What Was James J. Hill's Railroad Advantage?

David Senra says James J. Hill's advantage was that he understood the railroad as an operating business, not as a financial instrument. James J. Hill is the only person in American history to found a railroad and not go bankrupt. Most of his competitors came from finance or speculation. They were often trying to build railroads to capture land grants, sell bonds, manipulate stock, or reorganize bankrupt systems. Hill came from freight, warehousing, and transportation logistics. When he finally got control of a railroad, he understood the customer, the cargo, the routes, the costs, the bottlenecks, and the economics from the inside.

Reading James McGrath Morris, Senra says the same edge shows up in Joseph Pulitzer. Pulitzer read The Sun regularly and called it the most entertaining and, without exception, the best newspaper in the world. Looking for newspapers to buy, he was confident because he could do every job inside a newspaper. He came from inside. People who own newspapers scarcely ever make them, and the persons who own them are scarcely fit to write the smallest and most unimportant part of the paper. Charlie Munger listed James J. Hill in Poor Charlie's Almanac as one of the best business operators of all time, and Hill described his railroad edge the same way Pulitzer described buying and building newspapers.