Thoughts on rail......

[88gta350]

This post is likely to be rambling, as I'm kind of writing it as I'm thinking it... but here goes. (These topics may have been discussed around here before, but I've never caught them)

Many people say it's not fair that the trucking industry gets their transportation system (the roads/interstates) subsidized by the government while the railroads have to build their own physical plant. Roads are financed through taxes and tolls. Would it be advantagous for the railroads if the government owned all the rail? Obviously this would save the railroads a lot of money in maintaince and labor charges, and it would cost the government a lot. The government would have to make up that deficit through higher diesel fuel tax or some type of set toll for usage of the tracks.

But I can see this creating a whole host of problems. Because no one now owns the rails, everyone would be free to go as far on them as they like. Railroads would compete on cost of shipping alone. Every road in the country could travel from coast to coast. So how would you handle this traffic. At least on the road there is room for all the trucks. On rail you'd have a traffic nightmare. You'd now need some type of independent control center to route all the traffic. If a shipper wanted to build rail access, who would build and pay for it? The shipper or the govt?

Perhaps a better solution is to give some type of credits back to the railroads in direct proportion to how many miles of rail they own. Rather than the gov't building the physical plant for the railroads as they do the trucks, perhaps they could subsidize it through tax breaks or lessening the fuel tax railroads have to pay, or something else to that affect.

Anybody have any feasable ideas as to how the gov't could level the playing field between trucks and rail? Is the ROW considered real estate that gets taxed by the state/local authorities? If so, perhaps the gov't could proclaim railroad real estate exempt from all taxes, federal, state, and local?

[mudchicken]

Dave:

The Feds tell the state how many miles of rail, how many acres and what physical improvements. The state receives a check from the railroad every 3 months for that part of the railroad in their state. The State distributes the property tax to the state, counties and cities. States like Colorado also have a ton-mile tax and diesel fuel taxes. The trucker pays an artificially low highway use tax (the tax does NOT equal the proportional damage done to the highway, no matter what excuse ATA turns loose), a tax on diesel fuel and taxes on the rig..(and not much else).

You've got a lot to see and learn yet...

[Overmod]

Dave:

Much of what you're speculating about has been discussed -- in some respects, to death -- under the title of "open access". One place you might start is by reading up on some of the work done by John Kneiling (the old Trains Magazine "Professional Iconoclast") who proposed that trackwork be considered as an 'iron ocean' over which trains would navigate following mutually accepted conventions and rules. It is interesting to speculate on the ways that privately-owned ROW might be converted to allow this kind of practice, as the situation with railroad track occupancy is very different from what prevails on our nation's interstates with respect to vehicle safety, capacity, etc.

When you've worked out some ways this might be done -- and checked with Google, etc., to flesh out your ideas with some facts and details -- start thinking about potential problems and opportunities. Then go back over the posts on this forum that concern "open access" and see how the arguments and discussions there affect your ways of looking at the issue.

[greyhounds]

QUOTE: Originally posted by mudchicken

Dave:

The Feds tell the state how many miles of rail, how many acres and what physical improvements. The state receives a check from the railroad every 3 months for that part of the railroad in their state. The State distributes the property tax to the state, counties and cities. States like Colorado also have a ton-mile tax and diesel fuel taxes. The trucker pays an artificially low highway use tax (the tax does NOT equal the proportional damage done to the highway, no matter what excuse ATA turns loose), a tax on diesel fuel and taxes on the rig..(and not much else).

You've got a lot to see and learn yet...

"The Feds tell the state how many miles of rail..."

"The state distributes the property tax to the state..."

Huh?

[Anonymous]

QUOTE: Originally posted by Overmod

Dave:

Much of what you're speculating about has been discussed -- in some respects, to death -- under the title of "open access". One place you might start is by reading up on some of the work done by John Kneiling (the old Trains Magazine "Professional Iconoclast") who proposed that trackwork be considered as an 'iron ocean' over which trains would navigate following mutually accepted conventions and rules. It is interesting to speculate on the ways that privately-owned ROW might be converted to allow this kind of practice, as the situation with railroad track occupancy is very different from what prevails on our nation's interstates with respect to vehicle safety, capacity, etc.

When you've worked out some ways this might be done -- and checked with Google, etc., to flesh out your ideas with some facts and details -- start thinking about potential problems and opportunities. Then go back over the posts on this forum that concern "open access" and see how the arguments and discussions there affect your ways of looking at the issue.

If you can somehow get a copy of TRAINS from July of 1973, you can find an excellent John Kneiling column regarding the separation of infrastructure ownership from rail transporter services. He explores three options in terms of his preferences: 1) a series of small investor owned transport companies, 2) a series of investor owned toll railroads, and 3) government ownership of railroad right of ways. As is the case somtimes with Kneiling's writing style, it is hard to ascertain the specifics of his plan (e.g. I can see no difference between options 1 and 2 above), but he does make the point that if a railroad transporter happens to fail under this separation scenario, it does not mean the track will get torn up too, which is what happens now under the proprietary closed access system. The phrase "open access" does not occur in Kneiling's column, at least from the 1970's.

To recap from the other threads, separation of rail infrastructure from rail transporter services would take care of some serious problems: 1) It would eliminate the unfairness of the captive rail shipper, 2) It would allow more rail transporters to enter the transportation services market e.g. opens the field of railroading to more, not less, competition, 3) It would help aleviate the U.S. trade deficit, since many of the U.S. exporters are captive shippers, while no U.S. importer is captive to any rail system, 4) Operating the U.S. rail system as regulated infrastructure companies and/or under government ownership would virtually eliminate the concept of deferred maintenance e.g. there would be no robbing the maintenance budget to "sex up" the balance sheet for Wall Street speculators or to procur expenditures on non maintenance capital, 5) Right now railroad companies try to eliminate capacity until lines are saturated with traffic in order to be able to turn away business and thus boost profit margins, then and only then do they consider adding capacity. Under a separation regime, the incentive of the infrastructure companies would be to constantly add capacity in order to expand the customer base (the customer base in this case being the transporter companies) e.g. instead of improving the bottom line through monopolistic practices, they would instead improve the bottom line by increasing volumes.

Best of all, a separation of rail infrastructure from rail transporter services would be a move toward "equalization" of rail infrastructure construction and operations with the infrastructure of other modes, and by doing so will begin to eliminate the skewing of the transportation market that current runs in favor of truckers and barge lines. Railroads once moved 70% of the goods in this country, and that can only happen again under the separation scenario. Conversely, you can bet the farm that under the current system railroading will never again capture over 50% of the transporation market.

[mudchicken]

QUOTE: Originally posted by greyhounds

QUOTE: Originally posted by mudchicken

Dave:

The Feds tell the state how many miles of rail, how many acres and what physical improvements. The state receives a check from the railroad every 3 months for that part of the railroad in their state. The State distributes the property tax to the state, counties and cities. States like Colorado also have a ton-mile tax and diesel fuel taxes. The trucker pays an artificially low highway use tax (the tax does NOT equal the proportional damage done to the highway, no matter what excuse ATA turns loose), a tax on diesel fuel and taxes on the rig..(and not much else).

You've got a lot to see and learn yet...

"The Feds tell the state how many miles of rail..."

"The state distributes the property tax to the state..."

Huh?

(1) You've never heard of a distribution check or the federal disbursement check have you? (If that check does not show up on time, the county fathers howl in pain....But their assessors, who don't understand it either, will complain that the railroads are not paying THEM directly, scoff at the notion that railroads pay their fare share)

(2) Never heard of the ICC Valuation Act of 1913? Created to level the playing field caused by uneven, wildly varying tax rates in each state caused by the people in (1)....Even with the Act of 1913, you have states like New York jacking rates up to unacceptable (as in double) the rates of other states.

(3) And futuremodal, I see, is up on his soapbox again[V]. I, for one, do not buy what he espouses. Won't fly, rather myoptic view of the real world.[}:)][}:)][}:)]

[Modelcar]

...A simple way to effect a difference and help level the playing field: Inforce truck speed limits on interstate highways...!

[Anonymous]

88gta350,

As you can see by Mudchicken's kneejerk and misdefined view of the idea of separate infrastructure and transporting entities for the NA rail system, there is a narrow-minded cultishness that dominates those who work for the rail industry. His reactionary response to the presentation of evolved ideas is the result of a deep seated fear in the rail oligarchy that the monopolistic gravy train would soon end if the rail playing field was ever opened up to de facto competition. Obviously, given the fact that all other transportation modes function extremely well in an open access environment, one must question why the rail industry continues to short itself with the closed access mentality (and continue to lose market share to other modes as well). It is even more intriguing in Mudchicken's case, given that he is a MOW worker and would thrive working for an infrastructure company. At least, it would be useful for folks such as he to provide some background for their opposition, rather than shovel out insults and inuendo to those who present the new ideas. The fact that the only rebuttal these folks can give in opposition to open access is the problems experienced in Great Britain during it's startup of an open access regime shows that their body of work in this rebuttal is thin indeed, especially when one considers that the British open access rail system is now thriving. Add to that the success experienced in other European countries and Australia, and there is no question such a system would do wonders here in NA for making railroads dominate in intercity freight transportation once again.

If you really want an example of myopic hypocrasy, try the fact that railroaders complain about the "subsidies" for the infrastructure of other modes, yet they themselves will reject any attempt to include the nation's rail system under a similar regime. You sometimes get the feeling that railroaders would rather see the nation's other transportation systems devolved into closed access regimes for highways, waterways, airways, pipelines, and transmission as the way to "level" the playing field, rather than joining their modal counterparts in a superiorly evolved state of existence.

What the rail heirarchy doesn't understand is that the current closed access oligarchy is untendable, and will either be eventually re-regulated by the feds in response to the mounting complaints from captive shippers regarding rate gouging and underserved industries regarding poor or refused service requests, or the nation's rail grid will be nationalized to provide the necessary rate and service relief for our nation's manufacturers and producers (at a huge cost to transportation productivity). The best solution is a separation of the private rail network into infrastructure and transporting companies, with the infrastructure companies functioning as regulated utilities and the transporter companies functioning as the transporter companies do in other modes, but given the lack of cognitive abilities and forward-thinking vision in both the industry and government (not to mention the complete ignorance the average voting citizen has toward the current rail structure), the other two options are more likely to happen.

[selector]

Whew! Marxism/Leninism (i.e-head-up-buttism) vs. Capitalist swine (swindle and predate). Glad to see that there is common ground.

When you appeal to the state to solve your problems, you place them in charge of your life!!! Mother Corp will only be too glad to offer you a nipple and hold you tight so that you can never let go.

[mudchicken]

Futuremodal:

You are entitled to your opinion, just do not expect the rest of the forum to walk off in lockstep with your point of view. The one sided argument does NOT fly with those of us working in the real world and would make Penn Central's finance and physical condition look insignificant by comparison.

Balance of opinion.....Let 88gta form an informed opinion on his own.

MudChicken

[bobwilcox]

If you can not defend your ideas then you resort to demeaning anyone that has a different view.

[Anonymous]

QUOTE: Originally posted by mudchicken

Futuremodal:

You are entitled to your opinion, just do not expect the rest of the forum to walk off in lockstep with your point of view. The one sided argument does NOT fly with those of us working in the real world and would make Penn Central's finance and physical condition look insignificant by comparison.

Balance of opinion.....Let 88gta form an informed opinion on his own.

MudChicken

What? You mean the rest of the forum participants won't walk off in lockstep [bow] with "my" POV?!? I'm shocked![:O][:O][:O]

I totally agree with your view that 88gta and others will be able to from their own opinions. I'm not sure why you and others are convinced there is some kind of "agenda" going on here. I would argue just about everyone on this forum has some thought provoking opinions. In my view, the more diversity of opinion, the better. It's just that some on this forum mistake insults and backstabbing for thought provoking opinion.

Suffice it to say, it's not kosher to accuse someone of being on a soapbox, when you yourself are standing knee deep in Ivory Liquid.

[PNWRMNM]

Dear Mudchicken,

I have given up on futuremodal because of his ranting personal attacks on those who do not agree with him. You might want to adopt the same course.

Mac

[edblysard]

Actually,
Its kinda funny...
All you gotta do is ring the bell, and watch Uncle Pavs nephew start slobbering about open access....
Talk about knee jerk reactions!

Ed

[Anonymous]

Mac and others,

What right do you have for accusing me of personal attacks, when all I did was initially provide a set of reasons that open access might be perferable to both the current closed access system and/or a return to re-regulation of rail transporter services? The response was not a set of counterarguments, but an accusation of having "an agenda", being "myopic", being on a soapbox, etc. Naturally, I will respond in kind, and I am correct in assessing Mudchicken's initial response to my set of talking points as being kneejerk, and his assessment of open access arguements being "myopic" is clearly misdefined. Add to that the "dings" from Ed and his ilk, and it is extremely amusing to me that I am the one being accused of "personal attacks", when clearly it is the anti-idea crowd that is engaged in personal attacks. Paul, you don't know what you're talking about.

Again, I will challenge anyone to provide some substance to the set of talking points in favor of open access with a set of counterarguments against open access, without resorting to the "agenda", "soapbox" or "ding" replies. Will open access aid in reducing the U.S. trade deficit or not? If not, provide some substanitive reasons why you don't think open access would address that issue. Will open access provide incentive for manufacturers to stay and or build in the U.S. rather than locating overseas, or not. If not, provide some substanitive arguments why you think open access won't aid in addressing that issue. Will open access be the best option for staving off re-regulation of rail transporting services (e.g. rate re-regulation), or is there a better way to placate the concerns of captive shippers without the inevitable rate regulation? If it is the latter, please provide the reasons how and why these other ways will work toward resolving those issues. What about the points of "equalizing" the playing field among railroad service providers, trucks, barges, et al? What about the idea of using open access to transfer part of the burden of capital expenditure from the railroads to federal and state governments? If you don't think open access in some form would result in an increase in rail's share of intercity traffic, tell us why. If you don't think open access the best way to allow private rail passenger services to thrive in the U.S., tell us why.

If any of you can do that without the insults and inuendo, that would probably be appreciated by all. I have my doubts that most of the anti-open access crowd can do so.

[selector]

I heard once that the person doing the most talking in an argument is usually the one in the wrong.

[CSXrules4eva]

Ok here's what I have to say about this issue. The government was once interested in railroads when the first came out as the new and improved way of effective transportation of people and goods. Tthe government subsidized and funded the now "fallen flag railroads". And they would be concidered foolish if the didn't. Railroads were one of the biggest and fast growing industries in the market. Well this all changed when cars were invented. Now the big thing was the trucking industry, so the govrnment turned it's back on the rails and looked to the trucks. This is one of the reasons why I'm mad at the govenment for doing this. Because of this I don't think the government would have the slightest interest in investing in railroad technology anymore. The government doesn't even what to give Amtrak money do you think that they'd want to give a major class one freight, any money to build new infrastructure??//

[edblysard]

Wow,
I have ilk!


Are those free range ilk?


Anybody know how to chicken fry ilk?

Do baked potatoes go good with ilk?

Hey mudchicken,up for a ilk fry?

And what season can you hunt them in?

Ed[:D]

[brazos87]

[C):-)][dinner][C):-)]

QUOTE: Originally posted by edblysard

Wow,
I have ilk!


Are those free range ilk?


Anybody know how to chicken fry ilk?

Do baked potatoes go good with ilk?

Hey mudchicken,up for a ilk fry?

And what season can you hunt them in?

Ed[:D]

As the dairy ads say "Got ilk?". As far as ilk goes, it must be a minimum of a 6 point ilk, ilk is best grilled over mesquite, ilk goes great with others "whine" and cheese. Unfortunely ilk season is over, but snipe season is here!![:D]

[88gta350]

I can't really make an informed opinion because most of the arguments that are being made by both sides are a bit over my head. I'm not very familiar with railroad processes, history, or even the terminolgy being thrown about. Open access, closed access, regulation, deregulation, reregulation.... it's all greek to me.

I originally posted this thread to solicit ideas on how the givernement could make rail more competetive, or "subsidize" it as it does with the trucking industry. While gov't may not set out to subsidize trucks by directly giving them money, incentives or tax breaks, the industry uses governement supplied highways and it's only real costs are labor, fuel, and maintainance on it's fleet. Imagine what rail could do if it had those same 3 major costs and didn't have to worry about maintaining or replacing rail or ballast or signals, etc. However, short of turning the entire rail network over to the gov't, I'm not sure how the playing field could be leveled like that. That's what I'm looking for opinions on.

And for all I know, that's exactly what you've been discussing and I just can't understand it. Let's pretend you were explainging this to Joe Blow out on the street.... what could gov't do to help the railroads be more competetive or "level the playing field" if you want to use that term, without bankrupting either the roads or the gov't.

I appreciate all the replies, and let's keep the discussion civil and informative! I'm learning!

[Overmod]

I waited for years and years to see whether the FRA would redirect their corridor research away from pure passenger operation (at 110mph) and start developing joint models that were tolerant of the 'right' kind of freight operations as well as passenger -- this would have state and Federal funds providing the initial capitalization, and the expensive/unproven parts of the maintenance and infrastructure development, and at least some of the cost of high-speed signaling, PTC, and the systems that PTC and NDGPS make practical for train handling and customer service.

The most recent letter to the Administrator I saw indicated that FRA was indeed redirecting its research emphasis away from passenger rail, as being an unrealistic application of Federal funds in our current era of [insert reasons for scarce resources as you like in this space]. Unfortunately, as soon as you eliminate public transportation, you lose most of the political attractiveness for allocating funds to rail development -- even at best, the shipping community is an oligopoly, only relevant to the average voter if there is CLEAR and DIRECT evidence that support for rail decreases actual cost of goods and services to that voter.

I think it is a given that the United States Government will not at any time move to take over the ROWs of the 'national railroad network'. I think it is also obvious that the Government will not allocate funding, or assume debt, sufficient to finance purchase of the ROWs, even assuming some incentive could be found to get the railroad companies to sell (and to get the local taxing entities to give up their money pots!)

This leaves comparatively little that can be done, meaningfully, to achieve even limited open access. Most of the systems that I think have some practicality involve some opening up of trackage rights accessibility in return for Government incentives or integration -- there's a writhing can of worms involved with this idea, make no mistake, but in the hands of fair-minded people it might be made workable (which the purchase-based schemes to me obviously aren't) [And yes, I know, "fair-minded government" is often an oxymoron...]

Let the government, for example, coordinate and administer a more advanced system of dispatching (analogous in scope, but of course not in detail, to the current air controllers' system). It is not a big jump to give this agency oversight and control of the standards needed to qualify a train and its personnel for 'access' to a given system and route... signals, training, maintenance, union representation, whatever might be considered appropriate... and then assume legal responsibility or provide indemnification to the 'track providers' for any lapses or problems in this qualification which lead to damage, delays, etc. Note that, just as with airport capacity, there will be just so many available 'slots' available to handle trains, and this translates into something that might look like the 'medallion' system for taxis.

I think there's no reason formulas can't be developed that fairly allocate maintenance expense, improvement capitalization, etc. for the marginal increase in track utilization/occupancy generated by the additional 'trackage rights' -- or to provide a Government guarantee of funding, resource allocation, tax-writeoffs, etc. to cover anything that isn't directly billable to the service providers.

In my youth, I wondered whether railroads might try to fill up capacity of an expanded dispatch and control system with their own trains. Answer: yes, they might, but I recently note quite a few instances where additional service isn't provided because the amortized capital cost of the locomotives needed to render it effectively (even at our current very low iinterest rates) isn't something the railroads involved care to engage in. Perhaps better to take a piece of the guaranteed profit from a train's operation than 'compete' and perhaps lose more than the opportunity income...

One place the Government could make a positive difference would be in establishing open standards -- and even more of a networked enabling technology -- for systems efforts like RailDocs. I believe the Government is already a major partner in implementation of NDGPS, and would logically be a partner in implementation of standards for advanced PTC, if indeed not subsidizing key parts of the infrastructure. Sometimes a 'foot in the door' can be a good thing, not a threat to return to the bad old pre-Staggers mentality... ;-}

[Overmod]

This was another of those wacky 'automatic' multiple posts... but let me take this opportunity to add that we're already seeing a potential path to partial "open access" variants as states and other public agencies acquire ROW that railroads no longer care to operate.

Not entirely just for grins: Assume the ITS architecture is expanded to include on-rail control as well as crossing interactions, as a standard. You might get some interesting results from even poorly-maintained Midwest granger feeders used as routes for 'hy-rail' equipped farm trucks with multiple trailers, either optimized for elevator transloading or actually fitted with intermodal bodies of some kind...

[adrianspeeder]

QUOTE: Originally posted by edblysard

Wow,
I have ilk!


Are those free range ilk?


Anybody know how to chicken fry ilk?

Do baked potatoes go good with ilk?

Hey mudchicken,up for a ilk fry?

And what season can you hunt them in?

Ed[:D]

I have no clue about any of this stuff, but I will say that your post ed made me laugh. And whats up with puttin a hemi sig line in a train forum.....[:D][:D][:D]

Adrianspeeder

[edblysard]

Uhhhh..

'02 F-250, Black, XLT, Crew Cab, Short bed, 4x4, 7.3L Power Stroke Turbo Diesel, 4R100 auto
'92 Bronco, Black, XLT, 302 V8, M5OD FIVE SPEED!!!
'84 Bronco, Black, XLT LARIAT!, 351HO V8!, C6 auto
'97 F-150, Black, XLT, Ex Cab, Short Bed, 4x4, 4.6L V8, Mazda M5OD FIVE SPEED!!!
'85 Chevy, Sand, Reg Cab, Long Bed, 4x2, 305 V8, threespeed auto
'66 F-250, Orange, Custom Cab, Long Bed, 4x2, 352 V8, Three on the tree!!!

Yeah, thats what I though....[:P]

[Anonymous]

88gta350,

Here's my best attempt at a primer. "Closed access" is the term I use to described a transportation system in which the owner of the right of way is (usually) the sole provider of transporting services. Most if not all of the railroads in North America are closed access. In other modes, it used to be that the sole owner and user of transmission lines was the energy company/electric utility. Ditto for pipelines. Now, much of the transmission and pipeline infrastructure is owned by third party entities, with access to the infrastructure allowed for online electricity or natural gas/petroleum producers.

"Open access" is the term used for any transportation infrastructure in which the owner of the infrastructure does not engage in any of the actual transporting services. Highways are open access, in that any truck line can provide transporter services to any online shipper, e.g. it is not limited to one trucking company. Ditto for waterways. There was a time long ago when some roads and canals were operated by the sole provider of transporter services, but (and this is my opinion) these modes evolved into open access by natural order, e.g. it just made more sense for these modal forms to be operated as open access, whether by a private toll company or some level of government. Unfortunately, the U.S. rail system did not evolve in a likewise manner, and therein lies the problem.

The problem that is growing today for closed access rail systems is that many of the shippers on the line are "captive" to that sole company for the most logical form of transporter services. Captive rail shippers can pay more than double the rates of rail shippers who have access to more than one railroad (or have alternative access to barging or pipelines, depending on the commodity in question). This is called "differential pricing", a less ignominious term used by the railroad industry to paint over what it really is, which is monopolistic pricing. It is unfortunate that the federal regulators have turned a blind eye to this practice, but the belief in the rail industry is that "differential" pricing is essential for railroads to keep their financial heads above water. The consequence of this practice is manyfold: Some plant owners will relocate a manufactering plant overseas, some will shut down the plant and re-invest elsewhere in industries not constrained by transportation issues, some will turn to less efficient forms of transportation such as truck and/or some will turn to less speedy forms of transportation such as barges.

Speaking in global terms, it is producers and manufacturers in the U.S. that are bearing the brunt of monopolistic rail service pricing, and thus it is making it harder for the U.S. to compete with foreign competitors for the world markets, since most other rail systems outside North America are either open access or are heavily regulated/subsidized by their respective governments. It cost more on average for a captive U.S. producer to deliver his product from point of origin to the nearest U.S. ocean port, than it does for his competitor overseas to do the same to his nearest ocean port. Additionally, it is cheaper to deliver foreign goods into the U.S. to the consumer markets via rail than it is for domestic producers to access the U.S. consumer market, because virtually all import ports have access to two or more railroads which all connect to the major consumer terminals, whereas many domestic producers are captive to one railroad, so they pay much higher rates to get their similar goods to the same U.S. consumer terminals. When you consider that with the devalued dollar we should be able to whittle down the trade deficit, yet we are still runnning record deficits, it is clear that the closed access rail system in the U.S. is a major culprit of the U.S. trade deficit.

There is a way for the government to ameliorate this problem, without resorting to either re-regulation of rates (pre-Staggers Act) or some form of nationalization. They can use the AT&T breakup as a legal template to do a similar thing for the railroad system, e.g. breaking up the rail oligarchy into rail infrastructure companies and rail transporter services providers. I've already gone over a list of the possible benefits of such a move. The others on the forum can provide a list of reasons why such a move would be bad for the U.S. economy, if they can come up with any....

Note to Overmod: Yes, some rail ROW's are being purchased by local and state governments, but they are still not open access in the sense that most of these governments simply turn around and assign a single rail operator the sole rights to provide rail transporter services. Even if the government entity itself runs the trains, in most cases there is only one connecting Class I, so the shippers on the line are still subject to captive rates.

[edblysard]

Sent in by some of my Ilk,
(and who would have though they could type so well with their big hooves!)

"Many people say it's not fair that the trucking industry gets their transportation system (the roads/interstates) subsidized by the government while the railroads have to build their own physical plant."
My answer: What does fairness have to do with anything? Some people are born to millionaire parents in the U.S., while others to beggared farmers in Somalia. No business was guaranteed a fair playing field beyond what's contained in the U.S. Constitution. Each individual, corporate or personal, is welcome to negotiate for whatever they can obtain. If truckers got a better deal, I say "good on ya." Now, if you'd asked if the system gives the best results for the resources that have been invested by the public, that might lead to different answers. But you didn't ask that question. In my opinion, the "it's not fair" argument is not only wrong, it's a losing argument. It's only effect will be to further distance the entity making the argument from the success that entity desires.
"Roads are financed through taxes and tolls. Would it be advantagous for the railroads if the government owned all the rail?"
My answer: Who are "railroads" in this case? The current companies? The industry? The transportation mode? I think you're referring to the current companies, so the answer is: it's impossible to tell. The deal could be structured so that the operating companies raked off immense profits when the taxpayers subsidized all the costs of the fixed infrastructure. Or it could be structured so that no viable, honest operating company would even touch the deal, because it would not return them enough profit. In other words, define how you want to structure the deal, and I could make some projections.
"Obviously this would save the railroads a lot of money in maintaince and labor charges, and it would cost the government a lot. The government would have to make up that deficit through higher diesel fuel tax or some type of set toll for usage of the tracks."
My answer: Not necessarily in any case. The government could make up the shortfall from the general fund.
"But I can see this creating a whole host of problems. Because no one now owns the rails, everyone would be free to go as far on them as they like. Railroads would compete on cost of shipping alone. Every road in the country could travel from coast to coast. So how would you handle this traffic. At least on the road there is room for all the trucks. On rail you'd have a traffic nightmare. You'd now need some type of independent control center to route all the traffic. If a shipper wanted to build rail access, who would build and pay for it? The shipper or the govt?"
My answer: All good questions. These parameters would have to be established. Any problem can be solved with enough money, but unless there's enough money, the problem might not be solved.
"Perhaps a better solution is to give some type of credits back to the railroads in direct proportion to how many miles of rail they own. Rather than the gov't building the physical plant for the railroads as they do the trucks, perhaps they could subsidize it through tax breaks or lessening the fuel tax railroads have to pay, or something else to that affect."
My answer: Why do you want to fix what may not be broken? What makes you think the present system is all that awful? Bottom line: everything MUST be paid for, either focused onto the direct consumer or spread out over the indirect taxpayer. There is no other source of money. If you're proposing a tax on the public to subsidize rail transportation to shift freight from highway to rail, I think a taxpayer has the right to ask how he gets a positive return on his investment in rail. Otherwise, it's just a wealth transfer from taxpayers to rail stockholders, suppliers, and employees.
"Anybody have any feasable ideas as to how the gov't could level the playing field between trucks and rail? Is the ROW considered real estate that gets taxed by the state/local authorities? If so, perhaps the gov't could proclaim railroad real estate exempt from all taxes, federal, state, and local?"
My answer: I think you're attempting to solve a problem before you've even defined the problem! What specifically is the problem you want to fix? Market share between rail and road is not a problem, it's merely an indicator of the respective attractiveness to transportation consumers of each transportation mode in the North American transportation marketplace under the present rules at the present time. Saying that "rail market share is too low" has no inherent truth or appeal (to anyone beyond than the partisan railfan), anymore than saying that "rickshaw market share is too low." If you want to change the rules in order to shift market share between modes, it would be essential for you to state why the current shares result in a problem.

First, perhaps you want to establish a hypothesis that the current system is less cost-effective than some alternate system; second, iterate a number of alternate systems and assess their costs and benefits; and fourth, compare your alternate systems to the status quo system and see if any offer lower costs and higher benefits. But right now, you're assuming the current system is "broke," and you have no way of knowing that without having something else to compare it to. Nor will you find any rational person willing to entertain an experiment with trillion-dollar risks until those alternatives are established to be better.*


*(submitted by an a senior member of Ilks United, a non profit group dedicated to getting a Ilk in every American household)

Got Ilk?


See, even Ilk get it.....

Ed

[adrianspeeder]

"We got Ilk commin in from all directions!!! Position is about to fall! 50 cal supression fire has NO effect! Send in an Alco to do an emergency evac. Over."

Adrianspeeder

[88gta350]

QUOTE: Originally posted by edblysard

Sent in by some of my Ilk,
(and who would have though they could type so well with their big hooves!)

"Many people say it's not fair that the trucking industry gets their transportation system (the roads/interstates) subsidized by the government while the railroads have to build their own physical plant."
My answer: What does fairness have to do with anything? Some people are born to millionaire parents in the U.S., while others to beggared farmers in Somalia. No business was guaranteed a fair playing field beyond what's contained in the U.S. Constitution. Each individual, corporate or personal, is welcome to negotiate for whatever they can obtain. If truckers got a better deal, I say "good on ya." Now, if you'd asked if the system gives the best results for the resources that have been invested by the public, that might lead to different answers. But you didn't ask that question. In my opinion, the "it's not fair" argument is not only wrong, it's a losing argument. It's only effect will be to further distance the entity making the argument from the success that entity desires.
"Roads are financed through taxes and tolls. Would it be advantagous for the railroads if the government owned all the rail?"
My answer: Who are "railroads" in this case? The current companies? The industry? The transportation mode? I think you're referring to the current companies, so the answer is: it's impossible to tell. The deal could be structured so that the operating companies raked off immense profits when the taxpayers subsidized all the costs of the fixed infrastructure. Or it could be structured so that no viable, honest operating company would even touch the deal, because it would not return them enough profit. In other words, define how you want to structure the deal, and I could make some projections.
"Obviously this would save the railroads a lot of money in maintaince and labor charges, and it would cost the government a lot. The government would have to make up that deficit through higher diesel fuel tax or some type of set toll for usage of the tracks."
My answer: Not necessarily in any case. The government could make up the shortfall from the general fund.
"But I can see this creating a whole host of problems. Because no one now owns the rails, everyone would be free to go as far on them as they like. Railroads would compete on cost of shipping alone. Every road in the country could travel from coast to coast. So how would you handle this traffic. At least on the road there is room for all the trucks. On rail you'd have a traffic nightmare. You'd now need some type of independent control center to route all the traffic. If a shipper wanted to build rail access, who would build and pay for it? The shipper or the govt?"
My answer: All good questions. These parameters would have to be established. Any problem can be solved with enough money, but unless there's enough money, the problem might not be solved.
"Perhaps a better solution is to give some type of credits back to the railroads in direct proportion to how many miles of rail they own. Rather than the gov't building the physical plant for the railroads as they do the trucks, perhaps they could subsidize it through tax breaks or lessening the fuel tax railroads have to pay, or something else to that affect."
My answer: Why do you want to fix what may not be broken? What makes you think the present system is all that awful? Bottom line: everything MUST be paid for, either focused onto the direct consumer or spread out over the indirect taxpayer. There is no other source of money. If you're proposing a tax on the public to subsidize rail transportation to shift freight from highway to rail, I think a taxpayer has the right to ask how he gets a positive return on his investment in rail. Otherwise, it's just a wealth transfer from taxpayers to rail stockholders, suppliers, and employees.
"Anybody have any feasable ideas as to how the gov't could level the playing field between trucks and rail? Is the ROW considered real estate that gets taxed by the state/local authorities? If so, perhaps the gov't could proclaim railroad real estate exempt from all taxes, federal, state, and local?"
My answer: I think you're attempting to solve a problem before you've even defined the problem! What specifically is the problem you want to fix? Market share between rail and road is not a problem, it's merely an indicator of the respective attractiveness to transportation consumers of each transportation mode in the North American transportation marketplace under the present rules at the present time. Saying that "rail market share is too low" has no inherent truth or appeal (to anyone beyond than the partisan railfan), anymore than saying that "rickshaw market share is too low." If you want to change the rules in order to shift market share between modes, it would be essential for you to state why the current shares result in a problem.

First, perhaps you want to establish a hypothesis that the current system is less cost-effective than some alternate system; second, iterate a number of alternate systems and assess their costs and benefits; and fourth, compare your alternate systems to the status quo system and see if any offer lower costs and higher benefits. But right now, you're assuming the current system is "broke," and you have no way of knowing that without having something else to compare it to. Nor will you find any rational person willing to entertain an experiment with trillion-dollar risks until those alternatives are established to be better.*


*(submitted by an a senior member of Ilks United, a non profit group dedicated to getting a Ilk in every American household)

Got Ilk?


See, even Ilk get it.....

Ed

Ed, I'm not trying to solve any problem because I don't know enough about the system to know whether a problem exists or not. I've merely heard a lot of griping on this forum before that trucks are given gov't provided roads etc while the railroads fend for themselves. I know next to nothing about the business or operation side of rail, so I was looking for information and not trying to give answers. The "answers" I threw out there were just to show what direction I was hoping the debate would take.

Futurmodal, thanks for the Rail 101. I'm glad you likened the system to the electrical grid, because that's something I can understand, working in that field. While third party ownership of the rail infrastructure does sound like a good idea, I imagine it would be a lot more complicated to introduce and employ than it is with the electrical grid. but again, I don't know enoguh about either system to say for sure.

Perhaps the best idea is just to let Capitalism play its hand and the market will bear what it can bear. If rail can't compete, the companies will be forced to make some changes; the same as any company in any industry must.

[SALfan]

QUOTE: Originally posted by edblysard

Actually,
Its kinda funny...
All you gotta do is ring the bell, and watch Uncle Pavs nephew start slobbering about open access....
Talk about knee jerk reactions!

Ed

Well said! And it is amazing to me how futuremodal never misses an opportunity to work in an endless rant on open access, no matter how tangential the connection between the topic at hand and open access. Thank goodness the posts are marked with the poster's name.

[edblysard]

Perhaps the best idea is just to let Capitalism play its hand and the market will bear what it can bear. If rail can't compete, the companies will be forced to make some changes; the same as any company in any industry must.
--------------------


88gta350,

Exactly...

And the converse is just as true...

If a shipper can't compete, the shipper(company) will be forced to make some changes; the same as any company in any industry must.

Was picking on the open access guru, that all.

Gov. regulation was the norm for quite a while, and it did allow small shippers, like the Montana wheat growers, to "share" in the lower cost on shipping fees....they paid what everyone else paid per ton mile, because the feds set the rate....
Railroads couldnt compete with each other, because the basic cost was fixed in place...so it boiled down to the guys with the fastest/most efficent route made the money.

Now, this is a simplistic version, it would take several volumes to even make a dent in why open access isnt the solution, right now.

You are off to a good start, though, because you seem to understand that railroads are a business...

They are not public utilities!

Therefore, the people who invested in them, (me, you, and a lot of other folks) expect them to make a profit.

As the Senior Ilk pointed out, highways allow many trucks to use the same piece of roadway at the same time.
One of them wrecks, drag it off to the side, and while that is going on, the other 4 or five lanes are still in use...

Have the same thing on a railroad, every train behind the problem is stuck...


And, contrary to the open access proponents, the railroads of today are not broken, in fact, last year we moved more tonnage than ever before....
So if it aint broke, why try and "fix" it?

Because a small, select group of people want the same style of rates they had before, where the feds were keeping rates on some things atrifically low....now that they have to pay the same as everyone else, they gripe...because now, instead of paying the same rate a shipper a few miles from a major interchange pays, they have to pay for the extra mileage, at a proportionally higher rate....

If you shipped a package from Key West to Nome, Alaska, would you expect to pay the same rate as if you were shipping it to Penscola Florida?

Why shouldnt you pay more for the extra service?

Because it isn't fair?

So, neither is any other type of business, fair play is what little league baseball is all about, not billions of dollars worth of railroading...

I want BNSF to get every dime they can from every shipper they service, and I want then to dump the shippers who cost them money...same for UP...because I am one of those who invested in both railroads...I am a stockholder, and I want the most return on my investment.

Because BNSF spent "my" money on "their" tracks, I dont want anyone else to use them, unless the other person using them makes me as much or more money as BNSF can in the process.
I could care less if someone dosnt see that as fair...

If you have a product, and want to ship it by rail, and only one railroad serves your town, then your stuck using that railroad, and paying what that railroad wants to charge, even if it is more than what another manufacture of the same product pays elsewhere.

If you dont like that option, then either move your plant to a more profitable location, use trucks to ship, or change what you charge for your product to make up the difference in cost...

It aint rocket science!

If there is only one railroad serving a paticular area, the reason might be that what is shipped from that area is not all that profitable.

Or, on the other hand, the product from that area is very valuable...in which case almost any railroad is free to buy land, build track, and enter the area to do business...if they dont do so, then the return on the cost isnt there...

Think of it this way, when Powder river basin coal was not a profitable venture, there were only a few railroads in the area...now that is it a big part of the business, everyone wants to build a line into the area...

If you have only one line left in your area....?

Captive shippers are "captive" for a reason...no other railroad wants the business bad enough to invest in the area, or there isnt enough business to support another railroad.

No where in the US Constitution is the concept of business having to play fair mentioned, not in any of the amendments, nor in any of the business laws I have read....what is mentioned is that business has to follow the current version of the law that governs that paticular business.

Its business, not baseball....

You said you were looking to be educated on this concept...great, do some more research, on both sides of the issue.

Let us know what you find out, and I will bring it up at the next meeting of my Ilk...they meet on the first Monday of the month, or the first full moon, whichever comes first![:D]

Ed