The Last Thing the Railway Industry Needs Is Another Giant Merger

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'The only win if Canadian Pacific acquires Kansas City Southern,' writes DavidSegalRI of DemandProgress, 'is for freight rail's hedge fund investors.'

David Segal is co-founder and executive director of Demand Progress, a million-member civil liberties and civil rights organizing outfit.

In a nation committed to a competitive market, in a sector that's already as consolidated as American freight rail, it's important to evaluate mergers very carefully, because once big companies absorb smaller ones, it becomes impossible to pull them apart again. And as economics researcher Eric Peinert of the American Economic Liberties Project puts it,"Nothing in the history of rail consolidation suggests this particular merger is a good idea.

investors continues to mount, it will likely contribute to even more aggressive cuts in service than we have seen over the past five years.about the merger, from industry experts, researchers, lawmakers, and the general public—hundreds of them laying out reasons why it shouldn't get the green light. On behalf of people across America, U.S. Senators and Representatives weighed in with their concerns, which the STB ignored.

 

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