Government intervention in Americas Railroads

[Viking Prince]

The Economist.com has focused on the question of rail transport in the USA. The age old conflict of freight vs. people. In Europe they solved the problem in favor of people and thus frieght costs and efficiency to more freight has suffered. In the USA we tried to have both and government regulation pretty well assured the economic failure of both. Amtrak was the admission that passenger traffic was not competitive with alternative private forms of transit. Penn Central went into bankruptcy. Since than, regulation has let up on the stranglehold over the freight companies. There is a risk of it returning though.

Major urban areas are looking to rail transport as a solution for rapid movement between cities in the various urban corridors (California, East Coast, etc.) The problem is frieght. It is unsafe to mix feight with passenger service. The higher the passenger speed, the greater the risk.

In Denver CO there has been a number of proposals to completely move the freight system to the eastern plains. This will allow for the urban freight corridors to be used for passenger service without the need to regulate the freight companies. It is not cheap. The railroads will want to ve compensated for their land at market rates as well as a subsidy to pay for the relocation.

So the question before the forum is:

To what degree should such reorganization of rail networks be government run? Does it matter that the private railroads will also eventually reap billions in potential future profits off of such a reallignment.

Economist.com link High-speed railroading

[Dr. Oza]

i want my 300 mph train going from san francisco to los angeles in and hour or 2 at most

make a new rail.. its not like freight and passenger go on the same lines

[Viking Prince]

But you are not going to get your 300 mph train service unless the existing freight rail lines, freight terminals, transfer yards, etc. are relocated. Also -- the railroads have other uses for the land such as communications. Fiber optic lines generate a great deal of revenue for BN.

[Saturn]

Is it possible to have two unconnected systems in place at once in the same area, or is it not worth the cost? Maglev?

[Viking Prince]

The problem is not between the cities, but within the cities. When a freight train derails it creates a massive and fairly large area of potential devesation. Passenger cars (even heavy weights) are not equipped to handle the impacts. The only solution is physical seperation. Puttinig in differant levels is not a solution unless the support structure can ahndle the impacts. The rail right of way was acquired in most cases over a century ago and was never meant to even modern freight volume, let alone physical seperation in a congested area.

The classic government solution is to regulate the railroads so that they are obligated to provide access for the commutor equipment. This costs the railroads money. More money than even the government adds on top as Amtrak and other passenger subsidies. Regulation is why the railroads collapsed previously -- mainly by controlling freight rates and access. We are repeating the process.

Even though it will be more expensive the solution is to purchase the inner city rights of way and pay the railroads to rebuild their infrastructure on the perimeter of the urban regions. Regulations cost money to businesses and citizens but not money out of the government budget so this has been historicly the path of least resistance. But in the end regulations cost the economy much more.

[Phier]

The only viable passanger lines seem to be lines in heavily urban areas where you don't want to fight traffic. If these are popular and will make a profit, that profit should be allocated to moving the freight out of the city.

If they are not profitable then they should not be built in the first place.

[Viking Prince]

I would agree, but the problem is the political solution of regulation will always gather more votes. This means that some form of subsidy will occur in any case. My point is that it is best to avoid the hidden subsidy (or tax if you are the railroad) by putting in place an open subsidy for urban transit with the express understanding that the government will not hide a subsidy through a hidden tax on the railroads. We are already massively subsidizing the roads and heavily taxing fuel for urban transit.

[Phier]

I would agree, but the problem is the political solution of regulation will always gather more votes. This means that some form of subsidy will occur in any case. My point is that it is best to avoid the hidden subsidy (or tax if you are the railroad) by putting in place an open subsidy for urban transit with the express understanding that the government will not hide a subsidy through a hidden tax on the railroads. We are already massively subsidizing the roads and heavily taxing fuel for urban transit.

Well what you are asking is how to make it so the government will not screw it up, and I can't answer that because I'm sure they will.

They always try to sell a free lunch after all.

[Saturn]

I read somewhere a while ago that Germany had a better rail system before WWII than it does now. Prior to 1920 the railways were nationalized with the intent to turn a profit purely for revenue, though. Not saying I'd support it, but I was just throwing in some info I remember hearing a while back.

Really I think what should happen is that inter-city transport should be limited to subway, buses, taxis, etc. Between cities, monorail or maglev, and the rail system should be primarily freight. I know you already addressed it, but that's what I think. I really don't know a whole lot about this issue, but it seems pretty interesting and something I think I need to read up on.

Now that I think about, I always found modern infrastructure to be fascinating.

[Aetius]

I love Europe's rail system.

Driving cars is expensive, dangerous, stressful in urban areas, and bad for the environment. I dislike driving, it is such a tiresome way to travel.

I don't see us moving towards passenger trains here in America anytime soon however. We chose the automobile over the train back in the 30s and all the infrastructure that came with it.

[Armenum]

Problem is the US is very vast, Europe by area is small and compact, thus railroad infrastructure is easier in europe. What US should focus on is improving the railroad infrastructure in most populated areas (e.g. northeast, chicago areas, south western California, etc.) Rail transport should be the future, and should replace the polluting and large trucks. And also replace short flights in the long run.

[xcorps]

To what degree should such reorganization of rail networks be government run?

I think that the failures of government to provide such services are clear and numerous. The private sector thrives when a reasonable and sustainable demand for services exist. When the government interjects itself, failure follows.