Legislation intoduced to make railroads subject to antitrust laws.

[Anonymous]

I was going to wait for LC to post this, but it may be he's having a hard time removing his fist from the wall in reaction to this.....

http://www.progressiverailroading.com/freightnews/article.asp?id=7225

Introduced by Congressman Mark Green of Wisconsin.

Two questions:

1. Can someone tell us why railroads should remain exempted from normal antitrust laws?

2. Hey, jeaton, did you vote for this guy?

[bobwilcox]

QUOTE: Originally posted by futuremodal

I was going to wait for LC to post this, but it may be he's having a hard time removing his fist from the wall in reaction to this.....

http://www.progressiverailroading.com/freightnews/article.asp?id=7225

Introduced by Congressman Mark Green of Wisconsin.

Two questions:

1. Can someone tell us why railroads should remain exempted from normal antitrust laws?

2. Hey, jeaton, did you vote for this guy?

I can not think of any reason the railroads should continue their anti-trust exemption. Of course, Burns legislation has nothing to do with anit-trust.

[Anonymous]

QUOTE: Originally posted by bobwilcox

QUOTE: Originally posted by futuremodal

I was going to wait for LC to post this, but it may be he's having a hard time removing his fist from the wall in reaction to this.....

http://www.progressiverailroading.com/freightnews/article.asp?id=7225

Introduced by Congressman Mark Green of Wisconsin.

Two questions:

1. Can someone tell us why railroads should remain exempted from normal antitrust laws?

2. Hey, jeaton, did you vote for this guy?

I can not think of any reason the railroads should continue their anti-trust exemption. Of course, Burns legislation has nothing to do with anit-trust.

I'm glad you mentioned the other legislation, because I am curious as to which proposal would be seen as the lesser of two evils to the railroad industry. I can tell you from an economist's perspective, I would definately prefer the Green antitrust legislation over the Burns reregulation legislation.

[Junctionfan]

I guess this is a punishment against CN/WC. I think it would be safe to say that Montana would also support this (BNSF).

[Anonymous]

How are they going to enforce this Railroads don't hold a monopoly (truck lines)? As long as railroads stick to their agreements nobody should mess with them. Why does the government always stick their nose into every thing, except my fist? If it didn't cost so dang much I would have thrown the computer out the window. Give me a break don't they have something better do to, even take a vacation is better than this.
James[C):-)]

[jeaton]

Mark Green has to do something to ensure that money continues to flow into his campaign fund from the paper manufacturing industry. Otherwise he might be looking for a job in his old occupation-5 & 10pm news reader on a local Green Bay TV station. People in Wisconsin do not demand high standards of intelligence for their elected government officials. The winner is usually one having the money to run the "cut taxes, family values, guns for everyone" smoke machine for the longest.

I was not able to vote for or against Green. I live in a different district. Our guy wins by promising save Social Security without cutting benefits or raising taxes paid to the Social Security fund. (You're trained in economics, tell me how that works). He is an expert on that subject because he recieved survivor benefits when he was growing up.

Any way my comment on making the railroads subject to Anti-Trust is "Whatever". If I was a shipper in Green's distrtict, I wouldn't be expecting three or more "railroad" companies to show up at my door anytime soon.

Jay

[csxengineer98]

QUOTE: Originally posted by Lotus098

How are they going to enforce this Railroads don't hold a monopoly (truck lines)? As long as railroads stick to their agreements nobody should mess with them. Why does the government always stick their nose into every thing, except my fist? If it didn't cost so dang much I would have thrown the computer out the window. Give me a break don't they have something better do to, even take a vacation is better than this.
James[C):-)]

becouse thats what government dose best... they have to "justify" there jobs by making sure they always have work by writing more and more laws
csx engineer

[CSSHEGEWISCH]

The Burns bill looks like re-regulation to me and is obviously an attempt to gain the votes of Montana grain farmers. The Green bill is smoke and mirrors and has a similar ulterior motive. As pointed out above, railroads already have major competition, known to most shippers as trucking companies.

[Anonymous]

What about all those DHL Trucks loaded on flat cars whipping by the UPS and FedEx trucks stopped at the grade crossing? With gasoline headed for $5.00 a gallon, why not finish killing of all the more economical means of transportation, and pour more $s into those conservation, non poluting modes of transportation like airlines and truckers. I am glad to see the electorate has wised up since the fifties, when the politicians slogans were "Vote for me and I'll raise your Social Security checks" before every retirement comunity that they could eat chicken with!

[daveklepper]

Very appropriate comments. The only real problem with this legislation is a stupid but powerful court (Like the court that forced power companies to sell their street railways under antitrust) could interpret this that single billing for interline shipments is out, shich would definitely cut into rail traffic. Particularly short lines. Some short line originated or teminated shipments see passage over as many as four different railroads. This should be an objection to the legislation by both shippers and railroads. At least an amendment should tackle the problem.

[gabe]

Just when I thought I was going to walk away from the forum . . . You have got to be kidding me, right? I don't know where to begin . . .

First, the contention that railroads are not subject to competition is about as fascicle as the media coverage of the newly selected Supreme Court Justice. It is very interesting to see that a transportation industry that transports far less than half the tonnage in the United States (and even less in terms of profit) can be classified as not subject to competition.

Second, why is it that we are going to target an industry that isn't even earning the cost of capital? What happened to the industry when it was subject to this regulation? Regulating this industry will end up producing one of two eventualities: (1) no railroads—as would have been the case were it not for Staggers—or (2) massive taxes so our country can either bail the rail industry out or run it publicly—which I assert would cost the voting public even more.

Railroads are getting close to earning the cost of capital; it would be such a waste to all parties—including the shippers--if we reversed course and went back to the days when lines were falling like flies. Did shippers really feel secure in their service in the late 70s and early 80s? Is that really preferable to right now?

Third, how would we implement this? Are we going to build new lines or have a public taking by forcing open access over tracks that will eventually fall into disrepair because everyone knows it is cheaper to run your trains over someone else's tracks rather than maintain your own.

Of all the nonsense and drivel . . .

Gabe

P.S. For what it is worth, I radically oppose a further round of mergers and am radically in favor of short line and regional spinoffs. But, what is suggested above is overkill.

P.P.S. "Kill" in "overkill" modifies the rail industry and those shippers who depend upon it for service.

[Anonymous]

Gabe,

"Compeition" in the Green bill refers to head to head competition between railroads. As you know (or should know), each transport mode has it's own advantages and disadvantages in comparison to the others. As has been explained, the railroads niche is to move bulk commodities at speed. Barges move bulk commodities at a relative snail's pace, trucks move product at speed but not in bulk, pipelines only move one or two specific commodities, airlines move light select products at max speed, etc. Therefore, certain product groups will tend to gravitate toward one of the modes as it's main tranporter. When these product groups are subject to only one transporter within each mode, you get captive shippers and monopolistic characteristics. Since all other modes have intramodal competition, the only mode left within intramodal monopolistic power are the railroads. Thus, when you have a representative government that is charged with maintaining a competitive free market, you are bound to get this type of legislation when certain monopolistic actions take place.

An easily understandable comparison is the antitrust action against Standard Oil. Using your logic, you can argue that Standard Oil wasn't a monopoly, because there were other forms of energy available for oil consumers. Coal was widely available at the time, I guess you can argue that coal was the competition against oil. But of course, that argument is flawed because the usage for oil is unique in transportation fuel consumption compared to coal. Oil had a niche, and Standard Oil had a monopoly on this niche. The antitrust action against Standard Oil was appropriate by the analysis of most historians and economists.

Trucks can only be seen as an alternative of last resort to railroads, just as coal is only an alternative to oil if we start building steam cars again, e.g. an alternative of last resort. Maybe if oil runs out we'll see coal fired steam powered autos again, but until then if oil is available we sure do want it coming from a competitive array of providers, right?

You seem to not want to comprehend the difference between the Green bill and the Burns bill. The Green bill is long overdue, the Burns bill is a regrettable attempt to return to the days to which you refer in the body of your post. It's pretty straight forward: Antitrust is good, reregulation is bad.

Then of course you apparently misunderstand open access. Under most open access proposal, you pay as you go, and you don't own one set of tracks but use someone else's. Instead, you split rail companies into independent infrastructure and transporter companies, ergo no co-management of tracks and rolling stock (although I'm sure you could own stock in both entities). This socialist misconception of open access as a "taking" of property is laughable when you consider past antitrust actions against monopolists. Do you really consider the Standard Oil or AT&T split ups as a "taking" of private property?

BTW, railroads are nowhere near to earning their cost of capital, and never will under the closed access system. Under the current system this goal is impossible, because to achieve it we'd have to kill our economy to pay for the comprehensive monopolistic rates required to achieve this cost of capital recovery in the first place. That's the Achilles Heel of Staggers - it made no realistic attempt to provide a competitive playing field to go along with the rate deregulation, thus creates monopolistic situations. It's half cocked, just like California's partial deregulation of their energy markets. If Staggers had been done correctly, we wouldn't even be discussing things such as antitrust potential against railroads, or the spector of reregulation of railroads.

A free market economy simply cannot function under widespread monopolistic control of key markets, nor can it blossom under govnerment price controls.

[Murphy Siding]

So, If a grain producing area is being "taken advantage of " by a barge company,will we expect taxpayers to dig another river to provide equal competition?[:D] No,wait, that would only be a duopoly-still not competion, according to some theories. We would need to dig two more rivers to get true competition.[:o)]
In your grand plan, trains from the Murphy Southern would have to be allowed to run over the Futrure Model Pacific lines, for a certain price-probably determained by some government agency. What's to stop the governing agency from determining that MS could run FMP trains over FMP lines for a certain price. As soon as The Murphy Southern purchases the right politicians,the owners could make someone else do all the work, and sit back to collect all the riches.[;)] I'm on my way to world domination! When I'm king of the world, there will be a smilie for tounge-in cheek!

[Anonymous]

Friends, Rail fans, Country lend me your ears. This is important; this could kill the railroads if this goes through. We need to raise hell about this, now before it is too late.
E-mail Congressman Green at [e-mail]
I have already done so. Please (I'm pleading) send your congressman a letter tell him that will kill the railroad industry, that truck lines and others offer competition to railroads that are fighting to survive. Ask what happened to the Uncle Sam that supported the railroads. Use your power granted to you in the 1'st amendment of the US constitution. Let them hear you.[soapbox]

[CSSHEGEWISCH]

The Honorable Mr. Green has an incredibly narrow definition of competition. Rail and trucks definitely compete with each other even if the Representative from Wisconsin says that they don't. He's obviously pandering to the voters and the contributors with this bill. In the current political climate, the bill will be lucky to get out of committee.

[bobwilcox]

It is my belief the only area where the anit-trust laws do not apply is with mergers. Anti-trust is certainly an issue when developing marketing strategies.

Do we have any lawyers out there who no of areas besides mergers where anti-trust does not apply?

[gabe]

QUOTE: Originally posted by bobwilcox

It is my belief the only area where the anit-trust laws do not apply is with mergers. Anti-trust is certainly an issue when developing marketing strategies.

Do we have any lawyers out there who no of areas besides mergers where anti-trust does not apply?

Baseball, the national defense industry, legalized prostitution, and gambling.

[bobwilcox]

QUOTE: Originally posted by gabe

QUOTE: Originally posted by bobwilcox

It is my belief the only area where the anit-trust laws do not apply is with mergers. Anti-trust is certainly an issue when developing marketing strategies.

Do we have any lawyers out there who no of areas besides mergers where anti-trust does not apply?

Baseball, the national defense industry, legalized prostitution, and gambling.

We do have the best Congress money can buy!

[jeaton]

I recently heard from some very knowledgeable industiy watchers that three or four of the Class I's may have earnings for 2005 that will meet the cost of capital ROI. This is a key factor in advancing projects to deal with capacity problems.

Although I consider it to be extremely unlikely, let's assume that this all leads to a full open access environment. Unless the managers of the "new" railroads are as dumb as a box of rocks, they will go after the business with the highest margins. Now, there will surely be issues of quality of service, but the key element of competition will be price. One cannot say it is bad for the shippers, but rates will certainly drop and so will margins. It can be assumed that lower rate will attract more business, but the question becomes, "Will the increase in new business be sufficient to bring total margins back to existing levels?" Answer: Doubtful.

It is typically assumed that competition will encourage the development of greater efficiency and a reduction in unit costs. In the case of railroading, I find that iffy. What elements of cost would be reduced? I can't see any special oppurtunities for significant reductions in the cost of rolling stock, track materials, signal systems or fuel. Maybe labor, but if the Class I's get the flexibility they are seeking for crew size, that cost will not be that easy to reduce.

The bottom line is a lower totals on the bottom line. So how does that do anything to relieve capacity problems?

Jay

[bobwilcox]

QUOTE: Originally posted by jeaton

I recently heard from some very knowledgeable industiy watchers that three or four of the Class I's may have earnings for 2005 that will meet the cost of capital ROI. This is a key factor in advancing projects to deal with capacity problems.

Although I consider it to be extremely unlikely, let's assume that this all leads to a full open access environment. Unless the managers of the "new" railroads are as dumb as a box of rocks, they will go after the business with the highest margins. Now, there will surely be issues of quality of service, but the key element of competition will be price. One cannot say it is bad for the shippers, but rates will certainly drop and so will margins. It can be assumed that lower rate will attract more business, but the question becomes, "Will the increase in new business be sufficient to bring total margins back to existing levels?" Answer: Doubtful.

It is typically assumed that competition will encourage the development of greater efficiency and a reduction in unit costs. In the case of railroading, I find that iffy. What elements of cost would be reduced? I can't see any special oppurtunities for significant reductions in the cost of rolling stock, track materials, signal systems or fuel. Maybe labor, but if the Class I's get the flexibility they are seeking for crew size, that cost will not be that easy to reduce.

The bottom line is a lower totals on the bottom line. So how does that do anything to relieve capacity problems?

Jay

I do not think open access is a anti-trust issue. Since Staggers an application to build into a facility on another railroad has never been turned down.

[MP173]

I am still awaiting the pro-forma numbers from Futuremodal for the open access concept.

In the other thread we discussed this, I requested his numbers, but havent seen them yet.

Dave...are you about done with the projections?


ed

[Anonymous]

Here's from the perspective of someone that has seen the direct consequences of a RR stonewalling competition:

Intermountain Power Project, a very large power plant in central Utah gets most all of its coal by rail. UP refuses to allow anyone but UP to use its rails to the plant. While it is POSSIBLE to ship the coal by truck, it simply isn't practical. We're talking about close to 1 million tons of coal a year required for this plant fellas.

When negotiations broke down once they DID shipt the coal by truck for 6 months, but it was an absolute disaster for everyone involved, especially the roads and the public. UP STILL charges per mile rates MUCH higher for that last stub of line than for any other section of their line for hauling the coal. Competition is available for hauling the coal 80% of the way, so the rates are low, but not on that section of line. It's a csh cow for UP, and they refuse to allow anyone else to use it.

Sure if you're shipping only one car of soy beans you can consider going by truck, but not if you need to ship 250,000 tons of coal.

As for the arguement that you'd destroy the RR by requiring them to allow anyone to use the rails, that's bull honky. Guess what the electric utilities have had to do? We have to allow anyone to run power over our transmision lines, and we can't charge more for them than we have to charge ourselves. It gets you into a TRUE cost of service plan for each route. No longer can you subsidize rates on one route only to make it up on another. It levelizes the playing field, and the final customer has to pay much closer to the actual cost of doing business.

Lets face it, the RR's don't want to change how they're doing business. Those executives that are afraid of going out of business don't know HOW they will have to be running their business in the future.

Mark in Utah
Been there, done that, life's still O.K.

[gabe]

QUOTE: Originally posted by mark_in_utah

Here's from the perspective of someone that has seen the direct consequences of a RR stonewalling competition:

Intermountain Power Project, a very large power plant in central Utah gets most all of its coal by rail. UP refuses to allow anyone but UP to use its rails to the plant. While it is POSSIBLE to ship the coal by truck, it simply isn't practical. We're talking about close to 1 million tons of coal a year required for this plant fellas.

When negotiations broke down once they DID shipt the coal by truck for 6 months, but it was an absolute disaster for everyone involved, especially the roads and the public. UP STILL charges per mile rates MUCH higher for that last stub of line than for any other section of their line for hauling the coal. Competition is available for hauling the coal 80% of the way, so the rates are low, but not on that section of line. It's a csh cow for UP, and they refuse to allow anyone else to use it.

Sure if you're shipping only one car of soy beans you can consider going by truck, but not if you need to ship 250,000 tons of coal.

As for the arguement that you'd destroy the RR by requiring them to allow anyone to use the rails, that's bull honky. Guess what the electric utilities have had to do? We have to allow anyone to run power over our transmision lines, and we can't charge more for them than we have to charge ourselves. It gets you into a TRUE cost of service plan for each route. No longer can you subsidize rates on one route only to make it up on another. It levelizes the playing field, and the final customer has to pay much closer to the actual cost of doing business.

Lets face it, the RR's don't want to change how they're doing business. Those executives that are afraid of going out of business don't know HOW they will have to be running their business in the future.

Mark in Utah
Been there, done that, life's still O.K.

So who was the genius who built the power plant without multiple railroads serving it? I hate to go back to my proverbial McDonalds that is the only practical place for me to eat on the way home and costs 25% more than any other McDonalds because it takes advantage of its prime location, but every industry that has prime location takes advantage of that location.

As for other companies using other companies power lines, can you explain to me how the use of power lines equates to the use of rails in terms of wear and tear on the physical plant?

I have to thank Jay for pointing out that railroads are nearing cost of capital contrary to other assertions. The last I heard CN was there and NS was close.

Finally, as for the anti-trust taking issue, last I heard, anti-trust divestiture was subject to purchases by the highest bidder.

Gabe

[Anonymous]

QUOTE: Originally posted by gabe

QUOTE: Originally posted by mark_in_utah

Here's from the perspective of someone that has seen the direct consequences of a RR stonewalling competition:

Intermountain Power Project, a very large power plant in central Utah gets most all of its coal by rail. UP refuses to allow anyone but UP to use its rails to the plant. While it is POSSIBLE to ship the coal by truck, it simply isn't practical. We're talking about close to 1 million tons of coal a year required for this plant fellas.

When negotiations broke down once they DID shipt the coal by truck for 6 months, but it was an absolute disaster for everyone involved, especially the roads and the public. UP STILL charges per mile rates MUCH higher for that last stub of line than for any other section of their line for hauling the coal. Competition is available for hauling the coal 80% of the way, so the rates are low, but not on that section of line. It's a csh cow for UP, and they refuse to allow anyone else to use it.

Sure if you're shipping only one car of soy beans you can consider going by truck, but not if you need to ship 250,000 tons of coal.

As for the arguement that you'd destroy the RR by requiring them to allow anyone to use the rails, that's bull honky. Guess what the electric utilities have had to do? We have to allow anyone to run power over our transmision lines, and we can't charge more for them than we have to charge ourselves. It gets you into a TRUE cost of service plan for each route. No longer can you subsidize rates on one route only to make it up on another. It levelizes the playing field, and the final customer has to pay much closer to the actual cost of doing business.

Lets face it, the RR's don't want to change how they're doing business. Those executives that are afraid of going out of business don't know HOW they will have to be running their business in the future.

Mark in Utah
Been there, done that, life's still O.K.

So who was the genius who built the power plant without multiple railroads serving it? I hate to go back to my proverbial McDonalds that is the only practical place for me to eat on the way home and costs 25% more than any other McDonalds because it takes advantage of its prime location, but every industry that has prime location takes advantage of that location.

As for other companies using other companies power lines, can you explain to me how the use of power lines equates to the use of rails in terms of wear and tear on the physical plant?

I have to thank Jay for pointing out that railroads are nearing cost of capital contrary to other assertions. The last I heard CN was there and NS was close.

Finally, as for the anti-trust taking issue, last I heard, anti-trust divestiture was subject to purchases by the highest bidder.

Gabe

The only argument is that UP should have to sell trackage rights (to any part of the route) to anyone for the same price. This is not always a good thing. It could cause price wars loss leaders and put some railroads out of business. That is how telephone lines work any one can start their own phone company using the existing lines for a fee. This might be the idea for the railroads. Does any one know where I could get a copy of the bill?
James[C):-)]

[Anonymous]

Power plants are built according to where they CAN be built. Too many NIMBY's out there. You think people don't like railroads, try power plants..... They're psychotic. You've got transmission line access, water availability, air quality issues, coal availability (fuel), etc. I've seen natural gas-powered power plants turned down that would have been quieter and caused less polution that the warehouse they were to replace.

The rail line to IPP was built specifically for IPP, it didn't exist before the plant was built.

As for the usage of powerlines.... If you run 100 MW's down my line, then I can't use my line for my core business by that same 100 MW's. If you're running power down my line, then system stability is affected (or can be), reducing reliability to my customers. If you're running power down my line, who supplies VAR support for maintaining voltage or voltage stibility on my system? How abouit transient stability in case this line trips out and I have to instantaneously handle the resulting influx of power onto my system? That's how the big east coast power outage was propogated. Did anyone like that? That's also how several LARGE outages in the west have occurred. The electric transmission system simply was not designed for those large continuous power transfers. People also don't want additional powerlines built, anywhere at any time - especially the big ones. It's estimated that the US economy could save over $10 billion dollars a year (that's net) if sufficient lines and associated substations could be built. The electric utility industry has been called the most capital intensive business in the country. I'm not sure where RR's match up, but I bet they're right in the mix as well. Typical 345 kV line construction cost over bare ground is around $500,000 per mile alone. The substation (switching only) will cost about $12 million on for each end. If you need a step-down transformer plan on at least $4 million for a 750 MW unit, you'll need 3 or 4 of them. Upwards of 75% of your electric bill is for equipment.

Mark in Utah

[gabe]

Thank you for the very insightful information, but I think you are making my point. Your contention that shared access for powerlines hampers the industry, makes things less efficient, and costs U.S. consumers more if it were not for shared access. That is more or less why I am saying shared access for rail is a bad idea.

Unless your argument is power companies have to undergo this so railroads should to, I think everything you said demonstartes the deleterious consequences of open access.

Gabe

[bobwilcox]

Perhaps the power company should get a new management or due you expect the UP to pay for their stupidity?

Several large power companies have made it a policy to: (1) never locate a plant on one railroad and (2) build out to competing railroads when and existing plant is served by only one railroad.

[dinwitty]

railroads had plenty of competition against other railroads.
those lines either vanished or merged into the bigger lines.

The major railroads competition is trucking companies, and well, from the looks of that bill, it might be biased for trucking companies...who would be complaining about railroads about a "monopolistic environment"?
The truckers would be happy to bust the railroads.

that wont happen.

[Anonymous]

Geez, so many off the wall retorts, so little time.....

Murphy - Waterways are already open access, thus you wouldn't need to build a new canal/waterway to access a new barge line.

Lotus - You are what you eat. Tell us how competition would kill railroading. The only thing competition kills is inefficiency.

CSSHEGEWISCH - For the umpteenth time, trucks are best at shorthaul, railroads best at medium to long haul of bulk commodities, intermodal combines the two aspects, thus railroad's true competition is other railroads........wait a minute, I just realized I'm kicking a dead horse!

jeaton - Can you name your "industry insiders"? Most independent finance analysts say the opposite, aka Smith & Barney's latest report on railroads. But I guess what you're really saying is that volume does not make up for select captive markup. I think the trucking industry would say differently, at least from a macro basis. I ask you this, what is your approach to returning railroading to a 70% market share. I say true head to head competition and customer choice, you may say either (A) it can't be done (B) yes, if railroads are allowed to extend the monopolistic reach via more mergers, or (C)[fill in the blank].

Bob - You are correct, the hypothetical debate over open access has nothing to do with the antitrust legislation being considered. However, it is my contention that if this bill becomes law, the resulting legal actions may be the necessary pu***o finally bring open access to be debated on the floor of Congress.

ed - No, I don't have any pro forma numbers, nor have I ever claimed to have had pro forma numbers, because what we are discussing (the concept of open access) is still at the theoretical/philosophical level(s) when applied to railroads, although there are some countries which have adopted the concept. Granted, it would be hard to draw a comparison of Britain pre-open access vs former nationalized operations with what may or may not happen if a proprietary closed access system is evolved into a proprietary open access. I have searched and at this time have found no transportation studies which could provide real numbers for you. But, I percieve that you are a person of above average intelligence, so I assume you can take a self analysis of comparing U.S. railroad infrastructure in its current form with all other modal infrastructure in terms of access, and look at all other transporter operations and compare them to rail transporters, and take a look at proprietary open access with regards to electricity transmission and anaylyze how that has affect the energy markets (up or down?), and take a look at open access of telecommunications at analyse whether that sector has more or less investment today than if AT&T still was a monopoly, and compare Australia pre-open access vs post open access, etc., etc., etc., and after all that come up with your own set of theoretical constructs for applying open access to U.S. railroading. You cannot deny the successes of open access in other modes, and as of yet not one person on this forum can supply any solid argument as to why that success would not translate to U.S. railroads. Come to think of it, no one from the opposition has supplied pro forma numbers to prove open access will not work in the U.S. Could be that is because the arguments in opposition to open access are just as theoretical as the arguments for open access. As I stated before, the concept (open access on U.S. railroads) is way to new to have provided any substantial numerical analysis one way or the other.

Gabe - the statement of mark in utah regarding potential overdemand for access to transmission lines is if anything a rebuttal of your conclusion. Demand for a service is usually seen as a good thing, because as you know when demand exceeds supply it forces more investment into the sector to meet the demand. The problem was well enumerated as to the need for MORE transmission capacity to handle this increased demand, and the market will eventually meet this demand. What it shows is that there has been much more investment in power generation than would have otherwise happened under closed access. This is a good thing for the economy, all we have to do is to weather the transition. Whereas the railroads do not respond to market demand, choosing instead to turn away business. Trucks do take some of that rejected market, barge lines take another portion, but in all likelyhood the majority of that rejected market either ends up overseas or simply not existing at all. It's an undeniable contrast: You never see a transmission line being torn down to reduce capacity, never see a pipeline taken out to reduce capacity, only railroads engage in that kind of self destructive behaviour. Transmission lines and pipelines are open access, railroads are not. Hmmmm, do you thing there's a connection between access status and purposeful capacity reductions? Or do you want pro forma numbers before you will believe in what is actually happening out there?

Mark in utah - was that plant built pre-Staggers or post-Staggers? Makes a huge difference, since most rail dependent plants were built back when rates were still regulated, thus the investors believed they would retain relatively low shipping costs.

[Anonymous]

QUOTE: Originally posted by futuremodal



Lotus - You are what you eat. Tell us how competition would kill railroading. The only thing competition kills is inefficiency.

You seem to have misunderstood my post. Competition the driving factor of the capitalist free market is a great thing. I believe that the government forcing the break up of a railroad that has worked it's way up to the top is a bad thing since; no monopoly laws have been violated. I think the way the founders of our country did: That the government should keep its nose out of as much as possible. I don't argue with a lot of the trust busting done by good old Teddy Roosevelt this kept the free market from working as the company could force their competitors out of business by not doing business with them unless they charged a certain price. If the railroads have done this please let me know. How do railroads violate anti-trust laws?
James[C):-)]
PS here is a link to the site with a full copy of the bill. Sorry it is 23 pages, because the congress can't make anything simple.http://www.house.gov/transportation_democrats/rrcomp05_001_xml.pdf