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Bob, I will respectfully disagree with regards to winners vs losers. First of all, why is it axiomatic in your opinion that the rest of the country would somehow be penalized if captive shippers are freed from their bonds? We need to make this very clear: No one on my side is suggesting a return to pre-Staggars rate regulation (I will again make this allegation, that the 4R's act was only partial deregulation akin to the California partial energy deregulation, with a skewed market as a result), rather we only want the STB to follow the proper protocols and give all regions access to competitive rate setting. It isn't just farmers who suffer, it is captive chemical plants, captive coal fired power plants, captive intermodal terminals, et al, who get screwed by predatory rate setting. The only winners are those areas which manage to avoid becoming captive via STB fiat. Lucky them, but the same could have easily happened to them as has happened to the Northern Tier states. If SP and SF had merged followed by a merger with UP, what would have happened to rail rate payers in LA? That would have left LA screwed, and with their political power you can bet their complaints would have been heard at the STB. Too bad Montana has no real political pull in DC. Having the STB force agreements which gaurantee competitive access to all regions of the US will not hurt anyone except the bad players in the rail industry. Besides, don't you agree that if one area of the US suffers unnecessarily due to government negligence, it can negatively affect the rest of the country? If Montana farmers can't afford to ship their grain to export markets, doesn't that have a negative effect on the U.S. trade deficit, not to mention income tax reciepts? Rate regulation of competitive markets is bad, as is rate deregulation of monopolistic markets. Deregulating competitive markets is good, as is belatedly regulating monopolistic markets. That's how a capitalistic society is supposed to function with limited government. Any econ student knows that if you let monopolisitic forces have a free reign over markets (especially those markets where entry by newcomers is extremely difficult), bad things will happen to consumers. Either the government has to re-regulate the monopoly, or it needs to break up the monopoly. The latter is my preferred choice, re-regulation is my last choice, but even that beats allowing monopolisitic practices to continue. In a truly deregulated rail market, all shippers will have access to rate quotes from at least three (ideally) rail carriers. Even a duopoly can have monopolistic results. We have studied this before in my econ courses, and we concluded that three is the minimum necessary to prevent the occurance of monopolistic tendencies. There is no such thing as a "triopoply" in most cases, as the third party inevitably acts as the odd man out and will make more aggresive marketing decisions, at which point the concept of comparative advantage comes into play. A duopoly will often simply let one be the price leader and the second party will price accordingly without ever needing to conspire. With a third party, the tendency is to have constant market aggression. This is the theory of the third wheel you might have studied in psychology (as in a third person on a date does not fit the situation desired), and it applies as much to economics as it does to sociology.
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