http://www.missoulian.com/articles/2005/03/05/mtracker/news/93rr.txt
It’s about time the state did something other than bending over.
OK, one lone legislator introducing a bill and issuing a press release about that introduction does not, in anyway, represent action on part of the State of Montana.
If this does go through, and withstands the court challenge, we can kiss the railroad companys good by. Every state legislature will attempt to do the same thing. Money will leave the railroads and we’ll be back to 1972 in the Northeast on a national basis.
And no, open access is not the answer. A railroad is not a highway - the economics are different.
If it is true that shipping rates are 50% in Montana than other states then I can certainly understand the frustration that Montana farmers must feel.
This is the same argument that some used to oppose the original enactment of the Interstate Commerce Act, 119 years ago. Among other things, the ICC was originally created to abolish discrminatory rates.
Given the opportunity to reinstitute discriminatory rates against helpless customers, Railroads have done so with a vengence.
One role of governmemt is to provide equal opportunity for economic gain and to prevent economic discrimination.
Taxation is frequently used to implement governmental policy regarding social good.
Best regards, Michael Sol
Why does the government always pick on successful businesses (especially the democrats, like in this case)?!
WHAT DOES THIS HAVE DO WITH DEMOCRATS!!!
While I don’t think Montana has a chance of a snowball in hell to get the proposed law to go in effect, what would keep the railroad from passing the excess taxes back to the shippers in the form of increased rates? Maybe they could pass a law against that action, and throw the railroad in prison if it was found guilty of violating that law.
Can you imagine a prison 4’ 81/2" wide and hundreds of miles long?
I think that it’s total BULL[censored]!
BNSFrailfan.
The Railroads can raise rates as much as they want too just as the Trucking company’s do.
Like the old saying goes…You eather take it or leave it.
BNSFrailfan.
well…sounds like another form of blackmail… “if you…the biz…dont do what we (the few people that act like they know what is good for eveyone)… we are just going to tax you into doing what we want you to do”…that is bullcrap and oversteps the bounds of what the government is for…someone said in a statment above…that taxes are used by the government to do socail good…or something like that… show me 1 government program that uses tax money that isnt miss managed…over manganged…or has so many other hands into its buget that the tax money that should be going into progams is so little becouse of the skims of eveyone else from the top down… insted of trying to blackmail the few companys that are still in the US providing jobs…why dont the same people that want to put the taxs in place on corporations that are still here…try and get new jobs and tax bases…you cant milk a cow forever…at some point…it is going to die…
as far as what the railroad charges people that ship with it…well…thats the railroads right to do that… its called…for some of you communests in the crowd…capitalizum… so lets take this for an example… you have a favort place to eat… and you go thier alot… thier are other restunts out thier…but yet you chose this one…becouse the food is better…or the service is faster…or even the waitresses are better looking…what ever the reson is… now…say they raise thier prices of the meals served… now…are you going to go and *** to the local government saying that they raised their prices…so inorder to get them to lower them…i want you to put a bill to raise thier propory taxes if they dont…you would be laughted out of the office… the concept is the same thing… if you dont like what your playing…then go someplaces else… im sure the shippers that are complaing about can find a trucking company that will do it…and as far as the farmers…they are only up in arms becouse thier farm subsidies are looking at getti
Interesting comments on both sides.
However, the one thing every student of science knows (and is transposable to economics) is this: For every action, there is an equal and opposite reaction. If you set prices that are perceived as being discriminatory, you will end up getting a public action against you in some form. This is one area where the bean counters can really screw up a company, because their telling management “You can jack up your prices here because there is no competitive alternative, and thus increase your value to the shareholders”. Intangibles never show up on a balance sheet, yet if you don’t account for the intangibles, you can end up losing value to your shareholders.
Being a good business means being a good neighbor first and foremost. BNSF has made itself a pariah in Montana and North Dakota.
BNSF should fire their entire PR department. Then they should hire some bean counters who’ve actually gotten some grease under their fingernails and callouses on their hands. Maybe then they’ll figure out the real value of not being an arrogant overbearing corporation.
The end result, if this proposal should pass and be held as legal, is that the rates charged in Montana will be the same rates charged over the entire Intermountain West and to all BNSF and UP destinations outside of the Intermountain West. The rate from Kansas to Houston would be the same as Bismark to Seattle.
Rates will not go down. They will only rise to parity. The Powder River Coal will become really profitable (some of it comes out of Montana) and DME will be able to get its line into the PWB paid for by the coal companies (DME does not operate in Montana).
Montana will save nothing.
discrimitory is a very veg word… when your talking about what someone charges for something…becoues they charge 40k for an H2 hummer makes it a discrimitory price becoues i cant afford it?.. i could say that that is discrimitory priceing then? and force the car deal into lowing its price to where i can afford it by haveing the local goverment blackmail the dealer by saying you sell that to him and eveyone else for a depressed price becouse its discrimitory priceing or we will raise your proporty taxes…no…its called supply and demand… as well as cost of manufacture…in the case of BNSF… and the grain shipments…it falles under the same conncept…when the grain is harvested…the demand goes up for rail cars for shipments…the cost of leasing cars…and shiping will go up… it will take mover l
futuremodal
“Maybe then they’ll figure out the real value of not being an arrogant overbearing corporation”.
who made you the judge of that?
csx engineer
What you’re suggesting is that BNSF will compound its error by extending the stupidity to other parts of the nation. All that will do is **** off more people, and the result will be even more legislation against railroads.
BNSF can nip this in the bud right now by reducing it’s Montana/Dakota rates to the same level as it’s Nebraska rates. If BNSF wants more income to pay for increased capacity on the Chicago-LA corridor, it can just charge more per box moved on that corridor. Those people affected can have their concerns explained away by BNSF as simply it’s the way to pay for capacity improvements.
Deregulation in both the trucking and rail transportation industry was granted as a way to make both of these transportation modes cheaper for all shippers and make both modes more profitable and able to service needs.
If it is found that BNSF is in fact pricing service from Montana and South Dakota for all industries %50 above rates from other states for similar services, maybe some re-regulation is in order.
Jim - Lawton, NV MP236
CSX,
You miss the gist of the problem. BNSF is charging rates to move grain out of Montana and North Dakota that are 50% higher than the rates charged to more grain out of Nebraska, even though they are roughly the same distance to the PNW. Using your Hummer dealer analogy, it would be like the Hummer dealer charging you 50% more for a Hummer just because you live in the outskirts of the city, while your fellow citizen from the central city is charged the sticker price. Same vehicle, same dealer, but one of you is getting screwed, and unless you’re just a patsy willing to take up the back side, you’re going to fight back.
That’s what’s happening here. Montana shippers have finally decided they’re tired of getting reamed. The only real question is why it took them so long.
It is obvoius that businesses try to reap monopolistic profits when they are able to do so. The solution to this problem is competition, not new taxes. Competition can be realised by granting tracking-rights to other companies or by open-access. The latter will take several years.
If they raise properrty taxes ONLY on the BNSF it will killed by the courts. If the pols have to raise taxes for EVERYBODY that to will not fly. Sounds like good posturing by the pols so they can say they tried to help the grain shippers.
The article states that the legislator “introduced the measure to change the way railroads are taxed in the state, based in part on the rates they charge. Railroads that charge Montana farmers more for shipping than their customers in other states would pay more taxes. The size of the tax increase would depend on the gap in shipping rates between states; the bigger the discrepancy, the higher the taxes, he said.”
No reference to it being directed specifically at the BNSF.
Politicans have long taxed some kinds of profit differently than other kinds of profit. Capital gains are taxed at a different rate than earned income or interest income. Taxing income generated as the result of a discriminatory busiiness practice differently than honest income might perhaps be more palatable to corporations than banning the practice altogether.
Best regards, Michael Sol