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National City Lines was formed in 1936 as a holding company, for the express purpose of acquiring local transit systems throughout the country, mostly in medium-size cities. Many of those transit systems had already converted from streetcars to buses. But the controversy involves those transit systems which were still running streetcars when acquired by NCL.
Transportation historians note that the conversion to buses would likely have occurred anyway, and the streetcar ridership peaked in 1920 before the existence of NCL and was steadily declining.
Additional factors enabled NCL to acquire streetcar systems in the first place. Because streetcars were the earliest heavy users of electricity, it was practical and economical for many streetcar systems to be owned by the electric utility companies themselves. As part of the New Deal, federal legislation was passed ordering the electric utility companies to sell off their businesses not actually providing electricity. Suddenly, these streetcar systems became more readily available for takeover by NCL.