PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

Kerrigan in Real Clear Markets: Rail Deregulation – A Success Worth Celebrating and Learning From

By at 14 October, 2020, 7:50 am

In an October 14 Op-ed in Real Clear Markets, SBE Council president & CEO Karen Kerrigan reviews the success of rail deregulation 40 years ago, and the lessons Congress and policy makers can learn from this critical effort that saved an industry.  As Kerrigan noted in the piece, the Staggers Rail Act turned 40 on October 14, which helped to revitalize and modernize the railroad industry. This is an industry that also drives economic activity for companies large and small. Freeing up the industry, allowing it to make its own decisions on pricing, routes, and shipper contracts, for example – in essence, being able to make decisions based on market conditions – was critical to investment and rejuvenation:

“For sectors like railroads, pipelines or even broadband that pay for their own infrastructure, possessing the freedom and flexibility on these type of decisions are essential to operations, resiliency and survival. Investors put their financial capital in companies and industries where there is a sound possibility of returns. When government limits activity and returns via intrusive regulation, an industry begins to crumble.

The Staggers Act helped to revitalize and modernize the railroad industry, which also drives economic activity for companies large and small. In the coronavirus era, railroads are playing an integral role in growing e-commerce, an increasingly vital lifeline for U.S. small businesses. As lawmakers continue to wrestle with big policy questions related to markets and competition across sectors, especially with regard to policy that will drive economic recovery and growth, they need to look at rail deregulation for important lessons.”

Read a brief history of the Staggers Act, and lessons learned in the full Op-ed here.

 

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