MP173 wrote: futuremodal wrote: MP173 wrote: Another interesting discussion.Dave wants increased capacity from PRB for coal to keep his rates down (understandably so). I want low electricity rates. I also want the highest rates of return for my investments. The environmentalists dont want coal to be burned (what are we supposed to do, go to nuclear? or back to the caves?).I think this upcoming debate over energy will really shape our policy for years to come. Not only coal, but also oil, corn (fuel or food?) and others.The amount of capital available for investment is at a high water mark. Private equity funds are flush with cheap money in the form of loans. Yet DME cannot (yet) get funded. What does that tell you? PE funds are looking for steady cash flow in order to pay down the high levels of debt they take on for buyouts. Comment was made earlier that Buffett and BH was investing in BNSF, not DME...well, are you sure that he isnt also into DME? Remember that BH owns considerable energy, I believe it is in Iowa. Hmmm...vertical integration? Wouldnt put it past him.My guess is that DM&E has enough investors lined up to start at least the first few phases of the project. May not mean the actual extension just yet, but rather continued concentration on the core money makers. My bet is that DM&E is restructuring it's PRB extention request, perhaps disguising parts of it as "just loans for our current trackage". Remember, the entire project as promoted was one comprehensive package which included rebuilding most of it's SD/MN line from Wall to Winona. As was pointed out, the FRA did okay a loan for the Colony line improvements. Who knows, they may not even include any mention of the PRB extension for their next request, yet as we all know corporations have a way of shifting funds to meet desired goals.Dave:I would guess that if they did that, they would possibly be spending some serious time in prison, if not prison then serious $$$ with great defense lawyers. That would be grounds for serious investment fraud I believe.
futuremodal wrote: MP173 wrote: Another interesting discussion.Dave wants increased capacity from PRB for coal to keep his rates down (understandably so). I want low electricity rates. I also want the highest rates of return for my investments. The environmentalists dont want coal to be burned (what are we supposed to do, go to nuclear? or back to the caves?).I think this upcoming debate over energy will really shape our policy for years to come. Not only coal, but also oil, corn (fuel or food?) and others.The amount of capital available for investment is at a high water mark. Private equity funds are flush with cheap money in the form of loans. Yet DME cannot (yet) get funded. What does that tell you? PE funds are looking for steady cash flow in order to pay down the high levels of debt they take on for buyouts. Comment was made earlier that Buffett and BH was investing in BNSF, not DME...well, are you sure that he isnt also into DME? Remember that BH owns considerable energy, I believe it is in Iowa. Hmmm...vertical integration? Wouldnt put it past him.My guess is that DM&E has enough investors lined up to start at least the first few phases of the project. May not mean the actual extension just yet, but rather continued concentration on the core money makers. My bet is that DM&E is restructuring it's PRB extention request, perhaps disguising parts of it as "just loans for our current trackage". Remember, the entire project as promoted was one comprehensive package which included rebuilding most of it's SD/MN line from Wall to Winona. As was pointed out, the FRA did okay a loan for the Colony line improvements. Who knows, they may not even include any mention of the PRB extension for their next request, yet as we all know corporations have a way of shifting funds to meet desired goals.
MP173 wrote: Another interesting discussion.Dave wants increased capacity from PRB for coal to keep his rates down (understandably so). I want low electricity rates. I also want the highest rates of return for my investments. The environmentalists dont want coal to be burned (what are we supposed to do, go to nuclear? or back to the caves?).I think this upcoming debate over energy will really shape our policy for years to come. Not only coal, but also oil, corn (fuel or food?) and others.The amount of capital available for investment is at a high water mark. Private equity funds are flush with cheap money in the form of loans. Yet DME cannot (yet) get funded. What does that tell you? PE funds are looking for steady cash flow in order to pay down the high levels of debt they take on for buyouts. Comment was made earlier that Buffett and BH was investing in BNSF, not DME...well, are you sure that he isnt also into DME? Remember that BH owns considerable energy, I believe it is in Iowa. Hmmm...vertical integration? Wouldnt put it past him.
Another interesting discussion.
Dave wants increased capacity from PRB for coal to keep his rates down (understandably so). I want low electricity rates. I also want the highest rates of return for my investments. The environmentalists dont want coal to be burned (what are we supposed to do, go to nuclear? or back to the caves?).
I think this upcoming debate over energy will really shape our policy for years to come. Not only coal, but also oil, corn (fuel or food?) and others.
The amount of capital available for investment is at a high water mark. Private equity funds are flush with cheap money in the form of loans. Yet DME cannot (yet) get funded. What does that tell you? PE funds are looking for steady cash flow in order to pay down the high levels of debt they take on for buyouts.
Comment was made earlier that Buffett and BH was investing in BNSF, not DME...well, are you sure that he isnt also into DME? Remember that BH owns considerable energy, I believe it is in Iowa. Hmmm...vertical integration? Wouldnt put it past him.
My guess is that DM&E has enough investors lined up to start at least the first few phases of the project. May not mean the actual extension just yet, but rather continued concentration on the core money makers. My bet is that DM&E is restructuring it's PRB extention request, perhaps disguising parts of it as "just loans for our current trackage". Remember, the entire project as promoted was one comprehensive package which included rebuilding most of it's SD/MN line from Wall to Winona. As was pointed out, the FRA did okay a loan for the Colony line improvements. Who knows, they may not even include any mention of the PRB extension for their next request, yet as we all know corporations have a way of shifting funds to meet desired goals.
Dave:I would guess that if they did that, they would possibly be spending some serious time in prison, if not prison then serious $$$ with great defense lawyers. That would be grounds for serious investment fraud I believe.
Hmmmm, could be a semantic difference of opinion here. Because if what Ed says is true, then both BNSF and UP would have some execs behind bars.
When I refer to "shifting funds", I take as an example BNSF's own wish list. BNSF is willing to spend it's own money (seemingly) on expanding capacity on the LA-Chicago corridor, but wants the State of Washington to pay for improvements to the BNSF lines serving Puget Sound. To me, that's simply a case of BNSF shifting funds from the PNW to the Southwest, because if BNSF was forced to pay for it's own PNW line improvements, wouldn't that possibly reduce the amount it is paying for the SW line?
Futuremodal keeps perpetuating the notion that lack of proper maintenance was the exact cause the failure of the BNSF and UP to meet their contract obligations for hauling coal out of the PRB. He conveniently ignores the fact that the problems were triggered by the unprecidented rainfall in the basin area. Of course they BNSF could have done more to clean the ballast and mitigate the effct of the rains, but in many respects that would have been something akin to someone living in Florida owning a snowblower so as not to be late to work after a three foot snow storm.
Obviously the excuse would not work anymore, because comparable rains could no longer be unprecidented.
So here a link to a story about what is now being done.
http://www.rtands.com/A/feature3.html
By the way, the same rains will also fall on the DME.
Here is relavant parts from the UP press release that is at the link I posted earlier.
"Both railroads have agreed on preliminary work to construct more than 40 miles of third and fourth main line tracks, at a cost of about $100 million over the next two years, to meet current and future forecasted demand for Wyoming's Powder River Basin (PRB) coal. This project is in addition to the construction of 14 miles of a third main line track completed in Spring 2005 and an additional 19 miles of the third main line currently under construction and scheduled to go into service later in May and be fully operational in September 2006. The total cost of this nearly 75-mile capacity expansion will be about $200 million, which is split between the line's two owners, Union Pacific and BNSF.
To meet the growing demand for Western coal, volume grew steadily and in 2005, the Joint Line capacity had grown to handle an all-time record 325 million tons. These improvements will enable the Joint Line to handle in excess of 400 million tons of coal."
So $200 million buys the UP/BNSF another 75 million tons capacity, whereas to get just another 100 million tons capacity, the DME has to spend $6 billion. Hmmmm.
Nice thing about coming up with grandios plans when you are sitting on the sidlines is that you don't have to put your money where your mouth is. Interesting that futuremodal seems to ideologically opposed to feeding on the government trough, except when in his mind it is a "good cause". Of course, competition is the sacred cow of good causes.
Some reading this post may wonder where I stand on the issue of government vs. private money for transportation. Frankly, I don't care. Unless a person hunts, grows or makes with his own hand everything he acquires or consumes, he is paying paying for transportation. I take that back, you might consider the oxygen you consume as free.
As I see it, the problem is that the debate is based on ideological grounds and it becomes an either or argument. Government is bad. Private enterprise has ulterior motives. Governments waste money. Business extract exhorbitant profits. It's my money and I should be able to spend it anyway I want.
Like it or not we are already far too committed to funding transportation with a mix of both public and private funds to to move to one side or the other. Highways, waterways, airways and passenger rail transit systems are never going to be 100% private enterprises and railroads are never going to be completely cut off from public funding. In my view, the debate really ought to focus on the question of where the expenditures go rather than where they come from. When I say "where the money goes" I mean what is the best mix of modes to produce the most efficient overall transportation system. Unfortunately, the political leadership and the government agencies at all levels all exist in separate modal camps and each is just defending there turf.
While I like railroad, I don't think they are the be all end all of every transportation problem. I would like to see an expansion of the regional or corridor rail passenger services perhaps with some high speed service, but the idea of building such a line into my little town of 8,000 is preposterous. My automobile will work just fine to get me to a station 50-100 miles away. My second least favorite idea is spending hundreds of billions building very high speed transcontinental rail lines. We have perfectly good airplanes that can get me hundreds or thousands of miles away if I am in a hurry. Want more efficiency there? Put a few bob in a security system that will get me from the terminal door onto the plane in less than two hours.
I could go on.
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futuremodal wrote: We need more players in the basin, and we need more lines leading out of the basin.
So, put up your money, get in the game, and build "more lines".
n012944 wrote: futuremodal wrote: Well, I don't see DM&E as a Cinderella. They are already nearly a Class I, it's the proposed PRB line that would put them over the top. Do you have some inside information on the DM&E that you would like to share with us? Since the class of a railroad is decided by annual operating revenue, and the DM&E does not give out info about its finances, how do you know that it is "nearly a class 1"?Bert
futuremodal wrote: Well, I don't see DM&E as a Cinderella. They are already nearly a Class I, it's the proposed PRB line that would put them over the top.
Well, I don't see DM&E as a Cinderella. They are already nearly a Class I, it's the proposed PRB line that would put them over the top.
Do you have some inside information on the DM&E that you would like to share with us? Since the class of a railroad is decided by annual operating revenue, and the DM&E does not give out info about its finances, how do you know that it is "nearly a class 1"?
Bert
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ed
futuremodal wrote: miniwyo wrote:I am not sure if this is really relative to the discussion but I have heard rumours that they may be building another powerplant up there.Where is "up there"? There's literally dozens upon dozens of coal-fired power plants on the drawing boards, some of which have passed various stages of authoritative approval, none of which has had a spade full of dirt turned as of yet.Are you talking about the one proposed for Pierre? Great Falls? Ely? Kalama?
miniwyo wrote:I am not sure if this is really relative to the discussion but I have heard rumours that they may be building another powerplant up there.
Where is "up there"? There's literally dozens upon dozens of coal-fired power plants on the drawing boards, some of which have passed various stages of authoritative approval, none of which has had a spade full of dirt turned as of yet.
Are you talking about the one proposed for Pierre? Great Falls? Ely? Kalama?
Well, Seeing as the area in question is the PRB, And it is north of me, that would be "up there".
RJ
"Something hidden, Go and find it. Go and look behind the ranges, Something lost behind the ranges. Lost and waiting for you. Go." The Explorers - Rudyard Kipling
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Murphy Siding wrote: futuremodal wrote:My guess is that DM&E has enough investors lined up to start at least the first few phases of the project. May not mean the actual extension just yet, but rather continued concentration on the core money makers. Therein lies another big obtacle. There are no core money makers at this time. Kevin Shaeffer has said repeatedly, that they need the PRB extention to survive.
futuremodal wrote:My guess is that DM&E has enough investors lined up to start at least the first few phases of the project. May not mean the actual extension just yet, but rather continued concentration on the core money makers.
Always go with the analysts when predicting investor interest in such projects....
http://www.progressiverailroading.com/commentary/article.asp?id=10527
"There's one place all of these folks might meet: South Dakota. Buying and selling is just one part of the money story; lending and borrowing is another. And the long Dakota, Minnesota & Eastern Railroad Corp. saga took another twist in February when the Federal Railroad Administration turned down DM&E's $1.33 billion RRIF loan request.Whether it was a straight FRA decision or one influenced by others (say, the Office of Management and Budget), I do not know. But I suspect that the DM&E has always had other options besides the feds - after all, the DM&E has built a fine franchise in of itself (think "ethanol"), and has gone through the rigorous permitting, regulatory, environmental and most of the political process on a winning streak.So what's next? A private-equity partner? Outright sale? Stay tuned."
MP173 wrote: Comment was made earlier that Buffett and BH was investing in BNSF, not DME...well, are you sure that he isnt also into DME? Remember that BH owns considerable energy, I believe it is in Iowa. Hmmm...vertical integration? Wouldnt put it past him.ed
jeaton wrote: futuremodal wrote: jeaton wrote: The DME plans to spend $6 billion to get the 100 million tons. I'd venture to say that a mere billion dollars spent by the UP and BNSF could get that twice that much in additional capacity.Saving this one!Save away.http://www.uprr.com/newsinfo/releases/capital_investment/2006/0508_sprb.shtml
futuremodal wrote: jeaton wrote: The DME plans to spend $6 billion to get the 100 million tons. I'd venture to say that a mere billion dollars spent by the UP and BNSF could get that twice that much in additional capacity.Saving this one!
jeaton wrote: The DME plans to spend $6 billion to get the 100 million tons. I'd venture to say that a mere billion dollars spent by the UP and BNSF could get that twice that much in additional capacity.
The DME plans to spend $6 billion to get the 100 million tons. I'd venture to say that a mere billion dollars spent by the UP and BNSF could get that twice that much in additional capacity.
Saving this one!
Save away.
http://www.uprr.com/newsinfo/releases/capital_investment/2006/0508_sprb.shtml
Yep, that 50 or so miles worth of track addtions will bring them coal rates down and guarantee timely deliveries!
Jay, do you remember what it was that caused the inability of BNSF and UP to meet contractual coal commitments? Derailments due to faulty track maintenance that took out a triple track section. What makes you think this addition of a third and fourth track alongside the present Joint Line will prevent a repeat of that catastrophy? Any bets that BNSF/UP will not do more than provide cosmetic improvements in their Joint Line maintenance schedule?
After all, those contractual shortfalls haven't yet cost either UP nor BNSF a dime in lost business.
A a single scattering derailment will take out a four main set of tracks as easily as a single set of tracks. That's the fallacy of thinking that a dollar spent by BNSF/UP is somehow the capacity equivalent of two dollars spent by DM&E.
I agree with you that the entry of DM&E will not cause a fall in coal hauling rates, but it will force BNSF and UP to keep the reigns on their own rate increases in the future, not to mention the possibility of lost business if they try to continue to do Joint Line maintenance on the cheap.
futuremodal wrote:I'm not really sure why you are stuck on the status quo as being the prefered alternative in this debate. This has nothing to do with being pro-BNSF or anti-BNSF, pro-UP or anti-UP, pro-DM&E or anti-DM&E, nor pro-MS&P or anti-MS&P. It's about what's best for the country in terms of a reliable cost competitive supply of coal for it's power plants. The key word there is competitive, an idea that seems not to take root in your analysis of the situation. You seem to be okay with the notion of a continued duopoly out of the PRB as being the best alternative, but of course you are not in the energy biz so you don't see things the way we do. Suffice it to say, just adding incremental capacity to UP and BNSF coal hauling lines, regardless of who pays for it, is not going to alleviate the situation to any great extent. We need more players in the basin, and we need more lines leading out of the basin.
I guess I could type a long rfeply to this, but then jeaton covered eveything I would have said.
Rather than re-hash all this one more time, let me add just a little. I'm not in the energy biz, so I don't see things the way you do. I am in the competitive sales business, so maybe you don't see things the way we do. The market has shown, that there aren't investors lined up to loan DM&E $6B, or $2.3B, or even some numbers that end in million, to build the PRB line. That, to me, is an indication that DM&E can't 1) build a line into the PRB 2)be competitive with UP and BNSF shipping coal, and 3)turn a profit big enough to pay off their loans. That is why I forsee expanded capacity on UP & BNSF long before anything happens on DM&E. In fact, now that the DM&E's prospects are somewhat dim, BNSF will find it a safer bet to expand coal hauling. Perhaps, some big-time investor thinks so too?
I have never had any problem with the DME getting into the PRB, and I was not opposed to the government loan. One way or another, the public is going to pay for the project, either through their electric bill or, if government grants or loans are ever provided, through their tax bill.
However, I think that an expectation that the DME will blow the current coal rates out of the water may just be wishful thinking. I have heard that in a decade or two, the demand for PRB coal will be on the order of 700 million tons per year. Right now the BNSF and UP, at capacity, are hauling about 400 million tons. When finished the DME says they will haul 100 tons. The DME plans to spend $6 billion to get the 100 million tons. I'd venture to say that a mere billion dollars spent by the UP and BNSF could get that twice that much in additional capacity.
The bottom line is that the DME is not going to be the low cost carrier. Not only will they have the $6 billion nut to deal with, but,according to the models reference by Michael Sol, the twenty or so daily trains the DME will be moving will be quite a bit above the 8 or 9 daily trains said to be the optimum for unit costs on a single track railroad.. Take that along with the forecast of the demand for the coal and unless the DME coal pricing manager is a dunce, I can't see any major downward move on coal rates.
The mere fact of another player moving into a market does not automaticly mean that prices will soften. At least that won't happen unless the new player can produce at a lower cost. I doubt that the DME is going to be the low cost player in the PRB game.
Dan
Murphy Siding wrote: futuremodal wrote:You're still not differentiating between a dollar spent on or by BNSF/UP and a dollar spent on or by someone other than BNSF or UP. How does capacity growth on BNSF help UP, CP or KCS? Why should capacity growth on BNSF have to help UP,CP,KCS or any other railroad. Is the goal to get more coal to power plants, or simply to take business away from BNSF? Would it be any different if only UP increaced capacity?( pssssst: You're letting your anti-BNSF ideas cloud the issue again)
futuremodal wrote:You're still not differentiating between a dollar spent on or by BNSF/UP and a dollar spent on or by someone other than BNSF or UP. How does capacity growth on BNSF help UP, CP or KCS?
( pssssst: You're letting your anti-BNSF ideas cloud the issue again)
I'm not really sure why you are stuck on the status quo as being the prefered alternative in this debate. This has nothing to do with being pro-BNSF or anti-BNSF, pro-UP or anti-UP, pro-DM&E or anti-DM&E, nor pro-MS&P or anti-MS&P. It's about what's best for the country in terms of a reliable cost competitive supply of coal for it's power plants. The key word there is competitive, an idea that seems not to take root in your analysis of the situation. You seem to be okay with the notion of a continued duopoly out of the PRB as being the best alternative, but of course you are not in the energy biz so you don't see things the way we do. Suffice it to say, just adding incremental capacity to UP and BNSF coal hauling lines, regardless of who pays for it, is not going to alleviate the situation to any great extent. We need more players in the basin, and we need more lines leading out of the basin.
Murphy Siding wrote: futuremodal wrote: The question put forth in this thread is whether the PRB is better off with two railroad companies simply trying to add track to existing lines or with a new third railroad coming in with a uniquely located new line. I of course vote for the latter. I would amend that basic question with a scenario of my own: The PRB would also be better off if UP and/or BNSF added new trackage on new corridors out of the PRB than if a third railroad company was added but was instead granted trackage rights over the present set of lines. Of these four choices, I choose a third player over new trackage in new corridors. Next would be UP/BNSF adding new trackage on new corridors. Next would be adding a third player over present trackage with added sidings et al, and last is UP/BNSF simply adding trackage on present lines.I have to go to work. I'll explain it later.There's the unique reason you and I disagree on some things. I'm all in favor of a Cinderella story. Small, ad-hoc,struggling regional railroad builds dream line into fat city coal market, steal business away from two big Class 1's, and saves the day! That has Disney movie written all over it. The reality, as I see it, is different. UP and BNSF already go to the mines, and to the power plants. Use whatever number you wish-$6 billion for example. $6Billion invested in infrastructure investments by BNSF,UP, or both, would yield far more capacity growth than the same amount invested in a new route. Unique-yes. Logical-no. I think the market is proving that. Warrn Buffet isn't buying big chunks of DM&E.
futuremodal wrote: The question put forth in this thread is whether the PRB is better off with two railroad companies simply trying to add track to existing lines or with a new third railroad coming in with a uniquely located new line. I of course vote for the latter. I would amend that basic question with a scenario of my own: The PRB would also be better off if UP and/or BNSF added new trackage on new corridors out of the PRB than if a third railroad company was added but was instead granted trackage rights over the present set of lines. Of these four choices, I choose a third player over new trackage in new corridors. Next would be UP/BNSF adding new trackage on new corridors. Next would be adding a third player over present trackage with added sidings et al, and last is UP/BNSF simply adding trackage on present lines.I have to go to work. I'll explain it later.
Of these four choices, I choose a third player over new trackage in new corridors. Next would be UP/BNSF adding new trackage on new corridors. Next would be adding a third player over present trackage with added sidings et al, and last is UP/BNSF simply adding trackage on present lines.
I have to go to work. I'll explain it later.
The reality, as I see it, is different. UP and BNSF already go to the mines, and to the power plants. Use whatever number you wish-$6 billion for example. $6Billion invested in infrastructure investments by BNSF,UP, or both, would yield far more capacity growth than the same amount invested in a new route. Unique-yes. Logical-no. I think the market is proving that. Warrn Buffet isn't buying big chunks of DM&E.
Well, I don't see DM&E as a Cinderella. They are already nearly a Class I, it's the proposed PRB line that would put them over the top. It's not like they're the next Murphy Siding & Pacific!
You're still not differentiating between a dollar spent on or by BNSF/UP and a dollar spent on or by someone other than BNSF or UP. How does capacity growth on BNSF help UP, CP or KCS? Are you looking at the end game, namely getting lots of coal to power plants in a timely manner and at a competitive rate? Or are you only looking at it as a big homogenous pie?
Remember, that's the same logical fallacy made by Olgilvie in allowing the PCE to be torn up west of Miles City - "Hey, BN can more than make up the slack in Montana, we don't need no stinkin' New Milwaukee!"
Well, do you think Montana is better off today with only BNSF as a primary rail service provider, or would the state be better served if New Milwaukee was there competing with BNSF?
If indeed we the taxpayers have to make up the shortfall in our nation's rail capacity improvements, aren't we better off if that money is allocated for more encouraging more intramodal competition rather than subsidizing a few monopolistic entities?
wjstix wrote: Always amusing how people throw "Socialism" around. Guess it comes down to the "Limbaughization" of American politics - any money spent by government on health care, roads, or basically anything except the military is "socialism".Except for the Great Northern, virtually every 19th c. transcontinental railroad was built thanks to government subsidies via land grants...this during a 30-40 year period when Republicans controlled the Presidency, House and Senate for all but a few years. Guess Abe Lincoln was a "Socialist" for authorizing the subsidies for the UP and NP to be built?? How about General / President Grant?? Well, a lot of those Presidents did have beards kinda like Karl Marx I guess, maybe they were really Bolsheviks!!
Always amusing how people throw "Socialism" around. Guess it comes down to the "Limbaughization" of American politics - any money spent by government on health care, roads, or basically anything except the military is "socialism".
Except for the Great Northern, virtually every 19th c. transcontinental railroad was built thanks to government subsidies via land grants...this during a 30-40 year period when Republicans controlled the Presidency, House and Senate for all but a few years. Guess Abe Lincoln was a "Socialist" for authorizing the subsidies for the UP and NP to be built?? How about General / President Grant?? Well, a lot of those Presidents did have beards kinda like Karl Marx I guess, maybe they were really Bolsheviks!!
Actually, Lincoln gave money to private companies to help them complete a monumental task. 'Socialism', as defined in wallyworld's post above, would mean that the government undertook the task of building the transcons itself. There is a difference, if you think about it.
Murphy Siding wrote: on another thread, you suggest that the railroads don't have enough money to maintain their trackage at the current levels of traffic. On this thread, you're once again championing a third rail line into the PRB to increace competition, and lower shipping costs. You do see the irony in this-don't you?
on another thread, you suggest that the railroads don't have enough money to maintain their trackage at the current levels of traffic. On this thread, you're once again championing a third rail line into the PRB to increace competition, and lower shipping costs. You do see the irony in this-don't you?
excellent point..
so·cial·ism Pronunciation: 'sO-sh&-"li-z&mFunction: noun Any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods.
Nothing is more fairly distributed than common sense: no one thinks he needs more of it than he already has.
CSSHEGEWISCH wrote: wallyworld wrote: daveklepper wrote:I agree with the above analysis, except that what will prevent rail freight from going Socialist is the increasing demand for freight service, continual shift from highway-alone to intermodel with greater profit pricing ability given to the railroads, and greater use of industrial land with rail access. This will improve profitability of all the Big Six and the regionals. Short Lines with benefit also, but some will require some "Socialism" to improve physical plant to handle the business. Like what Maine is proposing for the Portland - Crawford Notch line.One interesting consideration that is a wild card is the lead time required to complete civil engineering studies, project and then actual cost budgets and the filing and approval of enviromental studies...and then ponder the rate of increase for traffic within that time frame and then, of course the time required to actually add trackage. Will one overrun the other? It would be interesting to compare long term capital planning and the actual phases toward completion that are ongoing now based on the projections of available capital and projected increases in traffic and the ultimate reconciliation of the four aspects of this dynamic. If they do not meet in a syncronicity of events, then perhaps the socialist remedy will be applied. I think the tipping point could be a tangent path of increased demand for rail passenger services adding to the load. In other words, if the political situation changes during the next cycle occurs ( and who can plan for that?) and a legislative cure-all for additonal access by passenger services is wedged forward, it will make for a interesting set of circumstances. ?
wallyworld wrote: daveklepper wrote:I agree with the above analysis, except that what will prevent rail freight from going Socialist is the increasing demand for freight service, continual shift from highway-alone to intermodel with greater profit pricing ability given to the railroads, and greater use of industrial land with rail access. This will improve profitability of all the Big Six and the regionals. Short Lines with benefit also, but some will require some "Socialism" to improve physical plant to handle the business. Like what Maine is proposing for the Portland - Crawford Notch line.One interesting consideration that is a wild card is the lead time required to complete civil engineering studies, project and then actual cost budgets and the filing and approval of enviromental studies...and then ponder the rate of increase for traffic within that time frame and then, of course the time required to actually add trackage. Will one overrun the other? It would be interesting to compare long term capital planning and the actual phases toward completion that are ongoing now based on the projections of available capital and projected increases in traffic and the ultimate reconciliation of the four aspects of this dynamic. If they do not meet in a syncronicity of events, then perhaps the socialist remedy will be applied. I think the tipping point could be a tangent path of increased demand for rail passenger services adding to the load. In other words, if the political situation changes during the next cycle occurs ( and who can plan for that?) and a legislative cure-all for additonal access by passenger services is wedged forward, it will make for a interesting set of circumstances.
daveklepper wrote:I agree with the above analysis, except that what will prevent rail freight from going Socialist is the increasing demand for freight service, continual shift from highway-alone to intermodel with greater profit pricing ability given to the railroads, and greater use of industrial land with rail access. This will improve profitability of all the Big Six and the regionals. Short Lines with benefit also, but some will require some "Socialism" to improve physical plant to handle the business. Like what Maine is proposing for the Portland - Crawford Notch line.
One interesting consideration that is a wild card is the lead time required to complete civil engineering studies, project and then actual cost budgets and the filing and approval of enviromental studies...and then ponder the rate of increase for traffic within that time frame and then, of course the time required to actually add trackage. Will one overrun the other? It would be interesting to compare long term capital planning and the actual phases toward completion that are ongoing now based on the projections of available capital and projected increases in traffic and the ultimate reconciliation of the four aspects of this dynamic. If they do not meet in a syncronicity of events, then perhaps the socialist remedy will be applied. I think the tipping point could be a tangent path of increased demand for rail passenger services adding to the load. In other words, if the political situation changes during the next cycle occurs ( and who can plan for that?) and a legislative cure-all for additonal access by passenger services is wedged forward, it will make for a interesting set of circumstances.
?
Will the increase in freight traffic projected now actually be larger in scope than the increase in capacity designed into projects already on the books, given the lead time required and the lag in completing them? Is the increase in traffic and the planning for more capacity to carry it at a state of equalibrium considering this lead-lag timing? Then throw into this question, the political change which may occur in Washington next year, which could easily equate to legislative action to increase passenger services over freight lines by mandate. This is a likely wild card in the capacity issue..
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