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[quote]QUOTE: Originally posted by ValorStorm True, there is no one answer. There are three. And Mark Hemphill enumerated them: 1. Deregulation 2. Deregulation 3. Deregulation Other answers were quite informative, like a 100 level accounting class. However, "Thank you Data, that will be all." [/quote] 1. Wrong 2. Wrong 3. Wrong Of course, the question is rhetorical, since the railroads are still struggling to cover costs of capital, ergo they are not all that "profitable". However, they do have certain advantages they did not have before that keeps them in the mix like the proverbial 600 lb gorilla: 1. The partial deregulation of Staggers, which allowed.... 2. The mega mergers of the 1990's, which resulted in...... 3. Substantial retrenchment of trackage , which allowed.... 4. Expanded pricing power over captive shippers, aka differential pricing, aka monopoly power. Contrasted against this is the continually shrinking customer base (a problem not addressed by Staggers), faulty claims of "efficiency gains" promised by the move to heavier cars and longer slower trains (an unintended consequence of Staggers[?]), and no market based incentive to innovate (a concept omitted from the Staggers legislation). Bottom line: Railroads are the 600 lb gorilla, too big to die but not ingenious enough to serve the public in any meaningful manner.
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