Public ownership of railroads

I'm not sure where this belongs, but this white paper was just released today by publicrailnow.org and I thought others might be interested.

Today, on July 1, one week after the National Transportation Safety Board's damning hearing on Norfolk Southern's disastrous handling of the derailment in East Palestine, the 102nd anniversary of the Railway Shopmen's Strike, and 68 years after the Act creating the Interstate Highway System went into effect--

My report, "Putting America Back on Track: The Case for a 21st Century Public Rail System," offers a vision of the public alternative to the failures of the private short-term-profit-focused rail system dominated by four duopolistic Class I railroads.

The failures of the private rail system are plain to see:
-Layoffs and understaffing are rampant, impacting workers' quality of life
-Disrespect and retaliation against employees, especially those raising safety concerns
-An accident rate that has risen 30% in the past 10 years
-A failure to grow traffic, and "the worst service ever" that has driven customers away from rail
-And many other issues, impacting every part of our society (I don't want to drone on in this post on the manifold issues, so if you are the least bit interested, please give the executive summary a glance for a fuller introduction)

These issues are outlined in the report below, as well as how the system of private ownership and management has led us here.

Public ownership—as with our highway system, inland waterways, and most rail systems around the world—offers an alternative vision. That of a sustainable, publicly accountable, worker-friendly, service-focused rail system capable of triggering a modal shift to rail.

In the report, I discuss:
-the "Why" of public ownership/the problem with the private Class Is
-the history of public rail in the United States
-present-day public rail in the United States
-international rail systems, both public and private
-and various models for public ownership

I am incredibly proud of this work, and thankful to all the folks who have helped me get it done. Now the hard work begins of restarting the long-dormant discussion about public rail ownership and building the coalition for Public Rail Now (publicrailnow.org). If you would like to get involved with, or organizationally endorse, the campaign please visit our website and fill out one of the linked forms:
https://lnkd.in/e3TPpueF

If you have questions about the report or would like to have me present to your organization about public rail, feel free to reach out to me personally at [email protected]

America deserves a rail system that works for all of us.

hashtag#rail hashtag#railroad hashtag#raillabor hashtag#labor hashtag#climate hashtag#publicrailnow hashtag#supplychain

Very interesting. I just skimmed it but intend to go back and read it later.
One question I had is what would be the mechanism for public control of the railroads, could the nation afford to buy them outright as that would be quite expensive. Also how would that affect Canada as both CN and CPKC operate in both countries (also Mexico).

Having used various publicly owned railroads in Europe, the service and safety are better, but at a price. Not one of them comes close to breakeven, I think. If you treat them as a public service then I guess it makes sense.

JWM said:

Having used various publicly owned railroads in Europe, the service and safety are better, but at a price. Not one of them comes close to breakeven, I think. If you treat them as a public service then I guess it makes sense.

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Actually, I believe the Swiss Federal Railways break even and perhaps show a small profit due to the quality of their service and the high level of patronage by people there. Between the trains and the buses that are well organized to connect with each other, you can get just about anywhere in the country without a car.

Also I believe some of the high speed trains in Europe do break even although of course we are not counting the high cost of capital to build them in the first place. I think this is why you see many open access operators vying to run their own high speed services in competition. In many countries there is still a large network of conventional trains that do lose money. I do worry that the cherry picking of high speed service and subsequent neglect of the local trains is detrimental in the long run to a comprehensive network. I hear this is happening in France for example.

I can never understand how if it costs 100 units to provide a correct service of anything, cover wages, repairs, etc, that pretending to provide the same level of service for less cost, and provide a profit for private owners, makes any realistic sense?

BlackDiamond said:

Also I believe some of the high speed trains in Europe do break even although of course we are not counting the high cost of capital to build them in the first place. I think this is why you see many open access operators vying to run their own high speed services in competition. In many countries there is still a large network of conventional trains that do lose money. I do worry that the cherry picking of high speed service and subsequent neglect of the local trains is detrimental in the long run to a comprehensive network. I hear this is happening in France for example.

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France has among the highest track access charges in Europe, and a rather poor network outside of their high-speed lines. Flix wanted to operate several conventional speed trains, and gave up because of the excessive track charges. The first competitor on these lines is SNCB for a couple of months, that operates trains between Bruxelles and Paris, but without any stop between the Belgian border and Paris. https://www.b-europe.com/EN/Trains/Eurocity-Brussels-Paris

In Germany for example, where the network is much cheaper to use, and where the conventional lines are in a mostly good shape, the competitors only operate conventional speed trains.

Spain is a different story, as their conventional speed network has a different track gauge than the rest of Europe.

The big difference between Europe and the US is one word: Freight! That said, it sounds like some of the freight railroads here aren't doing a great job pleasing their customers with freight (whether that is planned money losing for value-out or planned sale or just plain sheer incompetence I can't answer) but that makes a big difference in the networks and whether/how they could be nationalized. At the moment, I suspect it's a pretty big non-starter with the potential, uh, changes facing the nation and whether we will be a nation in a few years.

BlackDiamond said:

Actually, I believe the Swiss Federal Railways break even and perhaps show a small profit due to the quality of their service and the high level of patronage by people there. Between the trains and the buses that are well organized to connect with each other, you can get just about anywhere in the country without a car.

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They break even after counting subsidies received as income.
Inter City trains are supposed to operate without subsidy (at least on paper), but all commuter and regional services are subsidized by local and / or federal government. SBB declares a profit if they end up with money in hand after taking the subsidy and running the service. Amtrak could do that too.

Major infrastructure and construction projects are also for the most part generously supported by government money.

Overall Swiss Federal Railways consume quite a lot of taxpayer money.

So they only really break even for a special way of counting.

cirdan said:

So they only really break even for a special way of counting.

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Kinda like the Northeast Corridor then.

I find it so messy and useless to try to derive any sort of value over whether or not transportation or transit makes a profit.
All forms of transportation are basically not profitible, and its not a good metric by which to judge them. The externalities are simply too important.

In terms of public ownership of the railroads: I think its a bad idea. I could get on board with public ownership of the tracks, but I am wholly unconvinced that the US government running our railroads and rail companies would somehow make them better.

When I have a chance, I will enjoy reading this. Happy to read a counter-argument.

As I've written before, the term "profitable" is a slippery term and is close to useless for the purpose of this discussion. (see "Hollywood Accounting.") I guess at best, it means that an enterprise owned by the government needs to earn all of its expenses from income derived from users of the enterprise and that no taxpayer subsidies are spent supporting the enterprise. This is not due to any divine law, but rathe politics. At this time, any political consensus to support, or at least tolerate, public subsidies of railroads is very limited.

But there are many other government owned enterprises which receive very generous taxpayer subsidies for which there is little or no argument. Consider such enterprises such as the U.S. Marine Corps, The U.S. Air Force (actually, we pay for two air forces, the other being run by the Navy, and they're both larger than that of any other country in the world), The Navy, the Army, the FBI, etc. Local and state police forces. And I don't think many of us would want these run by privately-owned for-profit companies. In the transportation field, there's the FAA, the Corps of Engineers, The Federal Highway Administration, and all of the state and territorial highway departments. Yes, a few roads are financed by tolls, and a few of those of run by private companies, but it doesn't seem to be too successful a business model and isn't spreading. Also, to be honest, many of the government-owned roads (at least in my state, which spends more than most) are not in the best of shape, as voters tend to be very skeptical about the need to raise taxes to fix the roads.

What's lacking is a political consensus that rail infrastructure should be owned and maintained by the government, with an emphasis on ensuring that the tracks are in tip-top shape to allow rail operators (whether privately owned or government) to provide the best, most reliable rail service. The entire country would benefit, but so far, I don't think the electorate sees that these benefits would be a great enough priority to spend the tax money to acquire and maintain the Nation's railroads.

I like the idea of publicly-owned rail infrastructure, but I'm a little nervous about rail infrastructure having to compete with air and highways for funding.

Metra Electric Rider said:

The big difference between Europe and the US is one word: Freight! That said, it sounds like some of the freight railroads here aren't doing a great job pleasing their customers with freight (whether that is planned money losing for value-out or planned sale or just plain sheer incompetence I can't answer) but that makes a big difference in the networks and whether/how they could be nationalized. At the moment, I suspect it's a pretty big non-starter with the potential, uh, changes facing the nation and whether we will be a nation in a few years.

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On the subject of freight, public ownership of infrastructure and private operation of freight trains is generally considered to have worked well in Europe. Such a system could have positive effects in the US, as it would greatly increase competition.

Harmon Shay said:

I like the idea of publicly-owned rail infrastructure, but I'm a little nervous about rail infrastructure having to compete with air and highways for funding.

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No need to worry about it since it's never going to happen. It is not remotely on any factions' political radar and would face immense, very well funded and proven effective opposition if it were.

This is an interesting mental "what if" exercise, nothing more.

Undoubtedly correct. Unfortunately, it probably means we're now consigned to not having much of a rail system in the future.

Then again where is all that money required for a publicly owned network just for operations going to come from? Freight will still work out fine. I am not so sure about passenger.

I wonder if the operating cost had to do with the decision not to go to public ownership of infrastructure following World War I and following the bankruptcy of the Penn Central.

zephyr17 said:

No need to worry about it since it's never going to happen. It is not remotely on any factions' political radar and would face immense, very well funded and proven effective opposition if it were.

This is an interesting mental "what if" exercise, nothing more.

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its might be on the table for some States or certain lines but I doubt we will see the feds asking to buy the sunset route or BNSFs southern transcon.

Amtrak has from the start been a weird mix of public & private. As much of a small government person as I am, I do realize that it isn't sustainable as both and needs to be one or the other. I personally favor private, as there is very little that the government does better that the private sector. I am impressed to see what Brightline accomplishes, as the prevailing wisdom was that private passenger service was not a good business. The government need not concern itself with profits and instead could simply put trains where t thinks they are needed. On the one hand that is a plus, but on the other if there is not profit potential it probably means there isn't much need.

Years ago, during the debates on public healthcare, I saw a comedian doing a routine. He brought up public housing projects. His joke (which a good joke always has an element of truth in it) was that if you wouldn't live in public housing why would you seek treatment in a public hospital? The same could be said about public trains. Flex dining, dated interiors and chronic lateness are all symptoms of this.

Not that long ago NYC used a mix of public and private busses, with private companies running regular routes. They changed to an all-MTA bus system. Oddly enough to circle back to health care they have a three-tiered ambulance system. I think there is room for both public and private trains, but probably not in the same entity.

I have not fact-checked, this it is something I was told by a rail fan I got into a conversation with at a rail fanning event in Britain. He was telling me about the old LNER, company, which was one of the four private companies, who prior to nationalisation of the railways in 1948, had between them controlled virtually the entire UK rail system (outside of the London and Glasgow undergrounds, Northern Ireland, most streetcar systems, and some industrial and narrow gauge lines).

He said that prior to nationalisation, the management of the LNER had put forward an alternative proposal to full government control. They were proposing to hand over all the track and ROW to the government, and were proposing to pay access charges to be allowed to continue to run the services they considered profitable, with the government being able to decide what to do with the rest. The LNER was proposing that these be put out to tender and the company offering the best value for money being allowed to operate them.

It seems to me that this is pretty much the inverse of what the US railroads did when Amtrak was launched. But it does resemble the later privatisation of UK railways.

Sometimes maybe the time just isn't right to see that an idea might work.

I'm starting to think that we're simply going to be stuck forever with an inferior railroad system for both passenger and freight, and nothing can be done about it.

Harmon Shay said:

I'm starting to think that we're simply going to be stuck forever with an inferior railroad system for both passenger and freight, and nothing can be done about it.

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It is a sociological problem. It is hard to change things without addressing land usage, social traditions and such other broader social issues.

jis said:

It is a sociological problem. It is hard to change things without addressing land usage, social traidtions and such other broader social issues.

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Agreed.

Harmon Shay said:

I'm starting to think that we're simply going to be stuck forever with an inferior railroad system for both passenger and freight, and nothing can be done about it.

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Unless something drastic changes our whole country into something modelled after China, where dictator’s rule, you’re probably correct.
I don’t think most people would want that to happen…

railiner said:

Unless something drastic changes our whole country into something modelled after China, where dictator’s rule, you’re probably correct.
I don’t think most people would want that to happen…

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Uh, we could possibly change our country into something modeled more on Western Europe, where, that last time I checked, there are no dictators. But, as everyone says, I think it's unlikely, at least under current conditions.

But then nobody thought our culture could eliminate slavery or get itself involved in "foreign entanglements," and we have a record for government owned and funded "internal improvements," as the Interstate Highway system, the Air traffic system, and our river and coastal navigation system demonstrates. We just need more agitation about the benefits of publicly owned rail infrastructure and need to get it into the national discussion.