Thread by Kombiz Lavasany
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- Sep 22, 2022
- #Laboureconomics #Politics
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Now that workers are reviewing and voting on a railway contract there's a railway consolidation story that is very related to the power imbalance in negotiations and coming up around here in Iowa where people are pissed at monopolies.
A Canadian company that carries products from the tar sands in Alberta is trying to merge with another railroad that will let it carry tar sand will keep moving all the way to the Gulf of Mexico even though Keystone is dead.
I learned from the strike coverage that railway companies have way too much power. Part of that is legal, the Railway Labor Act. On the books since the 1920s. But there's a lot of consolidation. Also Wall Street, which is demanding more of fewer workers so they can buyback stock.
This piece in the prospect is a really good deep look at the industry's consolidation, financialization, and deregulation. It’s a real prospect special, lots of info without being dense. prospect.org/economy/how-americas-supply-chains-got-railroaded
As @ddayen lays out here. A proposed merger of two rail major lines would allow one company to go from Canada to Mexico. As mentioned, the Canadian company already traffics tar sands products on its lines but doesn't yet connect to Southern ports, yet. prospect.org/economy/railroad-profit-making-strategy-comes-at-a-cost/
And @Pat_Garofalo has a good post that pairs well with David's piece about the awful impact of consolidation, layoffs, gutted capacity and no consideration for communities they run their trains through boondoggle.substack.com/p/stopped-on-the-tracks?r=efch&s=r&utm_campaign=post&utm_medium=email
I realized that the lines run through Iowa, and we'd be on the path to get tarsands to the Gulf. I live in Cedar Rapids, which has two other rail companies, one that is 2 blocks from my house, next to a park and an elementary school. 
Let me start off by saying that trains are great. They're much better for the environment for moving freight than trucks. There will always be trains and a train line next to us, I have zero problems with trains as a way to move products in our economy.
The issue will be that tar sands product can now travel down from Canada through Iowa to the coast. Add to tar sands that consolidation and with it comes fewer workers, doing more on existing infrastructure that no one is making them upgrade.
Way back in the day, during 2010-2011, I did some work against the Keystone pipeline. My role wasn’t important, but I did get to see people like @janekleeb working with a diverse group of people effected to push back.
With only 7 major carriers, you already see some of the issues of rail companies that don't have to do anything besides maximize profits and cut workers in order to do rake in money.
That rail line two blocks away is run by one of the other 6 carriers. If the merger happens, there’ll be one less carrier.
Even though I live in a pretty residential area of Cedar Rapids with an elementary school nearby the railroad, there are no gates on the railroad signal near me, or as it crosses some major sections of cedar rapids.
There are no gates at a bigger road in the south part of Cedar Rapids near my in-law's house, where more railway traffic flows from another major railway carrier. No one can apparently make them do it.
With the merger, you would get yet another consolidated rail line, trying to do the minimum to get its merger approved. Bigger trains, less workers. And already have safety issues as they've made cuts to be able to afford the merger. 
It's no wonder people are pissed; they see these mergers on autopilot and rigged against them and the process as their only chance to get basic safety upgrades from carriers. iowacapitaldispatch.com/2022/09/02/noise-safety-issues-make-rail-merger-a-rotten-deal-for-eastern-iow...
But the company has already politely turned down making upgrades at intersections at a smaller city in eastern Iowa that pointed out its intersections need updating for the bigger and extra traffic going through qctimes.com/news/local/govt-and-politics/rail-merger-a-disaster-of-monumental-proportions-eastern-iow...
When I moved here in 2020, I thought it was weird that there was this rail line with no gates in a residential area. Now I'm realizing everyone is doing the minimum they need to squeeze a few more bucks for their investors.
In Southern California, where my family lives near a line, they've got the political power to get walls built, gates, elevated roads over the railroad, etc.
Apparently, in Iowa, we can't get railway gates.
Apparently, in Iowa, we can't get railway gates.
Going national and political for a second, there’s no benefit to the merger for anyone except the existing shareholders. It’s bad for everyone but them to have less competition. They can control their own line.
And it’s also bad even for Republican communities in rural places— see this – the communities pushing back in eastern Iowa against the merger. Lots of Trump voters. www.echopress.com/opinion/commentary-railroad-merger-will-hit-rural-minnesota-hard
I'm a big fan of taking on monopolies. It's not a silver bullet, and many other issues matter, but it seems pretty clear that opposing a merger can get some GOP voters to take you seriously, at least in eastern Iowa and Illinois.
Shoutout to this website that I had a lot of fun playing with on seeing who owns different rail lines. www.acwr.com/economic-development/rail-maps/class-i-freight-carriers
I want to add an Iowa-sized addition to this long tweet thread about the merger. @FrankenforIowa has made the merger and the impacts of monopoly on local communities an issue in Iowa. NE Iowa was very Democratic pre-2016.
qctimes.com/opinion/letters/letter-franken-makes-sense-on-railroad-and-otherwise/article_ff51c62f-f2e...
qctimes.com/opinion/letters/letter-franken-makes-sense-on-railroad-and-otherwise/article_ff51c62f-f2e...
Meanwhile, everyone knows where Grassley stands on consolidation from the last 40 years. Could help explain the closeness of the race, beyond just age.
