Public ownership of railroads

[railiner]

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.

Unfortunately the government system that built our nation and infrastructure now seems to be “broken”, and at a perpetual stalemate, as far as getting anything done…

 

[MARC Rider]

Unfortunately the government system that built our nation and infrastructure now seems to be “broken”, and at a perpetual stalemate, as far as getting anything done…

Well, yes, there's that.

But "perpetual" might be a bit of an overstatement. One needs to play the long game, and work for some changes. And even the "stalemated" Congress did pass some improvements. What's needed is a change on the overall narrative in our national discourse. It's not impossible, the American public isn't clamoring for privatized military, highways, waterways, etc. And for good reason. I think that the American public could be persuaded about the value of publicly owned rail, too.

 

[Tlcooper44]

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.

The country and states favor zoning and land use policies which basically give the automobile artificial, but very powerful transportation hegemony. The preference for car-dependency in America is often touted as a straight-forward consequence of technological innovation, or at least as a cultural preference, synonymous with the American ideal of freedom. Both of these explanations, however, completely ignore the cumulative effect of decades of government laws and subsidies that skewed personal and corporate decision making, underwriting suburban sprawl while deliberately undermining the existing urban framework - and of course, all other forms of transportation.

Anyone focusing on the fact that rail transportation never makes a profit either doesn’t realize that the deck is HEAVILY stacked against trains (and anything but air travel), or is ideologically dubious and incapable of looking at this with unbiased eyes. (Randall O’toole).

Until this is addressed, trains will not thrive, public or private, even if they’re Shinkansens. I often look at Amtrak with wonder. How legendary this company that they can run a halfway functioning train system in this hostile country.

 

[cirdan]

There may be systemic biases against rail. Simply changing ownership will not address these IMHO.

Across the world you can find examples of well run and badly run rail systems, and of privately run and publicly run and mixed forms. I don't think the ownership form is necessarily a predictor of the quality of output. Discussions of ownership are thus in the extreme just distractions from the bigger topic of what sort of railroads there should be. If the government were to buy out the freight railroads that would be a lot of money just to buy the stocks, no doubt creating additional debt without anything to show for that money. Getting railroads to work effectively is a question of public culture and setting of priorities and expectations. I just don't see the political will to do that. There are so many other things that are more important and urgent in the eye of the public and these will consume the bulk of resources and attention for the time being.

 

[MARC Rider]

There may be systemic biases against rail. Simply changing ownership will not address these IMHO.

Across the world you can find examples of well run and badly run rail systems, and of privately run and publicly run and mixed forms. I don't think the ownership form is necessarily a predictor of the quality of output. Discussions of ownership are thus in the extreme just distractions from the bigger topic of what sort of railroads there should be. If the government were to buy out the freight railroads that would be a lot of money just to buy the stocks, no doubt creating additional debt without anything to show for that money. Getting railroads to work effectively is a question of public culture and setting of priorities and expectations. I just don't see the political will to do that. There are so many other things that are more important and urgent in the eye of the public and these will consume the bulk of resources and attention for the time being.

Another thing to consider is that there's a lot of provincialism in our government system. Legislators are elected from local districts, the national Senate is set up so that states with small populations have the same power as states with large populations. The whole system gives rural areas somewhat more power to set the national agenda and the agendas of the individual states. There's more interest in passenger rail in densely populated urban areas, although there are some urban areas that still think they're small towns and can continue to rely on cars. For rural and exurban areas, rail is irrelevant to them, they think they can do fine with cars.

This is all on top of a cultural view that railroads are a 200-year-old technology, barely more advanced than horses and carriages, whereas the 100-year-old technology of automobiles and airplanes is much more up to date. This is the cultural force than ensures the continued fascination with gadgetbahnen, hyperloops, monorails, maglev, and flying cars.

What seems to be evolving is a system where there is public ownership of rail systems in heavily populated urban areas, whereas the bulk of the intercity network used mostly for freight is run by private companies. The "private companies," however, do get some government aid to upgrade parts of their infrastructure, and as common carriers, also have some obligations to provide public service, plus most of them are obligated to host Amtrak trains as well. With this government aid and their obligations as common carriers and under the laws forming Amtrak, it is entirely appropriate that there should be considerable government control of the operations and policies of these "private" railroads. All this without the government having to incur massive debt to buy the property.

 

[jis]

The biggest boost that the private companies get from the government is protected competition free franchises. Take that away and watch the fun begin Easiest way to do that is enforce unrestricted equal access to all desiring to operate a train. Ironically at this point "Socialist" Europe has more operating competition on its rail network than the "Capitalist" US does.

 

[AFS1970]

The stories of the car, oil and tire companies buying up the streetcar lines and running them into the ground are infamous. The lasting effect of this was that they have convinced a significant amount of people that owning a car is essential to life in our country. To some extent, I think this led to the highways getting more support than the track, and not the other way around. However, this is now a system that it is not easy to walk back, even if people wanted to. Couple this with the American spirit of individuality, and I am not sure passenger rail will ever be as mighty as it once was.

 

[toddinde]

The fundamental premise we have to decide before we think about ownership models is what we want the railroads to be, and understand that we, as a society, have a right to have the railroads be what we need them to be. They were built with massive land grants, charters and subsidies, and have been subsidized directly and indirectly since. The railroads can never be uber profitable like they are unless they only carry a fraction of the most profitable freight and continue practicing the downsizing model. If we want the railroads to carry more freight and passengers, we have to accept a lower level of profit for the public good produced. Public ownership of the railroads may seem enticing, but many national railways have ceased operations in the world, and British Rail was severely downsized in the Beeching cuts. An idea worth of study would be separating the infrastructure from the operating companies with the infrastructure companies open to all comers based on fees that would cover the infrastructure costs and a profit. Railroads could then serve anywhere in the country. Passenger services could as well. Food for thought.

 

[George Harris]

What is being left out here is that nationalization of the railroad system has been done once in the USA. During WW1 the railway system was nationalized under the theory that coordination and standardization would improve efficiency. This was not done during WW2, and the general information is that more freight and more passengers were moved more efficiently and with less equipment.

 

[eldomtom2]

What is being left out here is that nationalization of the railroad system has been done once in the USA. During WW1 the railway system was nationalized under the theory that coordination and standardization would improve efficiency. This was not done during WW2, and the general information is that more freight and more passengers were moved more efficiently and with less equipment.

I have not heard of any studies comparing the performance of US railroads between WW1 and WW2.

 

[Tlcooper44]

The biggest boost that the private companies get from the government is protected competition free franchises. Take that away and watch the fun begin Easiest way to do that is enforce unrestricted equal access to all desiring to operate a train. Ironically at this point "Socialist" Europe has more operating competition on its rail network than the "Capitalist" US does.

It’s not just that - there are several aspect of ‘capitalist’ America that are laughably socialist, housing and zoning included.

Not that it’s feasible at all in the given moment, but I would love to take a Brightline train on the NEC some day.

It’s nice to have companies and options like Italo keeping government run services on their toes. Hopefully BL can do the same.

 

[George Harris]

What is being left out here is that nationalization of the railroad system has been done once in the USA. During WW1 the railway system was nationalized under the theory that coordination and standardization would improve efficiency. This was not done during WW2, and the general information is that more freight and more passengers were moved more efficiently and with less equipment.

I have not heard of any studies comparing the performance of US railroads between WW1 and WW2.

There were a couple/few/several done in the 1950's and possibly 60's that I read, but I do not recall the specifics other than that the differences were significant. Some, but not all, of the improvements in freight were due to increased average car load, but the load/unload times were also better. There was little in the way of improved capacity in people per car in passenger service. Just an aside, my mother talked of one WW2 era trip they made between Memphis and Jackon TN with her sitting on his lap and a GI in the other seat falling asleep and gradually leaning over against my dad. They did not wake him up because they figured he was so tired he needed the sleep. Not only is passenger service on this line long gone, so is the track. Another random item from the WW2 era, on a sectional sleeper they would allow two people to sleep in a lower berth.

 

[MARC Rider]

There were a couple/few/several done in the 1950's and possibly 60's that I read, but I do not recall the specifics other than that the differences were significant. Some, but not all, of the improvements in freight were due to increased average car load, but the load/unload times were also better. There was little in the way of improved capacity in people per car in passenger service. Just an aside, my mother talked of one WW2 era trip they made between Memphis and Jackon TN with her sitting on his lap and a GI in the other seat falling asleep and gradually leaning over against my dad. They did not wake him up because they figured he was so tired he needed the sleep. Not only is passenger service on this line long gone, so is the track. Another random item from the WW2 era, on a sectional sleeper they would allow two people to sleep in a lower berth.

There may have been some interline cooperation, too. When my Dad reported for Navy duty, he said he took a train that departed from Mt. Royal Station in Baltimore (B&O) and took him to York, PA (PRR). There must have been some sort of track interchange with the Northern Central that doesn't exist today.

 

[BlackDiamond]

The stories of the car, oil and tire companies buying up the streetcar lines and running them into the ground are infamous. The lasting effect of this was that they have convinced a significant amount of people that owning a car is essential to life in our country. To some extent, I think this led to the highways getting more support than the track, and not the other way around. However, this is now a system that it is not easy to walk back, even if people wanted to. Couple this with the American spirit of individuality, and I am not sure passenger rail will ever be as mighty as it once was.

The conspiracy theories about car, oil, and tire companies destroying the streetcar system are somewhat overblown. The fact is that streetcar systems were already run into the ground by the Depression and heavy use with minimal maintenance during WW II due to gas/tire rationing resulting in an artificial boom in streetcar ridership. After the war, the great expense it would have taken for streetcar operators to replace worn tracks and equipment meant that it was an easy matter to instead convert to buses, especially since the growth of suburbia had pushed many outside of the city anyway and traffic patterns had changed. A few cities with relatively modern equipment such as the PCC cars did continue on such as Boston, Philadelphia, and Pittsburgh.

The situation with the mainline railroads was somewhat different in that although they experienced the same deferred maintenance with the Depression and WW2, they did make an attempt to recover the passenger business in the 1950's with the introduction of new equipment but they had another factor that the streetcars didn't have, air travel which had been boosted by new planes developed as a result of wartime military oriented development (pressurized cabins, jet engines) which eventually killed off much of the long range passenger business.

I feel that in the US the future is in corridors such as the NEC and state supported e.g. NC and CA. Not sure whether the LD "cruise trains" will survive in the long run.

 

[JamesWhitcombRiley]

Leading up to the First World War, the railroads were in flux, with Pres. T.R. at the turn of the century, labor action, the newly formed ICC harming profits and efficiencies, and of course the longstanding problem of workers being maimed and killed - all this as the age of robber barons, including in the railroad industry, was winding down (becoming financial), and issues like the power of the gov't to institute an eight hour day was going to the Supreme Court. Flux also with Progressives followed by Republican dominance followed by the Democrat Wilson. Then the war was on. The railroads operationally failed in a giant cluster flower. A strike was threatened (more on that below), justified by everybody else making money. On December 26, 1917, Wilson nationalizes.

There's a myth that the labor strife of the 1930s ended with Pearl Harbor. One of the Hollywood Ten, the former communists and the like, blackballed by McCarthyism, came back from exile in France to speak at a film festival in Virginia in the 2000s. I was astounded to hear him say labor activism ended with Pearl Harbor, and all the unions fell in line with the war effort. Not 200 miles away from the festival, in Virginia and westward, the UMW and John Lewis staged the largest labor action of the Second World War, going on longer than a year, finally ended when FDR threatened to bring in the Army to mine the very essential coal. Same reason, everybody else was making money, workers risked their lives every day.

But there are many smaller cases of WWII strikes sprinkled on random pages of the NY Times Machine, as I found looking for other stuff. Labor coverage was a big part of the news then. And "Trenton Makes, the World Takes" is right there in NYT territory.

The common assessment is that the railroads learned their lesson in WWI and made sure not to get nationalized in WWII. And the scale was much vaster. Any war memorial with names on it will show you that.

 

[MARC Rider]

The situation with the mainline railroads was somewhat different in that although they experienced the same deferred maintenance with the Depression and WW2, they did make an attempt to recover the passenger business in the 1950's with the introduction of new equipment but they had another factor that the streetcars didn't have, air travel which had been boosted by new planes developed as a result of wartime military oriented development (pressurized cabins, jet engines) which eventually killed off much of the long range passenger business.

I feel that in the US the future is in corridors such as the NEC and state supported e.g. NC and CA. Not sure whether the LD "cruise trains" will survive in the long run.

One aspect of the passenger business that the mainline railroads didn't attempt to recover was that of the corridors, which in the age of autos and airplanes was actually their best chance to revitalize their business. I say this on the basis of my extensive riding of the NEC (especially the PRR part) in the 1960s. Lots of deferred maintenance, old, shabby equipment, unexplained delays, dingy stations. (For example, Baltimore Penn Station didn't have the WW2 blackout paint removed from the skylights until the 1980s.)

Improvements along these lines didn't start until the 1960s and were mostly paid by government funding, and then the railroads in question (PRR, NYC, and Hew Haven) went bankrupt and were essentially nationalized. The current vastly improved service is all a result of this government takeover, and even today there are still problems, like the antiquated overhead catenary on the WAS-NYP NEC. I wonder what the NEC and Empire Service would be like today if those private railroads had spent some serious money on upgrading their infrastructure and service improvements in the 1950s, just like the Federal government did on the Interstate Highway system and the FAA.

As far as the long-distance trains, I would think that the current basic network should be able to survive. It seems to have a certain amount of bipartisan political support, at least as a basic system. It does serve rural areas that have few other transportation options, and there is a certain percentage of the traveling public that can't drive (for medical reasons) and won't fly (because they hate the experience or for medical reasons.) There may be a chance to expand it some, but this should probably be done in conjunction with corridor service running over parts of the routes in order to share the (large) fixed costs.

In any event, railroads in general have a lot of fixed expenses that need to be paid whether or not the business is good. This is not a good match for the current breed of capitalists who are inspired by the tech industry where seemingly endless revenue streams can be generated by a very minimal expense. The private railroad companies own the infrastructure, and it would be too expensive to buy them out. Thus, I think what will evolve is "private" railroads with a lot of government spending on their property and bailouts, if necessary to seep the system running. We can only hope that the government has the guts to use their financial support to control the operations of the companies to provide the essential services that the railroads provide.

 

[toddinde]

What is being left out here is that nationalization of the railroad system has been done once in the USA. During WW1 the railway system was nationalized under the theory that coordination and standardization would improve efficiency. This was not done during WW2, and the general information is that more freight and more passengers were moved more efficiently and with less equipment.

Here’s some food for thought. Imagine the railroads had remained nationalized and the highway centric policies that carried the day during the ‘50s, ‘60s and ‘70s had been in place and responsible for funding the railroads. We might have an even more skeletal rail system than we have.

 

[eldomtom2]

There were a couple/few/several done in the 1950's and possibly 60's that I read, but I do not recall the specifics other than that the differences were significant.

So you don't remember whether or not the studies investigated the cause of the differences and whether or not they could be placed on private control?

 

[George Harris]

So you don't remember whether or not the studies investigated the cause of the differences and whether or not they could be placed on private control?

That the differences were primarily due to private control versus public control was the major point of the studies I read.

 

[George Harris]

The fundamental premise we have to decide before we think about ownership models is what we want the railroads to be, and understand that we, as a society, have a right to have the railroads be what we need them to be. They were built with massive land grants, charters and subsidies, and have been subsidized directly and indirectly since. .

They point made also in several of these post WW2 studies was that these land grant and other similar federal benefits were paid back many times over during WW2 alone due to the reduced rates for government freight that was part of these land grant agreements. As to the subsidies since: What subsidies? Railroads have been paying property taxes on their right of way and other real property ever since, which is the reverse of subsidy. In some states there have been lawsuits by railroads and utilities against states and counties due to inequitable assessments of property values resulting in higher taxes on their properties.

 

[BlackDiamond]

One aspect of the passenger business that the mainline railroads didn't attempt to recover was that of the corridors, which in the age of autos and airplanes was actually their best chance to revitalize their business. I say this on the basis of my extensive riding of the NEC (especially the PRR part) in the 1960s. Lots of deferred maintenance, old, shabby equipment, unexplained delays, dingy stations. (For example, Baltimore Penn Station didn't have the WW2 blackout paint removed from the skylights until the 1980s.)

Improvements along these lines didn't start until the 1960s and were mostly paid by government funding, and then the railroads in question (PRR, NYC, and Hew Haven) went bankrupt and were essentially nationalized. The current vastly improved service is all a result of this government takeover, and even today there are still problems, like the antiquated overhead catenary on the WAS-NYP NEC. I wonder what the NEC and Empire Service would be like today if those private railroads had spent some serious money on upgrading their infrastructure and service improvements in the 1950s, just like the Federal government did on the Interstate Highway system and the FAA.

I agree, I rode the NEC between Philadelphia and Boston often in the late 1960's NH/Penn Central era. I generally used Back Bay station which still had its classic old waiting room back then (before they tore it down and built the current concrete dungeon) but I recall South Station being quite a dump. Much of the equipment was tired too, with GG-1's hauling the trains to New Haven where ancient ex Pennsy E8's would take over. The one bright spot were stations between New Haven and New Rochelle many of which were being rebuilt by the states of CT and NY as part of the upgrading of the commuter service that would eventually become Metro North.

 

[MARC Rider]

The one bright spot were stations between New Haven and New Rochelle many of which were being rebuilt by the states of CT and NY as part of the upgrading of the commuter service that would eventually become Metro North.

See? The only investment being done on the railroads was with government funds.

 

[MARC Rider]

They point made also in several of these post WW2 studies was that these land grant and other similar federal benefits were paid back many times over during WW2 alone due to the reduced rates for government freight that was part of these land grant agreements. As to the subsidies since: What subsidies? Railroads have been paying property taxes on their right of way and other real property ever since, which is the reverse of subsidy. In some states there have been lawsuits by railroads and utilities against states and counties due to inequitable assessments of property values resulting in higher taxes on their properties.

There you go. The property tax thing is a big deal. Ownership of the tracks by the government or some sort of non-profit entity might make that fixed cost go away. Airports don't pay property taxes. The state highway departments and drivers don't pay property taxes (and I think the gas taxes that drivers pay are much less of a financial burden. (The Federal gas tax is 18.5 cents per gallon, last raised in 1993 when the average price of gas was about $1 a gallon. State gas taxes are a little more, but in both cases, they aren'tindexed to inflation, and the motorist gets a free (or cheap) ride from the low gas taxes.

 

[MARC Rider]

I wonder what the NEC and Empire Service would be like today if those private railroads had spent some serious money on upgrading their infrastructure and service improvements in the 1950s, just like the Federal government did on the Interstate Highway system and the FAA.

What would today's NEC, Keystone, and Empire Service be like if the private railroads (PRR, NYC and New Haven) had invested in improvements in the 1950s instead of letting things go to seed? The PRR finished its electrification in the 1930s, and after 20 years of hard use, maybe it would have been time to replace the catenary. I'm not sure when constant tension catenary was developed, but certainly that's something they could have done. The New Haven's electrification was done even earlier, it definitely needed to be replaced by the 1950s. Maybe the NYC might think about changing to overhead electrification with more modern equipment, and possibly even working with the PRR to build an Empire Connection to allow through trains to run from Washington to Albany. The PRR and NYC might have been competitors, but not on the WAS - ALB route, which until the Empire connection was built required a taxi transfer in New York. I would also think that the PRR and New Haven should have had a new electric locomotive to replace the GG-1 in development starting in the late 1950s. (The GG-1 came out in the 1930s and by the late 1950s would have had 20 years of hard use.) I imagine there would have been a lot of technical improvements, and at least they could have had transformers that didn't contain PCBs.

Stations, of course, could have been restored or rebuilt, but that was one of the problems. The railroads had a lot of very valuable downtown real estate tied up in their stations, and that was one of the reasons they wanted to suspend service - so they could tear down the stations and sell the land to real estate developers, which is pretty much what happened to Penn Station in New York, even though the actual tracks and platforms were retained.

Whether improved corridor service with higher ridership and revenue would have been profitable for the railroad companies is an open question, as the fixed costs of operating railroads is high, and I suppose it's possible to lose money even if your product is selling well. No wonder they brought the government in.

 

[Qapla]

Perhaps, ownership of the rails, not the railroad companies would go a long way. After all, the government owns the roads, not the trucking companies and seems to work quite well.

By transferring the rails to public ownership, just like the highway system, would allow the private sector as well as the public sector to travel on the same rails just as the highways do now - and it might be met with far less opposition than nationalizing the actual freight rail businesses.