Rails Across the Water – Fall 1973

The Great Lakes… 84% of the continent’s fresh water… a different story in every drop.

By Carl E. Krog

The transportation system which developed along the west shore of the Green Bay region during the three decades after 1860 was designed to serve sawmill towns, not manufacturing cities or regional retailing centers. Forest and water complemented one another in a seemingly natural combination. Logs were floated down the Menominee River, the boundary between Wisconsin and Michigan, to sawmills in Marinette, Wisconsin, and Menominee, Michigan, two towns at the mouth of the river. Here the logs, after being converted to lumber, resumed their journey via water to Chicago.

Logging on the Menominee River. Image from the Library of Congress.

After 1890, what formerly was an asset became a debit. Almost all of the merchantable timber near natural waterways was cut, and lumbermen were forced to build logging railways to reach the remaining stands of timber, or ship logs by rail great distances. Land, valued only for its magnificent stands of white pine, became valueless when once cut over. In time it became tax delinquent and reverted back to the county government. Similarly, Lake Michigan, a superb highway for inexpensively transporting lumber to the Chicago market, now began to assume the aspect of a barrier with the development of an integrated national railroad system.

Marinette lumbermen faced difficulties on both ends of their lumbering operations after 1890. New railroads were needed both to reach timber stands and to provide alternative routes for reaching markets. Unlike some of their competitors, Marinette lumbermen could not ship directly by rail from mill to customer because of the high rates charged by both the Northwestern and the Milwaukee Road. What was needed was an alternative rail route for reaching markets.

A railroad company with a capitalization of $1,500,000 was organized in the fall of 1893. The new railroad, called the Wisconsin and Michigan, had the financial backing of Isaac Stephenson, Marinette’s wealthiest and most prominent lumberman. The nucleus of the new line was the roadbed of a 27-mile narrow gauge lumbering railroad which hauled logs from the Michigan woods to the Menominee River. This railway was extended north to Faithorn Junction, where it joined the east-west line of the “Soo” Railroad. Bridging the Menominee, the railroad extended its line south to the village of Peshtigo, which was to be the headquarters of the new line with a roundhouse, car shop, and offices. From Peshtigo the railroad ran seven miles southeast to the Peshtigo harbor on the railroad roadbed which the Peshtigo Company had built in 1868. By using the Milwaukee Road’s branch line the Wisconsin and Michigan gained access to Marinette and Menominee.1

Wisconsin and Michigan railway bridge cross the Menominee River. Image from the Library of Congress.

Ineptitude marked the Wisconsin and Michigan Railroad’s first year of existence. The railroad’s bridge across the Menominee River was washed out the first spring and in the fall of 1894 a steam locomotive and switch engine collided.

Despite the Depression of 1893 and the closing of the Peshtigo Company, hopes were high in the neighboring village of Peshtigo in 1894. The new railroad held great promise for the future. It already provided a source of employment for the village, which faced the bleak future in the 1890s of being a sawmill town without a sawmill. The railroad appeared to have greater potential for Marinette and Menominee because the two cities now had a rail connection by way of the “Soo” line with the Twin Cities in Minnesota.

Though the tracks of the new railroad ended at the Peshtigo harbor the southern terminus of the Wisconsin and Michigan was Chicago. Since it was no longer practical to ship lumber in the leaky barges of the Marinette Barge Company, Stephenson decided to keep the same system, but modernize the operations. The plan was to send railroad cars filled with iron ore and finished lumber on barges. The Lake Michigan Car Ferry Transportation Company was organized as a subsidiary of the Wisconsin and Michigan for this purpose.

The new company ordered four large wooden barges, 316 feet long, 44 feet wide, and 20 feet deep, capable of carrying 24 freight cars on four tracks on an open deck. The railroad cars were protected from the weather by gunwales and canvas described by the Railroad Gazette, not altogether reassuringly: “The gunwales are high enough to protect the cars except in very high seas.”2 In the same year, 1895, the Marinette Barge Line Company sold its tug, J. C. Perrett, to the Lake Michigan Car Ferry Transportation Company.

The amphibious Wisconsin and Michigan Railroad also expanded its operations on land. By September 1896, it owned seventy miles of track, eight engines, over five hundred cars and employed one hundred men. Despite vigorous rate cutting by the Wisconsin and Michigan and Lake Michigan Car Ferry Transportation Company during the summer of 1896, the new company did not prosper. Lumber rates between Menominee and Chicago were cut to five cents per hundredweight in August. The company later offered a through freight rate from Chicago to Minneapolis-St. Paul (via the Lake Michigan Car Ferry Transportation Company, the Wisconsin and Michigan Railroad and the “Soo” Railroad) of thirty-five cents per hundredweight. The Northwestern and Milwaukee road, the Wisconsin and Michigan’s chief competitors, charged sixty cents per hundredweight by an all-rail rate to the Twin Cities from Chicago.3 In spite of the rate war for Twin City trade, the barge line, nevertheless, remained dependent upon its parent company, the Wisconsin and Michigan, for traffic, although some coal was shipped from southern Illinois by the Wabash Railroad.

There were a number of reasons why the venture failed. Shippers and other railroads were reluctant to subject cargo and equipment to the long voyage on an open barge. The railroads looked upon the new amphibious operation with great distrust because a few barges and a tug represented a small investment compared to what the Northwestern and the Milwaukee Road had invested in their transportation systems. In fact, the Central Freight Association refused to publish the joint Wisconsin and Michigan ferry line rates. In the end, the Lake Michigan Car Ferry Transportation Company merely continued the declining trade of its predecessor, the Marinette Barge Company, shipping lumber and railroad ties to Chicago. .

The skepticism of railroad men over the feasibility of shipping railway cars on open barges on Lake Michigan proved to be well founded. The barge company lost two of its barges, loaded with pulpwood, in a severe storm in November 1900. The following fall the company lost two more barges with thirty railroad cars aboard, thirteen of them carrying iron ore. The cars became loose in a storm on Lake Michigan and capsized in twenty-five feet of water in the harbor of South Chicago, taking the lives of three men.4

Nor was the company successful in operating its tugs. A company tug crashed into a schooner in the Sturgeon Bay ship canal in 1897. In 1906, as the result of an accident in the harbor of South Chicago, the company leased the car ferry Pere Marquette which ran aground twice after she was acquired, had two collisions in 1907, and did considerable damage to the Waukegon city dock. The latter accident ended the amphibious phase of the Wisconsin and Michigan railroad twelve years after the railroad had begun its barge operation. 5

Neither the Wisconsin and Michigan Railroad, nor the Lake Michigan Car Ferry Transportation Company, were long term successes, but viewed as the means by which Isaac Stephenson secured favorable all-rail rate to Chicago for his lumber, the new transportation system was effective. He observed, “The railroad officials [of the Milwaukee Road and the Northwestern] were brought to the realization of the shortsightedness of their policy [of high freight rates for lumber] by the establishment of a car ferry which ran between Chicago and Peshtigo, connecting at the latter place with a short railroad line, the Wisconsin and Michigan, which ran for some distance up the Menominee River.” Stephenson claimed that the system forced the Milwaukee Road and the Northwestern to reduce their freight rates from the Green Bay region to Chicago by one-half. When this was done, the Chicago and Milwaukee yards of the Marinette lumber companies were discontinued and shipments were made directly from the mills.6

Although the last years of the 1890s were difficult for the railroad, prospects improved in 1900. In that year, the Wisconsin and Michigan reported its total revenue was $123,628.89, expenses $87,817 with a total indebtedness of $1,349,198.47. In October 1900, John Walsh, founder of the Chicago National Bank and president of the Southern Indiana Railroad, bought a large interest in the Wisconsin and Michigan. Walsh planned to ship Indiana coal north and lumber and iron ore south via his three transportation companies, but the operation remained unprofitable.7

The railroad’s main freight was not coal and iron ore, but farm and forest products from the Menominee valley. In spite of poor returns Walsh continued to invest in the railroad, adding to its rolling stock. Walsh announced at a Marinette stockholders’ meeting in the fall of 1905 that the railroad planned to build west into the adjoining counties of Forest and Vilas, and eventually west to the cities of Superior and Duluth.

In spite of the railroad’s continued poor return, Walsh remained optimistic about its future and the region. Lured by land and railroad companies, farmers continued to settle in Marinette and Menominee counties, and both Menominee River cities hoped that other industry would replace lumbering. Walsh assumed that the Wisconsin and Michigan would follow the pattern of railroads serving the northern part of the Lower Peninsula, a declining lumbering region similar to the Menominee valley.

The Lower Peninsula railroads in attempting to increase their business promoted northern Michigan as a tourist resort and vacation land, Using the lower Michigan railroads as a model, Walsh built an elegant hotel on the eighty two acre Miscauno Island in the middle of the Menominee River, about forty five miles upstream from Marinette. The hotel was to serve the wealthy as a refuge from hot Chicago summers. In addition to the hotel, the island had a nine-hole golf course and tennis courts. The hotel venture was at best a sideline for the railroad, providing a seasonal business during the short northern Wisconsin summer, but the transportation of tourists was hardly the basis for sustaining a railroad.

Thus, Walsh overextended himself, and in December 1905, his railroad and banking empire collapsed. Investigation later revealed that Walsh had loaned himself millions of dollars from his Chicago bank. In 1908, he began serving a five-year sentence at the Federal Prison at Fort Leavenworth, Kansas, for embezzlement of funds. The railroad fared poorly over the next few years. Deficits of over $100,000 were recorded for the years 1910 and 1911, and in 1912, the railroad went bankrupt.8 John Marsch, another Chicagoan, bought the railroad at a receiver’s sale in 1917, reorganized it, and resumed service on a limited scale.

The quest by Menominee River lumbermen for alternative railroad routes to markets did not end with the organization of the Wisconsin and Michigan, At the same time the railroad began operations, the Ann Arbor Railroad and Car Ferry started alternate day service between Frankfort, Michigan; Kewaunee, Wisconsin; and Menominee, Michigan. Samuel Stephenson was appointed president of the Ann Arbor in 1899, the year the railroad was incorporated under Michigan law.

Car Ferry ANN ARBOR NO.1 cutting through ice. Image from Alpena Public Library.

The Ann Arbor began service shortly after the Depression of 1893, and its first years were beset with difficulty. The citizens of Marinette and Menominee skeptically watched the approach of the Ann Arbor ferry on January 7, 1895, as it cut its way through six inches of Green Bay ice. The ship successfully reached port, the first time a ship had landed in Menominee during the winter. Winter service was short-lived. On February 1 it was discontinued, not, as was predicted, due to ice, but to lack of profit. The company reported that coal alone cost the company $150 a day, while daily receipts were only $220.9 In spite of the difficulties of the first year, the line became profitable during the years that followed and the Ann Arbor was able to provide excellent year-round service.

The Northwestern Railroad bitterly opposed its new competitor at first. The railroad was forced to trim its rates in the port cities on Green Bay and Lake Michigan. Shippers from Oshkosh, closer to Chicago, paid $35 more a car than shippers in the cities of Green Bay or Marinette. Marinette shippers paid seven cents per hundredweight for freight to Chicago. The cost to Oshkosh shippers was ten cents per hundredweight.

In the late 1890s the Ann Arbor began discussions with the Milwaukee Road and Wisconsin and Michigan Railroad concerning possibilities for building a belt line railroad from its docks on Green Bay to the industrial area along the river. To the surprise of local citizens, the Northwestern Railroad received a contract in October 1899, to do the switching from the Ann Arbor’s docks in Menominee. In return, the railroad agreed to allow Ann Arbor to use its tracks. The talk of a new belt line railroad was merely bluff by the Ann Arbor.10

Unlike the Wisconsin and Michigan, never a viable alternative except for carrying lumber and logs, the Ann Arbor provided Marinette and Menominee with a direct route to the eastern market, giving them parity in rail freight rates with Wisconsin and Illinois cities on the western shore of Lake Michigan. Geographers differ on the northern limits of the northeastern industrial region. A majority would probably draw the line from Muskegon, Michigan, on the Lower Peninsula, across Lake Michigan to the city of Green Bay. At best, Marinette and Menominee are on the periphery of this industrial belt of northeastern United States. The Ann Arbor, besides providing an alternative to the Northwestern, brought the two cities a little closer to the industrialized northeast.

  1. Marinette Eagle, October 21 & 28, 1893; March 31, 1894; September 13, 1894; November 10, 1894; and November 17, 1894. Isaac Stephenson, Recollections of A Long Life, 1829-1915 (Chicago: R. R. Donnelly& Sons Co., 1915), p. 83.
  2. Marinette Eagle, March 16, 1895. George Hilton, The Great Lakes Car Ferries (Berkeley: Howell North, 1962), pp. 186 & 187.
  3. George Hilton, op. cit., p. 189.
  4. Marinette Eagle, November 17, 1900 and Marinette Eagle-Star, October 2, 1906.
  5. George Hilton, op. cit., pp. 188-89.
  6. Isaac Stephenson, op. cit., p. 83.
  7. Marinette Eagle, May 26, 1900.
  8. Marinette Eagle-Star, August 18, 1903; October 23, 1903; May 17, 1904; May 4, 1906; October 10, 1906; and February 5, 1912. George Hilton, op. cit., pp. 190-193. Willis F. Dunbar, All Aboard, A History of Railroads in Michigan (Grand Rapids: Wm. B, Eerdman’s Publishing Co., 1969), pp. 173-79.
  9. Marinette Eagle, January 12, 1895; February 2, 1895; and November 4, 1899. The Ann Arbor discontinued services to Menominee in March 1970.
  10. Marinette Eagle, June 17, 1899; September 10, 1899; October 7, 1899; and October 28,1897. 175

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About the Author: Dr. Carl E. Krog is an Assistant Professor of History at the University of Wisconsin Center, Marinette, Wisconsin. His doctoral dissertation, a part of which was published in INLAND SEAS, Winter 1972, was devoted to the lumbering activities of Marinette, 1850-1910. Dr. Krog’s Ph.D. in history was attained at the University of Wisconsin, in 1971. 

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