After reading the Rush Loving book and the Binzen/Daughen book, it seems to me that Perlman (NYC) could turn a profit with a railroad, but still had quite the roadblock to serious profitability in regulation - which existed for 14 years post-1968. His success at WP may be partially attributable to the early-1900's construction of WP and the lack of excessive track and branches present at NYC. That said, he was probably the best shot at keeping PC rail operations on track and at minimal losses. However, Stu Saunders, an attorney that didn't know a train from a wheelbarrow, and Dave Bevan, a psychopath CFO, (both PRR), refused to face the facts and instead covered up the problems and forced Perlman out. PC was still paying dividends when it was making money on paper but physically drained of money in reality.
So conclusions from my oversimplification of the PC debacle?
1. Perlman should not have been forced out but was only able to do so much. Could he have saved PC single-handedly, especially without Conrail's labor concessions and deregulation? That's a tough call.
2. PRR's culture that made them a machine is their downfall - it was a fantastic machine when it worked, but the fact that nobody questioned their superiours led to unchecked aggresion at the top (Bevan) that could not stand.
3. Saunders was likely more of a dunderhead than crook. He was paralyzed by fear of unions and Bevan and his allies (Mr. Mellon of the PC board and the famous bank)
Would a BNSF-CN or BNSF-KCS merger represent the same situation? No. There would be tough consolidation choices, but first both roads are profitable. Second, we have mistakes of PC to learn from, as well as the success of UP-MP-WP, CSX, NS, and BN/BNSF to learn from. In fact, Mr. Watkins at CSX wrote the book on a succesful merger, gently consolidating Seabord and Chessie (although their later affairs under Secretary Snow are another story...) over a five year period rather than crash jamming them together like PC did.
As for the final question, will there be just two titans of the rails in USA and Canada? Maybe for a short while, but I believe there's a optimal Class I Railroad size, and the "two titans" theory is just too big. How can a company with the expenditure needs of the transcon or waterlevel route justify a marginal branch or even secondary mainline suitable for GP40's and moderate traffic? They can't. Should we see the "two titans" emerge, there will be a boatload of new regionals, a reinvention of the WC or 1990's NYSW concept if you will.
The new Acela: It's not Aveliable.