America’s leaders face difficult challenges to restart the country’s economic engine. Railroads and the broader transportation sector will be critical to the recovery.
Through investment and innovation, railroads have transformed from a crumbling relic of the 1970s to the world’s best rail freight network.
Today’s railroads can reduce highway congestion and address environmental concerns, further improve the efficiency of freight delivery and create tremendous economic growth.
The decisions of our new president and Congress will go a long way to determining if railroads are to remain on this path of progress and innovation.
Projections by the U.S. Department of Transportation indicate that the nation will experience an 88 percent increase in rail freight demand by 2035, requiring an investment of $148 billion. Railroads on average already reinvest 17 percent of revenue — well more than almost any other industry.
Following partial deregulation in 1980, and through 2007, railroads invested about $420 billion in their networks. That helped reverse a decades-long erosion of market share, supported dramatic improvements in safety and lowered average rates for customers.
A balanced approach to regulation, combined with a 25 percent infrastructure tax incentive now before Congress, would generate more of that important investment.
Other decisions will have similar far-reaching effects, including achieving a balanced energy policy that works for the environment and the economy.
Railroads offer a compelling environmental advantage for our country. Our trains can carry a ton of freight more than 423 miles on a gallon of fuel. We also haul coal, an affordable, abundant energy source that helps reduce our dependence on oil. Coal makes up 50 percent of electrical generation in the U.S. We must champion development of advanced clean-coal initiatives and other energy technologies to build available domestic energy supplies.
Just as they have faithfully spurred U.S. economic activity and development for the past 180 years, railroads are ready to help America move again.