Fact Sheet #6


Freight Rail

prepared by Christof Spieler, cspieler@ctchouston.org, July 31 2005. Last updated Aug 7 2005.

Why this matters

Many of the things Americans use every day travel by train. Freight trains are taking trucks off the highways, and the potential exists to increase rail's market share. But outdated rail infrastructure is causing considerable hardship for some neighborhoods.

What does freight rail carry?

Railroads are no longer the dominant form of transportation they were a century ago, and few Americans have direct dealings with railroads anymore. 40% of the rail lines the United States once had -- including the lines that once served many small towns -- have been abandoned. But the railroads are not going away; instead, they have become specialized carriers, focusing on certain sorts of traffic on long hauls. Railroads actually carry 4 times as much freight as they did in 1930. Here's what railroads are hauling today:

A third of the electricity used in the United States is generated using coal brought by train. The most important coal fields are in the high plains of Wyoming. Every day 80 trains leave the open-pit mines of the Powder River Basin and fan out across the Midwest. Each train is destined for a single power plant; when it gets there its hoper cars (100 tons each, 100 per train) are dumped out and the train returns for another load.


Most goods imported into the United States -- DVD players, T-shirts, toys -- arrive in 40 foot long steel international containers. Many of these containers, in particular those arriving from Asia at the West Coast ports of Los Angeles-Long Beach, Seattle, and Oakland, continue their journey by train. Some are destined for American population centers, traveling to Chicago or New Jersey or Houston before being lifted onto trucks bound for local warehouses. Some actually cross the continent and are reloaded onto ships bound for Europe.


The success of international container traffic lead to a boom in domestic containers, which can carry anything a truck can: paper, furniture, machine parts. These boxes are bigger than their international counterparts and lighter, since they do not have to withstand ocean storms. They can carry anything a truck can, and some major trucking companies, including Schneider and J.B. Hunt, have converted their fleets from standard truck trailers to containers. Trains are now an integral part of the trucking system, carrying loads on long hauls at the same speed as truck with lowers costs.


Before there were domestic containers, there were piggyback railcars, which carry entire truck trailers, wheels and all. The biggest railroad customer in the United States is UPs, which load trailers filled with mail-order packages onto trains. Many major UPS hubs are built next to rail yards; like the truck lines, UPS uses rail to save money on long hauls. Every Christmas the major railroads compete with each other to see which ones can make it through the peak shipping season without delaying a single UPS trailer; some regularly achieve the mark.


The products of the chemical industries -- the building blocks of plastics, fertilizers, cosmetics, and innumerable other things -- are heavy, hazardous, and shipped in large quantities: in other words, they are perfect for rail freight. The Gulf Coast is to chemicals what Wyoming is to coal, and trains leaving are full dozens of different liquids and gasses are shipped black and white tank cars and plastic pellets in grey covered hoppers.


Many building supplies arrive by rail. Most of the raw products used to mix concrete in Houston -- cement and aggregates -- come from elsewhere in Texas, and the majority come by rail.


Among the railroads' biggest customers are, ironically, car companies. 70% of the new cars sold in North America are shipped by rail. North American built cars are loaded onto huge, 80 foot long double or triple level autorack cars at the plant; foreign cars are loaded at the docks. They then travel to regional distribution hubs where they are loaded onto trucks destined for dealerships. Many of the parts of automobiles, from seats to coils of steel sheet, come to the plants by rail.


Every fall, farmers across the Midwest and the Great Plains bring grain to massive elevators where it is loaded onto trains. Some are destined for bakeries and breweries to be made into bread and beer; others go to ports like Galveston for export.


The railroad industry

Freight railroads are the only major form of transportation in the United States that does not use government-built infrastructure. Railroads are private, for-profit corporations that build, maintain, and operate their own tracks; nevertheless, they pay gas tax and property taxes.

The North American freight railroad system is dominated by six major railroads: Canadian National and Canadian Pacific serve Canada and the upper Midwest; Norfolk Southern and CSX serve the United States west of the Mississippi; and Union Pacific and BNSF serve the western U.S. These railroads are the product of a series of mergers over the past 50 years; a handful of medium-sized regional railroads escaped consolidation or were spun off from the major railroads. The rest of the industry consist of small and usually lightly trafficked short lines serving small towns or industrial areas. Most were spun off from larger railroads which found those lines unprofitable.

Historically, U.S. railroads were heavily regulated. Those regulations, created when railroads were a monopoly, were finally lifted in the 1980s. The result was a revival in the industry which lead to more aggressive marketing and new traffic flows. Today, despite the yearly investment of million of dollars in new locomotives, tracks, yards, and signaling systems, many key rail lines are running at capacity.

Despite their successes, railroads do not have the money to build new routes or significantly improve all but a few lines. Railroads compete against taxpayer-subsidized trucks and barges; as a result, their return on investment is small.

Neighborhood impacts

On a regional level, railroads are among the most environmentally friendly of transportation modes. Railroads use a tenth of the fuel and as trucks to haul the same cargo the same distance and produce a third of the emissions. Trains are also significantly safer then trucks.

On a local level, though, railroads are often a nuisance. Because railroads do not have the money to build new routes or rebuild existing ones, trains today use lines built in the 1920 and earlier. Since then, cities and towns have grown around those lines, often with little regard to accommodating the rail lines. As a result, houses are built right up to busy rail lines, and most streets cross those lines are grade, with only as set of crossing gates to separate cars and trains. These problems are exacerbated by congestion on the rail lines themselves, as trains wait for other trains.

The impacts of trains on neighborhoods include:

Some of these problems are the fault of the railroads, which have not always been good neighbors. Better efforts towards cleaning up around tracks, replacement of locomotives with newer, quieter models, operating plans which take steps to avoid parking trains in residential areas, faster response to stalled trains or broken crossing gates, and better communication with neighborhoods would help. Nevertheless, many of the problems are inherent in the system. These can only be solved in one of two ways:

Towards a rail policy

Historically, the United States has never had a real transportation policy. Instead, there are agencies devoted to streets, agencies devoted to highways, agencies devoted to ports, agencies devoted to inland waterways, agencies devoted to airports, and agencies devoted to rail transit. Grouping some of those agencies under departments of "transportation" has not resulted in any planning that recognizes that different modes interact and complement each other.

When it comes to railroads, government policy has focused on only two areas: safety regulation and anti-trust protection. Historically, there have been no continuing efforts to consider railroads' role in the transportation system or even to reduce the impact of railroads on neighborhoods.

In recent years, though, various levels of government have made significant efforts on freight rail issues:


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