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The stages of deregulation of the US airline

I. Regulation

Although it was initially thought that deregulation of the U.S. airline would lead to a larger number of airlines whose divergent service concepts, market segments, fleets and route structures would have created new competition, boost traffic and cut fares, it eventually to a full cycle and only resulted in a virtual monopoly. Three different stages took place during its evolution.
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The ordinance itself originated in 1938 when Congress passed the Civil Aeronautics Act. The resulting five-member Civil Aeronautics Board (CAB), which was established two years later in 1940, regulated fares, authorized routes, grants awarded, and approved interline agreements.

“Regulation by definition replaces the regulator’s judgment for that of the market,” said Elizabeth E. Bailey, David R. Graham and Daniel P. Kaplan in their book Deregulating the Airlines (The MIT Press, 1985, p. 96).

In fact, the environment was so regulated that an airline often had to rely only on the purchase of another airline to obtain its route authority. Delta Air Lines, for example, has long been interested in providing non-stop service between New York and Florida, has continually requested CAB rights. But the regulator felt that Northeast, a small local service provider often plagued by low traffic, financial losses and bad weather due to its route system, needed the Florida route’s lucrative revenue potential to make it healthy again and gave it instead the authority.

Fearless, Delta eventually resorted to taking over the regional airline and subsequently received approval for the merger on April 24, 1972. However, these extremes would no longer be necessary.

A glimpse of the future was already available in California and Texas. The CAB, which was not competent for local air transport, could not charge and exercise authority over intrastate airlines and those airlines, which usually offer a high-frequency, single-class, no-nonsense service at half the rates charged by the regulated trunk. Airlines were charged to charge, consistently recorded both profit and traffic growth.

Air California and PSA Pacific Southwest Airlines, for example, active in the Los Angeles-San Francisco market, saw annual traffic numbers increase from 1.5 million passengers in 1960 to 3.2 million in 1965. Texas-based Southwest Airlines offered comparable wise cheap flights between Dallas and Houston and other points in Texas. These airlines have demonstrated that true deregulation can deliver fares accessible to middle-income passengers, offer a wider choice of aviation and service concepts and stimulate traffic.

Passengers and the government increasingly disapproved of regulations in the mid-1970s, citing the examples of Air California, PSA, Southwest and other intrastate airlines as demonstrative evidence that deregulation could bring mutual benefits to airlines and passengers. At least that was the theory.

Eventually, President Jimmy Carter eventually gave in to reason and democratic rule and signed the Airline Deregulation Act on October 28, 1978, eliminating CAB approval for boarding and disembarking routes and lowering most of the current fare restrictions. Even those would eventually be eliminated when the Civil Aeronautics Board, in its now-famous “sunset”, disbanded in 1985.

At the time of the event, eleven then-designated trunk airlines jointly controlled 87.2 percent of domestic passenger passenger miles (RPMs), while 12 regional employees, 258 commuters, five additional and four intrastates accounted for the balance of the RPM distribution. What would still be in the air if the dust of deregulation settled?

II. Deregulation

Phase one: New Generation Airlines:

Like intrastate airlines in California and Texas, an increasing number of non-traditional deregulated airlines have initially infiltrated the U.S. market. The first of these, Midway Airlines, was the first to be certified after the adoption of the Airline Deregulation Act in 1979 and the first to actually inaugurate the service, in 1979.

Founded three years earlier by Irwing Tague, a former Hughes Airwest director, Midway commissioned the low-fare, high-frequency, no-nonsense “Rainbow Jet” service from Chicago’s underutilized Midway Airport in November of that year. was once the city’s only airport until O’Hare was built and Midway hoped to generate it in the same way as Southwest at Dallas’s Love Field – carrying five single class, 86 passengers, former TWA DC-9-10s, initially to Cleveland, Detroit and Kansas City. The low rate structure promoted rapid growth and hoped to strategically penetrate the Chicago market without attracting O’Hare competition from the incumbents.

However, since he is employed by Midway, the author can confirm that he quickly learned three essential lessons, showing that he had to remain hugely flexible to survive in prevailing competitive market conditions:

Although it serves a secondary airport in the Chicago area, it still competed in the Chicago market in the first place.

Second, as the incumbent airlines cut their fares, the utilization rates declined.

Finally, the high-density, low-fare strategy, which had become the key features of deregulation-induced start-ups, was ineffective when an airline attempted to target a specific market segment, such as the higher-yield business, where comfort and service was expected.

As a result, Midway changed its strategy by introducing a conservative cream color scheme; single business cabins with four floors and more legroom; extra hand luggage space; and improved free in-flight wine in exchange for higher than Rainbow Jet fares, but still below the unlimited bus fares of major airlines.

The newly implemented strategy, called “Midway Metrolink”, significantly reduced the number of seats per aircraft. While the DC-9-10s and -30s accommodated 86 and 115 passengers respectively, they were reconfigured for only 60 and 84 under the new Metrolink strategy.

Apparently successful, it caused explosive growth, from an initial 56,040 passengers in 1979 to nearly 1.2 million in 1983.

Capitol Air, another deregulation-transformed airline whose author was also a part, also experienced initial rapid expansion. Formed in 1946 as Capitol Airways, it had begun domestic charter services with Curtiss C-46 Commands and DC-4s, eventually acquiring larger L-049 constellations, and in 1950 became the fifth largest additional airline in the U.S. after World Airways , Overseas National (ONA)), Trans International (TIA) and Universal. It acquired the first of what would become one of the largest used Super Constellation fleets in January 1960, eventually serving 17 L-749s, L-1049Gs and L-1049Hs over the 14-year period from 1955 to 1968.

Redesignated Capitol International Airways, the charter airline received its first pure jet, a DC-8-30 in September 1963, then operated four versions of the McDonnell-Douglas design, including the -30, -50, -61 – and -63 series, which replaced the Lockheed Constellation as the workhorse of its fleet.

Capitol received the planned authority in September 1978 and opened the New York-Brussels service on May 5 of the following year and a second transatlantic sector Chicago / Boston-Brussels on June 19. Like PSA and Southwest, Capitol Air, a former ancillary airline, was not regulated by the CAB and therefore conducted its own “deregulation experiment” by sublimating the proven charter economy of single class, high density, low unlimited and even standby fares to regular service to achieve low seat mileage costs and profitability.

The planned concept, called “Sky Saver Service”, consistently attracted cross-capacity demand and significantly expanded the fleet and route system. With six DC-8-61’s, five DC-8-63’s and five DC-10-10’s to seven U.S. domestic, three Caribbean and three European destinations from a New York-JFK hub in 1982, it attracted an ever-growing passenger base : 611,400 passengers in 1980, 1,150,000 in 1981 and 1,824,000 in 1982.

Passengers, unaware of deregulated airlines whose low fares could only be profitable with used airplanes, high-density seats, and lower-wage non-union workers, often criticized Capitol Air’s non-interline policies and the refusal to provide meals and hotel rooms during delays and compensation for missed connections with other airlines. Nevertheless, fares in the New York and Los Angeles markets ranged from an unlimited $ 149 based on a round trip, to a one-way ticket of $ 189, while the majors’ unlimited fares in the market remained around $ 450. As a result, Capitol Air’s tax factors exceeded 90 percent.

In September 1981, ten new companies received a company certificate and an initiated service.

“The first effects of deregulation were dramatic,” Anthony Sampson wrote in Empires of the Sky: The Politics, Contests, and Cartels of World Airlines (Random House, 1984, p. 136). “A new breed of aviation business saw the opportunity to expand small businesses or create ‘instant airlines’ that could lower fares on local routes; they could cut out much of the superstructures and bureaucracy of the major airlines and use their flexibility to put the giants at their weakest points where they could return quickly. ”

Four types of airline types have emerged that have had a significant initial impact on the traditionally regulated airline industry.

The first were the deregulated starters, such as Air Atlanta, Air Florida, Air One, Altair, America West, Best, Carnival, Empire, Florida Express, Frontier Horizon, Jet America, Midway, Midwest Express, MGM Grand Air, Morris Air , Muse Air, New York Air, Northeastern International, Pacific East Air, Pacific Express, PEOPLExpress, Presidential, Reno Air, SunJet International, The Hawaii Express and ValuJet.

The second was the deregulation-matured local service providers, including Allegheny, Frontier, Hughes Airwest, North Central, Ozark, Piedmont, Southern, and Texas International, which soon outgrew their previously regulatory-imposed geographic concentrations.

The third, the cross-border intrastate airlines, included companies such as Air California (later AirCal), Alaska, Aloha, Hawaiian, PSA, Southwest, and Wien Air Alaska.

The fourth was the deregulation-transformed charters, such as Capitol Air, Trans International (later Transamerica), and World Airways.

While some of these airlines, notably Air One and MGM Grand Air, targeted very specific market niches by offering first-class seating and service, the vast majority, whether produced, raised or matured through deregulating parenting, achieved profits ( or attempted to achieve this) through resources of various core characteristics, including, of course, low, unlimited fares, single-hub, short- to medium-haul route systems, high-density seats, limited on-board services, lower wages, non-union workers and medium haul, medium capacity trijets, such as the 727, and short range, low capacity twinjets, such as the BAC-111, DC-9, 737, and F.28.

All achieved high taxation factors, generated huge traffic in existing and emerging markets and created significant competition.

“In this regard,” wrote Barbara Sturken Peterson and James Glab in their book Rapid Descent: Deregulation and the Shakeout in the Airlines (Simon and Schuster, 1994, p. 307), “Deregulation worked like a charm.”

Stage two: Monopoly:

While the established, traditionally regulated large airlines have temporarily lowered their fares in selected markets with high airline deregulation to maintain their passenger base, the established airlines, long cherished and protected by regulation, were not structured for profitable operation with them. But even in those cases where they managed to eliminate competition from the market, another cheap start seemed to be waiting in the wings to fill the void.

The incumbent airlines thus faced the choice of relinquishing developed markets or shrinking the financial resources to retain passengers until they went bankrupt themselves. It soon became clear that the deregulation of tariff reductions would become permanent elements of the “new” unregulated aviation industry, and the major airlines eventually found that they had to fundamentally restructure themselves or succumb to the new type of airline. Almost every aspect of their activities would eventually be transformed.

The first intended aspect was the route system. Traditionally, they consisted of a point-to-point, non-stop service, which had its origins in 1940 and 1950 CAB route authorizations, but these route systems actually did not contain an inherent “system” at all and instead consisted of unbalanced geographic conversions which resulted in lost revenues for other companies and inefficient, uneconomical use of existing fleets. What was really needed was a centralized self-food collection point.

Due to bilateral agreements, European airlines operated the first “hubs”, guiding passengers from, for example, Copenhagen to Athens through an intermediate connection point such as Düsseldorf. Any passenger flying with the Copenhagen-Düsseldorf or Athens-Düsseldorf sector could theoretically switch to one of the airline’s outward-radiating flight spokes, greatly increasing the number of potential markets. These European capital hubs also showed increased aircraft utilization, improved traffic flow, a larger market base than the traditional point-to-point service relying solely on traffic from origin and destination, and retaining the connecting passenger.

“Although passengers prefer frequent non-stop service, such a service can be quite expensive,” said Bailey, Graham and Kaplan (p. 74). “Airlines are therefore strongly encouraged to operate hub-and-spoke flights … By combining passengers with different departure points and destinations, an airline can increase the average number of passengers per flight and thereby lower costs. broader scope the airline benefits from the economies of scale in aircraft while at the same time a hub-and-spoke operation provides an easier service for travelers in less crowded markets. ”

The first U.S. hub emerged in the 1940s, when the government, in an effort to develop the south, assigned Delta some profitable long-haul routes in exchange for its agreement to serve several small communities from Atlanta.

“All of these routes became the ‘spokes’ that lead to a Delta hub in Atlanta,” said Peterson and Glab (p. 120). “With that came the convincing benefit of passenger retention.”

Formerly a Pittsburgh-based local service provider without a distinctive long-term development plan, Allegheny achieved significant success on its eastern and mid-Atlantic state route network, which had gradually “evolved” due to its funnel point in Pennsylvania. By balancing the predominantly business and small community route system with longer-range sectors toward leisure-oriented destinations, it was able to further nurture this evolution, and by 1978, 73 percent of its passengers had joined. By 1981, this figure had risen to 89 percent, meaning 89 percent of those who flew to Philadelphia and Pittsburgh did not fly to Philadelphia and Pittsburgh.

The Delta and Allegheny hubs were just the beginning of the phenomenon, as the concept did more than create concentration in a particular city. Instead, it resulted in an ultimate monopolistic strangulation that ruled out any competition.

For example, at four of the major U.S. hubs (Atlanta, Chicago-O’Hare, Dallas-Ft. Worth, and Denver), “the two largest airlines simply squeezed out or made it virtually impossible for other airlines to expand and gain market share Julius Maldutis wrote in Airline Competition at the 50 largest US airports since deregulation (Salomon Brothers, Inc., 1987, p. 4).

In Atlanta, where both Delta and Eastern once had hubs, the possibility of some significant competition from third-party airlines was eliminated. In 1978, the percentages for hub traffic in Delta and East were 49.65 and 39.17 percent, respectively, while nine years later these figures had risen to 52.51 and 42.24 percent.

Analysis of the 50 largest airports (representing 81.1 percent of scheduled passengers in the US) indicated that only ten of these airports could be considered less concentrated. On the other hand, 40 (or 80 percent) of the airports had excessive concentrations. The ten most concentrated airports had one airline with a market share of over 66 percent in passenger traffic.

In St. Louis, where both TWA and Ozark operated hubs, the former had a 39.06 percent market share, while the latter held 20.21 percent in 1978. In 1986, these corresponding figures rose to 63.16 and 19.68 percent, respectively. The following year, after TWA acquired Ozark, the only other major competitor, it reduced this share to 82.34 percent, while nine other U.S. domestic airlines shared the remaining 17.66 percent. An airline computer list, listing all airlines that operated between the three major airports of New York and St. Louis on December 1, 1995, revealed 27 flights on this day. None of them were served by any airline other than TWA! This was power.

Likewise, deregulation-matured Piedmont, which captured only a 10.19 percent market share in Charlotte, North Carolina in 1977, turned it into a monopolistic 87.87 percent ten years later after establishing a hub there. The same transformation took place in Pittsburgh with Allegheny / USAir / US Airways – 43.65 percent in 1977 and 82.83 percent in 1987.

“Since much of the city pair markets cannot support convenient non-stop service, hub-and-spoke operations have proven to be the dominant airline strategy since deregulation,” Bailey, Graham and Kaplan wrote (p. 196). “There has been a significant shift away from the regulatory vision of linear systems to pathway solar rays.”

Aside from the hubbing concept, major airlines have undergone several other fundamental changes. For example, aircraft were reconfigured for higher-density seats and, in some cases, single-class seats, while business cabs reinforced first-class and coaches on certain routes; first-class cabins were later entirely replaced by that of business class in a trend-following pattern generated by a number of special niche deregulation companies.

Fuel inefficient aircraft types were gradually replaced by new generation designs and daily use increased from 8.6 hours in 1971 to 10.3 hours in 1979. In the 1970s and early 1980s, average aircraft size increased in long-haul sectors, while in the late 1980s, size increased in all categories. In the early 1990s, pure jet technology first entered all markets – from the 50 passenger regional region to the 500 passenger intercontinental.

Employment also changed. According to Robert Crandall, former chairman and chief executive officer of American Airlines, “deregulation is profoundly anti-labor … there is a huge transfer of wealth from airline employees to airline passengers.”

The tariff reductions of airlines caused by fare reductions led to a lower income and profit base, allowing funding to be redistributed into traditionally high employment salaries and benefits, necessitating increased worker productivity, reciprocal use, part-time work, non-union activity and profit-sharing measures. . In some cases, employment was actually provided by contracted ground service providers to reduce benefits. The author was involved in the groundwork company’s first experiment at JFK International Airport between Triangle Aviation Services and Royal Jordanian Airlines.

“A relatively new, but rapidly evolving concept, the service company provides contract staff to the respective airline for which a certain amount per daily turn-around is assessed, according to Airport-Based Airline Careers (Hicksville, New York, 1995, p. 9 The service company then hires the staff, conducts the training programs (if applicable) and determines the hourly wages and benefits package. ”

After wearing the Royal Jordanian uniform and performing all the functions on the ground, I often felt “trapped in the middle” trying to please both the passenger and the airline at the same time. After all, they were both my client and revealed the inherent conflict of the concept.

Lower pay and airline benefits actually originated with Crandall himself, who devised a plan to cut labor costs with a “B-scale” payment scheme that initially offered lower salaries to newly hired workers and required them to work longer lifetime before they could reach the higher “A scale” levels.

“American (himself) was about to grow enormously in size, and it had a strong incentive to do so,” said Peterson and Glab (p. 136). “The more it grew, the more workers it would hire – all at lower B wages – and the more the average cost would drop.”

According to Bailey, Graham and Kaplan in their work, Deregulating the Airlines, regulation created an industry-wide monetary and benefits package. “It is now clear that inflexible labor rules and higher than competitive wages flourished during regulation. Aviation workers appear to have benefited significantly from CAB’s protective regulations.” (P. 197)

Yet another necessity caused by deregulation was the increasing dependence on automation. American Airlines, again led by Crandall, created the first automated airline reservation system, SABER, which was immediately followed by United’s Apollo system. As automated sales aids, these automated systems were purchased by travel agents who paid a different fee to their owners for each booking made, while smaller airlines had to negotiate for representation.

These systems were so sophisticated and versatile that their information was gradually sublimated by every aspect of the airline with their “reservation modes” providing reservations, routes, fares, hotel, tour and ground transportation bookings, frequent flight mile tracking and ticketing. ; their “departure control systems” (DCS) for checking in passengers and issuing boarding cards; and their “controller modes” that use this information for the weight and balance of aircraft and the load plan and the generation of load sheets.

Only these advanced airline reservation systems allowed airlines to implement yield management programs, that is, determining the optimal balance between low passenger prices and profitable high fares based on seasonality, departure time and demand, convenience, capacity and competition to Eventually produce profitable flight. For example, a consultation of the airline reservation system listed 27 separate fares between New York and Los Angeles on December 1, 1995, on American Airlines only, ranging from an unlimited fare of $ 1,741.82 for a first-class one-way ticket to a very limited fare from $ 226.36 for a return bus. The codes in the “Rate Base” column, such as “KPE7HOLN”, were used to reveal the limitations associated with each of them – the printout of which ran across multiple pages!

Another fundamental change in the deregulated industry was both the structure and the relationship of the regional and commuter operators with the majors. Because history is sometimes cyclical, the pattern once shown by local service companies to leave small, low-density community routes when they bought pure jet planes reappeared, but now with two primary differences: (1). Current regionals were never, by regulation, limited to these routes, and (2). Although rapidly expanding with their own pure jet fleets, they attempted to co-exist with the majors rather than compete through code-share agreements in which their planes appeared in major livery matches and their flights carried the two letters of the member airline. codes.

For example, of the 300 destinations served by Delta in the second half of 1995, 85 were actually reached by one of four coded “Delta Connection” airlines, including Atlantic Southeast Airlines (ASA), Business Express, Comair, and Skywest only, the first to purchase pure jet equipment at the time. American bought his own commuter food companies at the latest and collectively called them ‘American Eagle’.

Nevertheless, the restructuring of the major airlines required by deregulation was completed.

When TWA matched Capitol Air’s unlimited transcontinental bus fares, the former recorded additional bookings of 30 passengers on DC-8-61 aircraft that could otherwise accommodate 252 and canceled the flights. In a similar situation, when the tax factors of USAir and upstart PEOPLExpress were analyzed in the Buffalo-Newark market between August 1981 and June 1982, the latter consistently reported those that were at least 20 points lower.

“The data thus suggests that many consumers chose to travel on the courier with greater brand awareness and amenities at the same fare,” Bailey, Graham and Kaplan continued (p. 106).

Competition eventually forced Capitol Air to adjust its route system to accommodate an increasing number of ethnic and under and under-market markets until the majors also entered this area and the airline had little choice but to file for Chapter 11 bankruptcy protection. and ceasing operations on November 25, 1984.

Halfway through, opposition from major airlines also came to the fore. Whatever strategy it implemented to define its optimal niche, it has always been opposed by the aggressive majors. For example, it acquired Air Florida in 1984, reconfigured its two-seat plane, but quickly returned to the concept of one class on either side of a seesaw, and back to dual-class one in November 1989, by which time it had a fleet of 82 with its “Midway Connection” connection and carried 5.2 million passengers a year.

But excessive expansion and an attempt to replace Eastern at its Philadelphia hub during bad economic times in direct competition with USAir resulted in its own demise two years later on November 13.

“While these numerous strategies pointed to a constant reassessment of the right course, they also pointed to the instability of the market conditions in deregulated air and the airline’s determination to stay in it and the resilience to navigate it through a combination of service concepts , cabin configurations, seat densities and marketing strategies, “said The McDonnell-Douglas DC-9 (Hicksville, New York, 1991, p. 59).

Capitol Air en Midway waren slechts twee voorbeelden van door deregulering gerijpte maatschappijen die bezweken voor de radicaal geherstructureerde majors. Van de ongeveer 100 luchtvaartmaatschappijen die gecertificeerd waren sinds de goedkeuring van de Airline Deregulation Act, was er eind 1995 nog maar één actief, America West.

“(De grote luchtvaartmaatschappijen) voerden een strategie uit waarmee ze de concurrentie met lagere tarieven in hun eigen spel konden verslaan door, ondanks hoge verliezen op bepaalde routes, agressief uit te breiden en vergelijkbare tarieven in rekening te brengen, allemaal in een poging om – of in sommige gevallen – , om marktaandeel te herwinnen … De grote luchtvaartmaatschappijen werden machtig en monopolistisch door de concurrentie uit te schakelen waar ze ook werden aangetroffen ‘, aldus de Austrian Airlines Passenger Handling Manual-JFK (Hicksville, New York, 1990, pp. 10-11).

Fase drie: Megacarrier:

Eenmaal in beweging gebrachte luchtvaartlijn leek zelfaangedreven en weerstond de traagheid. Monopolies kennen per definitie geen grenzen. De logische volgende stap was penetratie van de buitenlandse markt.

In tegenstelling tot de binnenlandse groei in de VS “was het echter veel moeilijker voor een Amerikaanse luchtvaartmaatschappij om toegang te krijgen tot een nieuwe buitenlandse markt dan tot een nieuwe binnenlandse markt, omdat internationale luchtdiensten nog steeds streng gereguleerd werden door bilaterale overeenkomsten tussen de Verenigde Staten en buitenlandse regeringen ‘, schreef Peterson en Glab (p. 283). “… Om onmiddellijke exploitatierechten naar het buitenland te verwerven, moest een Amerikaanse luchtvaartmaatschappij de route-autoriteit van een andere Amerikaanse luchtvaartmaatschappij kopen.”
We’ve seen Android Beam blow the dust in recent months, and it’s probably a replacement. This feature is not yet widely available.
However, due to an accidentally limited beta test, you may be able to subscribe to the beta version of Google Play services. You might remember this as “quick sharing”, which we thought to be called before the launch of Google Pixel 4.
crypto airdrop
Some of you may be wondering what sharing is nearby. This is Google’s version of AirDrop, a very useful feature in Apple products that allows you to transfer files quickly and easily over a Wi-Fi connection. This is something that Android users have been begging for for several years, and now it’s finally coming.
We’ve managed to get a couple of our own devices to work nearby so you can know what to expect, how it’s different from Apple AirDrop, and see if it’s really the local sharing solution we’ve been waiting for for years. for a. With Apple taking a lot of design nuances from Android to iOS 14, this could be one of the few imitations Android fans have been waiting for for a long time – if RCS can eliminate iMessage, I’m sure we’ll all be happy.

Er wordt aan herinnerd dat het fenomeen vóór de deregulering een virtuele herhaling was van de Amerikaanse binnenlandse overheidsstructuur. Een dergelijke aankoop werd in het laatste geval gewoonlijk alleen verleend als de voor de route geautoriseerde luchtvaartmaatschappij in financiële moeilijkheden verkeerde en de door de verkoop gegenereerde inkomsten nodig hadden om levensvatbaar te blijven.

Pan Am, met name gehamerd door de gevolgen van deregulering, werd gedwongen zijn lucratieve Pacific-divisie, samen met vliegtuigen en grondfaciliteiten, voor $ 750 miljoen aan United te verkopen om overeind te blijven. United, toen al een grote, financieel gezonde luchtvaartmaatschappij, beschikte nu over een wereldwijd routenetwerk met de juiste binnenlandse voeding.

Belangrijker dan de verkoop waren echter de verstrekkende gevolgen. “De overname van Pan Am’s Pacific-divisie door United Airlines was bedoeld om een ​​domino-effect te veroorzaken”, vervolgden Peterson en Glab (p. 148). “Veel luchtvaartmaatschappijen waren gealarmeerd door de nieuwe concurrentie waarmee ze werden geconfronteerd, met name Northwest, die bezwaar maakten tegen de grootste luchtvaartmaatschappij van het land. Noordwest wist dat het een aanzienlijk groter eigen binnenlands netwerk nodig zou hebben, en de snelste manier om er een te krijgen zou zijn door middel van een fusie. ”

Eind 1986 had ze dat gedaan door de overname van Republic, die zelf was gevormd door de fusie tussen Noord, Centraal en Zuid in 1979 en de secundaire overname van Hughes Airwest in 1980, en de strategie beloonde Northwest met een monopolistische status op al haar hubs , zoals Minneapolis, met een marktaandeel van 81,55 procent.

Delta, die vreesde dat het niet zou kunnen concurreren met luchtvaartmaatschappijen van een dergelijke omvang, verwierf in september 1986 voor $ 860 miljoen aan Western Airlines, waarbij het een kust-tot-kust routestructuur en nieuwe hubs in Salt Lake City en Los Angeles verwierf.

De reeds beschreven TWA-Ozark-fusie veroorzaakte een zodanige sluis in St. Louis dat driekwart van alle poorten werd gecontroleerd en veel hogere tarieven kon worden beoordeeld in die markten waar geen concurrentie was.

Deze fusies hebben in feite alleen maar bijgedragen tot het verstevigen van de toch al bijna niet aflatende greep van een vervoerder op een bepaalde hub. Deregulation-spawned Empire, for instance-a rapidly-expanding New York State Fokker F.28 Fellowship operator-adopted a Syracuse hub and recorded an initial 1979 market share of just.75 percent, but this exponentially increased to 27.36 percent in 1985 when Piedmont acquired the growing regional. Two years later, its market share climbed to 39.82 percent. However, when USAir in turn purchased Piedmont, the Syracuse hub lock skyrocketed to over 61 percent.

Perhaps the most encompassing (and disjointed) merger was that between PEOPLExpress and Continental, which itself had already been the result of an amalgamation between the original, pre-deregulation Continental, Texas International, and New York Air. PEOPLExpress had equally already absorbed Denver-based Frontier. Texas Air, owner of the new conglomerate, also acquired Eastern, but retained its separate identity.

All these mergers, consummated during the latter half of 1986, unequivocally produced the “megacarrier.”

“Deregulation’s theme, echoing Darwinian philosophy, clearly demonstrated itself to be ‘survival of the fittest,’ which, for the airlines, translated as ‘survival of the largest,’ according to the Austrian Airlines Passenger Service Manual-JFK (p. 10). “If the long-established major carriers… wished to survive and maintain the markets they had so carefully nurtured during regulation, they would somehow have to implement a strategy which would ensure that they would remain ‘large.'”

The major airlines’ fundamental restructuring, beginning with monopoly and ending with megacarrier, constituted that strategy, as carriers tracing their origins to the infantile days of aviation and bearing names virtually synonymous with the industry fell like a string of acquisition-induced dominoes. By 1995 only seven US megacarriers remained, including American, Continental, Delta, Northwest, TWA, United, and USAir, along with two significant majors-America West and Southwest-a few “niche” airlines, and the regional-commuters which were almost exclusively aligned with one of the megacarriers or majors through code-share agreements.

Even these names disappeared early in the 21st century. Like brides and grooms walking down a monopoly-destined aisle, Delta married Northwest, United took Continental as its lawfully wedded, American joined arms with US Airways, and Southwest tied the knot with AirTran.

III. Conclusion

Although the examples set by Air California, PSA, and Southwest had indicated that a deregulated environment would ultimately prove to be mutually advantageous to both the operating airline and the passenger, these experiments failed to approximate actual conditions, since the rest of the US airline industry was still regulated and these fledgling airlines had therefore been insulated from major-carrier competition. Lacking the authority, cost structure, and equipment, they had been unable to launch comparable service of their own.

The initial proliferation of small, low-fare, no-frills, non-unionized deregulation-spawned, -bred, and -transformed airlines provided tremendous airline-, fare-, and service concept-choice only until the major carriers implemented their fundamental route system, aircraft, employment, computerized reservation system, and regional airline affiliation restructuring, reversing the expansion phase into one of buyout, merger, bankruptcy, retrenchment, consolidation, monopoly, and, ultimately, megacarrier. The upstarts, having lacked the majors’ name recognition, financial strength, frequent flier marketing tools, and size, invariably succumbed, leaving most of the original dominant airlines, although in greatly modified form, until even these surrendered to prevailing forces. US airline deregulation had thus come full cycle.

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Gang Members – Big Bill Dwyer – King of the Rum Runners

He started out as a simple docker, went on to boat laying on a large scale and was known as the ‘King of the Rum Runners’. Big Bill Dwyer made so much money that he teamed up with well-known gangsters in several chic New York City nightclubs. Dwyer also owned two professional hockey teams, including the Americans from New York, and owned the Brooklyn Dodgers football team. But in the end, Big Bill Dwyer, when he died, died out of the limelight and broke flat.

William Vincent Dwyer was born in 1883 in the Hells Kitchen area on the west side of New York City. Two gangs, the Hudson Dusters and the Gophers, ruled Hell’s Kitchen at the time, but Dwyer avoided joining both gangs and instead took a job in the port as a stevedore for the International Longshoremen’s Union (ILU).

While working on the docks, Dwyer started his own bookshop. After the Volstead Act passed in 1919, banning the distribution of alcohol, with the money he made from making books, Dwyer branched out into the smuggling business. Dwyer purchased a fleet of steel-lined speedboats, each with a mounted machine gun, in case crooks attempted to hijack a shipment. Dwyer also bought several large rum-running ships, which were required to unload the illegal hootch from whatever boat it provided.

Dwyer traveled to Canada, England and the Caribbean to bond with those who sold him the liquor he needed to smuggle into the United States. Dwyer then set up a system whereby his ships would meet the ships that gave him the drink many miles away at sea. There, the liquor was transferred to Dwyer ships and then quickly transported to Dwyer speedboats, which were closer to the coast of New York City.

The speedboats were unloaded into the docks, which were protected by ILU Local 791, of which Dwyer was a charter member. From the docks, the drink was moved to various warehouses in the New York area. When the time came, trucks of illegal alcohol and protected by convoys of team members transported the drink across the country, carrying heavy loads to Florida, St. Louis, Kansas City, Cincinnati and as far away as New Orleans.

Dwyer was able to smuggle large amounts of liquor into New York because he knew a simple fact: you had to bribe the police and coast guard if you wanted to be successful in the smuggling business. And Dwyer did that by handing over thousands of dollars to anyone who had to be greased.

Paying off the New York City police was easy. The police who had not rolled up their sleeves for vaccinations were among the few. However, Dwyer was particularly adept at recruiting Coast Guard members to look the other way as his speedboats sailed into New York waters.

Dwyer’s first contact was Petty Officer Olsen from the Coast Guard. Through Olsen, Dwyer met with dozens of Coast Guardsmen, “Guardies” whom he called them, who may have been willing to take bribes. Dwyer would take these Guardians to the bright lights of New York City, where he would give them delicious meals, bring them to Broadway shows, and even deliver a fancy hotel room occupied by the lady of their choice, for whom Dwyer would pay to. Once a Guardie took bribes from Dwyer, he was told he could make hundreds and sometimes thousands of dollars more if he brought in other Guardies to help protect Dwyer’s shipments.

Soon Dwyer made so much money from smuggling that he was considered the largest distributor of illicit alcohol in the entire United States of America. However, Dwyer had one major problem that he needed help to solve. Whenever one of his trucks left New York to distribute the drink to other parts of the country, they were vulnerable to being seized by the hundreds of hijackers operating across the country. Dwyer knew he had to avoid this, he had to include partners – members of the Italian mob and the Jewish mob. Since he brought in millions of profits, Dwyer didn’t mind and could certainly afford to share the wealth. The problem was that Dwyer saw himself as a businessman and was not a gangster himself. Dwyer needed someone in the underworld who could make the contacts Dwyer needed to continue operating without fear of being hijacked.

Almost by accident, that person fell straight into Dwyer’s lap. In 1924, two of Dwyer’s shipments were hijacked in New York State. Dwyer leaned on the police on his payroll to find out who was responsible for the hijackings. Soon Dwyer returned that the perpetrator arrested for the hijackings was none other than Owney Madden, himself an Irishman, who grew up in Liverpool, England, before emigrating to New York as a teenager. Madden was a common crook nicknamed “The Killer” and had once ruled the murderous gang of Hell’s Kitchen Gopher.

Dwyer paid the one who had to be paid to drop the charges against Madden, ordering, “Give me Owney Madden. I want to talk to him. I have a business proposal that we should discuss. “

Madden was told who his benefactor had been and that he was expected to meet with Dwyer. The two men met at Dwyer’s office in the Loew’s State Building in Times Square. There is no recording or transcription of this meeting, but T.J. In his masterpiece about Irish mobsters, called Paddy Whacked, Engels said the conversation between Madden and Dwyer would have been something like this:

“You have a problem,” Madden would have said to Dwyer. “Gangsters pick out your trucks like seated ducks and what are you going to do about them?”

“That’s why I called you here.”

“You have to organize the gunners and the pickers, to say nothing of the bulls (police) and wrist (politicians).”

‘You’re right. I need the hijackings to stop. I need a place to make my own brew here in the city. Protected by the tiger and the buyers. And I need electrical outlets – speakeasies, night clubs, you name it. ”

“You need a lot, my friend.

“Are you on my side?”

“Give me a reason why.”

“I can make you rich.”

“Friend, you and I are two peas in a pod.”

And that was the start of the New York City Irish Mob, which would then unite with the Italian and Jewish mob to control the smuggling trade in the United States of America. The grouping of the three ethnic gangs was known as the ‘Combine’.

With millions from Dwyer, Madden oversaw the creation of the Phoenix Cereal Beverage Company, which was located on 26th Street and 10th Avenue, in the heart of Hell’s Kitchen, where both Madden and Dwyer had grown up. This red brick building, which encompassed the entire block, was originally the Clausen & Flanagan brewery, which was established to produce and sell near beer, which no real beer drinker would ever pass. The beer produced in the Phoenix was called Madden’s No. 1.

With Dwyer basically the money man behind the scenes, Madden became the architect who created and cherished their empire. Madden hired Larry Fay, a former taxi company owner, to headline several top-notch establishments needed to sell Madden No. 1, plus all the whiskey, rum, vodka, brandy and champagne smuggled in the Combine. city. One of these places was the El Fay at 107 West 54th Street.

The main attraction on El Fay was Texas Guinan, a bawdy comedian / comedian, who was later copied by May West. To entice Guinan to work at El Fay, Madden and Dwyer made Guinan a partner. Guinan was known for her wise squatters, which she knocked over between the jaws of a frog or the toots of a piercing whistle while she sat on a high stool in the great room. Guinan’s signature saying was “Hello Sucker,” which is how she greeted all well-healed El Fay customers.

When a singer or dancer ended their performance at El Fey, Guinan urged the audience to “Shake the little lady a great hand!”

One day, a prohibition agent, who could not be bought by Madden or Dwyer, raided the El Fey. He marched to Guinan, put his hand on her shoulder and said to his colleague, “Give the little lady a very big handcuff.”

Dwyer did what he was good at, Guinan was released from prison and the El Fey quickly hopped again, making all those involved very rich indeed.

Madden and Dwyer also worked with former bootlegger Sherman Billingsley at the highly fashionable Stork Club on East 53rd Street. The two Irish gangsters spread their wings to northern Manhattan when they bought Club De Luxe from former heavyweight boxing champion Jack Johnson. They added Big Frenchy De Mange as their operating partner and changed the name to the Cotton Club. At the Cotton Club, De Mange instituted a “Whites Only” access policy, despite the fact that the waiters, dancers, and main artists, such as Cab Calloway, Duke Ellington, Louis Armstrong, Lena Horne, Bill “Bojangles” Robinson, and the Nicholas Brothers , were all black.

Still, the Cotton Club was hugely successful with the big spenders from the center putting tons of money in the pockets of Dwyer and Madden.

In 1925, Dwyer was arrested for trying members of the Coast Guard to buy during a sting operation led by Prohibition Bureau. Dwyer was sentenced to two years’ imprisonment, but was released after 13 months for good conduct. With Dwyer in the can, Frank Costello took over Dwyer’s smuggling business.

While in prison, a dispirited Dwyer told one of his cellmates. “I wish I had never seen a case of whiskey before. I spent years in daily fear of my life, always expecting to be arrested, always with scam artists and look-alikes, and now look at me. worse than broken. ‘

As we will see, that was not quite the truth.

When Dwyer took to the streets again, he left the smuggling business and left the rum operation to Costello and Madden. To kill his time, Dwyer started investing in legitimate business, especially sports teams.

In 1926, boxing promoter Tex sentenced Rickard Dwyer to buy the Hamilton Tigers from the National Hockey League. Dwyer did that and he moved his team to Madison Square Garden in New York, calling them the New York Americans. As clever as Dwyer was in running shoes, he was as stupid as running a hockey team. His pockets are bursting with contraband, Dwyer’s strategy for winning was in fact overpaying everyone on his team. With an average hockey player between $ 1500 and $ 2000 per year earned, Dwyer Billy Burch gave a three-year contract of $ 25,000. Shorty Green also got a huge raise when Dwyer rewarded him with a $ 5,000 a year contract.

A long-time crook, Dwyer took an active part in leading his team, going as far as trying to manipulate the games. Dwyer paid goal judges to decide that his team had scored a goal when the puck to the goal line just hit, instead of the goal line completely to pass, what was the rule.

During a match in Madison Square Garden in 1927, the goal judge, who had Dwyer in his pocket, started taunting Ottawa goalkeeper Alex Connell for some unknown reason. Connell responded by inserting his hockey stick into the nose of the goal judge. Dwyer was infuriated by the actions of the Ottawa goalkeeper (you don’t treat one of Dwyer’s employees) and Connell was told to leave town soon after the game. A police detail took Connell to the train station and protected him until the train was safely out of town. After the train left the station, a man asked Connell if he was Ottawa keeper Alex Connell. Scared of his life, Connell said no to the stranger. And as a result, he lived to other hockey games.

Dwyer ignored a league rule that no one can own two hockey teams and bought ex-lightweight boxing champion Benny Leonard as his front man, the NHL’s Pittsburgh Pirates, in 1929. In 1930, Dwyer also put his dingy fingers in the newly formed National Football League by buying the Dayton Triangles for $ 2,500. Dwyer moved the team to Ebbets Field in Brooklyn, calling them the Brooklyn Dodgers.

In three years, Dwyer, again overpaying his players, began to lose so much money that he sold the Brooklyn Dodgers to two former New York Giant Football players: Chris Cagle and John Simms, for $ 25,000. Although he sold the team 10 times more than he had paid, Dwyer estimated that he lost in the three years he owned the team still $ 30,000.

In 1934, when he had enough of American sports teams (he still had the Americans in New York, but she bled money), Dwyer bought the famous Tropical Park Horse Racing Track in Miami, Florida.

However, the roof fell on Dwyer when he was charged with gambling in 1935. Dwyer hit that case, but then the government did what they did to Al Capone: they beat him with tax evasion. Those charges got stuck, and Dwyer was stripped of all his possessions, except for the Americans of New York, and a house in Belle Harbor, Queens. Almost destitute, Dwyer no longer had the money to keep the Americans afloat in New York.

In 1937, the National Hockey League temporarily took control of the Americans in New York. To show the NHL that he was financially solvent, Dwyer borrowed $ 20,000 from Red Dutton. But instead of paying his team’s salaries, Dwyer decided to try multiplying his money in a craps game. That didn’t go so well when Dwyer retired and lost the entire twenty million. Unable to pay for his team and raise capital, the NHL Dwyer finally started up and took ultimate control of the Americans in New York. Dwyer broke and dejected and retired to his home in Belle Harbor.

On December 10, 1943, Big Bill Dwyer, the “King of the Rum Runners” died at the age of 63. Dwyer was reportedly destitute at the time of his death, his only possession was the roof over his head.

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Travel Historic Route 66 through Arizona

Route 66 can trace its history back to the late 1920s when it was first proposed and constructed. However, it was not until 1938 that the road was completely paved from the eastern start in Chicago, Illinois to the western terminus in Santa Monica, CA, some 2,450 miles later. Of course, the route can be taken east or west, although most Route 66 travelers prefer to go from east to west, just as the Joad family did in John Steinbeck’s famous literary work, The Grapes of Wrath.

Unfortunately, Route 66 was replaced in the 1960s by new interstate highways that bypassed many small towns along the way and was completely removed from the freeway system in 1985. But in part for many Route 66 organizations, small town chambers of commerce, enthusiasts and historians, many refused to let it die. In the past 25 years, there has been a new revival of heritage tourism that has sparked interest in preserving this great piece of Americana history and nostalgia that is Route 66.

Often referred to as “The Mother Road,” “America’s Main Street,” or “Will Rogers Highway,” the route passes through eight different states: Illinois, Missouri, Kansas, Oklahoma, Texas, New Mexico, Arizona, and California. Let’s take a closer look at the state of Arizona.

Arizona

To the west, Arizona is the 7th of the 8 Route 66 states and has 401 miles from border to border. It has some of the most beautiful scenery, some of the most unique must-see establishments, the highest point and the longest continuous stretch of Route 66 throughout the journey.

Geographically, Arizona is home to Meteor Crater, Petrified Forest, and Painted Desert. These locations provide some incredible photo opportunities, as well as an opportunity to explore and hike these natural attractions.

About 75 miles to Arizona, beyond both the Petrified Forest and the Painted Desert, lies the town of Holbrook. Home to the Wigwam Village Motel, most Route 66 travelers look forward to sleeping in a teepee and many cite this landmark as a highlight of their trip. Further west is Joseph City, a Mormon establishment founded in the late 1870s. Located in Joseph City is the famous Jackrabbit Trading Post. One of Route 66’s most famous signature sites is the famous billboard that declares “HERE IT IS” at the Jackrabbit Trading Post.

Further west past the Meteor Crater and the towns “standin ‘on the corner” Winslow, the extinct Two Guns, the abandoned Twin Arrows and the “don’t forget” Winona lies the town of Flagstaff. Flagstaff is home to the famous Lowell Observatory and is also the gateway to the Grand Canyon, an hour’s drive north. The canyon is definitely worth a trip along Route 66 to see one of the eight natural wonders of the world. If you prefer, you can also access the spectacular Grand Canyon via the Grand Canyon Railway from Williams, just 19 miles west of Flagstaff. Brannigan Peak is located between Flagstaff and Williams. At 7,320 feet above sea level, this is the highest point along the entire Rt route. 66.

24 kilometers west of Williams is Ash Fork, the flagstone capital of the world. Just past Ash Fork, you can say goodbye to I-40 as you begin the longest continuous stretch of Route 66 on the entire journey. Make sure to stop at the legendary Snow Cap Drive-in in Seligman and the fascinating Hackberry shop before arriving in Kingman. Here you will find many still preserved business establishments for the Route 66 traveler, including a very well done museum.

Make sure to leave Kingman while you still have daylight as you won’t miss the incredible scenery ahead as you drive through the Black Mountain twists and hairpins. Oatman is waiting, just like the many wild burros that call the old mining town home. Make sure to visit the historic Oatman hotel where Clark Gable and Carole Lombard spent their honeymoon.

Leaving Oatman, you can take a short trip to the Laughlin Nevada casinos and try your luck, or you can continue through Golden Shores, Topock and back on I-40 to cross the mighty Colorado River to California.

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Royal Gorge Railroad War

In the 1870s there was a small section of a narrow railway line meandering through the cavernous walls of Arkansas Canyon in the heart of Colorado. Control of this railway would be an important melodrama in the mining history of the state and would later be referred to as the ‘Royal Gorge War’. The incident occurred in Arkansas Canyon in the years 1878-1880.

Bat Masterson and Ben Thompson, two famous gunmen of the day, sided with one of the warring railroad companies – the Atchison, Topeka and Santa Fe (AT&SF). The railroad company attempted to claim the tracks their rival, the Denver and Rio Grande (D&RG) built in 1872 as a lucrative connection between Denver and Pueblo.

The stage took place in 1872 when the Denver and Rio Grande (D&RG) railroad company constructed a narrow-gauge railway from Denver to Pueblo, Colorado. They then opened a line from Pueblo to Canon Coal Mines, which was 37 miles west of Pueblo. They then built south of Pueblo and walked a line through the mountains of southern Colorado to the San Luis Valley until they reached El Moro in 1876. They extended the railroad to Fort Garland in 1877 and finally to Alamosa in June 1878.

At about the same time, the railroad company Atchison, Topeka & Santa Fe (AT&SF) built west of Kansas City. The AT&SF reached the Colorado line in 1872, but only reached Pueblo by delay in 1876. In the same year, Leadville grew as a center for the silver mines and a lot of money had to be made by entering and leaving goods. from the city.

The AT&SF realized this potential and decided to run a railroad from Pueblo to Leadville. This required the line to run through the Royal Gorge of the Arkansas River, which was fifty miles west of Pueblo. Due to the narrow passage, only one railway line could be constructed. This was the core of the conflict; the D&RG wanted the same.

By 1878, both railroad companies had rushed men and equipment to the area in hopes of securing the passage through the gap, while corporate attorneys fought for court rulings in their favor. By April of that year, the AT&SF had more than 300 men stationed in the canyon to secure their construction sites for lines. The D&RG matched that number, but struggled to keep the men hired because their rival paid higher wages.

The AT&SF lawyers have asked a local court to issue a temporary injunction against the D&RG, halting further work in the gap. But before the AT&SF took advantage of this opportunity, the D&RG received their court order blocking the Kansas company from continuing to work on their line. With both companies shut down, men were placed in critical areas of the gap to ensure they had control over the line and equipment.

The D&RG built several stone fortresses under the leadership of their chief engineer, a man named James R. DeRemer who had served in the Civil War and knew how to build the rockwork needed to fight. Built in Texas Creek and Spikebuck, this dry-laid masonry “DeRemer Forts” had gun ports and impressive views of the track below.

Fortunately, the rock fortresses have never been used to ambush each other. In November 1878, the D&RG ran out of money and had to make a pact with their arch rival. On December 1 of that year, they issued the AT&SF with a 30-year lease, which allowed them to use all railways and equipment, including rolling stock.

Once AT&SF took control of all tracks and trains, they quickly began doing more business for Kansas City and less for Denver. The D&RG realized their mistake and started legal action to break the lease. Finally, in early 1879, the case was brought before the Supreme Court in Washington. Pending a violet reply, regardless of court decision, every company sent in armed men to defend their rights and property. The AT&SF hired Bat Masterson and a group of 33 men he recruited into Dodge City to set up a camp in the canyon to defend their construction workers and company premises. They arrived on a special train and after setting up camp called “Dodge City” Bat returned to Kansas.

On April 21, the Supreme Court ruled that the D&RG had previous rights to the Canyon but did not have exclusive rights. The decision, watered down as it was, did not please either side. In the second half of May, the Attorney General of Colorado filed a lawsuit with the State Court to stop the AT&SF from operating railways in the state. On June 10, state judge Thomas M. Bowen issued a subpoena that prevented the AT&SF from using or operating any of the D&RG’s buildings, equipment, or rolling stock – essentially destroying their lease. With the handwriting of Judge Bowen, the D&RG officers went to the sheriffs of each county traversed by the railroads to take possession of all their properties.

Before the warrant could be delivered to the county sheriffs, AT&SF ordered Bat Masterson to return to Colorado and concentrate their forces at Pueblo. He quickly recruited 50 armed men and brought them into a special train. This group included Ben Thompson and a dozen of his fellow Texans.

Initially, when Ben was approached with the offer, Ben was reluctant to sign up, fearing he would be charged with murder when violence broke out. He eventually agreed to keep the stone round house in Pueblo until the police handed him legal documents to take possession of him. According to Walton’s book (Life and Adventures of Ben ThompsonThompson agreed to do the work for $ 5,000 and was approached by the D&RG to hand in the roundhouse for $ 25,000. Ben declined the offer and said, “I will die here unless the law relieves me.”

On June 11, the Denver Sheriff and his group of D&RG men seized the AT & SF office and roundhouse in Denver. Then a train load of D&RG agents drove south to take possession of the property en route. At the same time, ex-Governor of Colorado, A.C. Hunt, raised a troop of 200 men, took a train and drove north, confiscated all the small stations and captured the officers as prisoners. In Cucharas, Hunt’s troops shot it down with twelve AT & SF men – killing a Mexican and injuring an Irishman named Dan Sullivan.

In Pueblo, Sheriff Henley R. Price supported two officers of the D&RG, J.A. McMurtie and R.F. Weitbrec, sent copies of Judge Bowen’s warrant to all AT & SF workers at dawn. After writing the papers, Sheriff Price and his posse marched to the train operator’s office at 8:30 AM. The coordinator refused to let him take possession of the building, and the sheriff told him he had thirty minutes to think it over.

At 9 a.m. Price came back and found the office filled with several dozen armed AT&SF men who refused to budge. Rejected, the sheriff retreated to the Grand Central Hotel and recruited another 100 deputies – all heavily armed and filled with plenty of free liquor.

At noon, they returned to the depot and demanded Sheriff Price and his army of deputies that the people in the depot surrender. They refused, and the troop moved on to the round house where Ben Thompson and Texans were waiting. Confronted with the sheriff, Ben said that he had been put in charge of the company’s property and that he could not give it up without authorization. The sheriff then declared that he had come to disperse an armed crowd.

Ben replied that there was no armed gang in the roundhouse, only construction crew men sent to guard the company’s premises. Since he said some men had guns, Ben invited the sheriff to come in and look at the men to see if any of them were guilty of breaking the law. Price was only allowed to enter the house and left after a short search without arrests.

Faced with a dead end powder keg, Sheriff Price withdrew his men and sought the advice of local lawyers. After reviewing the judge’s verdict, he was informed that he was not authorized to use force to take over the ownership of AT&SF. He chewed this until about 3:00 a.m. and then decided it was time to take action, regardless of the legality of the warrant. He and fifty of his alcohol-lubricated delegates met in front of the Victoria Hotel, where they were provided with rifles equipped with bayonets and heavy ammunition, courtesy of the D&RG. They marched to the depot and formed a skirmish line for the building.

Around that time, a farmer called W.F. Chumside stumbled out of the counter. He is said to have been “somewhat under the influence of drink” and wanted to plead the case for those in the depot. He was quickly knocked down by one of the delegates and kicked his head.

The posse then went to the telegraph office and the shooting started as they stormed through the door. Most of the men in the office quickly escaped through the back doors and got to safety. Unfortunately, Harry Jenkings fell while running and was shot in the chest with the bullet in his spine. The group threw the injured man into a fast car and sent him for medical attention. He died a short time later.

After storming the telegraph office, the posse ran to the roundhouse, the last stronghold of the AT & SF defenders. Thompson met them outside the round house and yelled, “Come on you bastards, if you want to fight, you can get one.” Before meeting his challenge, he was overwhelmed by a dozen deputies and thrown in prison. Without their leader, those inside wanted to have the conversation. Shortly after, they surrendered the building without firing a shot. They were all disarmed and walked down the street to join Thompson in the crowded little prison on West Fifth Street.

Late that evening, ex-Governor Hunt and his party arrived by train from the south, then continued on the Arkansas River to Canon City. By midnight, the entire railroad had been taken. Sometime that night, Bat Masterson, Ben Thompson and the others hired by the AT&SF were released from prison and put on a special train to Dodge City. When he arrived the next morning, Ben collected his money from the AT&SF and went to Texas via Kansas City and St. Louis.

The Royal Gorge affair did not end on June 11, but continued in the courts for several more months. Finally, the “robber baron” Jay Gould bought fifty percent of the shares in the D & RG and settled the lawsuit out of court. On March 27, 1880, both railways agreed to sign the “Boston Treaty”, which returned the railway and ownership to the D&RG. The AT&SF was paid $ 1.8 million for the railroad he built through the pass, and the Royal Gorge War was finally over.