Rail Competition Issues Still Vex Many Shippers

More Capitol Hill hearings on railroad freight services and rates are likely no matter which party controls Congress in the next session, but it remains to be seen whether sentiment for any level of re-regulation of the rail industry will grow.

For now, federal lawmakers seem unlikely to turn back the clock to the era before the Staggers Act of 1980, which removed many federal controls, allowed railroads to more easily abandon unprofitable routes and protected the carriers from charges of monopolistic practices where only one line serves a region.

“Sure, the shippers don’t like paying high rates, but if the government comes along through regulation and squeezes rates, then who is going to pay for the upgrades the railroads need to make?” asked a congressional rail analyst who did not want to be identified. “I think it would be a fantasy that the federal government would start paying the tab for the industry. Historically, we already had a heavy dose of regulations which brought on railroad bankruptcies.”

So far, Congress has only promised to listen as complaints mount.

For the full story, see the Nov. 13 print edition of Transport Topics. Subscribe today.