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BNSF boss says transport system nearing crisis

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[quote]QUOTE: Originally posted by NS2317 Futuremodal, Where did Mr. Rose suggest subsidizing the railroad? From my interpretation of the article, Mr. Rose talks of the demand for transportation capacity from all modes, not just railroads. The article goes on to show what the railroad is trying to do to keep up with the demand and at no time is the word "subsidize" mentioned there. It is the talk about the roads and waterways that infer tax payers money.[/quote] See post by James the Mad. [quote]QUOTE: To blame the railroads' past decision to eliminate unused capacity for the current bottle neck is kind of strange.[/quote] Why? I happen to think the opposite is strange, aka the railroads for the last few decades have gone hog wild to eliminate effective rail capacity, then they turn around and ask the taxpayers to subsidize new capacity. You don't find that the least bit ironic? [quote]QUOTE: Would any business continue to maintain high cost assets "just in case" the need arose 20 to 30yrs down the road? I would hope not. Not many share holders would play that foolish game. [/quote] Look at the forest products industry for a model of maintaining underutilized assets for future gain 20 to 30 years down the road (although their long term hold goes for more like 40 to 50 years). Why do such businesses do so? Because it results in a long term pay-off. Just because some greedy stockholders demand profit maximization now at a cost of future lost profits doesn't mean you aquiesce to them, because to do so is a bad business model, unless you're in it for the shorthaul e.g. take the money and leave a corporate corpse. However, the railroads didn't embark on the task of eliminating capacity to avoid even mothballing fees, they eliminated capacity to extract pricing power aka monopoly profits with the unwitting aid of those Stagger's era politicians. When you can reduce usage to a few remaining lines, you get predictable congestion, which means you can pick and choose premium price takers and eliminate sub-premium price takers, who then of course will default as much as possible to using highways, so now we get more highway congestion. That's where the federal regulators really screwed up, and why Mathew Rose's statements of *concern* over our nation's transportation system clogging up is really laughable. And we should remind Mr. Rose that the purpose of our nation's transportation policy isn't to make it easier to bring in more imports in a time of growing trade deficits. On the contrary, our transportation policy should be directed to making it easier for domestic producers to get their products to the consumer markets, both here and abroad. The current railroad modus operandi is the antithesis of this purpose.
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