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73 comments on API Conference Call on Gas Prices

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oilmanbob on May 23, 2007 - 12:29pm Permalink | Subthread | Parent | Comments top

Hi JustZizGuy
Railroads were initially subsidised to build lines, both the Federal Government and the State of Texas gave away huge amounts of the public lands to build tract. Texas, since it was a sovereign republic before annexation in 1845, retained all unpatented lands in its borders. The railroads were in the land speculation business as well as the transportation business.
Railroads have common carrier status under the law. In other words, they can condemn lands just like a government can for right-of-way. So can pipelines and electric utilities for that matter.
Since they constructed the Railroads with essentially a grant and have profited at the public trough for 150 years, I have a hard time feeling sorry for them. They abused labor and farmers for many years, they are card-carrying members of the corporatocracy that runs the U.S.A..The Railroads are possibly a saviour of our "non-negotiable lifestyle", but expect them to operate in their own interest, not the people's.
If you'd like to read further about these land grants, check out "The Handbook of Texas" online, as well as the history of The Texas Railroad Commission on their website. I'm a landman in Texas, and I've read about this bit of history for years, and it is within my area of professional expertise here in Texas.

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Mike C on May 23, 2007 - 4:18pm Permalink | Subthread | Parent | Comments top

I'm pulling for a US railroad renaissance all the way, and would love nothing better than to see Alan's slate of rail projects get moved to the front of the national agenda, but it's also true that US railroads were the (Exxon/ Microsoft/ WalMart/ Halliburton/ pick your favorite corporate villain) of their day.

For an excellent account of all that, see 'Hear That Lonesome Whistle Blow' by Dee Brown (who did sublimely righteous pissed-offedness better than any other historian I've ever read... )

Mike C
rail and bike fan in Boston

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JustZisGuy on May 23, 2007 - 5:16pm Permalink | Subthread | Parent | Comments top

I'm well aware that huge land grants were given to railways. There didn't used to be an Interstate Highway System either. I'm talking about more recent history.

I don't know how things are in Texas, but railways in Canada do not profit "at the public trough". Of course companies will operate in their own best interests - that's a good argument for public railways, not for subsidizing roads. Why the completely different status for railroad versus road? If public subsidies and planning apply to roads, why not to rails? If private capital and planning and land is the best way, why aren't roads all private?

(If you want an example of an absolutely enormous land grant, check out the E&N Railway on Vancouver Island. Nearly one third of the entire land was given to the company. Nowadays, in more recent history, you have the provincial government spending billions of dollars on highways - $1.4 billion on one highway project alone - and the railway no longer operates.)

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oilmanbob on May 23, 2007 - 6:17pm Permalink | Subthread | Parent | Comments top

The railroads don't continue to feed at the public trough, they've been nudged away by the other hogs. But since they have no capital invested in their rights-of-way except maintainence and repair, ad valorem taxes are fair. In Texas these are the major support for our schools, counties and cities, the state has no ad valorem tax. There's an excellent arguement that they should be public. I agree, but I'm a communist.
Our fearless Governor and State Legislaure are building a huge , new Transportation Corridor, funded by a private toll road company. Its supposed to run from Laredo to San Antonio, Austin and Dallas and also from Houston to Dallas. Its going to supercede the interstates and have high speed rail lines, Electrical Grid pipelines as well as new Highways. I haven't paid any attention to how they are funding it, possibly bond guarantees. I'm sure they all plan to get richer from the scheme, and I'll help pay for it. Sometimes being a Texan really sucks.

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AlanfromBigEasy on May 23, 2007 - 6:43pm Permalink | Subthread | Parent | Comments top

Short bit of history.

Generally, railroad ROWs west of the Mississippi (basically) were given away to build 5 East-West transcontinental railroads PLUS alternating sections (section = 1 square mile) in a checkerboard next to the 100' wide ROW. In return, the US Gov't got a discount on cargoes shipped on the railroad.

After WW II, the RRs got Congress to repeal the discount, noting that they had "paid" for the ROW and land several times over (neglecting to calculate interest). I assume that if one calculates interest against a steady income stream (with a massive payment during WW II), that the railroads just about "paid" for their ROW and land with cut rate freight and passenger charges to the US Gov't.

And the railroads WERE seen as the robber barons of their age, when they had a monopoly on transportation. Given the large number of RR bankruptcies in the 1800s and early 1900s, I am unsure how much truth there was to that.

Some railroads were (and UP still is) quite arrogant in their behavior, pricing, etc. and NOT "good neighbors". But bad PR does not necessarily = robber baron.

Alan

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Dryki on May 23, 2007 - 9:21pm Permalink | Subthread | Parent | Comments top

We need to (re)build the railroads as a key part of public infrastructure. That means public ownership. There should be noisy and contentious public meetings where the public decides where the rails and stations go. I'd like to see them - at least the smaller commuter type rail and interurbans - set up as community investment trusts or co-ops. More or less along the lines of rural electrics or the blues before they got privatized. The structure of the ownership is going to matter a great deal. They are going to have to be subsidized; the free market is not going to do what's necessary.

cfm in Gray, ME

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AlanfromBigEasy on May 23, 2007 - 9:46pm Permalink | Subthread | Parent | Comments top

This year the freight railroads are investing $10 billion in infrastructure improvements. The best "bang for the buck" in increasing capacity is improved signaling (decidedly NOT sexy).

I know someone who worked on extending electrification on Amtrak's (they own it) NorthEast Corridor from New Haven to Boston. As a public entity, those meetings you want added several years to implementation of a "slam dunk" decision to build.

Given the track record (pun intended) of Amtrak and the same solution in the UK (public tracks, private trains), I cannot support public ownership of mainline railroads.

Th story in Alaska (the state that gives annual rebates to their citizens) is a mixed bag for the Alaskan Railroad (Fairbanks-Anchorage).

When Japan Rail was broken up and privatized, it was an outstanding success (no real disagreement).

This is a critical issue for the survival of this country ! I do *NOT* want to screw it up with social experimentation. I would not want to depend upon Amtrak freight to get the essentials of life.

For branch lines that were about to be abandoned (see Wisconsin), I can see public ownership of the tracks, but they are slow to fix that as well (still 1/2 1920s track).

Best Hopes,

Alan

The US freight railroad industry has been quite innovative and is a world leader (despite a lack of electrification). Double stack containers, the heaviest axle loadings and heaviest rail in the world (other than an isolated mine in Australia).

The failure to get the projected freight through the Chunnel has been blamed on the French SNCF. They handle voters quite well, but freight is a real weakness for them. New reforms that allow others to use their tracks may add frieght volume to EU railroads.

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Dryki on May 23, 2007 - 10:32pm Permalink | Subthread | Parent | Comments top

Amtrak is the not the scale I'm talking about; I'm talking about local commuter and interurban rail. And yes, it will add a lot of time, even for local systems. The alternative, however, is having some "official" decide. You tell me what's working in NOLA, the "officials" or the locals? Power has to be coincident with the biosphere/community; otherwise what you have will be taken by those "officials" and their goons.

That, of course, is Cheney's solution. All the "right people" will come out on top.

cfm in Gray, ME

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