It’s well-known that President Joe Biden—who regularly rode the Amtrak train between Wilmington and Washington as a senator and to his 2021 presidential inauguration—loves trains, always touting their environmental efficiency and value to the U.S. economy. The Biden White House is hostile to trains other than those that transport passengers, and has made it clear that they are not interested in freight trains.
This animus could lead to even worse results. Crony special interests are assisting in creating a dangerous industry.
Particularly, it was the President’s Team at the U.S. The controversial proposal was presented by the Surface Transportation Board (STB). It has just concluded a two-day marathon hearing. The idea would force private railroads to subsidize their own competitors and disregard their property rights through a burdensome regulatory change to what is known as forced “reciprocal switching”—the practice of allowing one carrier access to another’s infrastructure and customers.
Already, reciprocal switching is voluntary through agreements made between railroads. Washington bureaucrats now have more authority to make these networks available to other competitors. They can also offer lower shipping rates.
Although the rule may sound like an indirect price control measure, Washington claims that it will encourage competition. They claim that railroads are a monopoly. Data from the Bureau of Labor Statistics show that freight rail prices have not increased over the past several decades. This is in contradiction to the claims that freight railway has abused its position by charging customers too high prices.
Even more concerning is the argument of Patrick McLaughlin who argues that railroad workers would be at greater risk from accidents or casualties if they were forced to switch. He writes in a public statement:
Reciprocal switching is likely to lead to greater switching. The Federal Railroad Administration data clearly shows that switching is much more dangerous than regular operation of an over the-road freight train. Class I railroads saw a 2.79 casualty incidence rate for normal train operation in 2019, while the rate for switching operations was 7.55 per 100,000 hours.
McLaughlin’s 2019 and 2020 accident rate rates show that McLaughlin calculated that an increase of 1 percent in switching hours would produce 107.185 additional switching hour, which in turn would cause 4.18 more casualties, and 11.59 extra accidents. These assumptions are conservative.
To understand why something that sounds simple could be so dangerous, it’s useful to know that a typical switch of one car between two railroads can be complicated—either on its own or in the context of broader network operations. It is only when this risk is economically feasible that it’s worth it, and not when government orders it to be taken.
A large number of parties are opposed to the rule change. This includes key allies like labor unions, passengers train companies and environmentalists as well as libertarian think tanks and major Democrat-aligned think tank. You can call me a cynic but I find it difficult to believe who this administration is trying, through the Surface Transportation Board. It would do so at the cost of the administration’s stated goal to lower emissions and improve supply chains.
As always, powerful special interests seem to be the answer. Shippers are the answer in this particular case. According to the Rail Customer Coalition, they have written a letter to STB requesting that the government artificially lower their costs. The hearing also demonstrated an uncomfortable chumminess between the regulators—particularly the agency’s chair—and the ring of regulatory proponents led by multinational chemical companies. Indeed, as it has been from the beginning, the biggest cheerleader for the change is the powerful American Chemistry Council, which includes Delaware-based DuPont—a longtime political ally and campaign contributor of the president.
Here it is: Washington gives us all reason to believe that it sells favors to its cronies, even though it may mean worker safety, railway efficiency, supply chain stability, and environmental damage.
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