Buffet’s railroad takes advantage of a legal loophole that gives it a monopoly on last mile delivery of coal to the power generating stations. They make as much money on a short haul as the rail company that delivers coal thousands of miles from the mines to Buffet’s rail company territory.
So much citation needed. BNSF *is* the company that delivers coal hundreds or thousands of miles from the Powder River Basin, so this comment comes from a place of confusion, ignorance, or AI.
I don't really agree with your take on High Speed Rail. America is broken up into many different regions. I don't believe that having a High Speed line from NY to CA makes sense but connecting cities within each region. Example, NYC to DC or Boston, Seattle to Vancouver, Chicago Hub, Texas, or Atlanta to Charlotte, etc. If regional airlines can exist so can High Speed Rail.
NotJustBikes already has a debunk of that talking point. In short, saying “America can't have HSR because it's a big country” is like saying “Earth can't have HSR because it's a big planet”
Yet I keep seeing those sorts of proposals all the time online or in the media. There are places where passenger rail will work, but those aren’t the projects that get attention. And the projects that could work are usually drastically over-engineered or poorly managed, like CAHSR
@@andrewreynolds4949 What do you expect? The US has no experience doing that stuff. The US doesn't even have a national rail infrastructure managing agency which is common around the world
@@michelangelobuonarroti4958 I don't see why that's particularly relevant; the majority of HSR schemes in the US are proposed by politicians and activists with no experience in rail and no resources to implement it other than an ability to attract newspaper headlines. Meanwhile Brightline and Amtrak manage their own infrastructure on their HSR routes where they are the primary traffic; not much point in or need for a national infrastructure company when every HSR corridor (or potentially viable one) is so geographically, operationally, and customer demographically diverse and separated.
I think we *are* seeing the commercially viable routes being built: Miami to Orlando, LA to Las Vegas. And, of course, the northeast corridor *should* be much faster than the current Acela. But the reason Vegas, Manhattan, and Disney World make sense as HSR destinations is because there is a clear epicenter that tourists and residents all want to get to. Most US cites simply don’t work like European or Japanese ones-traditional downtowns are *not* the center of population in Atlanta, Houston, Cleveland, Detroit, or the Bay Area. We can complain about suburban sprawl all we want, but it’s a fact-meaning HSR stations in the US would basically have to function like airports, complete with mass on-site parking. And unlike air routes, rail is a permanent bet on travel demand between particular cities. Which is fine if you’re talking Paris to Marseilles or Wuhan to Nanjing…those places have been population centers for literally thousands of years. The natural rail hub for the US would be St Louis-which was indeed a rail boomtown for several decades around 1900 and has been in relative decline ever since. Fine for freight; wasteful for passengers. To make the US a more rail-centric culture, I’d focus on local public transport first. Make existing stations viable again as commuter hubs; then you can consider intercity HSR.
I'm an HSR advocate but I can agree that at some point the distance between two cities can be "too far." LA to NYC would not work just because of 1 reason. The Rocky Mountains. HSR for the East Coast however is perfect due to the density of cities in close proximation of each other
Old regulation is just like legacy code. It should be revisited periodically. What enabled something in the past may be holding things back in the future. Great wrap up on how US railways got sandwiched in between new developments in transport and old regulation. And a spot on remark on that rail transport tends to get billed for use of track whereas trucks can mostly travel on roads for free.
Software developer here understands this. But for the same reason code doesn't updated, laws don't get updated. Everyone gets paid for the big, bold new features everyone knows about not the old features no one cares about
@@poetryflynn3712 The problem is still being understated. Old regulations remain despite starting to do net harm largely because they still benefit someone, often competitors, who fight hard to keep them in place. It's public choice economics.
@@PrezVeto Exactly. Yet, we keep adding more regulations because people forget we even have the old ones. Then when we get rid of the regulations, we don't invest anything to fix what would happen if the regulations weren't there. There is just zero nuance.
A weird trivia is that the Texas Railway Commission has nothing to do with trains... I have a friend heading the CA high speed rail, after having moved on from working on the Taoyuan metro. He said first train is expected to run 2030-2033.
The problem with American railroads isnt nessisarly the problem. The main issue was the double whammy of over regulation in response to 1800's railroad tomfoolery, and the simultaneous gross underregulation and outright subsidization of the Automobile and trucking industry. Quite frankly, the railroads got their just deserts for their gross profiteering in the 1800s. However, the Automobile and Oil industries, despite at this point making the 1800's railroad baron look like John Charity himself, have avoided any such just deserts.
@@RonJohn63 In 1949, Firestone Tire, Standard Oil of California, Phillips Petroleum, GM, and Mack Trucks were convicted of conspiring to monopolize the sale of buses and related products to local transit companies controlled by NCL; they were acquitted of conspiring to monopolize the ownership of these companies. The verdicts were upheld on appeal in 1951. Of course truth is in the eye of the beholder. But sometimes it is whatever is being enforced by the bailiffs of the court upon the owner of said eye.
Buffett likes to invest in companies with a competitive moat. BNSF and the other Class I rail companies have massive moats - it seems extremely unlikely there will ever be competitors to them, is someone going to lay down thousands of miles of new track across the US? Almost certainly not. So BNSF, UP, CSX, etc - they all now have modern monopolies and they are again ruthlessly leveraging them.
The competition, as was mentioned in the video and by Charlie Munger, is the trucking industry. What really makes rail companies work as an investment, and I suspect this is why Berkshire bought them just as they bought the original woolen mill back in the day, is that they are capital intensive enterprises but generate huge operating cash flows once in service. And in the case of railroads, all that capital investment is decades - if not a century or more - in the rear view mirror. The marginal cost of running a railroad is very low compared to trucking, and that allows decent investment returns if you buy the business at a reasonable price.
@@benjaminlynch9958 Nope, not at all. Railroads have had historically low operating ratios. Deregulation helped increase them. When OR's really took off was after 2015 with the implementation of PSR. Now the activist investors expect increases every single year, and the Class I's have had to shed over 25,000 employees, close needed shops, sell off yards, and get lax on safety and inspections in order to meet investor expectations. I believe it was the former CSX president who listed off a few years ago what the company priorities were - Safety was #3 on the list.
The CPKC merger has already created more competition between companies and more new routes than in the last two decades. The period of competitive stagnation has effectively ended
@@andrewreynolds4949 The remaining monopolies are adjusting to try and retain their traffic. Once it settles out, stability will return. By definition, mergers and the creation of monopolies is ANTI-competitive and eventually destroys capitalistic models. Any innovations we then see are merely to cut costs and increase profits, not reduce consumer prices and promote competition. We have been the victims of monopolistic pricing since 2020, yet their bought politicians will scream about "inflation" and point their fingers everywhere but towards their donors.
@@andrewreynolds4949Spot on! Just look at CN. They have official partnerships with UP and Ferromex now to compete with CPKC. Just goes to show that the decision to allow CP and KCS to merge was good for the industry.
Living in Switzerland here. I take rail and high speed rail everywhere. Amsterdam to Palermo (Sicily). London to Vienna. Long distance public transportation (high speed or otherwise) won't work without a robust regional and local network, including last mile. If you have to rent a car at the terminus to get to your final destination, most people will fly or drive.
Excellent video. US rail history is a fascinating topic and I hope to see you do more videos on them. Three points: (1) Part of the overreliance on debt came from the major railroads constantly overexpanding to lock out competition on track/geo coverage and rolling stock efficiency/capacity. These geo-monopolies mostly carried to today's freight rail networks, which have a very real negative impact on domestic passenger rail performance and expansion. (2) The Pennsylvania Railroad considered themselves untouchable. They depended heavily on passenger rail and overextended their available capital. By the time they were forced to realize their dire financial situation, it was too late. In contrast, New York Central's last leaders saw the shift towards freight/intermodal and began taking aggressive action towards it. Unfortunately, the merger foolishly let the Pennsy's ignorant Mainline-mentality management win control, guaranteeing its death. It is an excellent example of competing cultures and management. (3) Regarding your last chapter, yes, revenue has risen but at the cost of maintenance and safety. As we have seen in recent years, on-time performance is all that matters even if that means skeleton crews, overworked engineers, and a length some claim are unsafe, ultimately leading to derailments.
People don't realize just how bad the derailments have gotten, its not uncommon to see abandoned freight trains just sitting around after being involved in non-fatal derailments. Before Norfolk Southern blew up East Palestine there was no press about them what so ever.
Free public roads? You should look into intermodal hubs like the one built outside of Chicago in Joliet, it already had a rich rail infrastructure due to, well, Chicago and the history of rail in the country. Roads, on the other hand, were NOT meant to handle the sudden surge in truck traffic: roads are wearing out faster, bridges are aging more rapidly than they should, and none of these shipping companies contribute a penny more than they have to for upkeep and upgrades.
That is one of the pillars of a "good" company, to externalize costly items such as wear and tear that are often overlooked and or underestimated by the ones paying for it. Hence why the GIG economy took off. Basically "make it someone else problem" and pocket the profits.
I remember seeing a video discuss the impact of different vehicle types on the road itself, and if I recall correctly, long-haul trailer trucks cause over a thousand times more wear on the road than a typical passenger car, which partially puts into perspective how much trucking industry is invisibly subsidized.
there's no "market" when the class Is have regional monopolies. the existing network has become more concentrated, brittle, and less robust, and is optimized for container movement and unit trains. the only companies moving non-unit freight (boxcars and the like) frequently don't have any other options. the regional monopolies know this, and statements from the privatization of BNSF are tacit admissions of a desire to extract maximum profit from captive customers. If the US really wanted private trucking-level or airline-level competition over rail, the core rail network would need to be nationalized, with centralized dispatch (like air traffic control), and system-wide standardized signaling. The railroad companies would remain in charge of individual trains and terminals, similar to airports. I'm not holding my breath. Trains remain the most energy-efficient method of land transportation; it's ironic that the least-efficient methods in the form of air and road are the ones that are socialized.
the wage increase graph at 6:15 was also pretty ridiculous. an annual wage of $1,820 in 1920 works out to under $27,500 today, which is poverty-level. who were the "public" against working wages? owners and shareholders?
I disagree somewhat. Rail (and most other infrastructure) could work similarly to how it worked in the early 1800's prior to regulation, which meant that to maximize the use of their assets (railways), the owners of individual lines would sell access to their rail networks to competitors, offering more service and increasing their potential pool of customers, even if they had a competing line themselves that used the rails they owned. This is largely how fiber optic internet works where it's not regulated. Individual providers ultimately share lines across the country and internationally in order to offer customers services where they control the market locally (though this local control is almost always the result of municipalities disallowing competition via regulation...) Another example is cell phone providers. In the USA, Verizon owns most of the cell towers. So their transmitter/receiver goes on the very top. But they rent the space immediately below to most of their competitors. So AT&T, Sprint, T Mobile, etc. can essentially boast the same network without putting in fixed investment costs (but of course renting space.) The entire industry thus ends up sharing the infrastructure investment proportionally to how much they actually use and with what is viable. Markets are almost magical in how firms reach agreements like this without government control or direction. Compare this to other countries, like Canada, where everything is tightly regulated and unlimited data is hyper expensive compared to the USA, or compared to other countries where service is essentially subsidized by the tax payer. Infrastructure is really not complicated once land is acquired/land use is allowed by law. Nearly every example of poor utility service can be traced back to laws created almost explicitly to prevent poor service or increase costs.
@@poofygoof poverty used to be much more common everywhere. People put rose-colored glasses on when they talk about industrial-age workers rights. Prior to any industrialization, the norm for 90% was complete poverty by today's standards. All improvements in wages in the long term are due to productivity increases in specific sectors. Union action, while relevant, actually has very little bearing on productivity itself, so any statistical gains that might be attributable to successful strikes or negotiations are usually the results of productivity increases which arise from a multitude of other things. Usually, if the wages are above the market clear price, it drives down investment into the industry in question and thus productivity stagnates, creating a potential short-term situation of higher than expected wages while creating a long-term situation of low wages due to industrial non-competitiveness. Because this occurs over time, it's hard for the average person to notice this. Investors notice right away, and often enough anyway, government policy is usually the culprit either enacting specific regulations demanded by industry itself, or by labor movements. Very funny how it produces the opposite of its intended effect!
@@classiclibertarian a society that relies on consumer based markets it's wild to me that anyone would advocate for low wages. How would anyone buy the goods being produced? That's why unions make this flawed system better because they make stingy companies give a better share of the surplus labor value (profits) to the everyday Joe who then in turn makes the economy move by purchasing goods therefore stimulating the economy. This is actually why the west has been in endless economic crisis for the last 30 years now because the everyday Joe isn't getting compensated accordingly by the rich and it strangles the economy which causes the rich shoot themselves in the foot because now they can't sell as much of their goods fir maximum profits if thats wgat they want.
Trans World didn't exist in 1929 in any form. The company that later became Trans World was founded in 1930 by a merger of a bunch of predecessor companies, which formed Transcontinental and Western Air - which was known as TWA. Only in 1950 did the airline rename itself Trans World Airlines - choosing a more modern name that had the same acronym.
A somewhat related vid topic would be the package delivery industry. ( UPS / Fed EX / REA Express ) From what I understand, until the 1980's or so there were some odd restrictions on a company being able to singularly offer delivery service from one end of the USA to the other.
Freight trains are five times as fuel efficient as trucks. With climate change becoming a serious threat to our livelihoods, health and security, we should be taxing fuel in a manner that would shift even more freight onto trains and encouraging the building of more pipelines to carry liquid commodities (pipelines are more fuel efficient than trains). Freight rail makes it very efficient and environmentally safer to transport food from one place to another, allowing regions to grow the food they are most efficient at producing.
American freight rail companies had been held to 1935 productivity levels all the way to 1980 by labor-owned regulators. Ten years after regulatory escape in 1980, they've reached 1990 productivity levels. Then, oddly, after this huge 150% leap, productivity increases stop cold.
There is still a union to deal with. The railroads have recently tried to reduce the running crew down to one, citing improved technology that obviates the need for the second member. But there has been hard pushback, of course.
@@gravityissues5210 yes, tho railroads have been pushing for this change since the 90s. In fact, railroad unions can not legally strike and must undergo a 2 year process to negotiate for new terms from the railroads, congress, and the president. If the don't get a deal with the railroads, then the timer restarts but now they must work with congress and the president, if that doesn't work then the unions can strike otherwise the president can reset the timer and force the unions back to negotiating. Otherwise the President can call the national guard or get scabs to take over train operations if the unions strike (as well make arrest for strikers). This pretty much happened about year ago when unions couldn't agree on a contract and the president forced the unions back into negotiating with railroads. Also should not the technology the railroads have been touting is not currently implemented either, and that was federally mandated already but the date been pushed back as railroads are unwilling to do the change, and I think its only amtrak and one other railroad company right now with Positive Train Control.
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@@CatnamedMittens Ideally, that could be for an insurance company to decide.
Australia's government owned railways were a financial disaster, until they were semi-privatized. The rail tracks remain nationally owned, but private companies can pay for access to run private freight services. Previously, private companies had rorted government rail, by overloading wagons, and getting contracts which had clauses like time performance inter city, that were usually un-acheivable, giving these private freight forwarders free freight. There was horrific corruption going on behind the scenes, but thankfully those days are over. Rail,ships and Road all have their economic place in transport. The best and most flexible model, is having government owned infrastructure, with open and equal access for private interests to provide services that make sense both practically and economically. Every single example of shared infrastructure from roads,rails,gas pipelines,phone lines to especially MONEY needs to be government owned with access for private people and companies to use for the communities economic benefit with being taxed beyond cost to operate,or monopolized.
@@whiteknightcat ARTC..........Australian Rail Track Corporation. On the same track network there is in my area Aurizon,Genesse Wyoming, SSR, National Pacific, and Qube. They all independently operate private rail locomotives and rolling stock on the same ARTC track network. Passenger services are still State Government.
Lol. In my childhood the rail lines through my city and state were very visibly run down. These days they are continuously welded rail rather than the old jointed track, with concrete ties instead of rotting wooden ones, and clean ballast. There are many rail infrastructure projects across the country that hardly even reach local media. Just because the rail network doesn’t look like the European ones like the big media and politicians want it to doesn’t mean they don’t invest
There are about 3 U.S. train derailments per day. In 2022, there were at least 1,164 train derailments across the country last year, according to data from the Federal Railroad Administration.
@@Ben....., the information is valuable and interesting. Any person into railroads understands what a derailment is. Only you are thinking that a real derailment is some Lac Gigantic catastrophe with incredible death and destruction.
@@seriouscat2231 I know most derailment are nothing important and cost nothing but time and money. My point is that statistic like "X happens Y times per year" don't mean anything unless you know the rate X happens per Z potentialities. it's purely appeals to pathos and can be emotionally manipulative.
0:32 how is US freight rail more profitable, if it has 3 cents per tonne-km, russians have 4 cents, chinese - 5 cents?! 4:18 you had 5 mln cars and 400 trucks? WTF?! 4:33 is there a "non-exclusive" monopoly?!
The last chapter misses the fact that Safety has gone down significantly, Class I railroads are also operating skeleton crews which has caused a massive uptick in accidents, derailments have skyrocketed. Not to mention the insane conditions they are working in right now. Majority of the big railroad companies refuse to invest into upgrading existing infrastructure, the infrastructure in question wasn't built for "monster trains" their running these days, which are way heavier and incredibly long. EDIT: Derailments have not skyrocketed, incidents have but derailments have only increased above pre-pandemic levels, they are nowhere near as bad as the 1970’s. Making this edit cause I do not like spreading misinformation
From a cursory google search for derailment statistics derailments have no skyrocketed, do you have some source saying they have? What statistics do they cite?
Two of the largest railways in North America are the CNR (Canadian National Railway) and the CPKC (Canadian Pacific Kansas City Southern). Canada has relatively few people and vast expanses of land, so these freight railways are vital.
The fall and failure to rise of American passenger rail would be an interesting topic for a video of its own, because the reasons go way beyond "America big." The California high speed rail project is a typical example of trying to cover too many bases in one project: is it meant to compete against airlines (fast) or highways (an exit in every town)? It tries to do both and ends up succeeding in neither.
This is of course leaving aside the various shortcomings of this policy for US railways such as... *Reducing maintenance on track infrastructure *Reduced maintenance on locomotives and rolling stock, which is more intensively used. *Longer trains causing traffic jams as they can't fit into sidings. *Overworked crews, which leads to an increase in mistakes. *Ignored safety procedures. *Blocked crossing. *Increased risks of derailment. *Trains unable to pass each other due to passing sidings being too short.
where is their union? the RR union is the most powerful in the country, I thought it was supposed to "protect workers". Or is that typical liberal hogwash?
Remember the huge chemical release and fire (for maximum dispersal I guess) caused by a derailment so large it poisoned the ppl in a large area of the East Coast a state sized area?
A package far better than the waste and technological stagnation of nationalized rail, which was the inevitable alternative to deregulation. That package is inaccurate, to boot. Track and equipment are in much better condition than they were before deregulation.
@@PrezVeto If you honestly believe gov't regulation has caused any societal benefit to our country, you're a lost cause. Not a single gov't program hasn't caused the most extreme destruction for the cause it professed to help. What world do you live in? We can go back as far as the "great society" that FDR told his allies in secret, "this will deliver the black vote to the democrap party for 100 years." There is no one program I know of that didn't have a similar, nefarious intent and effect. Name one. Help me believe beyond my study of history, data and analysis... No one knows everything...
@@PrezVetobullshit. They haven't bought a new (not refurbished) locomotive in years and less track is electrified than before. They're operating at massive profits at the expense of workers, ratepayers, and the public at large. They are nothing more than regional monopolies and should be nationalized immediately
Very interesting. Any chance you could do a video on the history of the British rail system, the world's first. Expansion, becoming mainly a commuter system, Beeching cuts, nationalisation, disastrous privatisation, wasting billions on a half built HS2 instead of revamping the existing system etc.
The US is suitable for high speed rail. But only on short to mid range distances. Nobody every said that you should go by high speed train from Chicago to Orlando. But short distinances between big cities are plenty of connections high speed rail in the US makes perfect sense.
This is the first Asianometry video I watched where it is pretty apparent that this video is very out of your comfort/knowledge zone. Nevertheless I enjoyed the coverage of the historical events, but especially in the latter half your explanations of current day issues seems quite shallow. Which is understandable because it crosses with a huge amount of different policies across different transportation methods such that it's difficult for one person that isn't already familiar with them to make a video about it. Just try to refrain from making absolute statements about the current day economic efficacy of things you don't fully understand, since people that usually watch your videos assume that they are well researched.
I live in northern Arizona and was a bit suprised when in 2000 I purchased my 5 acres (2 Ha) and about 9 miles (14 km) from the railroad, the mineral rights were still owned by BNSF railroad. It really shows just how much of the land the railroads owned and how if new mineral exploitations develop they are set to profit, well over 100 years later.
Trains are so cool....they really held us together during covid, and now the ability to move freight east to west coast & vice versa has helped tremendously in these recent days of supply chain disturbances and drought in Panama..... Your choices of topics have been quite germane to current events - cheers ... And as the song goes, "these are the days of miracles and wonders..." And one of these wonders has been the people who jump trains for amusement or just wanderlust....plenty of these adventures here on YT. Trains are a great way to travel, but less here than in Nexico or in Europe. I got to ride Ferrocarriles de México for a couple weeks when I was a kid......that was an adventure! Cheers....
Government never should have sold Conrail. I mean, The Staggers Act still needed to happen, but yeah...Conrail Quality! It's funny though. Now we have an Oligopoly that actively tries to NOT actually bolster the usage of rail for transport, but rather engage in PSR and actively discourage any sort of deviation from it.
Utica is pronounced Yewtika, not ootika... Utica is an interesting place, home of two notable airlines, Mohawk Airlines and Empire Airlines, and for some reason, the birthplace of the founder (Kenny Friedkin) of a third, Pacific Southwest Airlines (which many view as the original low cost carrier - it inspired Southwest Airlines). Must be something in the water there.
High speed rail can be competitive in North America. Let's compare Toronto_Montreal to Paris_Lyon (the first high speed rail outside Japan). Both cities are ≈ 500 km apart and have roughly the same respective populations. When the line opened in 1981, the airlines had to cut service between Paris and Lyon, because they could not compete against the train. 7 years later, the whole line was paid for: land acquisition, the tracks, the electric overhead lines, the signaling system, the trains (DOH!) and also the 25+ years of R&D that made the iconic TGV possible. Oh, and not a single penny of government money was paid into the project. The SNCF totally financed the project by itself. This means that for the last 35 years, that rail line has been the proverbial gravy train. And no, the population density between the cities does not matter because the train does not stop between the line ends...
Toronto to Montreal is probably viable, as is the Northeast Corridor in the US. So are the two private semi-HSR lines that are actually being built: Miami to Orlando and LA to Las Vegas. But, in general, density *is* a problem for North American HSR. A single station in the center of Paris or Lyon would be within walking or public transport distance of a huge proportion of the metro area’s residents-including those wealthy enough for regular business/tourist travel. Compare that to some of the fastest growing American cities: Where would you even place a HSR station in Atlanta, Phoenix, or Austin? Rail becomes a lot less competitive if suburban sprawl means most passengers need to drive to the station just like an airport.
you say how great deregulation is? so great that railroads are only too happy to use absurdly out of date safety equipment, check it rarely, and dodge most liability when things go wrong.
Yes the equipment is outdated and the employees are extremly overworked but look on the bright side. The freight rail companies have absolutly huge profit margins
Did you watch the video? the regulation mandated they use out of date stuff for a long time. It’s going to be ugly when deregulated but over time if competition is allowed, it’ll get better.
First airmail route was from Tampa to St Pete. You correctly feature an image advertising this, but incorrectly state that it was from DC to NY. I think you owe Tony Jannus an apology.
TBH the excuse that the US is so spread out therefore no HSR is possible is kinda trash. Ok, you can't possibly think of connecting Montana with Wyoming with high speed rail, sure, but the fact that there isn't a network that spans the whole North-East/New England area up to Chicago is just bokers. It's a very densely populated, very high income and extremely full of business area, it's perfect for a HSR network. If Spain can make it happen, there's no reason why the US can't in its most densely populated area
Government regulates competition between trains, trucks, airplanes and ships with taxes, subsidies, and rules. Unfortunately, there are many groups wanting different things, and outcomes are often dependent on political considerations over economics. Thus, you have clever entrepreneurs who take advantage of the current situation. As long as you have complexity, it will take a bright person to get around the current situation. Politicians still exist, and constantly change the rules, so what works one year might not work the next.
The brief history of the railroads presented in this video should be a hint to Ayn Rand followers that her view of the railroads as her symbol for how great accomplishments come from a few great men unhindered by government was as daft as her every-moving ideas of "selfishness" and general campfire "philosophy." They are fun books as early super-hero stories, which accounts for a lot of the popularity, but beyond that ...
To an extend the way US freight system is setup any form of passenger transportation is mostly dead except around large cities. How much money did the US goverment put in the rail system and how much was put in the road system/highway system. And hence we now have long single track routes with passage tracks. Plenty of larger cities can be connected with high speed trains over distance upto a few hundred miles. But all infrastructure has been stripped to make it cheaper the infrastructure maintenance....
I think this video should be seen by the new UK government elected a few days ago. They plan to re-nationalise the rails. They were nationalised after WW2 as they were then in a very poor state having been thrashed in the war. In 1997 they were once again privatised with Railtrack owning the track and infrastructure and private companies providing the rolling stock and paying an access charge. Railtrack got rid of much of its staff to new private companies that they contracted back to do the maintenance and new works. In the late 1990s there were a series of serious accidents attributed to poor management and maintenance. Railtrack's share price fell and they were unable to raise the funds to repair the backlog of work and raise safety standards. They were renationalise. Today we still have the private train companies running the trains although some of those have gone bankrupt and they are now under government control. The new government plans to take back the remaining companies when their contracts expire but details are unclear how they will regulate the industry. Will they set passenger fares? Fares today are set by demand so peak hour service are high prices yet peak trains on many lines are packed as people work away from cities and companies consolidate offices and roads are rammed. There is much criticism over the high ticket costs and complex ticket rules. If they go for a lower standardised and simpler fares, say x per km at all times, will the railways then be unprofitable and a money pit? Increasing reliability and capacity will need huge infrastructure investment yet the country is broke and the new government says it will not borrow more money but aims to reduce the national debt. It's not easy to find the right balance between costs to consumers, remuneration to employees (already well paid but wanting more), and funding capital investment and governments have not been a shinning example of how to achieve this.
Here in the Los Angeles/Long Beach ports, they upgraded the rail lines quite a few years ago. No way could all the containers coming from Asia be trucked across the LA county basin.
I feel like high speed rail vs car or airplane... there's gotta be a pretty straightforward calculation there on what's more economical based on population density, and "destination density".
As an IT person, government caps on AWS and Azure don't sound bad. Probably other controls I'd rather see on them first, though. Not sure that the cost of the datacenter is comparable to value of the cargo though. That would be like capping costs based on the value of the track. The obvious comparison would be capping based on some sense of value of what was being served. Of course much harder to estimate that than the value cargo
The increased length of trains comes with its own set of problems and I hear railroad companies are skimping on personnel and safety. I believe John Oliver's video on the topic could explain the what and why better than me.
I think you missed the point of high speed rail networks at the end there: it's the NETWORK effect, not the end point to end point line. There is a reason the US built a highway NETWORK rather than three coast to coast highways to speed up troop movements in case of war (the intention of the Highways Act). The more area a network covers the more its value increases. Just as Harrington, Morgan, Vanderbilt and all the other rail barons. What started as schemes to stymie rivals with short lines to poach traffic from rival coast to coast lines in the late 19th century became networks in the early 20th century. Also, the sale of ConRail back to the private sector was a give away at $2Bn. That was a $6Bn subsidy. It wasn't the miracle of private enterprise that rebuilt the railways, it was government money, as can be attested to by the amount of crashes due to failing infrastructure and failure to invest in new equipment (while spending millions on opposing requirements for important safety equipment), on those privatized railways every year.
Nationalization of trackage is a reasonable idea to re-create competition and compete with trucking (with free highways). None of the huge railroads created by mergers are innovative, and track choke-points have been created due to shutting down lines due to those mergers, no longer serving certain markets at all. With this, wages are poor as is moral. This is not healthy for the long-run. For nation-wide HSR, you would need to build all new track designed for passenger service - $$$. The cost is just too high for a nation as spread out as ours compared to the free cost of air, that you don't have to build or maintain. Regional where it makes sense, but not national. Nobody is going to choose (unless for pleasure), even HSR vs a plane to go from coast to coast, or even half way, it simply takes too long.
Air travel is massively less efficient carbon-wise though. We've just neglected to account for that externality through either taxes or regulation. At best, the gov't is funding "sustainable aviation fuel" research; unclear how that'll turn out.
@@crash.override Curious why you're concerned about 0.0012% of anything, especially CO2 which is free plant food. What matters to most people is cost, time, and convince, which air travel wins hands down. Use cross-country rail for what it is most suited for, moving bulk freight in place of thousands of semi-trucks.
@@hallkbrdz The "free plant food" excuse is just that - an excuse, knowing full well that there isn't enough vegetable matter on Earth to absorb the skyrocketing CO2 production that has been taking place for a century now. That being said, IMO we're already past the point of no return, despite what the experts claim about 2050 or whatever. Humanity can not and will not give up fossil fuels, so future generations will have to deal with the consequences. HSR on a nationwide scale in North America will also never happen IMO - just look at Texas Central boondoggle going on over here. I doubt the eminent domain court cases will even be done by 2030, and by then, the whole thing will likely have to be re-designed due to the original concepts having gone obsolete.
@@hallkbrdz My sky last year was orange for multiple days on account of wildfires from elevated temperatures. If that's not apocalyptic, I dunno what is. Also, you enjoy funding oil sheiks?
@@crash.override In the US most of our (brief) temperature records were set in the 1930s. In Europe temperatures were higher than today during the medieval warming. I know the scaremongers love to hype any hot days for profit, but the fact is it has been much warmer in the past, and that was not due to humans impact but instead natural causes. Understand that warmer is actually better than colder. More people die due to cold than heat. More food can be grown due to warmer temperatures. Enjoy it, don't fear it.
I'm glad someone made a video with a different perspective on privatization of the Class 1's, but man is it biased towards capital. There's no mentions of the consequences of PSR, longer freight trains, worsening of on time performance for freight and passenger rail, how shipping anything other than unit freight trains takes 5x the time as trucking, and how the trucking industry regulations starting set are making rail competitive as a result. American freight has become an example of over optimization at this point
Enjoyed this video. I am glad US freight rail recovered, though I do share others' safety concerns. My job takes me to Germany regularly, and I make significant use of their passenger rail system while there, local, regional, and cross-country. I wish the US, outside of a few large cities, had high-speed intra and interstate rail. A high-speed line connecting NYC with Albany, Syracuse, Rochester, and Buffalo would be perfect. I don't think it will happen without significant government investment. Also, one correction. Utica, NY, is pronounced You-tica.
Part of the problem is the railroads cut excess capacity and resources to gain efficiency, until there was a system perfectly optimized for the existing traffic conditions. Then Covid and other major supply disruptions happened, and suddenly their system didn’t have any of the excess capacity to handle it
Back in the late 70s to the 90s being a Railroad engineer was a high paying, good job where you worked with trained people and there were enough of them and good management. This simply isn't the case in Railroad any longer. Its "optimized itself" to Taco Bell standards.
This is a perfect example of the real problems with regulation. Yes, it is absolutely possible for smart government regulation to make things better -- but everyone underestimates how fucking hard it is to actually realize smart regulation. The regulators tend to either end up captured by industry or stick to anti-competitive and inefficient regulations. The real problem is the incentivizes for the regulators. The thing they actually need to do -- encourage healthy competition, efficiency increasing innovation (ie job cuts) and let investors take the hit when things go wrong while making capital investment appealing -- don't make any constituency happy. The beneficiaries of good regulation are the widely distributed American people but that doesn't particularly please either the investors, workers or politicians. And when you do it right that means both letting big companies go bust in bad times and accepting the massive job losses while letting investors make substantial profits when things go well -- in both cases making you look like the bad guy. It's not impossible but it's very hard.
@@nolanwhite1971 Unfortunately, I think people tend to conflate the idea that the government should be simple (it's not good at setting things like freight rates) with the idea the government should be small in monetary terms, e.g., you can have relatively massive programs like ubi or negative income taxes that work well and are very simple because they are basically just collecting revenue and cutting checks.
Similarly, bad deregulation can also have devastating effects. The remaining six Class I monopolies are now constrained to the lines they kept after having abandoned so much infrastructure they could have put to good use today.
The CPKC merger has done a lot to disrupt the existing monopolies. I’m also impressed with how the regulators have handled the conditions attached to the merger, which have mostly been “we reserve the right to monitor the situation for an extended period, and if there are any problems we will step in to add any additional conditions then”
Penn Central, the most profitable airline (there was a lot of embezzelment, and crazy shit that happened near the end of the railroad that lead to its bankruptcy)
@17:20 so the hedge fund manager prefers trucks because they hate actual capital investment, hate unions, think that trucks are more fuel efficient than trains (which they are demonstrably not, it's basic physics), doesn't realize that trains also run on Diesel, and that public roads are "free." Yeah, that about says it all about the supposed genius of the capitalist investor class.....
If you look at the USA as a whole, yes it is too big for high speed rail, but individual states and journeys between neighbouring states are not. The Federal Government should set standards - eg standard guage track, 25kVac overhead lines of a specific height above the track, etc, and then the actual services should be organised by State and Regional governments. Before the current situation in Russia, it was possible to travel from London to Hong Kong by train. You will find some videos on RUclips of people doing that, but the vast majority of people take the plane. However, for London to Paris, Madrid to Barcelona etc, you take the train. Likewise, if you want to get from Los Angeles to New York, you are going to take a plane unless you particularly hate them, particularly love trains, or want to make a RUclips video about the journey, and for the latter you are probably only going to take the train one way and fly back. Los Angeles to San Francisco or Las Vegas, those are journeys that should have a high-speed rail option. If for example you were to build a high-speed line from Miami Floria to Portland Maine, very few people would take it the full distance, but a lot of people would take it for one or two stops along the route.
Like it depends like China is similar size as US in area and they have high speed lines that run one end of the country to another, like from Vietnam/Laos border or South China sea to Russian border or from east coast to Kazakhstan border, with some services that actually cover entire length, and take more than entire day. Most people definitely don’t take full length though
Oh, there were all kinds of mispronunciations in Jon’s video. But out of respect for his Asian origins we don’t make a big deal out of it. Linus Boman had a great episode today on “Well actually’s” and weaponizing trivia. 👍🏼
In my house, we refer to those mispronoumciations as "talks like a homeschooler" because our kids read so much but heard relatively little pronounced. Was Jon homeschooled? Is that why his stuff is so great?
@@glennac Not trying to weaponize anything here; trivia for the sake of trivia all includes being correct. And I'm pretty sure there's no Asian and-expanding further for the history of east Asian phonemes-no greater Polynesian language which does not have the sound */ju/* integrated within it. Not to mention he pronounced the word "you" just fine. I, personally, would want to get that right, to call it as the locals do. That's why it's */ˈhjus•tən/* when I'm in Houston, Texas, but */'haʊs•tən/* when I'm on Houston Street in Manhattan.
@@LordMarcus Yes, but Place names are notoriously difficult to get right if you’re not a local. I can not pronounce many European city names correctly. But know most of the obscure city names in the US.
Touching on the interstate commerce clause, the most abused and distorted of all amendments. Just remember that the federal case against someone growing and smoking weed in their own home was upheld as a valid federal law under the interstate commerce clause because if they had not grown it, they would have bought it, and the weed might have crossed state lines. lol, FDR
@@nomadhgnis9425 True that. During World War II, the government chose not to repeat the USRA method, instead getting together with the railroads, determining how they could serve the war effort, and then imposing the necessary rules on the companies by which warfighters and materiel could be most efficiently moved to get the job done.
@@nomadhgnis9425 I was actually anticipating a collapse going into 2020, but then this stupid little virus showed up and turned everything on its head. Despite all the positive data, I can't help but feel there is something very unstable underneath it all - the wealth gap is the same or worse than it was in 1929, and I believe like a thunderstorm developing to its maximum power and then blowing itself out, the unrelenting prices increases and profiteering taking place will eventually yield price collapses as the levels become unsustainable.
Whomever can aggregate the most capital wins. For a long time the railroads in the US were king. They had the cash and could pay regulators and the government the correct amounts to keep them in power. I suggest if you have time, to study the highway lobby. This group of oil, rubber, asphalt and automotive industries with others simply showed up with more money, ripped up trolley and rail lines whilst building out the highway system and vehicle fleet. The railroads had zero push back in this affair. They had already had their moment of wild expansion and now, if Rockefeller told them what to charge to move crude oil? They did what they were told. Economically, why did this happen? Capital goes to growth and automotive/highway and associated was exploding while rail was contracting. The reason the railroads suffered so long? The highway lobby wanted them to. Railroads are actually a very efficient competitor for trucks and highways. The highway lobby knew this and it was to their benefit to keep pressure on the ever suffering railroads. As far as passenger trains? They require government backing and the highway lobby can apply far more pressure on the government than a silly little passenger rail line concept could ever do. I've lived in Europe and the passenger lines work so well because they were installed and built their political base/or were nationalized long before the tire, car and asphalt interests achieved lobbying power. Thank you for your videos.
Plus more recently (post WW II days) the highways and later freeways were drafted into the Cold war and were expected to be able to carry massive movement of people and war material in case of nuclear attack.
Great video. The railroad monopolies were the perfect example of why you can't have a true "free market economy" without regulation. Greed, corruption & power will take over every time. Also, 17:14 the "public roads" are not "free" they're being subsidized by tax payers, toll-payers, & taxes on gasoline & diesel, so maintaining the infrastructure was just shifted to the citizens. BTW, as vehicles shift from fossil fuels to electric, the highway maintenance tax money from fuel will dry up so they'll have to start taxing electricity..translation: any savings will be short lived..
Rate deregulation and some of the deregulations around manditory services (see passenger and extremely umprofutable lines) have definitly been a boon to almost all stakeholders in the US rail system, but it's also apparent that hesitancy to regulate the social ills created by railroads (see blocked crossings, derailments, and extremely poor crew conditions) has chipped away at the gains the regulation lean enviroment was meant to create. Personally I advocate a nationalized rails, privitized trains model as I feel that it will allow the government to leverage it's strength of being able to do long term management of large projects while still allowing the engine of creativity that is the profit motive to have some sway in this industry. Ultimately well functioning rail is essential to a well functioning national economy (trucks can really only haul so much and are horrifically inefficient fuel-wise, monetarily, and from a climate perspective) and private companies owning the rails and trains have a mixed record on that.
From what you hear these days they are still circling the drain in a downwards spiral, refusing and/or not able to invest in the now 100+ y.o. decaying infrastructure and launching gigantic length poorly maintained trains with barely any brakes or crew that sometimes explode and raze half a small town in the process after missing a corner. There probably should have been a continental wide infrastructure planning process at some point to make big arteries capable of taking current day volumes and weight and secondary lanes to smaller cities so at least the main part could be electrified and maintained properly. But now it seems way too late for that with nimby in the equation aswell and fed gov already massively in debt to finance any of that.
Despite the way the big media portrays it, that’s not actually true. Significant disruptions during and after Covid and a handful of high-profile incidents have drawn a lot of negative attention to the railroads, which have still had a decreasing accident rate year on year and are still investing in their infrastructure where needed. It’s Amtrak, who essentially has not been deregulated at all unlike the freight railroads, that is struggling to maintain its own infrastructure without outside funding.
Quick correction. The US didn’t actually nationalize the railroads themselves in WWI, it just took control of their operations. The railroads remained privately owned for the duration of the war and actually made money off of the government traffic. The US government couldn’t have afforded to actually nationalize the railroads, because in the US, the Takings Clause of the Constitution requires the government to provide fair compensation for anything it takes. So the government couldn’t have just seized the railroads, it would have had to effectively buy them at fair market value. The reason this was not an issue for the creation of Conrail was that the railroads it nationalized were so broke that they had no actual value, so there was no price for the government to pay.
Can someone explain why high speed rail won't work in a huge and spread out area? Isn't the advantage of high speed rail that you can go longer distances than a bus and just short of that of a plane at lower cost per ton? So shouldn't HSR favor longer distances?
because there is a certain point where plane travel becomes more efficient for consumers than HSR, it is around 400 miles between two population centres. One you get past that point the significant speed advantage become very apparent. In the north east corridor and a few others around the US and Canada this is fine because major population centres are close, but in CAHSR's case the main two selling points are LA and San Francisco when after considering the distance along the allignment are reaching that upper limit reducing the effectiveness in competing with short haul are travel.
We still need a more balanced approach to US rail in general. As it is, US passenger rail service is held hostage to the four-way hegemony of the largest freight carriers. Also, labor conditions are incredibly bad. Regulation itself is not bad, but it's a matter of how it's administered and the incentive structures in place. A tendency in our current politics is to decide just because something by the government goes badly, then government can't do anything at all and shouldn't even try. We can't keep being so shortsighted.
US passenger rail and Amtrak have been shackled to the same old unprofitable and uncompetitive routes they have been for decades, much like the railroad corporations were under the ICC. If things are going to change a number of there current routes need to die, yet there is less than no political will to allow that
7:48 “Ramsey pricing as it is so theroretically called-maximises ‘social value’ or whatever” 🤦 You saw the word ‘social’ and immediately decided it was communism? Look at the way it's defined: The sum of producer and consumer surplus.
Man I wish he explained how the interstate highway system got better, it required taking a large sum from the railroad funding for that project.
Yeah this video seemed a bit lopsided
Buffet’s railroad takes advantage of a legal loophole that gives it a monopoly on last mile delivery of coal to the power generating stations. They make as much money on a short haul as the rail company that delivers coal thousands of miles from the mines to Buffet’s rail company territory.
@@abdiganiaden money
oh, so he's running a scam.
@@Orinslayer it is not a scam if it is legal.
That is also why members of congress can’t be charged with insider trading.
So much citation needed. BNSF *is* the company that delivers coal hundreds or thousands of miles from the Powder River Basin, so this comment comes from a place of confusion, ignorance, or AI.
I don't really agree with your take on High Speed Rail. America is broken up into many different regions. I don't believe that having a High Speed line from NY to CA makes sense but connecting cities within each region. Example, NYC to DC or Boston, Seattle to Vancouver, Chicago Hub, Texas, or Atlanta to Charlotte, etc. If regional airlines can exist so can High Speed Rail.
i think that is exactly how most transit planning works - the start and end come second, what's important is the places it goes through
NotJustBikes already has a debunk of that talking point. In short, saying “America can't have HSR because it's a big country” is like saying “Earth can't have HSR because it's a big planet”
There are dozens of routes where HSR would work in the US. “Too far” is someone telling you NYC to LA wouldn’t work.
Yet I keep seeing those sorts of proposals all the time online or in the media. There are places where passenger rail will work, but those aren’t the projects that get attention. And the projects that could work are usually drastically over-engineered or poorly managed, like CAHSR
@@andrewreynolds4949 What do you expect? The US has no experience doing that stuff. The US doesn't even have a national rail infrastructure managing agency which is common around the world
@@michelangelobuonarroti4958 I don't see why that's particularly relevant; the majority of HSR schemes in the US are proposed by politicians and activists with no experience in rail and no resources to implement it other than an ability to attract newspaper headlines. Meanwhile Brightline and Amtrak manage their own infrastructure on their HSR routes where they are the primary traffic; not much point in or need for a national infrastructure company when every HSR corridor (or potentially viable one) is so geographically, operationally, and customer demographically diverse and separated.
I think we *are* seeing the commercially viable routes being built: Miami to Orlando, LA to Las Vegas. And, of course, the northeast corridor *should* be much faster than the current Acela. But the reason Vegas, Manhattan, and Disney World make sense as HSR destinations is because there is a clear epicenter that tourists and residents all want to get to. Most US cites simply don’t work like European or Japanese ones-traditional downtowns are *not* the center of population in Atlanta, Houston, Cleveland, Detroit, or the Bay Area.
We can complain about suburban sprawl all we want, but it’s a fact-meaning HSR stations in the US would basically have to function like airports, complete with mass on-site parking. And unlike air routes, rail is a permanent bet on travel demand between particular cities. Which is fine if you’re talking Paris to Marseilles or Wuhan to Nanjing…those places have been population centers for literally thousands of years. The natural rail hub for the US would be St Louis-which was indeed a rail boomtown for several decades around 1900 and has been in relative decline ever since. Fine for freight; wasteful for passengers.
To make the US a more rail-centric culture, I’d focus on local public transport first. Make existing stations viable again as commuter hubs; then you can consider intercity HSR.
I'm an HSR advocate but I can agree that at some point the distance between two cities can be "too far." LA to NYC would not work just because of 1 reason. The Rocky Mountains. HSR for the East Coast however is perfect due to the density of cities in close proximation of each other
Old regulation is just like legacy code. It should be revisited periodically. What enabled something in the past may be holding things back in the future. Great wrap up on how US railways got sandwiched in between new developments in transport and old regulation. And a spot on remark on that rail transport tends to get billed for use of track whereas trucks can mostly travel on roads for free.
Software developer here understands this. But for the same reason code doesn't updated, laws don't get updated. Everyone gets paid for the big, bold new features everyone knows about not the old features no one cares about
@@poetryflynn3712 The problem is still being understated. Old regulations remain despite starting to do net harm largely because they still benefit someone, often competitors, who fight hard to keep them in place. It's public choice economics.
@@PrezVeto Exactly. Yet, we keep adding more regulations because people forget we even have the old ones. Then when we get rid of the regulations, we don't invest anything to fix what would happen if the regulations weren't there.
There is just zero nuance.
A weird trivia is that the Texas Railway Commission has nothing to do with trains...
I have a friend heading the CA high speed rail, after having moved on from working on the Taoyuan metro. He said first train is expected to run 2030-2033.
They are basically the Texas version of FERC
The problem with American railroads isnt nessisarly the problem. The main issue was the double whammy of over regulation in response to 1800's railroad tomfoolery, and the simultaneous gross underregulation and outright subsidization of the Automobile and trucking industry.
Quite frankly, the railroads got their just deserts for their gross profiteering in the 1800s. However, the Automobile and Oil industries, despite at this point making the 1800's railroad baron look like John Charity himself, have avoided any such just deserts.
Standard Oil was broken, and the auto manufacturers (unless you can show me differently) never acted like monopolists.
@@RonJohn63 en.m.wikipedia.org/wiki/General_Motors_streetcar_conspiracy
@@andrewmorrow7472 that's not _monopoly._
@@RonJohn63 In 1949, Firestone Tire, Standard Oil of California, Phillips Petroleum, GM, and Mack Trucks were convicted of conspiring to monopolize the sale of buses and related products to local transit companies controlled by NCL; they were acquitted of conspiring to monopolize the ownership of these companies. The verdicts were upheld on appeal in 1951.
Of course truth is in the eye of the beholder. But sometimes it is whatever is being enforced by the bailiffs of the court upon the owner of said eye.
@@andrewmorrow7472 what do busses have to do with streetcars?
Buffett likes to invest in companies with a competitive moat. BNSF and the other Class I rail companies have massive moats - it seems extremely unlikely there will ever be competitors to them, is someone going to lay down thousands of miles of new track across the US? Almost certainly not. So BNSF, UP, CSX, etc - they all now have modern monopolies and they are again ruthlessly leveraging them.
The competition, as was mentioned in the video and by Charlie Munger, is the trucking industry.
What really makes rail companies work as an investment, and I suspect this is why Berkshire bought them just as they bought the original woolen mill back in the day, is that they are capital intensive enterprises but generate huge operating cash flows once in service. And in the case of railroads, all that capital investment is decades - if not a century or more - in the rear view mirror. The marginal cost of running a railroad is very low compared to trucking, and that allows decent investment returns if you buy the business at a reasonable price.
@@benjaminlynch9958 Nope, not at all. Railroads have had historically low operating ratios. Deregulation helped increase them. When OR's really took off was after 2015 with the implementation of PSR. Now the activist investors expect increases every single year, and the Class I's have had to shed over 25,000 employees, close needed shops, sell off yards, and get lax on safety and inspections in order to meet investor expectations. I believe it was the former CSX president who listed off a few years ago what the company priorities were - Safety was #3 on the list.
The CPKC merger has already created more competition between companies and more new routes than in the last two decades. The period of competitive stagnation has effectively ended
@@andrewreynolds4949 The remaining monopolies are adjusting to try and retain their traffic. Once it settles out, stability will return. By definition, mergers and the creation of monopolies is ANTI-competitive and eventually destroys capitalistic models. Any innovations we then see are merely to cut costs and increase profits, not reduce consumer prices and promote competition. We have been the victims of monopolistic pricing since 2020, yet their bought politicians will scream about "inflation" and point their fingers everywhere but towards their donors.
@@andrewreynolds4949Spot on! Just look at CN. They have official partnerships with UP and Ferromex now to compete with CPKC. Just goes to show that the decision to allow CP and KCS to merge was good for the industry.
Living in Switzerland here. I take rail and high speed rail everywhere. Amsterdam to Palermo (Sicily). London to Vienna. Long distance public transportation (high speed or otherwise) won't work without a robust regional and local network, including last mile. If you have to rent a car at the terminus to get to your final destination, most people will fly or drive.
Excellent video. US rail history is a fascinating topic and I hope to see you do more videos on them.
Three points:
(1) Part of the overreliance on debt came from the major railroads constantly overexpanding to lock out competition on track/geo coverage and rolling stock efficiency/capacity. These geo-monopolies mostly carried to today's freight rail networks, which have a very real negative impact on domestic passenger rail performance and expansion.
(2) The Pennsylvania Railroad considered themselves untouchable. They depended heavily on passenger rail and overextended their available capital. By the time they were forced to realize their dire financial situation, it was too late. In contrast, New York Central's last leaders saw the shift towards freight/intermodal and began taking aggressive action towards it. Unfortunately, the merger foolishly let the Pennsy's ignorant Mainline-mentality management win control, guaranteeing its death. It is an excellent example of competing cultures and management.
(3) Regarding your last chapter, yes, revenue has risen but at the cost of maintenance and safety. As we have seen in recent years, on-time performance is all that matters even if that means skeleton crews, overworked engineers, and a length some claim are unsafe, ultimately leading to derailments.
*looks at timestamp*
@@westrim Time travel is real.
@@brodriguez11000 😮
People don't realize just how bad the derailments have gotten, its not uncommon to see abandoned freight trains just sitting around after being involved in non-fatal derailments. Before Norfolk Southern blew up East Palestine there was no press about them what so ever.
@@hikarikaguraenjoyer9918 FALSE, FALSE, and FALSE
Free public roads? You should look into intermodal hubs like the one built outside of Chicago in Joliet, it already had a rich rail infrastructure due to, well, Chicago and the history of rail in the country. Roads, on the other hand, were NOT meant to handle the sudden surge in truck traffic: roads are wearing out faster, bridges are aging more rapidly than they should, and none of these shipping companies contribute a penny more than they have to for upkeep and upgrades.
That is one of the pillars of a "good" company, to externalize costly items such as wear and tear that are often overlooked and or underestimated by the ones paying for it. Hence why the GIG economy took off. Basically "make it someone else problem" and pocket the profits.
@@JoseLopez-hp5ooright, which is why the system itself is the problem, not individual bad actors
@@TAP7aI hate the players and the game, especially when people like Warren Buffet are so rich from them yet don't pay their way.
I remember seeing a video discuss the impact of different vehicle types on the road itself, and if I recall correctly, long-haul trailer trucks cause over a thousand times more wear on the road than a typical passenger car, which partially puts into perspective how much trucking industry is invisibly subsidized.
there's no "market" when the class Is have regional monopolies. the existing network has become more concentrated, brittle, and less robust, and is optimized for container movement and unit trains. the only companies moving non-unit freight (boxcars and the like) frequently don't have any other options. the regional monopolies know this, and statements from the privatization of BNSF are tacit admissions of a desire to extract maximum profit from captive customers.
If the US really wanted private trucking-level or airline-level competition over rail, the core rail network would need to be nationalized, with centralized dispatch (like air traffic control), and system-wide standardized signaling. The railroad companies would remain in charge of individual trains and terminals, similar to airports. I'm not holding my breath.
Trains remain the most energy-efficient method of land transportation; it's ironic that the least-efficient methods in the form of air and road are the ones that are socialized.
the wage increase graph at 6:15 was also pretty ridiculous. an annual wage of $1,820 in 1920 works out to under $27,500 today, which is poverty-level. who were the "public" against working wages? owners and shareholders?
I disagree somewhat.
Rail (and most other infrastructure) could work similarly to how it worked in the early 1800's prior to regulation, which meant that to maximize the use of their assets (railways), the owners of individual lines would sell access to their rail networks to competitors, offering more service and increasing their potential pool of customers, even if they had a competing line themselves that used the rails they owned. This is largely how fiber optic internet works where it's not regulated. Individual providers ultimately share lines across the country and internationally in order to offer customers services where they control the market locally (though this local control is almost always the result of municipalities disallowing competition via regulation...)
Another example is cell phone providers. In the USA, Verizon owns most of the cell towers. So their transmitter/receiver goes on the very top. But they rent the space immediately below to most of their competitors. So AT&T, Sprint, T Mobile, etc. can essentially boast the same network without putting in fixed investment costs (but of course renting space.) The entire industry thus ends up sharing the infrastructure investment proportionally to how much they actually use and with what is viable. Markets are almost magical in how firms reach agreements like this without government control or direction. Compare this to other countries, like Canada, where everything is tightly regulated and unlimited data is hyper expensive compared to the USA, or compared to other countries where service is essentially subsidized by the tax payer.
Infrastructure is really not complicated once land is acquired/land use is allowed by law. Nearly every example of poor utility service can be traced back to laws created almost explicitly to prevent poor service or increase costs.
@@poofygoof poverty used to be much more common everywhere. People put rose-colored glasses on when they talk about industrial-age workers rights. Prior to any industrialization, the norm for 90% was complete poverty by today's standards. All improvements in wages in the long term are due to productivity increases in specific sectors. Union action, while relevant, actually has very little bearing on productivity itself, so any statistical gains that might be attributable to successful strikes or negotiations are usually the results of productivity increases which arise from a multitude of other things. Usually, if the wages are above the market clear price, it drives down investment into the industry in question and thus productivity stagnates, creating a potential short-term situation of higher than expected wages while creating a long-term situation of low wages due to industrial non-competitiveness. Because this occurs over time, it's hard for the average person to notice this. Investors notice right away, and often enough anyway, government policy is usually the culprit either enacting specific regulations demanded by industry itself, or by labor movements. Very funny how it produces the opposite of its intended effect!
@@poofygoofwhen it comes to opposing the improvements to the status of the working class, it's always owners and shareholders.
@@classiclibertarian a society that relies on consumer based markets it's wild to me that anyone would advocate for low wages. How would anyone buy the goods being produced? That's why unions make this flawed system better because they make stingy companies give a better share of the surplus labor value (profits) to the everyday Joe who then in turn makes the economy move by purchasing goods therefore stimulating the economy. This is actually why the west has been in endless economic crisis for the last 30 years now because the everyday Joe isn't getting compensated accordingly by the rich and it strangles the economy which causes the rich shoot themselves in the foot because now they can't sell as much of their goods fir maximum profits if thats wgat they want.
To this day there is absolutely no limit to how long a train can block a road. States or cities can't even pass laws to enforce a limit.
Trans World didn't exist in 1929 in any form. The company that later became Trans World was founded in 1930 by a merger of a bunch of predecessor companies, which formed Transcontinental and Western Air - which was known as TWA.
Only in 1950 did the airline rename itself Trans World Airlines - choosing a more modern name that had the same acronym.
A somewhat related vid topic would be the package delivery industry. ( UPS / Fed EX / REA Express ) From what I understand, until the 1980's or so there were some odd restrictions on a company being able to singularly offer delivery service from one end of the USA to the other.
That would make a fascinating video.
Freight trains are five times as fuel efficient as trucks. With climate change becoming a serious threat to our livelihoods, health and security, we should be taxing fuel in a manner that would shift even more freight onto trains and encouraging the building of more pipelines to carry liquid commodities (pipelines are more fuel efficient than trains). Freight rail makes it very efficient and environmentally safer to transport food from one place to another, allowing regions to grow the food they are most efficient at producing.
American freight rail companies had been held to 1935 productivity levels all the way to 1980 by labor-owned regulators. Ten years after regulatory escape in 1980, they've reached 1990 productivity levels. Then, oddly, after this huge 150% leap, productivity increases stop cold.
The hard limits of human nature had been reached, I presume.
There is still a union to deal with. The railroads have recently tried to reduce the running crew down to one, citing improved technology that obviates the need for the second member. But there has been hard pushback, of course.
@@gravityissues5210it's also kind of a dangerous idea.
@@gravityissues5210 yes, tho railroads have been pushing for this change since the 90s. In fact, railroad unions can not legally strike and must undergo a 2 year process to negotiate for new terms from the railroads, congress, and the president. If the don't get a deal with the railroads, then the timer restarts but now they must work with congress and the president, if that doesn't work then the unions can strike otherwise the president can reset the timer and force the unions back to negotiating. Otherwise the President can call the national guard or get scabs to take over train operations if the unions strike (as well make arrest for strikers). This pretty much happened about year ago when unions couldn't agree on a contract and the president forced the unions back into negotiating with railroads.
Also should not the technology the railroads have been touting is not currently implemented either, and that was federally mandated already but the date been pushed back as railroads are unwilling to do the change, and I think its only amtrak and one other railroad company right now with Positive Train Control.
@@CatnamedMittens Ideally, that could be for an insurance company to decide.
Australia's government owned railways were a financial disaster, until they were semi-privatized. The rail tracks remain nationally owned, but private companies can pay for access to run private freight services. Previously, private companies had rorted government rail, by overloading wagons, and getting contracts which had clauses like time performance inter city, that were usually un-acheivable, giving these private freight forwarders free freight. There was horrific corruption going on behind the scenes, but thankfully those days are over. Rail,ships and Road all have their economic place in transport. The best and most flexible model, is having government owned infrastructure, with open and equal access for private interests to provide services that make sense both practically and economically. Every single example of shared infrastructure from roads,rails,gas pipelines,phone lines to especially MONEY needs to be government owned with access for private people and companies to use for the communities economic benefit with being taxed beyond cost to operate,or monopolized.
If the infrastructure is nationalized, who dispatches the lines?
Not sure how nationalized Aussie rail really was if they still can’t agree on a single gauge
@@whiteknightcat ARTC..........Australian Rail Track Corporation. On the same track network there is in my area Aurizon,Genesse Wyoming, SSR, National Pacific, and Qube. They all independently operate private rail locomotives and rolling stock on the same ARTC track network. Passenger services are still State Government.
@@wazza33racer Thank you.
Sadly here in Canada, our Conservative government back in the early 1990s privatized CN including the tracks and RoWs sadly
Efficiency measured in revenue?????????????? Okay I guess subsidies are efficiency now.
Just dump money on it, wow so efficient!!!
Implying the rail companies are investing in the infrastructure is asinine
Lol. In my childhood the rail lines through my city and state were very visibly run down. These days they are continuously welded rail rather than the old jointed track, with concrete ties instead of rotting wooden ones, and clean ballast. There are many rail infrastructure projects across the country that hardly even reach local media. Just because the rail network doesn’t look like the European ones like the big media and politicians want it to doesn’t mean they don’t invest
@@andrewreynolds4949 he didn't say it wasn't true. He was just saying that the cognitive dissonance he is experiencing makes him feel asinine.
Just tell us you know nothing of American freight rail.
There are about 3 U.S. train derailments per day.
In 2022, there were at least 1,164 train derailments across the country last year, according to data from the Federal Railroad Administration.
This information is worthless without context and information regarding scale.
Don't peddle propaganda.
Derailment doesn't mean the train crashed or caused damage to anything.
@@Ben....., the information is valuable and interesting. Any person into railroads understands what a derailment is. Only you are thinking that a real derailment is some Lac Gigantic catastrophe with incredible death and destruction.
@@seriouscat2231 I know most derailment are nothing important and cost nothing but time and money. My point is that statistic like "X happens Y times per year" don't mean anything unless you know the rate X happens per Z potentialities.
it's purely appeals to pathos and can be emotionally manipulative.
0:32 how is US freight rail more profitable, if it has 3 cents per tonne-km, russians have 4 cents, chinese - 5 cents?!
4:18 you had 5 mln cars and 400 trucks? WTF?!
4:33 is there a "non-exclusive" monopoly?!
The last chapter misses the fact that Safety has gone down significantly, Class I railroads are also operating skeleton crews which has caused a massive uptick in accidents, derailments have skyrocketed. Not to mention the insane conditions they are working in right now. Majority of the big railroad companies refuse to invest into upgrading existing infrastructure, the infrastructure in question wasn't built for "monster trains" their running these days, which are way heavier and incredibly long.
EDIT:
Derailments have not skyrocketed, incidents have but derailments have only increased above pre-pandemic levels, they are nowhere near as bad as the 1970’s. Making this edit cause I do not like spreading misinformation
Cite your source.
How does railway safety compare to eg trucks in absolute terms? Perhaps they were too safe before? ('Too safe' meaning that it wasn't cost effective.)
From a cursory google search for derailment statistics derailments have no skyrocketed, do you have some source saying they have? What statistics do they cite?
less union workers = more safety
@@Katchi_ en.wikipedia.org/wiki/East_Palestine,_Ohio,_train_derailment
The graph that starts @15:55 is missing a couple of lines, safety (number of accidents) and wage growth :p
Two of the largest railways in North America are the CNR (Canadian National Railway) and the CPKC (Canadian Pacific Kansas City Southern). Canada has relatively few people and vast expanses of land, so these freight railways are vital.
My grandfather was a section foreman for C&O, then Chessie, then CSX so I think it's pretty cool that you covered this. 🙂
I see new Asianometry. I watch new Asianomrtry.
monkey see, monkey monkey.
He's the best❤
The fall and failure to rise of American passenger rail would be an interesting topic for a video of its own, because the reasons go way beyond "America big."
The California high speed rail project is a typical example of trying to cover too many bases in one project: is it meant to compete against airlines (fast) or highways (an exit in every town)? It tries to do both and ends up succeeding in neither.
This is of course leaving aside the various shortcomings of this policy for US railways such as...
*Reducing maintenance on track infrastructure
*Reduced maintenance on locomotives and rolling stock, which is more intensively used.
*Longer trains causing traffic jams as they can't fit into sidings.
*Overworked crews, which leads to an increase in mistakes.
*Ignored safety procedures.
*Blocked crossing.
*Increased risks of derailment.
*Trains unable to pass each other due to passing sidings being too short.
where is their union? the RR union is the most powerful in the country, I thought it was supposed to "protect workers". Or is that typical liberal hogwash?
Remember the huge chemical release and fire (for maximum dispersal I guess) caused by a derailment so large it poisoned the ppl in a large area of the East Coast a state sized area?
A package far better than the waste and technological stagnation of nationalized rail, which was the inevitable alternative to deregulation.
That package is inaccurate, to boot. Track and equipment are in much better condition than they were before deregulation.
@@PrezVeto If you honestly believe gov't regulation has caused any societal benefit to our country, you're a lost cause. Not a single gov't program hasn't caused the most extreme destruction for the cause it professed to help. What world do you live in?
We can go back as far as the "great society" that FDR told his allies in secret, "this will deliver the black vote to the democrap party for 100 years."
There is no one program I know of that didn't have a similar, nefarious intent and effect. Name one. Help me believe beyond my study of history, data and analysis... No one knows everything...
@@PrezVetobullshit. They haven't bought a new (not refurbished) locomotive in years and less track is electrified than before. They're operating at massive profits at the expense of workers, ratepayers, and the public at large. They are nothing more than regional monopolies and should be nationalized immediately
Very interesting.
Any chance you could do a video on the history of the British rail system, the world's first. Expansion, becoming mainly a commuter system, Beeching cuts, nationalisation, disastrous privatisation, wasting billions on a half built HS2 instead of revamping the existing system etc.
The US is suitable for high speed rail. But only on short to mid range distances. Nobody every said that you should go by high speed train from Chicago to Orlando. But short distinances between big cities are plenty of connections high speed rail in the US makes perfect sense.
And only two derailments this week! Both hazmat evacuations, of course. Yep, our freight trains are in great shape. Yup.
This is the first Asianometry video I watched where it is pretty apparent that this video is very out of your comfort/knowledge zone. Nevertheless I enjoyed the coverage of the historical events, but especially in the latter half your explanations of current day issues seems quite shallow.
Which is understandable because it crosses with a huge amount of different policies across different transportation methods such that it's difficult for one person that isn't already familiar with them to make a video about it. Just try to refrain from making absolute statements about the current day economic efficacy of things you don't fully understand, since people that usually watch your videos assume that they are well researched.
I never thought I would see my hometown in an Asianometry thumbnail
Those regulations that hampered the train industry is what Atlas Shrugged is all about.
I live in northern Arizona and was a bit suprised when in 2000 I purchased my 5 acres (2 Ha) and about 9 miles (14 km) from the railroad, the mineral rights were still owned by BNSF railroad. It really shows just how much of the land the railroads owned and how if new mineral exploitations develop they are set to profit, well over 100 years later.
Trains are so cool....they really held us together during covid, and now the ability to move freight east to west coast & vice versa has helped tremendously in these recent days of supply chain disturbances and drought in Panama.....
Your choices of topics have been quite germane to current events - cheers ...
And as the song goes, "these are the days of miracles and wonders..."
And one of these wonders has been the people who jump trains for amusement or just wanderlust....plenty of these adventures here on YT.
Trains are a great way to travel, but less here than in Nexico or in Europe. I got to ride Ferrocarriles de México for a couple weeks when I was a kid......that was an adventure! Cheers....
Rail freight has held the economy and the transportation sector together for a long time, it just became very, very noticeable during Covid
Government never should have sold Conrail. I mean, The Staggers Act still needed to happen, but yeah...Conrail Quality! It's funny though. Now we have an Oligopoly that actively tries to NOT actually bolster the usage of rail for transport, but rather engage in PSR and actively discourage any sort of deviation from it.
Recommend the book "The Men Who Loved Trains" (Rush Loving) about the subject
Utica is pronounced Yewtika, not ootika... Utica is an interesting place, home of two notable airlines, Mohawk Airlines and Empire Airlines, and for some reason, the birthplace of the founder (Kenny Friedkin) of a third, Pacific Southwest Airlines (which many view as the original low cost carrier - it inspired Southwest Airlines). Must be something in the water there.
Also gets the odd shout-out in _The Simpsons._
How embarrassing, I've been saying Ooo-Ess-Ay all my life !😊
I thought I was the only one who caught that mispronunciation
I mean the name comes from an ancient Carthaginian city, so his pronunciation isn’t incorrect either…
High speed rail can be competitive in North America.
Let's compare Toronto_Montreal to Paris_Lyon (the first high speed rail outside Japan).
Both cities are ≈ 500 km apart and have roughly the same respective populations. When the line opened in 1981, the airlines had to cut service between Paris and Lyon, because they could not compete against the train.
7 years later, the whole line was paid for: land acquisition, the tracks, the electric overhead lines, the signaling system, the trains (DOH!) and also the 25+ years of R&D that made the iconic TGV possible.
Oh, and not a single penny of government money was paid into the project. The SNCF totally financed the project by itself.
This means that for the last 35 years, that rail line has been the proverbial gravy train.
And no, the population density between the cities does not matter because the train does not stop between the line ends...
Toronto to Montreal is probably viable, as is the Northeast Corridor in the US. So are the two private semi-HSR lines that are actually being built: Miami to Orlando and LA to Las Vegas. But, in general, density *is* a problem for North American HSR. A single station in the center of Paris or Lyon would be within walking or public transport distance of a huge proportion of the metro area’s residents-including those wealthy enough for regular business/tourist travel. Compare that to some of the fastest growing American cities: Where would you even place a HSR station in Atlanta, Phoenix, or Austin? Rail becomes a lot less competitive if suburban sprawl means most passengers need to drive to the station just like an airport.
you say how great deregulation is? so great that railroads are only too happy to use absurdly out of date safety equipment, check it rarely, and dodge most liability when things go wrong.
Yes the equipment is outdated and the employees are extremly overworked but look on the bright side. The freight rail companies have absolutly huge profit margins
Did you watch the video? the regulation mandated they use out of date stuff for a long time. It’s going to be ugly when deregulated but over time if competition is allowed, it’ll get better.
Never let reality get in the way of a good narrative!
Asianometry =Americanometry
First airmail route was from Tampa to St Pete. You correctly feature an image advertising this, but incorrectly state that it was from DC to NY. I think you owe Tony Jannus an apology.
TBH the excuse that the US is so spread out therefore no HSR is possible is kinda trash. Ok, you can't possibly think of connecting Montana with Wyoming with high speed rail, sure, but the fact that there isn't a network that spans the whole North-East/New England area up to Chicago is just bokers. It's a very densely populated, very high income and extremely full of business area, it's perfect for a HSR network. If Spain can make it happen, there's no reason why the US can't in its most densely populated area
Nice episode. Thanks!
Government regulates competition between trains, trucks, airplanes and ships with taxes, subsidies, and rules. Unfortunately, there are many groups wanting different things, and outcomes are often dependent on political considerations over economics. Thus, you have clever entrepreneurs who take advantage of the current situation. As long as you have complexity, it will take a bright person to get around the current situation. Politicians still exist, and constantly change the rules, so what works one year might not work the next.
The brief history of the railroads presented in this video should be a hint to Ayn Rand followers that her view of the railroads as her symbol for how great accomplishments come from a few great men unhindered by government was as daft as her every-moving ideas of "selfishness" and general campfire "philosophy." They are fun books as early super-hero stories, which accounts for a lot of the popularity, but beyond that ...
To an extend the way US freight system is setup any form of passenger transportation is mostly dead except around large cities.
How much money did the US goverment put in the rail system and how much was put in the road system/highway system. And hence we now have long single track routes with passage tracks. Plenty of larger cities can be connected with high speed trains over distance upto a few hundred miles. But all infrastructure has been stripped to make it cheaper the infrastructure maintenance....
I think this video should be seen by the new UK government elected a few days ago. They plan to re-nationalise the rails.
They were nationalised after WW2 as they were then in a very poor state having been thrashed in the war. In 1997 they were once again privatised with Railtrack owning the track and infrastructure and private companies providing the rolling stock and paying an access charge. Railtrack got rid of much of its staff to new private companies that they contracted back to do the maintenance and new works.
In the late 1990s there were a series of serious accidents attributed to poor management and maintenance. Railtrack's share price fell and they were unable to raise the funds to repair the backlog of work and raise safety standards. They were renationalise. Today we still have the private train companies running the trains although some of those have gone bankrupt and they are now under government control.
The new government plans to take back the remaining companies when their contracts expire but details are unclear how they will regulate the industry. Will they set passenger fares? Fares today are set by demand so peak hour service are high prices yet peak trains on many lines are packed as people work away from cities and companies consolidate offices and roads are rammed. There is much criticism over the high ticket costs and complex ticket rules. If they go for a lower standardised and simpler fares, say x per km at all times, will the railways then be unprofitable and a money pit?
Increasing reliability and capacity will need huge infrastructure investment yet the country is broke and the new government says it will not borrow more money but aims to reduce the national debt.
It's not easy to find the right balance between costs to consumers, remuneration to employees (already well paid but wanting more), and funding capital investment and governments have not been a shinning example of how to achieve this.
love these videos man
Here in the Los Angeles/Long Beach ports, they upgraded the rail lines quite a few years ago. No way could all the containers coming from Asia be trucked across the LA county basin.
I feel like high speed rail vs car or airplane... there's gotta be a pretty straightforward calculation there on what's more economical based on population density, and "destination density".
As an IT person, government caps on AWS and Azure don't sound bad. Probably other controls I'd rather see on them first, though. Not sure that the cost of the datacenter is comparable to value of the cargo though. That would be like capping costs based on the value of the track. The obvious comparison would be capping based on some sense of value of what was being served. Of course much harder to estimate that than the value cargo
The increased length of trains comes with its own set of problems and I hear railroad companies are skimping on personnel and safety. I believe John Oliver's video on the topic could explain the what and why better than me.
Absolutely!
I think you missed the point of high speed rail networks at the end there: it's the NETWORK effect, not the end point to end point line. There is a reason the US built a highway NETWORK rather than three coast to coast highways to speed up troop movements in case of war (the intention of the Highways Act). The more area a network covers the more its value increases. Just as Harrington, Morgan, Vanderbilt and all the other rail barons.
What started as schemes to stymie rivals with short lines to poach traffic from rival coast to coast lines in the late 19th century became networks in the early 20th century.
Also, the sale of ConRail back to the private sector was a give away at $2Bn. That was a $6Bn subsidy. It wasn't the miracle of private enterprise that rebuilt the railways, it was government money, as can be attested to by the amount of crashes due to failing infrastructure and failure to invest in new equipment (while spending millions on opposing requirements for important safety equipment), on those privatized railways every year.
Nationalization of trackage is a reasonable idea to re-create competition and compete with trucking (with free highways). None of the huge railroads created by mergers are innovative, and track choke-points have been created due to shutting down lines due to those mergers, no longer serving certain markets at all. With this, wages are poor as is moral. This is not healthy for the long-run.
For nation-wide HSR, you would need to build all new track designed for passenger service - $$$. The cost is just too high for a nation as spread out as ours compared to the free cost of air, that you don't have to build or maintain. Regional where it makes sense, but not national. Nobody is going to choose (unless for pleasure), even HSR vs a plane to go from coast to coast, or even half way, it simply takes too long.
Air travel is massively less efficient carbon-wise though. We've just neglected to account for that externality through either taxes or regulation. At best, the gov't is funding "sustainable aviation fuel" research; unclear how that'll turn out.
@@crash.override Curious why you're concerned about 0.0012% of anything, especially CO2 which is free plant food.
What matters to most people is cost, time, and convince, which air travel wins hands down. Use cross-country rail for what it is most suited for, moving bulk freight in place of thousands of semi-trucks.
@@hallkbrdz The "free plant food" excuse is just that - an excuse, knowing full well that there isn't enough vegetable matter on Earth to absorb the skyrocketing CO2 production that has been taking place for a century now. That being said, IMO we're already past the point of no return, despite what the experts claim about 2050 or whatever. Humanity can not and will not give up fossil fuels, so future generations will have to deal with the consequences. HSR on a nationwide scale in North America will also never happen IMO - just look at Texas Central boondoggle going on over here. I doubt the eminent domain court cases will even be done by 2030, and by then, the whole thing will likely have to be re-designed due to the original concepts having gone obsolete.
@@hallkbrdz My sky last year was orange for multiple days on account of wildfires from elevated temperatures. If that's not apocalyptic, I dunno what is.
Also, you enjoy funding oil sheiks?
@@crash.override In the US most of our (brief) temperature records were set in the 1930s. In Europe temperatures were higher than today during the medieval warming. I know the scaremongers love to hype any hot days for profit, but the fact is it has been much warmer in the past, and that was not due to humans impact but instead natural causes. Understand that warmer is actually better than colder. More people die due to cold than heat. More food can be grown due to warmer temperatures. Enjoy it, don't fear it.
I'm glad someone made a video with a different perspective on privatization of the Class 1's, but man is it biased towards capital. There's no mentions of the consequences of PSR, longer freight trains, worsening of on time performance for freight and passenger rail, how shipping anything other than unit freight trains takes 5x the time as trucking, and how the trucking industry regulations starting set are making rail competitive as a result. American freight has become an example of over optimization at this point
Is that a Russian freight train at 7:37?
Yep, a non-trivial percentage of stock footage in this video is of (post-)soviet trains and yards.
Enjoyed this video. I am glad US freight rail recovered, though I do share others' safety concerns.
My job takes me to Germany regularly, and I make significant use of their passenger rail system while there, local, regional, and cross-country. I wish the US, outside of a few large cities, had high-speed intra and interstate rail. A high-speed line connecting NYC with Albany, Syracuse, Rochester, and Buffalo would be perfect. I don't think it will happen without significant government investment.
Also, one correction. Utica, NY, is pronounced You-tica.
Right great for the companies, not so great for the employees who suffer to this day. There has to be a happy medium struck between the two somehow.
Part of the problem is the railroads cut excess capacity and resources to gain efficiency, until there was a system perfectly optimized for the existing traffic conditions. Then Covid and other major supply disruptions happened, and suddenly their system didn’t have any of the excess capacity to handle it
Back in the late 70s to the 90s being a Railroad engineer was a high paying, good job where you worked with trained people and there were enough of them and good management. This simply isn't the case in Railroad any longer. Its "optimized itself" to Taco Bell standards.
@@jaimeortega4940 From what I've heard the wages aren't bad, it's the working conditions and benefits they're complaining the most about
Interesting. We know so little about America despite having the illusion through television that we do know America.
@9:01 you say video cameras? I thought it wasn't until the late 60s that video tape came out?
This is a perfect example of the real problems with regulation. Yes, it is absolutely possible for smart government regulation to make things better -- but everyone underestimates how fucking hard it is to actually realize smart regulation. The regulators tend to either end up captured by industry or stick to anti-competitive and inefficient regulations.
The real problem is the incentivizes for the regulators. The thing they actually need to do -- encourage healthy competition, efficiency increasing innovation (ie job cuts) and let investors take the hit when things go wrong while making capital investment appealing -- don't make any constituency happy.
The beneficiaries of good regulation are the widely distributed American people but that doesn't particularly please either the investors, workers or politicians. And when you do it right that means both letting big companies go bust in bad times and accepting the massive job losses while letting investors make substantial profits when things go well -- in both cases making you look like the bad guy.
It's not impossible but it's very hard.
And this is the backbone reason to think "government is bad" or even "evil". Yeah it's a bit overstated, but it's definitely true.
@@nolanwhite1971 Unfortunately, I think people tend to conflate the idea that the government should be simple (it's not good at setting things like freight rates) with the idea the government should be small in monetary terms, e.g., you can have relatively massive programs like ubi or negative income taxes that work well and are very simple because they are basically just collecting revenue and cutting checks.
Similarly, bad deregulation can also have devastating effects. The remaining six Class I monopolies are now constrained to the lines they kept after having abandoned so much infrastructure they could have put to good use today.
The CPKC merger has done a lot to disrupt the existing monopolies. I’m also impressed with how the regulators have handled the conditions attached to the merger, which have mostly been “we reserve the right to monitor the situation for an extended period, and if there are any problems we will step in to add any additional conditions then”
Public choice economics explains why government always just can't seem to get it right.
How’s that California high speed rail project working out for you???
Penn Central, the most profitable airline (there was a lot of embezzelment, and crazy shit that happened near the end of the railroad that lead to its bankruptcy)
you need to do the rise and fall for this
@17:20 so the hedge fund manager prefers trucks because they hate actual capital investment, hate unions, think that trucks are more fuel efficient than trains (which they are demonstrably not, it's basic physics), doesn't realize that trains also run on Diesel, and that public roads are "free." Yeah, that about says it all about the supposed genius of the capitalist investor class.....
Exactly!
If you look at the USA as a whole, yes it is too big for high speed rail, but individual states and journeys between neighbouring states are not.
The Federal Government should set standards - eg standard guage track, 25kVac overhead lines of a specific height above the track, etc, and then the actual services should be organised by State and Regional governments.
Before the current situation in Russia, it was possible to travel from London to Hong Kong by train. You will find some videos on RUclips of people doing that, but the vast majority of people take the plane. However, for London to Paris, Madrid to Barcelona etc, you take the train.
Likewise, if you want to get from Los Angeles to New York, you are going to take a plane unless you particularly hate them, particularly love trains, or want to make a RUclips video about the journey, and for the latter you are probably only going to take the train one way and fly back. Los Angeles to San Francisco or Las Vegas, those are journeys that should have a high-speed rail option.
If for example you were to build a high-speed line from Miami Floria to Portland Maine, very few people would take it the full distance, but a lot of people would take it for one or two stops along the route.
Like it depends like China is similar size as US in area and they have high speed lines that run one end of the country to another, like from Vietnam/Laos border or South China sea to Russian border or from east coast to Kazakhstan border, with some services that actually cover entire length, and take more than entire day. Most people definitely don’t take full length though
4:08 "Utica* as in you-tik-a, not like choo-choo-tica.
Chewtica not chootica 😂
Oh, there were all kinds of mispronunciations in Jon’s video. But out of respect for his Asian origins we don’t make a big deal out of it.
Linus Boman had a great episode today on “Well actually’s” and weaponizing trivia. 👍🏼
In my house, we refer to those mispronoumciations as "talks like a homeschooler" because our kids read so much but heard relatively little pronounced. Was Jon homeschooled? Is that why his stuff is so great?
@@glennac Not trying to weaponize anything here; trivia for the sake of trivia all includes being correct. And I'm pretty sure there's no Asian and-expanding further for the history of east Asian phonemes-no greater Polynesian language which does not have the sound */ju/* integrated within it. Not to mention he pronounced the word "you" just fine.
I, personally, would want to get that right, to call it as the locals do. That's why it's */ˈhjus•tən/* when I'm in Houston, Texas, but */'haʊs•tən/* when I'm on Houston Street in Manhattan.
@@LordMarcus Yes, but Place names are notoriously difficult to get right if you’re not a local. I can not pronounce many European city names correctly. But know most of the obscure city names in the US.
Another great video! Amazing range you are pulling on topics.
I heard they've never heard of hamburgers being called steamed hams in Utica.
Touching on the interstate commerce clause, the most abused and distorted of all amendments. Just remember that the federal case against someone growing and smoking weed in their own home was upheld as a valid federal law under the interstate commerce clause because if they had not grown it, they would have bought it, and the weed might have crossed state lines. lol, FDR
Very interesting. A better title would be “How America Stopped Forcing Rail Lines Failures.” ❤
here is q question. Did the original owners get back their companies after nationalization or new owners took it over?
The properties were returned to the original owners in 1920.
@@whiteknightcat was just wondering because of the great depression. The original owners of the gold never received their gold back.
@@nomadhgnis9425 True that. During World War II, the government chose not to repeat the USRA method, instead getting together with the railroads, determining how they could serve the war effort, and then imposing the necessary rules on the companies by which warfighters and materiel could be most efficiently moved to get the job done.
@@whiteknightcat maybe he should do a video on the great depression since it is coming back. It could serve as a warning to everyone.
@@nomadhgnis9425 I was actually anticipating a collapse going into 2020, but then this stupid little virus showed up and turned everything on its head. Despite all the positive data, I can't help but feel there is something very unstable underneath it all - the wealth gap is the same or worse than it was in 1929, and I believe like a thunderstorm developing to its maximum power and then blowing itself out, the unrelenting prices increases and profiteering taking place will eventually yield price collapses as the levels become unsustainable.
RailRoAd? why are Americans obsessed with road infrastructure? Going as far as calling railway "railRoAdS"
Ah, my favorite Asian country: America
the amount of pissed off lefties here is staggering and kinda sad
Whomever can aggregate the most capital wins. For a long time the railroads in the US were king. They had the cash and could pay regulators and the government the correct amounts to keep them in power. I suggest if you have time, to study the highway lobby. This group of oil, rubber, asphalt and automotive industries with others simply showed up with more money, ripped up trolley and rail lines whilst building out the highway system and vehicle fleet. The railroads had zero push back in this affair. They had already had their moment of wild expansion and now, if Rockefeller told them what to charge to move crude oil? They did what they were told. Economically, why did this happen? Capital goes to growth and automotive/highway and associated was exploding while rail was contracting.
The reason the railroads suffered so long? The highway lobby wanted them to. Railroads are actually a very efficient competitor for trucks and highways. The highway lobby knew this and it was to their benefit to keep pressure on the ever suffering railroads. As far as passenger trains? They require government backing and the highway lobby can apply far more pressure on the government than a silly little passenger rail line concept could ever do. I've lived in Europe and the passenger lines work so well because they were installed and built their political base/or were nationalized long before the tire, car and asphalt interests achieved lobbying power.
Thank you for your videos.
Plus more recently (post WW II days) the highways and later freeways were drafted into the Cold war and were expected to be able to carry massive movement of people and war material in case of nuclear attack.
Youtica! Haha keep up the good work! ❤
I think you need a lesson on economics. How does government regulation help an industry compete? I suggest The Progressive Era by Rothbard.
Shame that the supposedly immutable freight rail priority has completed removed the competitiveness of passenger travel against other forms of travel.
What's your source for that notion?
Great video. The railroad monopolies were the perfect example of why you can't have a true "free market economy" without regulation. Greed, corruption & power will take over every time. Also, 17:14 the "public roads" are not "free" they're being subsidized by tax payers, toll-payers, & taxes on gasoline & diesel, so maintaining the infrastructure was just shifted to the citizens. BTW, as vehicles shift from fossil fuels to electric, the highway maintenance tax money from fuel will dry up so they'll have to start taxing electricity..translation: any savings will be short lived..
Rate deregulation and some of the deregulations around manditory services (see passenger and extremely umprofutable lines) have definitly been a boon to almost all stakeholders in the US rail system, but it's also apparent that hesitancy to regulate the social ills created by railroads (see blocked crossings, derailments, and extremely poor crew conditions) has chipped away at the gains the regulation lean enviroment was meant to create. Personally I advocate a nationalized rails, privitized trains model as I feel that it will allow the government to leverage it's strength of being able to do long term management of large projects while still allowing the engine of creativity that is the profit motive to have some sway in this industry. Ultimately well functioning rail is essential to a well functioning national economy (trucks can really only haul so much and are horrifically inefficient fuel-wise, monetarily, and from a climate perspective) and private companies owning the rails and trains have a mixed record on that.
From what you hear these days they are still circling the drain in a downwards spiral, refusing and/or not able to invest in the now 100+ y.o. decaying infrastructure and launching gigantic length poorly maintained trains with barely any brakes or crew that sometimes explode and raze half a small town in the process after missing a corner.
There probably should have been a continental wide infrastructure planning process at some point to make big arteries capable of taking current day volumes and weight and secondary lanes to smaller cities so at least the main part could be electrified and maintained properly. But now it seems way too late for that with nimby in the equation aswell and fed gov already massively in debt to finance any of that.
Despite the way the big media portrays it, that’s not actually true. Significant disruptions during and after Covid and a handful of high-profile incidents have drawn a lot of negative attention to the railroads, which have still had a decreasing accident rate year on year and are still investing in their infrastructure where needed. It’s Amtrak, who essentially has not been deregulated at all unlike the freight railroads, that is struggling to maintain its own infrastructure without outside funding.
I can say as a Floridian that an airboat 4:30 and a seaplane are two very different things. this seems like false advertising.
This was a great video
you forgot to post this in your "americanometry" channel
Regulations, not even once
Trains are always interesting.
Quick correction. The US didn’t actually nationalize the railroads themselves in WWI, it just took control of their operations. The railroads remained privately owned for the duration of the war and actually made money off of the government traffic. The US government couldn’t have afforded to actually nationalize the railroads, because in the US, the Takings Clause of the Constitution requires the government to provide fair compensation for anything it takes. So the government couldn’t have just seized the railroads, it would have had to effectively buy them at fair market value. The reason this was not an issue for the creation of Conrail was that the railroads it nationalized were so broke that they had no actual value, so there was no price for the government to pay.
Tons-kilometer, mot tonnes-kilometre ? (It isn't the 'meteric system' and why mix measurement systems)
Wah-Bosch, Uww-Ticka, these pronunciations are phenomenal.
*Yewdicka
@@PrezVeto No you are
Can someone explain why high speed rail won't work in a huge and spread out area? Isn't the advantage of high speed rail that you can go longer distances than a bus and just short of that of a plane at lower cost per ton? So shouldn't HSR favor longer distances?
because there is a certain point where plane travel becomes more efficient for consumers than HSR, it is around 400 miles between two population centres. One you get past that point the significant speed advantage become very apparent. In the north east corridor and a few others around the US and Canada this is fine because major population centres are close, but in CAHSR's case the main two selling points are LA and San Francisco when after considering the distance along the allignment are reaching that upper limit reducing the effectiveness in competing with short haul are travel.
At 11:49 it seems we are in India, not USA...😅
You did NOT just say that about high speed rail......
We still need a more balanced approach to US rail in general. As it is, US passenger rail service is held hostage to the four-way hegemony of the largest freight carriers. Also, labor conditions are incredibly bad. Regulation itself is not bad, but it's a matter of how it's administered and the incentive structures in place. A tendency in our current politics is to decide just because something by the government goes badly, then government can't do anything at all and shouldn't even try. We can't keep being so shortsighted.
US passenger rail and Amtrak have been shackled to the same old unprofitable and uncompetitive routes they have been for decades, much like the railroad corporations were under the ICC. If things are going to change a number of there current routes need to die, yet there is less than no political will to allow that
17:00 Berkshire Hathaway invest 26 per cent for BNSF ($26bn for 100%)
Finally, American trains 🚂✊
7:48 “Ramsey pricing as it is so theroretically called-maximises ‘social value’ or whatever”
🤦 You saw the word ‘social’ and immediately decided it was communism? Look at the way it's defined:
The sum of producer and consumer surplus.