Op-Ed: America can get back on track with right-sized rail reforms

For the millions of households struggling to cope with the coronavirus pandemic, keeping food on the table while saving for future expenses is no easy task. Fortunately, a recent court ruling provides a glimmer of hope that essential deliveries could become more affordable in the future.

On Sept. 30, the U.S. District Court for the Northern District of Illinois, Eastern Division, gave the rail sector a welcome reprieve from an onerous, unneeded crew size mandate enacted by Illinois in 2019. This much-needed regulatory reversal could eventually reduce shipping costs, leading to lower shipping prices for everything from personal protective equipment to food items to, yes, even toilet paper. While the court’s ruling should be applauded, policymakers at the state level can do their part to keep prices low for consumers by ditching costly crew size mandates. Lawmakers must do everything in their power to lend a hand up to Americans down on their luck.

Illinois is hardly the first state to enact onerous regulations in the name of “public safety.” Few rules have as little empirical grounding as rail crew size mandates, which require additional staff to be on board trains even if their presence is completely unnecessary to maintain safety.

In their push to tighten requirements on railroads, state lawmakers ignored rail lines that have operated successfully for decades with one-person crews. For example, the Indiana Rail Road has operated a 250-mile regional railroad across Indiana and Illinois for more than 20 years by relying heavily on one-person crews without compromising safety in the process.

The line’s executives explain that, “a one-person crew is ideal for trains that don’t need any intermediate switching or require the engineer to leave the cab for any reason,” giving rise to efficiencies and cost savings that aren’t possible with increased labor requirements. It stands to reason, then, that the recent ruling giving rail lines the green signal to operate as they see fit will result in significant cost-savings for consumers. A wealth of data demonstrates that increasing freight rail availability and flexibility can lead to significant reductions in shipping costs. According to a recent study by the consulting firm Mercator, the proliferation of rail-related shipping options near ports along the U.S. East and Gulf coasts has led to handling costs that are at least 15 percent lower than western ports bereft of rail options.

But all the facts and well-reasoned judicial opinions in the world won’t stop some states from trying to impose needless mandates. Regulators are unlikely to give up crew size mandates that easily, considering that more than a dozen states have laws or pending legislation imposing these rules. But for all the pressure to increase rail costs, there’s preciously little evidence that these measures increase safety. In fact, when the Federal Railroad Administration proposed a (now pulled) rule that would mandate two-member crews, it admitted it “cannot provide reliable or conclusive statistical data to suggest whether one-person crew operations are generally safer or less safe than multiple-person crew operations.”

Evidence to date shows that equipment and track improvements, as well as automation, are far more important to rail safety than crew size. Mercatus Center senior research fellow Patrick McLaughlin and Regulatory Studies Center research professor Jerry Ellig concluded in a 2016 analysis that declining freight accidents since the 1970s is due to deregulation that has allowed companies to invest in key capital improvements.

The simple fact is that clearing away rules is more effective in promoting safety than tacking on more costly regulations. While the District Court took a pivotal step in the right direction, judicial rulings can only do so much to thwart bad public policy.

Lawmakers across the country should consider the impact that onerous rail rules have on consumer costs and clear away these unwanted and unneeded regulations. Policymakers can help households chug along, but only with the right set of policies that can get America back on track.

By Ross Marchand
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Reposted with permission

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