The "signalization" requirements were imposed by the ICC, and could be met either by cab signals, ATS or ATC. These requirements had virtually nothing to do with the decline of long distance passenger trains. CNW, for example, installed ATS in the 1950's to permit continued high speed operation of its Twin Cities 400, only to discontinue the train completely in 1963 due to loss of business.

The primary causes for the decline of long distance passenger trains were loss of business passengers (who paid high fares) to airlines and the loss of other passengers to automobiles, plus an increase in operating costs after WWII which could not be made up with fare increases. A reduction in top speed to 79 mph wouldn't have affected this. Think about it a second from the standpoint of a business traveler - the bread and butter of the rail passenger business. Is a reduction in travel time by train of a few hours going to make him take a train rather than an airplane that can get him where he's going in hours rather than days? Also, train speeds would have been reduced anyways as high center of gravity freight cars were introduced, since this development required banking on curves to be reduced.