Consumers would be poorly served by the Railway Safety Act

Despite no conclusions yet from the investigation into a recent high-profile freight train derailment, a bill has been proposed in Congress to fix the still-undetermined problem. As lawmakers rush to act without knowing what causes accidents the Railway Safety Act of 2023 proposes several special interest handouts and expensive requirements that will raise prices for consumers and reduce the investment in freight rail safety.

The first handout is the requirement for two-man crews on freight trains. This has not been shown to increase safety, and in Europe one-man crews operate trains without additional risk. While crew size is not a safety issue, crew size regulation is valuable to unions, and it comes at a cost to the consumer.

Specifically, that regulatory requirement would remove the two-person crew issue from the bargaining table when unions and railroad companies negotiate terms. While unions may welcome this because it puts pressure on railroad companies to offer other negotiated concessions in return, in doing so it raises shipping costs — costs that are passed on to consumers and business through higher prices.

Another handout to the unions of the Railway Safety Act will require not only more inspections of the train car, but that the inspections are carried out by hyper-specific union members. Current policy allows cross-pollination of functions.

It’s not clear how this would improve safety more than inspecting non-union workers on rail cars, but it could also give unions an advantage when negotiating with railroad companies by eliminating on the issue from the bargaining table, such as two-man crews. It will also prevent greater adoption of technology-driven inspections, which are of course more effective than manual inspections alone. As before this cost increase does not increase safety but instead reduces the speed of delivery and instead increases the cost of delivery, which ultimately comes out of the consumers’ pockets.

The proposed bill would also impose restrictions on train length, weight, car type, route, speed, tracks, and maintenance. As ever, the increased costs and lost revenue from these provisions will raise the price of shipping and, ultimately, the price everyone pays for the goods.

In addition to raising costs, these handouts and restrictions can be counterproductive and risk making shipments more dangerous. The increased cost of rail shipping from these regulations reduces safety by moving rail freight to trucks. Truck-based shipping is a more dangerous mode of freight transportation than rail shipping resulting in 16 times more deaths during hazmat transportation from 1975 to 2021. It also resulted in an increase of pollution and the associated costs we bear. Consumers are stuck with higher costs, more risks, and accidents from shipping by trucks, and more taxes to pay for more wear and tear on public roads and bridges.

Higher operating costs mean less revenue to reinvest in technology and infrastructure. Investment, in fact, has been shown to be the key to improving rail safety. Compounded year after year, rising costs reduce cashflow and cut off historically strong re-investment, ultimately resulting in a system that is less secure than it would otherwise be.

Despite recent news stories US freight rail is the safest it has ever been and continues to improve. Before jumping to conclusions, Congress should wait to get the actual findings of investigations into recent accidents, avoid giving handouts to special interests, and avoid costly necessary to increase the prices of everyday goods.

It makes no sense to reduce investment in freight rail in the name of “safety.” This is a bad bill for consumers.

Steve Pociask and Justin Leventhal are with the American Consumer Institute, a nonprofit education and research organization. For more information about the Institute, visit www.TheAmericanConsumer.Org or follow us on Twitter @ConsumerPal.