Op Ed - "Railroad monopoly is drag from factory to the supermarket"

[MichaelSol]

I guess he would like to go back to the ICC which, according to "Enterprise Denied," the prize-winning economics treatise by Prof. Albro Martin on early 20th century railroads under the ICC ...

Of course, Albro Martin, known for howling errors in his work, is not an economist ...

 Gabriel Kolko's "Railroad Rates and Regulation" stands up as the better analysis of the era.

[youngengineer]

How many railroads can these shippers keep afloat, just because you want 2 railroads doesnt mean you can have 2 railroads. Should a small town that has 1 bookstore force another company to open another to help keep prices down. The town probably can barely keep one bookstore open let alone 2. Maybe the original bookstore should lease space to another outfit so they can sell books in the same store. The federal government, which can't even run a proftiable bussiness, i.e. the post office, could set the lease rates. Maybe they could even set the prices of the books. If you want railroads competing for your bussiness than open your bussiness where you have competing roads!

Some shippers used to have competing railroads, and guess what only one survives today, I wonder why, maybe the bussiness from the shipper is not enough for 2 railroads! Everyone wants what is good for them and they forget the economics of the real world. If there is so much bussiness out there that is going untapped, why arent new rail lines being built! 

[CSSHEGEWISCH]

We really need to ask the Australians how well the duopoly that is forming in the aftermath of OA legislation is working out for the shippers.

[jockellis]

G'day, Y'all,
The honorable delegate from Delaware conveniently forgets that all those captive shippers have roads in front of their doors and they could use trucks. Of course, that would cost even more which makes railroad rates appear cheap.
I guess he would like to go back to the ICC which, according to "Enterprise Denied," the prize-winning economics treatise by Prof. Albro Martin on early 20th century railroads under the ICC, the ICC was made up solely of lawyers, many of whom had made names for themselves back in granger states as State Railroad Commissioners. Let no one think that the states were on the side of the railroads, nor were the commissioners who were appointed to the ICC.
This body was the only "court" in America from which there was no appeal. The lawyer/commissioners liked to be called Mr. Justice - like a Supreme Court justice - and ran their meetings like courts. They thought the rates of 1878 were perfect and tried to keep them at that. When they did give a rate increase in one thing, they took it away in another.
Had WW I not come along, no telling what would have happened to the railroads. After the government nationalized the railroads, it hired railroad executives to run it during the war. Only then were they able to raise freight rates 60 percent and make it possible to railroads to have money with which to carry out all the modernization projects that needed being done.
Does anyone think today's politicians are any more public spirited than they were 100 years ago. I don't. I think they would use their powers to keep railroads from progressing. There may be seven railroads but there are thousands of trucking firms to help defray expenses for those new "commissioners."

[Anonymous]

FYI - I got this off the TrainOrders email list.....

http://www.delawareonline.com/apps/pbcs.dll/article?AID=/20070802/OPINION07/708020325/-1/NEWS01

"Railroad monopoly is drag from factory to the supermarket"

By Deleware Democrat Representative Bruce Ennis

Summary - "By repealing the antitrust exemption for railroads and reforming the STB, Congress has an important opportunity to restore competition and accountability to the nation's rail system."

 

My own commentary is just that finally politicians are waking up to the existance of the inherent natural monopoly of integrated rail systems, and it is only now becoming apparent with the consolidation of the industry from 40 or so Class I's to today's 6 big ones.