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Government Sticking Too Much of Its Nose Into Transportation .. Again!

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Posted by Ulrich on Saturday, July 10, 2021 9:16 PM

Often optics and perception outweigh the facts. There are excellent arguments to be made both for and against the merger based strictly on facts. Facts are facts.. but politics, personal biases, and other factors always come into play, and often the straight facts don't figure in at all.

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Posted by BaltACD on Saturday, July 10, 2021 9:22 PM

MidlandMike
 
BaltACD 
MidlandMike 
Ulrich
... CN and KCS are patiently awaiting the decision of the STB on whether their merger proposal will go ahead or not. Its up to five people to decide that.. they can give the thumbs up or the thumbs down. That's alot of power vested in five people..  

Those five people of the STB don't just go on a whim.  They still must follow the law, back their decission with facts, and are subject to legal challange. 

Are you referring to GOP style 'facts' or Democrat style 'facts'.  Between those two parties the 'facts' are mutually exclusive. 

I am referring to actual facts that will stand up to legal challanges.

Ah! Legal Challenges - someone has a even worse record in court than the Baltimore Orioles have on the baseball field, yet the facts are still challenged.

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Posted by MidlandMike on Sunday, July 11, 2021 9:55 PM

Ulrich

Often optics and perception outweigh the facts. There are excellent arguments to be made both for and against the merger based strictly on facts. Facts are facts.. but politics, personal biases, and other factors always come into play, and often the straight facts don't figure in at all.

 

Boards are not legislative bodies that make political decisions, but are administrative bodies that hold hearings, and any facts they consider should stand like evidence, otherwise they can be picked apart in appeals.  If the "straight facts" didnt figure at all, then they are malfeasant.

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Posted by Ulrich on Monday, July 12, 2021 8:11 AM

Straight facts will figure into this decision, but  likely other factors will dominate and lead to a decision apart from what the facts show. Biden, like Trump, is protectionist.. will that influence the decision? Even if the facts unequivocally show that the CN KCS combo is wonderful and efficient for all concerned parties we live in a "buy American.. America first" world, and against that backdrop, how does the proposed merger look? Boards are not legislative bodies, but they are politically driven just the same, and decisions they make will reflect the prevailing sentiment of the day, even when the bare facts might point in a different direction. 

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Posted by charlie hebdo on Monday, July 12, 2021 8:34 AM

MidlandMike

 

 
Ulrich

Often optics and perception outweigh the facts. There are excellent arguments to be made both for and against the merger based strictly on facts. Facts are facts.. but politics, personal biases, and other factors always come into play, and often the straight facts don't figure in at all.

 

 

 

Boards are not legislative bodies that make political decisions, but are administrative bodies that hold hearings, and any facts they consider should stand like evidence, otherwise they can be picked apart in appeals.  If the "straight facts" didnt figure at all, then they are malfeasant.

 

Very true.  A major question becomes the benefit analysis of more consolidation vs competition. I also wonder what our Canadian members would be saying if BNSF bought CP and UP bought CN? 

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Posted by Ulrich on Monday, July 12, 2021 8:44 AM

charlie hebdo

 

 
MidlandMike

 

 
Ulrich

Often optics and perception outweigh the facts. There are excellent arguments to be made both for and against the merger based strictly on facts. Facts are facts.. but politics, personal biases, and other factors always come into play, and often the straight facts don't figure in at all.

 

 

 

Boards are not legislative bodies that make political decisions, but are administrative bodies that hold hearings, and any facts they consider should stand like evidence, otherwise they can be picked apart in appeals.  If the "straight facts" didnt figure at all, then they are malfeasant.

 

 

 

Very true.  A major question becomes the benefit analysis of more consolidation vs competition. I also wonder what our Canadian members would be saying if BNSF bought CP and UP bought CN? 

 

Bingo.. my point exactly.. Often the facts have very little to do with the decision. Any salesman will tell you the same.. facts don't sell.. emotions (especially fear of loss) do. 

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Posted by Steven Otte on Monday, July 12, 2021 9:25 AM

I know that it's impossible to divorce railroading from politics when discussing regulation, but let's at least try to keep this discussion on that topic, rather than veering into party politics and electoral speculation. Otherwise I'll have to do more than delete a handful of posts to keep this thread on topic.

--
Steven Otte, Model Railroader associate editor
sotte@kalmbach.com

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Posted by greyhounds on Monday, July 12, 2021 11:14 AM
Government economic regulation of the railroads was one of the Great Failures of the 20th Century.  I just hope we don’t repeat it.
"By many measures, the U.S. freight rail system is the safest, most efficient and cost effective in the world." - Federal Railroad Administration, October, 2009. I'm just your average, everyday, uncivilized howling "anti-government" critic of mass government expenditures for "High Speed Rail" in the US. And I'm gosh darn proud of that.
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Posted by zugmann on Monday, July 12, 2021 11:18 AM

No worries - I believe PSR will be seen as one of the Great Failures of the 21st Century. 

   The opinions expressed here represent my own and not those of my employer or any other railroad, company, or person.

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Posted by greyhounds on Monday, July 12, 2021 11:50 AM

zugmann
No worries - I believe PSR will be seen as one of the Great Failures of the 21st Century. 

I’ll disagree.  I see PSR as a good concept that has had some poor implementations.  It will get fixed, or people will be fired.
 
It’s easier to fix problems in the private sector than in government.  And it’s much quicker too.
"By many measures, the U.S. freight rail system is the safest, most efficient and cost effective in the world." - Federal Railroad Administration, October, 2009. I'm just your average, everyday, uncivilized howling "anti-government" critic of mass government expenditures for "High Speed Rail" in the US. And I'm gosh darn proud of that.
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Posted by tree68 on Monday, July 12, 2021 11:56 AM

greyhounds
I see PSR as a good concept that has had some poor implementations. 

I would opine that it was a great idea until the investors got hold of it...

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Posted by zugmann on Monday, July 12, 2021 11:56 AM

greyhounds
It’s easier to fix problems in the private sector than in government.  And it’s much quicker too.

Well, I'm waiting.  Not holding my breath, though. 

Although the "good idea - poor implementation" seems like a cop-out to me. 

   The opinions expressed here represent my own and not those of my employer or any other railroad, company, or person.

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Posted by Ulrich on Monday, July 12, 2021 11:58 AM

Was the problem PSR or too much focus on PSR? Likely the latter... The first  railroad to apply PSR has long since evolved toward a more balance model that gives more weight to customer service, sales, MOW etc.. If the focus is too much in one direction or the other the organization will suffer. I think that would be the takeaway.. don't focus too much on one metric (like the OR) to the exclusion of everything else. 

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Posted by ronrunner on Monday, July 12, 2021 11:59 AM

Was there not a law that said that US railroads had to be domestically owned hence Grand Trunk which had a separate charter from CN and DT&I

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Posted by Ulrich on Monday, July 12, 2021 12:06 PM

ronrunner

Was there not a law that said that US railroads had to be domestically owned hence Grand Trunk which had a separate charter from CN and DT&I

 

 

That brings up a good question.. what constitutes the nationality of a corporation? Is it where the company is  headquartered? In what jursidiction the company is chartered? .. where the majority of its shareholders live?.. I don't know. CN (for example) has shareholders in Canada and the US as well as in other countries.. Americans as well as Canadians make up its workforce and senior management.. So is CN Canadian, American, multinational? Were the CN KCS merger to go through CN US would retain an American Headquarters.. I'm not sure if this would be a legal requirement or simply good form and the prudent thing to do in order to give Americans the impression that CN US is based in the US. Likely the CN US would be separately incorporated in the US as well.. for all intents and purposes an American corporation.. separate from the Canadian parent company. 

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Posted by Overmod on Monday, July 12, 2021 12:10 PM

zugmann
Although the "good idea - poor implementation" seems like a cop-out to me.

I'd call it a cop-out until the 'correct' use of PSR techniques is clearly distinguished from the financier-optimized aspects.  Which is more than just Euclidean-type semantics.

Of course, to get a sensible discussion you have to divorce discussion of 'railroads' as generators of effective transportation from 'railroads' as vehicles for maximum shareholder/owner perceived benefit.  

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Posted by charlie hebdo on Monday, July 12, 2021 12:12 PM

Inseparable.  PSR was developed to maximize short-term profitability. 

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Posted by Ulrich on Monday, July 12, 2021 12:13 PM

Overmod

 

 
Of course, to get a sensible discussion you have to divorce discussion of 'railroads' as generators of effective transportation from 'railroads' as vehicles for maximum shareholder/owner perceived benefit.  
 

 

They're not mutually exclusive.. 

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Posted by Murphy Siding on Monday, July 12, 2021 12:48 PM

Overmod
 
zugmann
Although the "good idea - poor implementation" seems like a cop-out to me.

 

I'd call it a cop-out until the 'correct' use of PSR techniques is clearly distinguished from the financier-optimized aspects.  Which is more than just Euclidean-type semantics.

 

Of course, to get a sensible discussion you have to divorce discussion of 'railroads' as generators of effective transportation from 'railroads' as vehicles for maximum shareholder/owner perceived benefit.  

 

  Euclidean-type semantics. Laugh

Thanks to Chris / CopCarSS for my avatar.

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Posted by BaltACD on Monday, July 12, 2021 1:29 PM

greyhounds
 
zugmann
No worries - I believe PSR will be seen as one of the Great Failures of the 21st Century.  
I’ll disagree.  I see PSR as a good concept that has had some poor implementations.  It will get fixed, or people will be fired.
 
It’s easier to fix problems in the private sector than in government.  And it’s much quicker too.

My observation is that PSR came on CSX and wrecked all the existing schedules and replaced them with chaos.

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Posted by mudchicken on Monday, July 12, 2021 2:04 PM

The last time total government control happened, Colorado Midland, DL&NW and nearly D&SL got killed off by the first USRA in my backyard. Others suffered greatly until USRA was pressured to disband.

Thank god neither iteration of the Prince Plan ever happened.

Nuf sed.

Mudchicken Nothing is worth taking the risk of losing a life over. Come home tonight in the same condition that you left home this morning in. Safety begins with ME.... cinscocom-west
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Posted by greyhounds on Monday, July 12, 2021 4:49 PM

Overmod
I'd call it a cop-out until the 'correct' use of PSR techniques is clearly distinguished from the financier-optimized aspects.  Which is more than just Euclidean-type semantics. Of course, to get a sensible discussion you have to divorce discussion of 'railroads' as generators of effective transportation from 'railroads' as vehicles for maximum shareholder/owner perceived benefit.  

Well, you can call it a cop-out, or you can call it a banana.  It doesn’t matter.  PSR works. 

 

1)    Whenever a major change such as PSR occurs there are going to be people who don’t understand it.  So, there are going to be problems until those people gain understanding or they get let go.

 

2)   Whenever a major change such as PSR occurs there are going to be people who won’t accept it.  They’ll fight it and try to make it not work.  So, there are going to be more problems until those people gain acceptance or they get let go.

 

3)   Whenever a major change such as PSR occurs there are going to be needed adjustments made to the original plan.   The Army has a saying: “No operational plan survives contact with the enemy.”  It’s pretty much the same in commerce.  “No operational plan survives contact with the customers.”  You’re going to have to adjust and accept changes.  That’s what is going on with PSR.

 
PSR is all about getting more efficient rail transportation.  It’s about getting more economic output while using fewer economic resources.  If someone loses their job with a railroad because of PSR it will be a hardship on that person.  But, for the overall economic welfare getting more for less is good.
"By many measures, the U.S. freight rail system is the safest, most efficient and cost effective in the world." - Federal Railroad Administration, October, 2009. I'm just your average, everyday, uncivilized howling "anti-government" critic of mass government expenditures for "High Speed Rail" in the US. And I'm gosh darn proud of that.
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Posted by BaltACD on Monday, July 12, 2021 5:51 PM

greyhounds
 
Overmod
I'd call it a cop-out until the 'correct' use of PSR techniques is clearly distinguished from the financier-optimized aspects.  Which is more than just Euclidean-type semantics. Of course, to get a sensible discussion you have to divorce discussion of 'railroads' as generators of effective transportation from 'railroads' as vehicles for maximum shareholder/owner perceived benefit.   
Well, you can call it a cop-out, or you can call it a banana.  It doesn’t matter.  PSR works. 

 

1)    Whenever a major change such as PSR occurs there are going to be people who don’t understand it.  So, there are going to be problems until those people gain understanding or they get let go.

 

2)   Whenever a major change such as PSR occurs there are going to be people who won’t accept it.  They’ll fight it and try to make it not work.  So, there are going to be more problems until those people gain acceptance or they get let go.

 

3)   Whenever a major change such as PSR occurs there are going to be needed adjustments made to the original plan.   The Army has a saying: “No operational plan survives contact with the enemy.”  It’s pretty much the same in commerce.  “No operational plan survives contact with the customers.”  You’re going to have to adjust and accept changes.  That’s what is going on with PSR.

 
PSR is all about getting more efficient rail transportation.  It’s about getting more economic output while using fewer economic resources.  If someone loses their job with a railroad because of PSR it will be a hardship on that person.  But, for the overall economic welfare getting more for less is good.

PSR has been about cutting muscle and hamstring the organization from seeking a increased level of the business as more business, with the hacked apart physical plant will drive up costs exponentially thus trashing the 'God' of PSR the Operating Ratio.

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Posted by charlie hebdo on Monday, July 12, 2021 6:15 PM

BaltACD

 

 
greyhounds
 
Overmod
I'd call it a cop-out until the 'correct' use of PSR techniques is clearly distinguished from the financier-optimized aspects.  Which is more than just Euclidean-type semantics. Of course, to get a sensible discussion you have to divorce discussion of 'railroads' as generators of effective transportation from 'railroads' as vehicles for maximum shareholder/owner perceived benefit.   
Well, you can call it a cop-out, or you can call it a banana.  It doesn’t matter.  PSR works. 

 

1)    Whenever a major change such as PSR occurs there are going to be people who don’t understand it.  So, there are going to be problems until those people gain understanding or they get let go.

 

2)   Whenever a major change such as PSR occurs there are going to be people who won’t accept it.  They’ll fight it and try to make it not work.  So, there are going to be more problems until those people gain acceptance or they get let go.

 

3)   Whenever a major change such as PSR occurs there are going to be needed adjustments made to the original plan.   The Army has a saying: “No operational plan survives contact with the enemy.”  It’s pretty much the same in commerce.  “No operational plan survives contact with the customers.”  You’re going to have to adjust and accept changes.  That’s what is going on with PSR.

 
PSR is all about getting more efficient rail transportation.  It’s about getting more economic output while using fewer economic resources.  If someone loses their job with a railroad because of PSR it will be a hardship on that person.  But, for the overall economic welfare getting more for less is good.

 

PSR has been about cutting muscle and hamstring the organization from seeking a increased level of the business as more business, with the hacked apart physical plant will drive up costs exponentially thus trashing the 'God' of PSR the Operating Ratio.

 

It's just cost cutting dressed up with a fancy (but inaccurate) label, designed by folks who have a cavalier attitude about disposable labor ("let them go") like they were rolls of toilet paper. All for short term profits,  not about growing revenue and customer base. 

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Posted by charlie hebdo on Monday, July 12, 2021 6:16 PM

BaltACD

 

 
greyhounds
 
Overmod
I'd call it a cop-out until the 'correct' use of PSR techniques is clearly distinguished from the financier-optimized aspects.  Which is more than just Euclidean-type semantics. Of course, to get a sensible discussion you have to divorce discussion of 'railroads' as generators of effective transportation from 'railroads' as vehicles for maximum shareholder/owner perceived benefit.   
Well, you can call it a cop-out, or you can call it a banana.  It doesn’t matter.  PSR works. 

 

1)    Whenever a major change such as PSR occurs there are going to be people who don’t understand it.  So, there are going to be problems until those people gain understanding or they get let go.

 

2)   Whenever a major change such as PSR occurs there are going to be people who won’t accept it.  They’ll fight it and try to make it not work.  So, there are going to be more problems until those people gain acceptance or they get let go.

 

3)   Whenever a major change such as PSR occurs there are going to be needed adjustments made to the original plan.   The Army has a saying: “No operational plan survives contact with the enemy.”  It’s pretty much the same in commerce.  “No operational plan survives contact with the customers.”  You’re going to have to adjust and accept changes.  That’s what is going on with PSR.

 
PSR is all about getting more efficient rail transportation.  It’s about getting more economic output while using fewer economic resources.  If someone loses their job with a railroad because of PSR it will be a hardship on that person.  But, for the overall economic welfare getting more for less is good.

 

PSR has been about cutting muscle and hamstring the organization from seeking a increased level of the business as more business, with the hacked apart physical plant will drive up costs exponentially thus trashing the 'God' of PSR the Operating Ratio.

 

It's just cost cutting dressed up with a fancy (but inaccurate) label, designed by folks who have a cavalier attitude about disposable labor ("they get let go") like they were rolls of toilet paper. All for short term profits,  not about growing revenue and customer base. 

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Posted by Euclid on Monday, July 12, 2021 6:57 PM

 

What is wrong with short term profits?  The concept is presented as though you get less profit by having it arrive too quickly, and so with taking short term profit, you consume your profit-making apparatus and must go out of business.  Usually a business wants to make as much profit as possible, as soon as possible.   Give me an example of how and why a business would decide to avoid short term profits. 

 

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Posted by tree68 on Monday, July 12, 2021 7:28 PM

Euclid
Give me an example of how and why a business would decide to avoid short term profits. 

Because they want to keep some of that money for continued growth.

Of course, a company wants a certain amount of short term profit, although it's completely normal for a new company to operate at a loss for several years.  

An existing company would theoretically be operating at some level of profit, wisely using their income to foster growth as well as provide income for the owners.

When you say "short term profits" I would opine that many people think of vulture capitalists, who are simply interested in how much they can wring out of a company with no thoughts to future growth, or even future operation.  

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Posted by Euclid on Monday, July 12, 2021 7:55 PM

 

tree68
 
Euclid
Give me an example of how and why a business would decide to avoid short term profits. 

 

Because they want to keep some of that money for continued growth.

Of course, a company wants a certain amount of short term profit, although it's completely normal for a new company to operate at a loss for several years.  

An existing company would theoretically be operating at some level of profit, wisely using their income to foster growth as well as provide income for the owners.

When you say "short term profits" I would opine that many people think of vulture capitalists, who are simply interested in how much they can wring out of a company with no thoughts to future growth, or even future operation.  

 

Yes I have heard that charge about vulture capitalists.  That is what I had in mind when I mentioned taking short term profit at the expense of consuming your profit making apparatus and thus putting the company out of business.  But is that actually happening?  It seems that Labor says it is, but Labor sees PSR as a threat to jobs.  But if railroads are actually consuming their capital, would it not be obvious as the physical plant falls apart?  Is the Country actually going to just stand by as vulture capitalists rob us of our railroads?

 

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Posted by MidlandMike on Monday, July 12, 2021 9:22 PM

Euclid
...Is the Country actually going to just stand by as vulture capitalists rob us of our railroads?

Most citizens don't know and don't care.  Congress has thought of railroads as essential, but with more populist being elected, even that is not a guarantee.

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Posted by Convicted One on Monday, July 12, 2021 9:40 PM

Euclid
But if railroads are actually consuming their capital, would it not be obvious as the physical plant falls apart?  Is the Country actually going to just stand by as vulture capitalists rob us of our railroads?

How long does it take for deferred maintenance to snowball to the point it can no longer be explained as a "run of bad luck"?  Long enough for the stockholders  to make their get away? Broken Heart

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