"Nonetheless, with his wife’s health ailing, Vauclain decided to resign as President of the Baldwin Locomotive Works at the age of 73.
He was appointed the Chairman of the Board and served in that position until his death in 1940."

I don't see evidence that Samuel Vauclain was a figurehead.

Steve


First, let me make the caveat that I said "I assumed" he had become a figurehead.

However, don't get hung up on these titles. Actual formal (and informal, which is often as much or even more important than formal) authority varies from organization to organization.

The Chairman is much like the Conductor, with general charge over the train, and the President is like the engineer, with a good deal more control over specifics. This is why today, many corporate "reform" efforts are directed at having different occupants in those positions. Of course like most academically inspired panaceas, the truth is that there are benefits and detriments to the separation. Splitting power avoids autocratic management, to some extent, and conforms to the idea of "segregation of duties" but at the expense of "unity of command".

While we can infer that the next page after the glowing obituary about-face policy statement (reversal) meant that Vauclain was holding up dieselization, to determine whether or not he was actually taking affirmative action to impede the entrance into the diesel market, you wou would have to be able to talk to people like Johnson and Kelly and other senior executives-and they too are long since passed. It may have just been that while he was present, everybody assumed or knew his prejudices and did nothing to rile "Mr. Sam" or they were just couldn't imagine a world without steam. Reading Johson's book "the Steam Locomotive" makes me think Baldwin had a "monoculture" of collective corporate myopeia.

I suspect that the commitment to steam was far more attributable to the corporate culture of Baldwin, (custom production to buyer specification) than to the efforts of any one individual, including Vauclain. Long after Vauclain died in 1940, Baldwin was expending effort and diminishing capital on turbines and duplexes and other ultimately unsuccessful steam efforts.

Remember for decades, Baldwin followed Matthias Baldwin's response to Alexander Mitchell's specification for the first 2-8-0 in 1866. That's a whole lot of ingrained corporate culture and difficult to change.

Afterall, they spent all the time and effort involved in a new design with the CNJ "double-enders" and there's no evidence that there was a market for them anywhere among any other railroads. Ironically, in this case responding to the customer wasn't helping them, it just assurred that they would be a boutique supplier during a transitional phase until they were so unable to compete they were forced to withdraw completely.

Its sort of an interesting contrast, that of a company (Baldwin) that was willing to experiment with new products with the customer's money and then having a string of unsuccessful runs and that of early standardised diesels that often had repairs made on the road along with EMD factory representatives on board. Glitches of a comparatively minor nature versus complete design failures.

I wonder if Baldwin's willingness to push experimentation at the customer's expense of failure did a great deal of damage to their later "unusual" products in that once bitten, twice shy might describe their customer's attitudes toward further Baldwin offerings. It almost seems a case of over confidence as well as myopia. An interesting discussion.

Based on the other comments, this example of corporate culture may have, as one said, "snatched defeat from the jaws of victory" An even more interesting case to my mind, is the case of Lma, of which I know little of. They seem to me, very distinct from the case of Baldwin, where their innovations with steam worked, and to my mind, they seemed to have produced a superior product, which, of course is a debate I suppose, in of itself.

It always struck me as ironic, that once merged, as BLH, they completely lost their way into oblivion. Was this due to Baldwin's stacking of the "corporate culture" deck? The blind leading the blind? It seems also at the same time, they were trying to transition into diversification with heavy equipment as well as selling diesel products as non rail power plants just to keep their heads above water...My assumption is that their heavy equipment product line was standardised, which seems to be a case of going in three directions at once. Myopia cubed?
The repeated derailment of PRR Centipedes in pusher service was answered by Baldwin's representative saying it's not our fault that the customer uses our products in a manner for which they were never designed to operated by the specifications given us by the customer. A case of ingrained denial of a repeatedly failed business model? I would think the PRR was not pleased with this response. While Baldwin was correct in their own minds, they seemed to miss the larger issue. Flexibility.

The power structure of the modern corporation has been studied with some differing conclusions but I believe a general rule of thumb was agreed to at least back in the WW II era:


That a pervasive pro-steam culture had developed at Baldwin was acknowledged by Churella. Later I shall quote the evidence of this culture. And also the evidence of Baldwin's systemic diesel failures with their customers.

Steve

The power structure of the modern corporation has been studied with some differing conclusions but I believe a general rule of thumb was agreed to at least back in the WW II era:


There is no "Power structure of a modern corporation", every one is different.

By the way, if you want to understand economics, skip-no dispose of -every Galbraith book in your possession. If you want to understand why, read "The New Industrial State" and how it insisted that increasingly product complexity meant ever longer product design cycles-posited by JKG as something of an iron law, in a pre-textual haste to assert the need for a central (government) planner. Of course, he never answered the question of why, if design cycles lengthen, bureaucrats with guaranteed jobs will have superior knowledge of the future relative to people in business, whose future depends on minimizing prediction error.

His theories never anticipated developments like CAD/CAM or CNC. Today a car is taken from screen to showroom faster than it was when they started in drafting rooms.

Galbraith didn't do technical economics, or write in peer-reviewed journals. He realized there was more money in specious fiction that provided politicians with pseudo-intellectual cover for the their schemes to acquire power.

Fortunately, there are antidotes to JKG exposure. Popper, Hayek, Taleb.

You shall have to produce quotes of where Galbraith ever stated that "bureaucrats with guaranteed jobs will have superior knowledge of the future . . ."


Quite a bag of snakes you're opening up here. Do you really wish to divert the discussion this far?

You are shooting the messenger and completely avoiding the message. I work for Target - a fortune 30 corporation. I along with the great majority of my co-workers own Target stock through 401K. None of us could name one single member of the board of directors. None of us could name one single policy change that the board has/is implementing. I can't find the minutes of the last meeting - or any meeting. Don't know when the next board meeting is. When the next proxy election is. Who will be nominated to be on the proxy election ballot - nominated by that very same board. My pdf reader isn't working and can't open any of the documents. The rest of my fellow Target stock owners couldn't care less - and I am speaking from direct experience. I've asked them.

And by the way - what has been the development time for the Boeing 787 compared to the DC-3?

The Whitcomb 65-ton centercab compared to the GM SD-90?

The diesel powered fleet submarine compared to the nuclear submarine of today?

The P-51 Mustang compared to the F-22 Raptor?

And ponder this Galbraith quote:



And what was Galbraiths' error - since you seem to be acquainted with Galbraiths' works?

The recent trend of "technical economics" to indulge itself into endless mathematical models of ever increasing complexity has been noted - along with its failures:

http://en.wikipedia.org/wiki/Black%E2%80%93Scholes


And its "unexpected risk" has been nothing short of spectacular:

http://www.youtube.com/watch?v=tsZRndV5lIc

I might add this-



Mr. Galbraith was voted by his peers to be president of the American Economic Society - quite an acomplishment for someone who "realized there was more money in specious fiction".

Hayek, Friedman, Sowell, Reisman, etc. - and the other idols of conservative inductive reasoning had their failings only most of them refused to admit to them. It took Friedman almost his entire career to admit his beloved monetarism didn't explain the real world.

I still find no evidence that what happened to Baldwin contradicts the model that Galbraith merely reiterated. Mr. Vauclain was chairman of the board. The stock holders (with the exception of the Dodge brothers - large stock holders which Galbraith alluded to) - the source of infinite wisdom to the conservative - didn't understand, didn't know, didn't have a clue as to the dynamics of what was happening inside Baldwin nor the diesel to steam problems inside Baldwin. Thus, the Baldwin failure was one of Baldwin management - which had 99% of the power. The free market at work.

Baldwin management - who made the decision to purchase and become the second largest stock holder of Whitcomb from December 1928 until January 1931 - didn't even know what the finances of Whitcomb were until they finally paid for and conducted their own audit and discovered that the Whitcomb vice president/treasurer had "loaned himself" about $75,000 from the company. And this audit most likely would have been further postponed indefinitely except that Baldwin management was attempting to purchase the rest of the company stock when the Great Depression came on the scene and sent Whitcomb into cash flow trouble. Even this gross ignorance of Whitcomb finances didn't stop Baldwin management from loaning Whitcomb $125,000 in December 1930 - a full month before the audit.

How many Baldwin stock owners even knew any of this ever happened?

Ultimately the Whitcomb take-over would cost Baldwin stock owners over $1.2 million in losses by the time Baldwin went into bankruptcy in 1935.

How many Baldwin stock owners knew that?

That information only came out in a law suit between Baldwin management and Whitcomb.

How many Baldwin stock owners even knew that Baldwin management was being sued by Whitcomb?

How many Baldwin stock owners knew what financial details had been hidden from stock owner review by Baldwin management were available only by accessing circuit court records in Cook county, Illinois?

How many Baldwin stock owners could even afford to travel to Chicago and request the court documents - assuming they even knew about any of this?

Do you think for one second that Baldwin management would broadcast to all Baldwin stock owners the fact that they were being sued by their own investment and that same investment had lost over $1.2 million?

How many small stock owners can afford an audit of the company they own stock in? Ever hear of Enron? And Enron is far from being just "one bad apple".

Let me introduce you to the LIBOR scandal and what bank management did to nearly collapse the global economy to the detriment of stock holders around the globe:

http://en.wikipedia.org/wiki/Libor_scandal

Steve

OK, I've tried to be nice, but you can't seem to stay focused here. The topic is Baldwin and its failure to effectively pursue what turned out to be the superior technology. I get it, you aren't where you want to be, so you have a lot of fury and indignation to share-but this isn't the place to resolve your angst. Although I forgotten more about bank finance (former bank auditor) than you think you know, nobody here cares and I'm not going to inflict my opinions on them here.

"You shall have to produce quotes of where Galbraith ever stated that "bureaucrats with guaranteed jobs will have superior knowledge of the future . . ."

He never said it explicitly, that I'm aware of. It is a reasonable inference that when you are proposing that group A should be planning rather than group B, that group A would among other things, be better at predicting future events.

"Quite a bag of snakes you're opening up here. Do you really wish to divert the discussion this far?"

It's not that far, ask the good folks at Strasburg how they've conquered custom- design problems with modern CAD/CAM and CNC. Last year, I took their shop tour and they had a pallet full of (was it safety valves or injectors) that was produced using these modern tools. Far closer to the field than discussions of TGT.

"None of us could name one single member of the board of directors. None of us could name one single policy change that the board has/is implementing. I can't find the minutes of the last meeting - or any meeting. Don't know when the next board meeting is. When the next proxy election is. Who will be nominated to be on the proxy election ballot - nominated by that very same board. My pdf reader isn't working and can't open any of the documents. The rest of my fellow Target stock owners couldn't care less - and I am speaking from direct experience. I've asked them."

Quite a bag of snakes you're opening up here. Do you really wish to divert the discussion this far?" So I guess my question is, do you consider yourself uninformed or what economists call "rationally ignorant"? If you want to know that stuff, all of the major financial sites have all the latest SEC filings, so you must have a revealed preference that the cost of obtaining the information doesn't affect your life. Of course, Target stockholder indifference really explains nothing about Baldwin.

Here you go:

http://www.sec.gov/cgi-bin/browse-edgar ... efilings=0


In any case, if you really want to discuss the predominate attitude at Baldwin, and want to read a real, credentialed economist doing technical work rather than thinly veiled polemics, try this paper from Truman Bewley @ Yale, who explains instutional biases under Knightian uncertainty.

http://cowles.econ.yale.edu/P/cd/d09a/d0905.pdf

Stop right there.

I'm not going to tolerate attacks upon my person. You don't know me from Adam. Never have - never will.

If you aren't capable of discussing Baldwin managerial policies without resorting to attacking my imagined personal motives, please find some other thread to haunt.

I'm not putting up with it here.

Steve

The less intangible reasons seem to be well covered beyond philosophic issues or historic corporate psychology which are and always have been endlessly debatable from a retrospective and post editorial slant.
P.D Ouspensky said it better. "I don't know. I wasn't there."

While their willingness to experiment seems to be a case of their reach exceeding their grasp while going in the opposite direction against the tide of standardisation. Another example is MU capability \ incapability on some models. Again the same response was no one who complained had specifically asked for it.
Do you want tires with that car?
If they had asked, we could have done that. Myopia and innovation were at odds. You just have to look at the evidence by what they produced and the fact that Baldwin's statue in front of the former headquarters ended up being saved by preservationists rather it's possibly inevitable fate to than be melted down much like his company's short lived experiments. If they had been successful no such overly complicated speculation would be required. Look at what they did and did not do. Pretty simple and no reading between the lines is necessary.

"I'm not going to tolerate attacks upon my person. You don't know me from Adam. Never have - never will."

Good for you. Now afford others the same courtesy, and don't worry, I expect not to seek you out.

Do you think your post "let me introduce you to.." bears the tender niceties you seem to expect?

I didn't attack YOU because I pointed out that your post contained a considerable amount of extraneous (Black Scholes??? LIBOR??? what the he-double hockey stick does that stuff have to do with Baldwin?) and irrelevant material.

When you post something publicly, people might take issue with it. This isn't the part of life where your sensibilities are going to be free from red pencil marks. You might even make the mistake of picking argument about a topic with somebody that actually received a degree in that field. Here, if you throw the ball at the other side, it will get thrown back.

As for "attacks", I'm not going to tolerate attacks on Uncle Miltie, especially since he isn't here to defend himself and he never posited the quantity theory of money in the way you asserted. As an aside, if it wasn't for him, you might now be wearing camies, rather than a red smock, and worrying more about AK's than 401ks.

Where would you like your mirror mailed to?

Or did you forget this little "courtesy":





You basically stated I didn't understand economics. You used my quote from Galbraith as "proof" of my presumed ignorance - and ignored that Galbraith was quoting previous studies done by both conservative and liberal economists.






It would appear that you need to take a dose of your own advice.

You started the assumptions about people being ignorant, not me.

Don't like it? Don't start it.

Steve

"You basically stated I didn't understand economics. You used my quote from Galbraith as "proof" of my presumed ignorance - and ignored that Galbraith was quoting previous studies done by both conservative and liberal economists."

No I didn't "basically stated" anything. You interpreted it as such. People, people who work in the field and related fields spend lifetimes trying to understand the dismal science.

In any case, it's pretty clear you want to discuss things that are thoroughly unrelated to Baldwin. I've tried to steer the conversation back to Baldwin & Diesels, but you want to assert that Baldwin has something to do with competing political and economic ideologies.

I'm done now. The floor is yours.

You have a strange way of stating nothing -



This is you stating nothing?

Not too many ways to interpret "if you want to understand economics" - least of all that you stated "nothing".

I'd be more than happy to discuss Baldwin, and the bigger picture of what Baldwin represents.

If you want to go off on a tirade about Galbraith or any other economist you happen to disagree with, and imply that anyone that quotes Galbraith or any other economist that you happen to disagree with is in need of learning economics - preferably your interpretation of economics - and . . .



. . . I'd say you were trying to pick a fight.

I'm not here to fight. I'm here to learn. That for me is the purpose of history. Learn it and interpret its lessons so that we can move forward and try to avoid the mistakes of history.

No one else took issue with the Galbraith quote nor the evidence that the Baldwin corporation fit the Galbraith quote.

Even Churella - who's book you refer to, Steam to Diesel - quotes Galbraith - and in much more respectful terms than you used:



Steve

Getting back to the evidence that Baldwin management missed opportunities some of the critical evidence is found here:

http://books.google.com/books?id=wHGfrl ... la&f=false

on pages 67-68 but pages 69-72 are missing:









The numerous technical problems with their diesel units doesn't appear in the Balwin Locomotive magazine that I have. Kind of natural that a corporation won't share the truth about its product performance when it is trying to sell that product.


Steve

Reading John Kirkland's book about Baldwin diesel locomotives, one gets the distinct impression that he greatly rationalizes BLW's many diesel locomotive deficiencies and failures. Fore example, the PRR "Centipedes" were assigned to the wrong service by the railroad, and were not properly maintained, according to him. There's plenty more in that vein.

Kirkland did the best he could to help develop a decent BLW diesel locomotive, and certainly made sure that many of the orphans (once BLW exited the locomotive business) had a long and productive life. But his biases show through in his book.

I think Churella is the most dispassionate historian of this shift from steam to diesel, and of the decline of Baldwin. He had no prior history with any of the players here.

Howard P.

Possibly the biggest development of the 1960s. Brosnan and Southern really "went to the mattresses" to promote pricing and innovative marketing, including "Big John."