WASHINGTON, DC, Feb. 3, 2015 (Press Release) -Edward R. Hamberger, president and CEO of the Association of American Railroads today told a U.S. House of Representatives Transportation and Infrastructure Subcommittee that the freight railroads operating in the U.S. are the best in the world and this global superiority is a direct result of a balanced regulatory system that allows railroads to spend record amounts of private capital used to maintain and modernize a nationwide rail network that benefits shippers and consumers alike.
The freight railroads' massive private spending - estimated to be a record-setting $29 billion in 2015 - is key to keeping economic recovery on track and enhancing the country's global competitiveness, Hamberger noted. Since the rail industry was partially deregulated in 1980, it has spent some $575 billion, or roughly $79 million a day, enhancing and upgrading the country's rail network, he said.
"The last thing this country or taxpayers need right now are policies that discourage private investments and spending. At a time when government is looking for monies to shore up infrastructure across the land, America's railroads are doing their part," Hamberger said. "They operate almost exclusively on infrastructure they own, build, maintain and overwhelmingly pay for themselves. That's in stark contrast to trucks and barges, which compete against railroads for freight traffic, but mainly use infrastructure supplied and paid for by taxpayers.
"The public interest is best served by polices that let the market work and incentivize investment while avoiding those which discourage investment. The demand to move goods will only continue to grow, and it's critical that the freight system be able to make the investments necessary to meet this demand."
Hamberger, reacting to proposals floated by some shippers both on Capitol Hill and before the Surface Transportation Board that would cap railroad earnings and hamper future ability to make necessary service and safety investments, said the recovering U.S. economy cannot afford to lose rail's annual private investments. He told the Subcommittee on Railroads, Pipelines and Hazardous Materials that as rail traffic grows, the energy sector continues to expand and more shippers choose rail for its inherent efficiencies, adequate earnings over the long term are critical to make the capacity investments needed to meet American businesses' demands and propel the economy forward.
"Railroads provide a vital link for our farmers, manufacturers and resource producers to the domestic and global marketplace, but the challenges of creating, maintaining and operating a rail system capable of meeting present and future needs will require the benefit of effective public policy," Hamberger added.