There seems to be alot of noise about unfair rates for shippers these days. Heres a short solution:
Break up the class 1s so they are closer to the 1980s in terms of numbers.
Regulate trackage rights, require host RRs to allow foreign traffic under reasonable terms.
Split Amtrak up between the RRs. I do not think a US government controlled passenger rail system can ever be profitable. With the national debt growing worse everyday, I do not think it sustainable either. If anyone can do it, the penny pinchers running the class 1s now might have a fighting chance.
Do not set rates at a national level.
I think that with more competition would bring lower rates. Lower rates attracts more customers. More customers bring more revenue.
Hmmm… you seem to be attempting to bait folk for argument.
Okay… Seems like breaking up the class 1s would require government intervention and regulating trackage rights would be government meddling and forcing AMTRAK into the hands of the RRs would be more government control, because without the government involvement the RRs would soon drop passenger service completely so it would just go away.
Not setting rates at a national level seems to incongruous to your other premisses. How come?
My post was a bit over simplified… and maybe its a little late to post things like this…
I don`t want the staggers act repealed, but I do want American industry to have better access to rail. Not setting national rates would allow railroads to remain profitable.
I am still bound by a non disclosure agreement, but I can think of one factory that has, or had, rail access that a class 1 will no longer serve, but premerger had service 5 days a week. A second class 1 is/was willing to provide service, but trackage rights could not be secured. The second class 1 RR handles similar traffic on a local via a line that connects to the first class 1s tracks. The cost of 50 or so trucks a day in and out is alot higher than what the second class 1 quoted. This is basis for my argument that trackage rights should be easier to acquire. This is not only an advantage to the shipper, but also to a railroad that could easily profit from the traffic.
As for breaking up the railroads I only really thought about the west coast and I like something like this
UP
a.CNW
b SP
c UP
BNSF
a. AT&SF
b BN
As for AMKT I think passenger rail service should be regulated, the same way the Airlines are. Yes, I know the airlines are really in the crapper ATM but I think the advantages of rail could make it profitable.
How about laissez faire capitalism? It’s about time we give true capitalism a try…no (or minimal) economic regulation within a framework of environmental regulations. Might not be such a bad idea…
True capitalism is working with the railroads…that’s how they got to be so few in number. If you give railroads a “true capitalism” ticket as you descirbe, Ulrich, you would have to do the same for airlines, trucking companies, bus companies, and waterway lines…making each pay their full (not fair) share of use of airways, highways, and waterways. As for no national rates…that is abusrd, you have to be able to quote a price from the waves of the Atlantic to the waves of the Pacific as well as from Springfield to Springfield and Middletown to Middletown. Give Amtrak back to the raileoads? Because it will never make a profit? Thats an argument always going on in these threads. Simply why does Amtrak hve to make a profit and who and how many in Congress really understand? Amtrak was formed because of the laissez faire capitalism wanted the socialist government to bail them out of the passenger business. My hands are greasey because the bread is butttered and jellied on both sides. This is a round robbin, merry-ro-round, non sensical questin for which there are thousands of thousands of opinions with very few real answers and solutions, at least none of which those who argue will accept.
It has taken Staggers + 30+ years for railroads to develop into sound financial business…that still aren’t earning their cost of capital according to the STB formula. For the most part, the ones that are crying the loudest are those who have monopoly control of their own markets, and those markets are populated by entities that aren’t big enough to challenge those monopoly. Those monopoly’s don’t know how to deal in a business relationship with a equal and thus cry foul.
Why does the first Class I no longer want to provide service ?
I believe there are procedures at the STB whereby the second Class I and the factory could compel access if the first Class I truly doesn’t want to provide service. For 50 truckloads a day, that might be worth the legal and expert witness fees.
But even if the trackage rights were granted voluntarily, the first Class I could still practically screw it up for the second Class I with scheduling delays, holding the second Class I’s trains for the first Class I’s priority trains, track inspections (“Safety First”, you know), MOW work, etc., etc.
A better solution for the factory to explore would be either draying the truckloads as domestic intermodal, and/ or as transloads, to the nearest railhead of the second Class I, and going via rail on it from there. The economic viability of that would of course depend on all the details involved, which I understand can’t be disclosed, so that’s about as far as we can go on that here.
The other parts of the Original Post would turn the industry’s clock back about 40 years to 1970 or so. Having already seen that and the
Tell that to the former employees of Braniff, Eastern, Pan Am, and Continental.
You are correct that the law was passed during the Carter Administration. Most of it took effect during the Reagan Administration and the consequences were seen then. That was the source of my error.
The airlines recorded a net operating loss of $421 million as early as 1981, when the number of passengers fell to 286 million. The number of major carriers in the United States fell from six in 1978 ( United, American, Delta, Eastern, TWA, and Pan Am ) to three by 1991. Others were saved by bankruptcy reorganizations and federal subsidies.
Thousands of high paid airline employees lost their jobs, thousands of investors lost their investments in the companies, and hundreds of smaller cities lost their airline service. I lived in one of them at the time.
Wouldn’t something similar for the railroads be a great shot in the arm for our struggling economy?
It could not have been laissez faire capitalism if there was a government requirement to keep running passenger trains while they lost money. The private railroads were not asking for government socialism by their request to be let out of their obligation to run passenger trains at a loss. On the contrary, they were asking to get out from under government socialism in the form of being forced to run passenger trains at a loss.
Either way Socialism is what the government is about and the customer is what capitalism is about. Isn’t that a neat way to twist words and meanings! No…my point is that capitalism got its way by getting the government to bail them out thereby reinforcing the concept of the government being a socialistic entity but a good tool of capitalism.
Socialism is public ownership of various industries and enterprises through the state, not regulation of private corporations and other businesses by the state. Let’s at least get the definitions correct.
Yes, but the “tool” of government socialism in the form of Amtrak was only a tool for capitalists get out from under government socialism. The government would have been a better tool of capitalism if they had not imposed socialism in the first place.
Rather than have the government “bail them out”, by forming Amtrak, the government could have advanced the cause of capitalism by allowing the railroads to quit running passenger trains at a loss. Rather, it appears the railroads had to, pretty much, pay the government to take the unprofitable passenger business oof their hands, rather than just be allowed to let it die on it’s own.
But none of the state nor the Federal governments were in a position to spend the needed money for highway construction and airway support that was needed to cover the anticipated increase of traffic. Plus there were situations where passenger train was the only mode of transportation available. The question is: what is the role of government when it comes to meeting the needs of its constituants? The whole concept that if one can’t make money at it, it shouldn’t be done makes no sense at all for the benefit of both the public and private enterprise. In the case of passenger rail, planners and scientists and others were aware of the lack land space for more highway construction, the enviornmental air and land pollution, as well as the petroleum source problems. Thus they thought it wise to maintain some kind of rail passenger service. Ever since Astor set the fare of the NYC subway at a nickle and the NYC and State solons saw fit to enforce that rate into the 50’s, the American public feels it has to have a cheap transportation system and refuses to pay its full price out of pocket. So we have government building and maintaining roads and airports and waterways and operating trains. Big business is too scared to take it away from the governments and make it private enterprise so they are satisfied to let the government do it so that they are left alone to do a
“But none of the state nor the Federal governments were in a position to spend the needed money for highway construction and airway support that was needed to cover the anticipated increase of traffic”