Chief Inspector, 1914 (New York, 1915), app. 5.Google Scholar

85 For acid carboys, see ARABE, Annual Report of the Chief Inspector, 1910 (New York, 1911), 8.Google Scholar The beginnings of the test department are from Annual Report of the Chief Inspector, 1919 (New York, 1920), 7; its expanded duties are from Annual Report of the Chief Inspector, 1921 (New York, 1922), 3.

86 The tests are described in ARABE, Annual Report of the Chief Inspector, 1920 (New York, 1921), 5–6Google Scholar; for the improvements, see Annual Report of the Chief Inspector, 1921 (New York, 1922), app. 3, and Annual Report of the Chief Inspector, 1922 (New York, 1923), app. 3.

87 The data for 1914 are from ARABE, Annual Report of the Chief Inspector, 1914 (New York, 1915), table 1.Google Scholar

88 For the Ardmore disaster, see ARABE, Annual Report of the Chief Inspector, 1915 (New York, 1916), table 5, app. 4.Google Scholar

89 ARABE, Annual Report of the Chief Inspector, 1916 (New York, 1917), 18Google Scholar; and Annual Report of the Chief Inspector, 1918 (New York, 1919), 4–5.

90 ARABE, Annual Report of the Chief Inspector, 1919 (New York, 1920), 6.Google Scholar

91 American Railway Association Mechanical Division, Proceedings (1930), 197–233.

92 The contract with the Bureau of Standards is from American Railway Association Mechanical Division, Proceedings (1927), 423.

93 ARABE, Annual Report of the Chief Inspector, 1927 (New York, 1928), 7–8Google Scholar; Annual Report of the Chief Inspector, 1931 (New York, 1932), 6.

94 “Col. B. W. Dunn Dies,” New York Times, 11 May 1936, 19; ARABE, Annual Report of the Chief Inspector, 1936 (New York, 1937), 14–15.Google Scholar

95 U.S. Congress, Office of Technology Assessment, Transportation of Hazardous Materials (Washington, D.C., 1986), ch. 4.Google Scholar See also United States Senate Committee on Commerce, Science, and Transportation, 96th Cong., 1st sess., Hazardous Materials Transportation: A Review and Analysis of the Department of Transportation's Regulatory Program (Washington, D.C., 1979).

96 Vogel, in “The ‘New’ Social Regulation,” notes that before the 1960s such regulations arose mostly at the state and local level. Hawley, “Three Facets of Hooverian Associationalism” stresses the role of ideology.

97 The importance of invisibility in protecting associationalist arrangements is stressed by Mirandi, Paul, “Associationalism, Statism and Professional Regulation: Public Accountants and the Reform of Financial Markets, 1896–1940,” Business History Review 60 (Autumn 1986): 438–68.CrossRefGoogle Scholar

98 The changes in public policy toward both railroad safety and hazardous substances in the 1960s are beyond the scope of this paper. They are discussed in Office of Technology Assessment, Transportation of Hazardous Materials; Senate Committee on Commerce, Science, and Transportation, Hazardous Materials Transportation; and Savage, Ian, The Economics of Railroad Safety (Boston, 1998), ch. 2.CrossRefGoogle Scholar