STB chairman Oberman's letter today suggests (to me at least) that there won't be any mergers in the near future. His letter (Trains newswire) makes it pretty clear that the STB doesn't think more mergers are a good idea. He also took direct aim at JJ Ruest's comment that single line service is needed to effectively move freight from road to rail. Will be interesting to see how CP/CN/KCS respond..
As a railfan, I personally think it woud be great if KCS remained independent.
Still in training.
Honestly, as long as someone doesn't try to merge the Strasburg and dieselize it I really don't pay much attention to mergers.
However, the "Surf Board" chairman's probably correct.
Some oil/gas pipelines between western Canada and eastern Canada take a shortcut thru the US around the Great Lakes. One that crosses under 5 miles of open waters between Lakes Michigan and Huron has become controversial. The Canadian pipeline company has brought up international agreements that say that the intermediate country (US) can not interfere in pipeline transit. I fear that the same legal theory might be extended to a Mexico-US-Canada rail merger. In the KCS merger, I think any Mexican subsidiary should be spun off or remain neutral.
How does the STB come to a decision? I'm assuming there are x number of members on the board, and they vote and the majority rules. Is that how it works?
Ulrich How does the STB come to a decision? I'm assuming there are x number of members on the board, and they vote and the majority rules. Is that how it works?
Yes that is how it works. The decision on the CP Voting Trust was split, the majority approved it. Chairman Oberman was not the dissenting vote.
Just a wild guess on my part, but I think we'll have a decision on the voting trust late this afternoon.
What the hell is a voting trust?
Lithonia Operator What the hell is a voting trust?
My understanding is that it is a legal construct that puts KCS in amber while the regulators decide the merger.
Down the Rock Island line she's a mighty fine road.
The STB sure seems like a very powerful entity. I had thought that that kind of regulatory power vanished along with the ICC.
Lithonia OperatorThe STB sure seems like a very powerful entity. I had thought that that kind of regulatory power vanished along with the ICC.
"A central theme of this book is that railroads, throughout their history, were so important to the US economy that politicians could not leave them alone, and when governments did intervene in transportation markets, they usually made a mess of things. Government regulation distorted consumer choices, found awkward and costly ways of subsidizing competing modes of transportation, taxed or regulated away profits needed for reinvestment and capacity expansion, and—while generally contributing to greater safety—typically fell far short of stimulating optimal safety performance for all transport modes."
Gallamore, Robert E.. American Railroads . Harvard University Press. Kindle Edition.
Let the CN buy the KCS!
greyhounds Lithonia Operator The STB sure seems like a very powerful entity. I had thought that that kind of regulatory power vanished along with the ICC. "A central theme of this book is that railroads, throughout their history, were so important to the US economy that politicians could not leave them alone, and when governments did intervene in transportation markets, they usually made a mess of things. Government regulation distorted consumer choices, found awkward and costly ways of subsidizing competing modes of transportation, taxed or regulated away profits needed for reinvestment and capacity expansion, and—while generally contributing to greater safety—typically fell far short of stimulating optimal safety performance for all transport modes." Gallamore, Robert E.. American Railroads . Harvard University Press. Kindle Edition. Let the CN buy the KCS!
Lithonia Operator The STB sure seems like a very powerful entity. I had thought that that kind of regulatory power vanished along with the ICC.
+1
SD60MAC9500"A central theme of this book is that railroads, throughout their history, were so important to the US economy that politicians could not leave them alone, and when governments did intervene in transportation markets, they usually made a mess of things.
Interesting - never thought of it that way, but it does follow.
Larry Resident Microferroequinologist (at least at my house) Everyone goes home; Safety begins with you My Opinion. Standard Disclaimers Apply. No Expiration Date Come ride the rails with me! There's one thing about humility - the moment you think you've got it, you've lost it...
tree68 In my career I was responsible for several detailed and elaborate reports to the Interstate Commerce Commission. I became suspecious that they were not using the reports, on forms perscribded by the ICC. After a meeting in Washington I stayed over the weekend and made an appointment to look at the latest three years filings. I was sent to a warehouse in Suitland, MD where I found all of them stored without having been examined. Things like this and much more presipitated the dismantling of the ICC. SD60MAC9500 "A central theme of this book is that railroads, throughout their history, were so important to the US economy that politicians could not leave them alone, and when governments did intervene in transportation markets, they usually made a mess of things. Interesting - never thought of it that way, but it does follow.
In my career I was responsible for several detailed and elaborate reports to the Interstate Commerce Commission. I became suspecious that they were not using the reports, on forms perscribded by the ICC. After a meeting in Washington I stayed over the weekend and made an appointment to look at the latest three years filings. I was sent to a warehouse in Suitland, MD where I found all of them stored without having been examined.
Things like this and much more presipitated the dismantling of the ICC.
SD60MAC9500 "A central theme of this book is that railroads, throughout their history, were so important to the US economy that politicians could not leave them alone, and when governments did intervene in transportation markets, they usually made a mess of things.
tree68 SD60MAC9500 "A central theme of this book is that railroads, throughout their history, were so important to the US economy that politicians could not leave them alone, and when governments did intervene in transportation markets, they usually made a mess of things. Interesting - never thought of it that way, but it does follow.
Mr. Tree as much as I would love to take credit for that quote. That's from Mr. Gallamore's book American Railroads that Greyhounds quoted. A book I have on my reading list along with DeBoer's book on Intermodal.
SD60MAC9500Mr. Tree as much as I would love to take credit for that quote. That's from Mr. Gallamore's book American Railroads that Greyhounds quoted. A book I have on my reading list along with DeBoer's book on Intermodal.
Agreed - I should have made that clearer.
Regarding the quotation and government regulation:
Suppose there were no government regulations whatsoever. Then one very wealthy individual or group could end up owning all railroads and perhaps turcking comopanies and petrolium suuppliers and be able to charge whatever they wish to maximize profits without real social responsibility.
The ICC was a reaction to abuse of power. It was fair as long as railroads had the clear technilogical advantage ovrer other forms of freight transportation. The fairness ended when the ICC and USA Government policies deliberaterly favored trucking at ar-freight at the expense of railroads.
daveklepper Regarding the quotation and government regulation: Suppose there were no government regulations whatsoever. Then one very wealthy individual or group could end up owning all railroads and perhaps turcking comopanies and petrolium suuppliers and be able to charge whatever they wish to maximize profits without real social responsibility. The ICC was a reaction to abuse of power. It was fair as long as railroads had the clear technilogical advantage ovrer other forms of freight transportation. The fairness ended when the ICC and USA Government policies deliberaterly favored trucking at ar-freight at the expense of railroads.
I don't think it's the problem of gov't regulation. The problem stems from the ICC overstepping it's boundaries by creating unrealistic rates, caps, and restrictions for the railroads..
daveklepper The ICC was a reaction to abuse of power.
JPS1 daveklepper The ICC was a reaction to abuse of power. It was! But as is the case with much of government regulation, the regulators became an entity unto themselves.
As to regulating train length, what should be the limit. Taking the case to the extreme. Could railroads act like a conveyer belt inserting cars at one end of a train and taking them off at the other end thus blocking crossing for a day. When trains get to be three mile long strings and slow down to under 20 mph, they can tie up towns for in my view excessive amounts of time. There will be cases where first responders are delayed. When I was about three years old (1940), I lived in Glen Ellyn IL on the South side of the tracks (C&NW + CA&E) and a house burned down because there was only one fire dept and it was on the North side of the tracks. And a slow moving C&NW freight had the crossings blocked. A couple of years ago, a CN train on the former EJ&E had the Barrington area tied up and an ambulance had to take a long detour to get the patient to the hospital. Who will be the DECIDER on what is acceptable.
Electroliner 1935As to regulating train length, what should be the limit.
I expect the argument to be made that running available traffic in 'longer' monstrains also implies fewer overall trains per day, hence fewer obstructions... this argument only holding much water if proper PSR "schedules" the trains away from peak traffic time. The argument of course says less than nothing about fires or ambulance calls, which can't be predicted, let alone 'scheduled for in advance' -- but there are clear potential benefits in having fewer free crossing times per day, too.
As an incentive away from the present tendency to shove multiple blocks together and run them at cost-trimming slower speeds, time-restricting legislation might act as a good incentive... provided the penalties for non-compliance and the consistency of enforcement are kept 'meaningful' for the financiers whose pockets are involved. I see an intermediate level of new hell for T&E crews who now have to juggle times on crossings as well as all the other conflicting stuff piled on them in addition to running trains safely, and I'd have to worry about discipline resulting 'automatically' from a citation being filed.
The more important part of this I'd like to see is better prediction when the crossing will be blocked, and for how long; some of the best-practices methods for ancipative crossing protection will already make this more practical. I've noted in the past that navigation systems can benefit dramatically when realtime train information can be incorporated into 'traffic' accommodation... the catch being that many ways to capture the information can be used to reveal 'proprietary competitive information' about operations.
I would opine that length is only part of the problem, as already mentioned. Case in point is good ol' Deshler.
Through trains on both the E-W line and the N-S line generally run through at around 35 MPH, barring other traffic. Someone else can do the math to figure out how long a hypothetical 13,500 foot train would block crossings at speed.
On the other hand, trains using the transfers (wyes) are limited to 10 MPH, resulting in much longer crossing blockages, obviously. And we won't talk about trains having to hold for other traffic, sometimes resulting in significantly longer blockages.
I think most states already have laws on the books regarding blocking crossings. In many cases, it's more a matter of enforcement.
Tree:
Multiple states have had rules on their books governing how long crossings may be blocked. Unfortunately, Federal courts have struck down each of these as Class 1's have challenged them.
Until the Federal government steps in, either Congress, FRA or STB and establishes a national blocked crossing rule, the railroads will continue to block grade crossings to their hearts content.
CW
Juniata Manultiple states have had rules on their books governing how long crossings may be blocked. Unfortunately, Federal courts have struck down each of these as Class 1's have challenged them. Until the Federal government steps in, either Congress, FRA or STB and establishes a national blocked crossing rule, the railroads will continue to block grade crossings to their hearts content. CW
What has not been discussed is the origin of the crossings. The railroad was, in many-most cases there first and when the growing city wanted to cross with a street they made a contract/agreement with the RR. The content of those agreements governs not only the maintainence of the crossing but other factors that may apply about occupancy.
diningcar Juniata Man ultiple states have had rules on their books governing how long crossings may be blocked. Unfortunately, Federal courts have struck down each of these as Class 1's have challenged them. Until the Federal government steps in, either Congress, FRA or STB and establishes a national blocked crossing rule, the railroads will continue to block grade crossings to their hearts content. CW What has not been discussed is the origin of the crossings. The railroad was, in many-most cases there first and when the growing city wanted to cross with a street they made a contract/agreement with the RR. The content of those agreements governs not only the maintainence of the crossing but other factors that may apply about occupancy.
Juniata Man ultiple states have had rules on their books governing how long crossings may be blocked. Unfortunately, Federal courts have struck down each of these as Class 1's have challenged them. Until the Federal government steps in, either Congress, FRA or STB and establishes a national blocked crossing rule, the railroads will continue to block grade crossings to their hearts content. CW
In some parts of the country, rail lines were given incentives to locate their ROW through a given small, growing town. You know a lot has changed with rail operations in the past 100-170 years (train length, frequency, etc.) on which agreements were based. So should crossing issues.
daveklepperThe ICC was a reaction to abuse of power.
I strongly disagree with that.
The creation of the ICC in 1887 was an attempt to stabilize railroad freight charges. These charges began to fall rapidly in 1867 and continued to fall. As the rail network was built out there was more competition. Both route and market competition. The added competition drove prices down. This troubled the railroad people and the financial people.
As created, the ICC had almost no powers. But the act did require that railroads have a written rate on file with the ICC before they could use the rate to move traffic. This meant they couldn’t play “Let’s Make a Deal” as auto dealers do. It created what I’ve seen called a “Sticky” or “Kinked” demand curve. It held prices up. It was predatory regulation designed to protect the producers (the railroads) against competition. This, of course, was to the detriment of the American economy and the American people.
If you want a clear, salient example of the “Sticky” or “Kinked” demand curve in operation today, look at a corner with three gas stations all displaying their prices. The prices will be the same or nearly the same. Why?
Well, each station operator knows that if he/she lowers the price in an attempt to sell more volume the other station operators will also reduce their price. No advantage will be gained. Same thing with increasing the price. If one station increases the price the customers will go over to the lower priced sellers. So, the price sticks where it is. Largely because each seller knows what the competition is charging. (I realize gas prices do change. The station operators don’t control the whole thing.)
A similar situation was created by the formation of the ICC. By requiring any rate charged to be on file and public information the law made the rail charges “Sticky”. Bad idea for the country and people. Rail freight rates quit falling after the formation of the ICC. Which was the whole idea.
Unfortunately, economic regulation is like cancer. It grows and eventually kills. While maximum rate controls were used to hurt the railroads before 1920, the eventual killer was the Transportation Act of 1920. This law extended government rate control to minimum rates. A railroad couldn’t reduce its rates without government approval.
This minimum rate control was wrongly used to stop the development of intermodal, stop the development of unit trains, restrict the ability to compete with barges, etc., etc., etc. The railroads couldn’t pass new efficiencies along in a competitive market. And the government sure killed a whole bunch of railroads. And the government harmed its economy and its people in doing so.
Greyhounds, I agree with your assessment of the impact of the ICC. I think its creation was made possible because of ruinous price cutting by eastern railroads and monopolistic actions by western railroads though. I think of all of these actions as abuse of power by those who had decision-making power In the era in question. I see these actions as different from say John Rockefeller and Standard Oil. His decisions were based in making oil products affordable to all.
Rockefeller's decisions were based on enriching himself, not some altruistic goal of making petroleum products affordable. Consider rebates paid to his firm on freight rates paid by his firm and his competitors.
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