Squashing the little guy?
DENTON, Mont. -- The billionaire investor Warren E. Buffett, in buying control of the nation's second-biggest railroad in November, the Burlington Northern Santa Fe, says he believes in America's future and the role that railroads would play in b...
DENTON, Mont. -- The billionaire investor Warren E. Buffett, in buying control of the nation's second-biggest railroad in November, the Burlington Northern Santa Fe, says he believes in America's future and the role that railroads would play in building that future.
On a much smaller scale, the eight employees of the Central Montana Railroad say the same thing. In their case, the belief is drilled down to the future of Denton, Mont., population 300, from which the Central's tiny, 84-mile empire extends.
The question facing this part of Montana, as tough economic times have stressed farming and railroading alike, is which future -- the macro or the micro -- to believe in and fight for.
"If this railroad goes down, Denton will dry up and blow away," Dennis Ayers, 38, says as he eases engine No. 1809 -- an Eisenhower-era relic -- into the shop building on a recent afternoon.
Burlington Northern officials say they understand, too, the stress that agricultural communities are under. But farmers have to survive first if towns such as Denton are to have any hope at all -- and cheaper rail shipping costs are the means to that end, they say.
In November, Burlington Northern shut off payments to the Central that had been locked in for years by contract -- by coincidence, company officials say, around the time Buffett took over -- prompting a lawsuit by the state of Montana on Central's behalf.
The big railroad also has been offering discounts if farmers bypass the Central and truck their wheat directly to the main Burlington Northern line about 40 miles from Denton. A text-message system recently was established to alert growers to the best prices.
The number of railcars and bushels of wheat loaded by the Central in Denton in 2009 is expected to be the second lowest in 22 years, according to preliminary figures from the railroad.
"They're competing with the rest of the world," says Kevin Kaufman, Burlington Northern's group vice president for agricultural products, referring to Montana's wheat farmers. "It's our job as a transportation provider to provide a cost-effective, efficient system so that they can do that."
So is the Burlington Northern a bully or a savior? And is the Central Montana a railroad of small-town nostalgia or a linchpin of community survival?
Like so many other stories at the frontier of economic life -- from the local battles over Wal-Mart to the debate over how big banks did or did not bring on the housing crisis -- the answers are less black and white or David and Goliath than either side suggests.