Conor here: Just a reminder that most railroads are nationalized in Europe, Asia and Latin America.
While such an effort here would face likely legal obstacles over eminent domain and compensation for the infrastructure, a motivated government could get it done. While nationalization might not be on the horizon, there’s still a lot the government could do. Peter Moore, a Georgia College and State University professor focusing on supply chain and logistics, wrote in 2021:
If the railroads operated over public lands, then those lands could be used for new passenger and freight infrastructure as well. There has been a call for regulation such as open reciprocal switching, allowing nearby railroads to compete for a captive shipper’s traffic.
The question remains: Could we do more than open reciprocal switching to captive shippers, a ruling held up by the STC for more than a decade, and think big?
In the 1980s, it was the granting of 48 state authorities by the ICC that opened the trucking and airline industry to competition. This could work for rail—not just local reciprocal switching, but national reciprocal trackage rights might enable competition over shared lines.
By Jake Johnson, staff writer. Originally published at Common Dreams.
An alliance representing rail workers across the United States published an open letter late Thursday urging all of organized labor to support the nationalization of the country’s railroad system, arguing that the private and inadequately regulated industry has “shown itself incapable of doing the job.”
“In face of the degeneration of the rail system in the last decade, and after more than a decade of discussion and debate on the question, Railroad Workers United (RWU) has taken a position in support of public ownership of the rail system in the United States,” reads the letter, which was published as the small town of East Palestine, Ohio is attempting to recover from the toxic derailment of a Norfolk Southern train two weeks ago.
“We ask you to consider doing the same, and announce your organization’s support for rail public ownership,” continues the letter, which was addressed to unions as well as environmental, transportation justice, and workers’ rights organizations. “While the rail industry has been incapable of expansion in the last generation and has become more and more fixated on the operating ratio to the detriment of all other metrics of success, precision scheduled railroading (PSR) has escalated this irresponsible trajectory to the detriment of shippers, passengers, commuters, trackside communities, and workers.”
PSR is a Wall Street-backed model that has taken hold across the U.S. rail industry, gutting workforces and undermining safety in pursuit of more “efficiency” and larger profits for rail carriers and rich investors. Meanwhile, more than 1,000 of the nation’s trains derail every year.
In its open letter, RWU—whose ranks include workers from a number of different unions and rail professions—noted that “on-time performance is suffering” and “shipper complaints are at all-time highs” as rail carriers prioritize their profit margins over all else.
Norfolk Southern, which also owns the train that derailed outside of Detroit on Thursday, brought in record revenue and profits in 2022.
“Passenger trains are chronically late, commuter services are threatened, and the rail industry is hostile to practically any passenger train expansion,” RWU’s letter states. The workforce has been decimated, as jobs have been eliminated, consolidated, and contracted out, ushering in a new previously unheard-of era where workers can neither be recruited nor retained. Locomotive, rail car, and infrastructure maintenance have been cut back. Health and safety have been put at risk. Morale is at an all-time low.”
The alliance also pointed to the White House-brokered contract that Congress forced rail workers to accept last year as evidence of broader industry dysfunction. At the center of the contract negotiations—which nearly resulted in a nationwide strike—was the issue of paid sick leave, which is denied to most rail workers due to PSR.
The solution, RWU contended, is to nationalize the rail industry, a step that would open the door to “a new fresh beginning for a vibrant and expanding, innovative, and creative national rail industry to properly handle the nation’s freight and passengers.” The organization is calling on allies to back its resolution supporting public ownership.
“During WWI, the railroads in the U.S. were in fact temporarily placed under public ownership and control,” the open letter notes. “All rail workers of all crafts and unions supported (unsuccessfully) keeping them in public hands once the war ended, and voted overwhelmingly to keep them in public hands. Perhaps it is time once again to put an end to the profiteering, pillaging, and irresponsibility of the Class 1 carriers.”
The railroads, their CEOs, and the hedge fund robber barons will not listen, but railroad workers have the solution to managing and operating critical railroad infrastructure. https://t.co/zcPf4795VW
— Railroad Workers United ✊ (@railroadworkers) February 16, 2023
The derailment and chemical spill in East Palestine have catalyzed discussions on how to prevent similar disasters from occurring in the future. Some, including environmental groups and progressive lawmakers, have implored the U.S. Transportation Department to take urgent measures to improve rail safety, including modernizing critical braking systems.
But others have sided with RWU in arguing that while narrow reforms may be necessary as near-term solutions, they ultimately won’t be enough to solve the rail industry’s deep flaws, which stem from the prioritization of ever-greater returns.
“We demand that Congress immediately begin a process of bringing our nation’s railroads under public ownership,” the general executive board of the United Electrical, Radio, and Machine Workers of America (UE) declared in a statement late last month, just days before the fiery crash in eastern Ohio.
“Railroads are, like utilities, ‘natural monopolies,'” UE said. “The consolidation of the Class 1 railroads in the U.S. into five massive companies over the past several decades has made it clear that there is no ‘free market’ in rail transportation.”
“Our nation can no longer afford private ownership of the railroads; the general welfare demands that they be brought under public ownership,” the union added.
Read RWU’s full open letter:
Dear Friends and Fellow Workers:
In face of the degeneration of the rail system in the last decade, and after more than a decade of discussion and debate on the question, Railroad Workers United (RWU) has taken a position in support of public ownership of the rail system in the United
States. (see Resolution attached). We ask you to consider doing the same, and announce your organization’s support for rail public ownership.While the rail industry has been incapable of expansion in the last generation and has become more and more fixated on the Operating Ratio to the detriment of all other metrics of success, Precision Scheduled Railroading (PSR) has escalated this
irresponsible trajectory to the detriment of shippers, passengers, commuters, trackside communities, and workers. On-time performance is suffering, and shipper complaints are at all-time highs. Passenger trains are chronically late, commuter services are threatened, and the rail industry is hostile to practically any passenger train expansion. The workforce has been decimated, as jobs have been eliminated, consolidated, and contracted out, ushering in a new previously unheard-of era where workers can neither be recruited nor retained. Locomotive, rail car, and infrastructure maintenance have been cut back. Health and safety have been put at risk. Morale is at an all-time low. The debacle in national contract bargaining last Fall saw the carriers ±after decades of record profits and record low Operating Ratios—refusing to make even the slightest concessions to the workers who have made them their riches.Since the North American private rail industry has shown itself incapable of doing the job, it is time for this invaluable transportation infrastructure—like the other transport modes—to be brought under public ownership. During WWI, the railroads in the U.S. were in fact temporarily placed under public ownership and control. All rail workers of all crafts and unions supported (unsuccessfully) keeping them in public hands once the war ended, and voted overwhelmingly to keep them in public hands. Perhaps it is time once again to put an end to the profiteering, pillaging, and irresponsibility of the Class 1 carriers. Railroad workers are in a historic position to take the lead and push for a new fresh beginning for a vibrant and expanding, innovative, and creative national rail industry to properly handle the nation’s freight and passengers.
Please join us in this historic endeavor. See the adjoining RWU Resolution in Support of Public Ownership of the Railroads, along with a sample Statement from the United Electrical (UE). If your organization would like to take a stand for public ownership of the nation’s rail system, please fill out the attached form and email it in to RWU. We will add your organization to the list. Finally, please forward this letter to others who may be interested in doing the same. Thank you!
In solidarity,
The RWU Committee on Public Ownership
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“In the 1980s, it was the granting of 48 state authorities by the ICC that opened the trucking and airline industry to competition” And what effect did that have on the subsequent decline of Unions? Just a question…
And the same crap is happening in Europe, with EU as its enforcer.
A good, solid post this Conor. Unfortunately I cannot see any major reforms taking place as that would require a major overhaul of how the US government does business. Consider the following. The post of US Secretary of Transportation is, from what I can see, a bit of a backwater. That is why Buttigieg was given the job as it was a safe place to stash him until he could make his run as President. Well that didn’t work out as there have been a few crisis events like the west coast container fiasco and now the Ohio disaster on his watch. And old Pete has shown himself to be incompetent at his job when something big comes up which may end up sinking his candidacy for the big job. But for things to change, you would have to have a major player given the job and laws changed to make it possible to carry out needed reforms. And in DC, the word ‘nationalize’ is like the word ‘socialism’ – and Congress just the other day denounced the horrors of socialism. Nationalization for them would be even worse – who gets an exclusive out of that?
We’ll see.. Meanwhile, here’s the link the RWU’s GoFundMe campaign to promote this.
Luckily, internet campaigns like RWU’s and Bernie’s presidential candidacy can bypass the oligarchy. Hey, it only took the Christians four centuries to take over from Rome. So…what am I saying? Patience?
Our country is actually collapsing. We do not have even four decades. It is closer to four years with the only path to survival is probably successfully pushing reforms on the whole system of governance.
The first step is to nationalize the government!
I wish the persons and organization pursuing this as a solution and end goal well, but feel it’s perhaps akin to chasing windmills. This will never happen.
Because markets, and other things. The US could perhaps fine them into oblivion after each derailment or personal harm infraction, but if one compares the heavy “fines” for our biggest Wall St firms after 2009 that was just the fee to continue doing business much as before. Poster children, see Citigroup, Wells Fargo, etc…
Great post, and glad to see the UE involved. They are one of the more radical unions and always have been. Good article from Harpers a few years back on unions that gets into the UE specifically about half way through – https://harpers.org/archive/2018/09/labors-last-stand-supreme-court-janus-decision-unions/
Might be paywalled, but the right browser addon should get through it. For those who can’t, a little about the UE –
Solidarity!
Good description of a union that is deserving of much respect, and which should be far better known.
The UE has single-handedly kept Richard Boyar and Herbert Morais’ magisterial history of labor from the Civil War to Eisenhauer, “Labor’s Untold Story” in print, and James Matles’ “Them and Us” is a useful description of the UE’s origins during the Depression and its survival during the Cold War/Red Scare. Your description of Matles bravely standing up to McCarthy in public comes from his book.
https:www.ueunion.org/labors-untold-story
Is turning the railroad industry into the Post Office a good idea, especially with inept creatures like Pete at the helm?
The railroads are FUBAR, just like the rest of America’s issues. Sorry for the pessimism. I have zero confidence in anything anymore.
Truly the problem with a solution like nationalization is that it moves control from the rapacious maw of finance capitalism to the federal government, which has proven itself to be the servant of finance capitalism. Though there is at least a chance of improvement under government control since we have theoretical power to change the government.
Now given that all of DC is on board with the US being at war with China and Russia, there is an opportunity for a president to nationalize the rail network under the umbrella of national security. But the fact that DC is collectively idiotic enough to get us into a war with China and Russia probably speaks against its ability to manage the rail infrastructure as a matter of national security. After all, in their planning for war they didn’t account for ammunition usage …
planning?
I get the impression that the USPS has deliberately been starved and run into the ground to open the segment up for privatization.
The same neoliberal shell game is slowly eating away at Europe as well.
Impression?
Started with Nixon. Curious timing of $25,000 donation from UPS to Committee to Reelect the President.
Between the union rules and the junk mail issues, the USPS is a combination of a mess and a disgrace. And it’s not just the unions; the politicians also share the blame.
I worked briefly in a co-op development in the Upper West Side and recall seeing two USPS workers sitting on the couch in the lobby for an hour or so each day with bags of mail because there would be a problem if they delivered the mail too quickly (or some such idiocy). This was, however, decades ago so maybe that has changed.
More crucially, how crazy is it that they go around the streets e.g. in NYC or drive around in the suburbs and spend 90% of the time placing junk mail into mailboxes which is destined to be thrown out as soon as it is received? I guess the discounted junk mail rates somehow pays for itself but what a colossal waste of time and paper and energy.
Anecdotally, I have gone to post offices in various US cities to be “greeted” with surly, unresponsive and generally unhelpful staff. I just went to the post office in a Japanese city and it was an absolute model of efficiency with very friendly and helpful staff. The same in my French town.
Between the alternatives of FedEx et al plus email, online billing, and generational changes (do millenials ever write letters?), the USPS is in a death spiral and is wasting huge amounts of taxpayer money. It’s sad, given its primal role in the US Constitution and a great history.
NB: as noted above, European countries have privatised their postal systems, with generally poor results in my experience. But the service still tends to be much better.
Lest we forget, in 1976 the federal government took over 7 major bankrupt railroads in the northeast. Penn Central was the largest, Erie Lackawanna was sizeable. The 7 railroads operated close to 30,000 miles of track and had well over 100,000 workers. Conrail was initially fully owned by the US government. As part of deregulation, workers received a 15% share for wage concessions. It was fully privatized in 1985 with an IPO. Conrail was the largest US railroad by most measures. It went out if existence in 1999, having been purchased by CSX and Norfolk Southern (40-60 split) in 1996.
Conrail spent billions in capital expenditures rebuilding physical plant. My yard, DeWitt in Syracuse, was fully rebuilt in 1978 at a cost of $28M. We thought we had jobs for life. As a result of the Carter deregulation it was completely shut down in 1982! The impact on the workforce was decimating. In less than 10 years 75% were gone and by 1999 even more were gone. Mileage was reduced by over 50%. Deregulation allowed confidential contracts for large shippers and effective abolition of published rate and common carrier status. Conrail was really at the rail industry forefront embracing deregulation and MBA slash-and-burn tactics. It was Jack Welch before it was a thing, all under government ownership.
US industry trends were mirrored in Canada. Canadian National was government owned from WW1 until privatized in the mid-90s.
And don’t misunderstand… public or worker ownership it the ideal. But there needs to be a management and cultural revolution in order for public ownership to work. Otherwise it’s Conrail redux.
Yes. It’s all about leadership and their motivation. Hard to remember a time when Hoover rose to power because of his skill in handling large projects. Roosevelt worked hard setting up a system of projects and good leaders. Later Eisenhower had his own skills and leadership to contribute, and we got interstate highways.
Our ‘leaders’ now are gutless grifters, pandering to monied interests, their life’s work seemingly keeping honest problem-solvers out of power.
Earthling, yes. But voters are so easily manipulated and fooled, bs’d, gaslit and bamboozled into believing the bad team vs terrible team nonsense that very few see it for what it is – a for profit system designed to screw 350 million of us.
good luck over coming free trade.
https://transportgeography.org/contents/chapter5/rail-transportation-pipelines/rail-ownership-north-america/
“Starting with the setting of NAFTA in 1994, rail mergers resulted in the involvement of Canadian and American operators offering cross-border services. Canadian National and Canadian Pacific acquired lines in the United States, enabling better connections with the Chicago hub as well as with New Orleans when CN purchased the Illinois Central Railroad in 1998. This made CN the only rail carrier in North America with a tri-coastal strategy (Pacific, Atlantic, Gulf). In 1998 Kansas City Southern purchased Transportación Ferroviaria Mexicana to form Kansas City Southern de México, which links the port of Lazaro Cardenas to Kansas City and passes through the main economic centers of Mexico (Mexico City, Monterrey). In 2021, Canadian Pacific acquired KCS, including its Mexican assets, forming the second North American railway having access to three maritime ranges. This merger still needs to be ratified by the Surface Transportation Board.”
and i am betting that the so-called america rail companies, also are heavily invested by foreign oligarchs.
and any attempt at restoring democratic control in any market/markets, will be stymied by free trade.
In the 1970s US passenger rail was nationalized, in the form of Amtrak. The federal government owns the interstate highway system; incompetent and corrupt as it is, there’s no reason it couldn’t own and manage the tracks.
i would like to find out if there is a on time record for amtrak? my gut feeling is that it could be better than the private sector if they had their own tracks.
it looks like sharing tracks is a no go. its time to nationalize.
https://www.railpassengers.org/site/assets/files/25442/on-time_performance_2022_final.pdf
Even though we nationalize some industry we really don’t have a viable goal in mind. We think that by nationalizing some failed but essential industry we will get it back on its feet, up and running, and then give it back to the highest bidder to run profitably. But it was the “profitably” that got it into trouble in the first place. And even profitability would be OK were it not for competition, requiring eternal growth, survival of the greediest, etc. So where does this leave us. We really do not have the time and resources left to indulge this capitalist misconception any longer. So… in a nutshell, this leaves not just nationalization, but requires us to embrace Socialism. Certainly it would have to be construed as “Socialism with American characteristics” but clearly better than martial law.
I come from a railway family, it used to be that way. I remember my grandfather’s last trip on the “Canadian”. Many were there to congratulate him on 40-45 years of service. That was the late 60’s in Union Station. My father retired in ‘86 after 38 or so years of service. I retired after 40+ years in the rail/transportation industry. I remember going to work with my father and sometimes with my grandfather riding the rails. People would as the train went by wave at the crew going by from their backyards. One time sitting in a locomotive with the crew my dad pointed out Bobby Orr’s mother waving at us going by from their family home. I may have been 9-10 years old. The other memories are of me going to play baseball, father son trips with Boy Scouts hockey etc without my father there due to him working at all hours of the day. Always on call. It used to be one big happy family. Railroaders hung out together as no one else had the same lifestyle. My dad and almost all his coworkers were alcoholics. Comes with the job. Divorce was common. I do know how my mother put up with it, raising 3 kids with little help. Not that my dad wasn’t a good dad, he was. The railway stole him from us. It is worse now. Far worse. I feel for all rail workers, as they are forced to put work before family. So sad……
Let me point out the obvious. The Railroads and government are already sleeping together. This is the same government that just eviscerated the grievances that labor had. I wonder who’s pocket the RWU is in? ☮️
Blazing Saddles still accurately portrays how railroads politically operate.
Nice read. Not going to happen. Even if Bernie became President we need really DYNAMIC CEOs to run nationalized industries. We need schools with curriculums to build people like that. I am pretty sure they maybe have people like that in China or maybe Brazil or perhaps some retired NHS medico admin in UK? Would be nice to read a piece about some heroic person doing a great job running a nationalized industry. The main problems are the 401ks and the pension funds. Buffet and his hedgie pals may be making money but some of it fattens 401ks and pension funds?
Nationalizing one or two industries is tinkering around the edges? Not a systemic solution? Reverse engineering what might work – a strongman takeover of the country say for example – for any chance of success should start first by crashing the stock market and decimating 401ks and pension funds and also kill the money changers sustenance. Then you start several Shakti style trials but this time real trials not show ones as in Stalin’s times. Now you have the mob on your side and ship off the criminals to Guantanamo or someplace nice. Next you are free to mold public opinion with a new Pravda, reshape and regrow a new system which puts social well being of all and the environment as the first article of a new Constitution, Its a little like er, destroying the village to save it.