Across the American heartland, there is no more silent yet effective power industry that that of private freight rail. It’s silent because millions of consumers depend on it to have their goods and supplies move from factories to their front door steps. Effective because it does it while most of us are blissfully unaware.
The privately owned network of commercial train tracks laid out across the United States runs 140,000 miles, hauling more than 1.6 billion tons of commodities and goods a a year. It moves raw materials and finished products from ports to factories, warehouses, and distribution hubs, forming the critical “middle miles” that ensure affordable access to everything from online orders to groceries.
But despite its reliability to consumers and businesses that rely on it, outdated regulations threaten to stifle progress, threatening higher prices across the entire supply chain.
Existing restrictions, impracticable labor rules, and bureaucratic requirements imposed on freight rail firms have subjected the industry—and those who depend on it—to an unpredictable regulatory regime more akin to central planning than a robust system of free enterprise. As we’ve learned from rail regulation history, this is a lesson we must heed again.
One hopeful avenue is the use of better technology to save costs, improve safety, and deliver faster trains to depots and exchanges.
As the Washington Post writes, technological advances in automatic track inspection, in particular, are moving quickly and recently received a temporary waiver from the Department of Transportation:
U.S. railroads have been developing automated track inspection (ATI) for years. These systems get mounted on the bottom of an ordinary locomotive or railcar. They use lasers to precisely measure tracks without special trips by workers to inspect them. They flag any defects in real time and dispatch maintenance workers can arrive exactly where they are needed.
Allowing full adoption requires updating archaic regulations. The Federal Railroad Administration (FRA) has in the past waived some of the manual-inspection rules for railroads to test ATI, including during President Donald Trump’s first term. The data showed safety results as good or better than manual inspections.
The Biden administration declined to extend the waivers after the union that represents maintenance workers opposed an extension. Naturally they want to maximize the number of dues-paying members slogging around on the tracks. But if these track inspections can be done better with smarter technology, they should be – regardless of union distortions.
Though Transportation Secretary Sean Duffy and Federal Railroad Administration’s Railroad Safety Board issued a five-year waiver to rail firms in December to allow the technology to be used, a more permanent solution is still wanting.
To reimagine and innovate railroad policy, we at the Consumer Choice Center advocate simple proposals that increase competition, generate investment, and pass lower costs to consumers. Providing regulatory certainty for new technology that may challenge labor concerns is one of them. Others are more structural.
Reforming the common carrier obligation, as we wrote about in our policy primer, by limiting or eliminating it, would grant rail companies flexibility to adapt to market demands, invest in modernization, and compete effectively—benefiting the economy and consumers. Lastly, amending the STB Reauthorization Act to redefine the STB as a remedial agency, resolving disputes and promoting competition rather than creating policies, would also be a big win.
The 21st century demands evolving regulatory practices to match transportation competition. As countries like China modernize rapidly, the U.S. must deregulate to stay ahead, ensuring a productive, consumer-friendly future.
For more ideas and policy proposals, check out our policy primer on The Consumer Case for Reimagining and Innovating Railroad Policy and our video below:
