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Pennsylvania is truly blessed, with our land abundant with timber and agricultural products, as well as the mineral wealth in the form of coal and natural gas below. And with one of the largest manufacturing industries in America, a competitive and affordable railroad system is vital to Pennsylvania's economy. It helps empower farmers, miners and the entire state to prosper in the manufacturing marketplace, getting our products across the nation and beyond. America's railways are the backbone of our nation's economy as they provide safe, cost effective and energy efficient transport for a vast variety of raw materials and finished products to destinations across the United States. A single freight train can replace more than 50 semi-trucks, alleviating traffic congestion on our roads and highways.
Union Pacific (UP) and Norfolk Southern (NS), two of the biggest U.S. railroads, want to merge. If the Surface Transportation Board rubber stamps it, the combined companies would control almost half of the national freight market. This raises valid concerns about reduced competition and monopolistic pricing. The loss of competition in a marketplace almost always leads to higher costs for those most dependent on the provider.
Shipping goods could become more expensive, supply chains could face disruptions and delays, and goods could end up costing more for consumers. The rural farmers in our agricultural industry already operate on thin margins. Our supply chains run on a strict timeline, and if disrupted, farmers could face revenue losses. Potential revenue losses from Pennsylvania's vital manufacturing sector could impact jobs. Consumers will eventually get hit with higher costs for necessities like groceries, housing and energy.
As a member of the Grange, unfortunately, this challenge is nothing new. In the mid-1800's, after ceding wide swaths of farm and public land to fuel railroad expansion, owners of these freight companies could charge exorbitant fees for their service, as there was little alternative. After persistent agitation by the National Grange, Congress enacted regulations and restrictions, known as "Granger laws" in the 1870's to protect farmers from price discrimination, secret rebates and monopoly control by railroads. Today, my goal as the leader of the Pennsylvania State Grange remains the same: keep railroads competitive to safeguard our mining and agricultural laborers' economic well being.
The Surface Transportation Board (STB) has the final say in this matter. It properly rejected the merger as incomplete in January, but round two is coming. When the companies refile, the STB must remember the great risk posed by a massive merger to workers, consumers and local economies. The Pennsylvania State Grange joins the many other commodity and farm groups standing in opposition to history repeating itself, and enabling the creation of another railroad monopoly.
Mark Espenshade is the Pennsylvania Grange President.