How the train industry could change after the Ohio disaster

A train on a track is seen through a chainlink fence as the sun sets.
A Norfolk Southern train passes underneath a bridge in East Palestine, Ohio. | Michael Swensen/Getty Images

The Ohio train derailment has put a spotlight on freight companies, rail safety, and how to prevent the next environmental disaster.

Railroads are a fixture of the American landscape: There are about 140,000 miles of track in the United States. But most people don’t think of the trains running through our towns and cities all that often.

“It was just a means of transportation for moving goods from one point to the other,” Wayne Bable told Vox’s Benji Jones last week in East Palestine, Ohio. “I mean, the trains are every 15 minutes on a regular basis. So it’s just part of life. … After a while, you don’t hear them. We sure hear them now.”

It was the dramatic derailment of a train last month in his small town that changed Bable’s awareness of that regularity. On February 3, a Norfolk Southern train carrying hazardous materials derailed near East Palestine. In its wake, concerns have been raised on the environmental impacts of the spill, and over the trains and how they run.

Action in Washington has been relatively swift. There’s now a bipartisan effort to address railroad safety, and Norfolk Southern’s CEO testified Thursday before Congress.

The derailment and its fallout raise a lot of questions about the rail industry, its profits, and deregulation. But in order to understand the regulatory landscape, we first need to know how the modern rail industry functions. To talk about that for an episode of The Weeds, we called Joanna Marsh, a senior staff reporter at FreightWaves, which covers freight transportation. And for a better understanding of the policy solutions, we talked to Washington Post transportation reporter Ian Duncan.

Below are some of their answers to our big questions about the state of railways and the railroad industry. Host Jonquilyn Hill’s questions and the reporters’ answers have been edited for length and clarity. There’s much more in the full podcast, so listen to The Weeds wherever you get podcasts, including Apple Podcasts, Google Podcasts, Spotify, and Stitcher.

Who are the big players in the modern railroad industry, and how much stuff are they moving?

Joanna Marsh: There are a lot of railroad companies operating in the United States. According to the Federal Railroad Administration, there are over 800 freight and passenger railroads. That includes subways and commuter rails and Amtrak. But you still have hundreds of railroad companies.

There are three economic classes of railroads. You have your smallest companies, like mom-and-pop operations. They serve the small towns, like companies or shippers that might be there if you want to transport crushed stone somewhere or farmers who want to sell their soybeans.

And then you have a slightly larger size, which means they make more money and they generate more revenue. Those include small railroads that might cover a wider territory, or they might include companies who have several of these smaller rail assets throughout the country or in a certain region. These two kinds of railroads are called short line railroads.

The last category consists of the biggest railroads, and they’re the ones who have thousands of miles of track, who make millions of dollars, and who spend millions of dollars. And they’re called the Class 1 railroads. There are seven of them right now in the United States and Canada … all of them except BNSF are publicly traded.

The bulk of freight goods are transported by truck, but rail handles a sizable portion of it as well. A lot of what rail handles are bulk commodities and things that you might not necessarily need right away. So things like coal or grain, or energy products such as ethanol or crude oil. Other commodities that the railroads carry include automotive parts and vehicles. Those components kind of go back and forth between the US and Canada and Mexico. So your car might have parts that are produced in Canada and the US and is actually put together in Mexico, and then [it] goes back into the US via train.

And there is also a type of rail car called intermodal cars or intermodal containers. Those are ones that carry your import goods, things that might come from the ports, inland.

How often do freight trains derail? Is East Palestine an outlier?

Joanna Marsh: Train derailments among the Class 1 railroads actually happen quite a bit.

Between January and November 2022, there were 818 train derailments reported to the Federal Railroad Administration out of 1,049 total. That number is actually slightly lower than 2020 and 2021 numbers, which are hovering around 870.

It’s interesting what happened in East Palestine as well, because it’s not an unusual cause to have overheated bearings.

Part of the reason you don’t hear about derailments as much is because they might be occurring in places where there just aren’t very many people around.

Part of it, too, might be that the derailment isn’t as flashy, like it might not have resulted in multiple cars derailing or what derailed didn’t cause tank cars to heat up their chemicals and cause an explosion.

There are various reasons why derailments occur. One could be how the track has been maintained. Another reason could be mechanical issues with the rail cars.

Looking at this [East Palestine] train derailment, even though this happened on Norfolk Southern’s track and it was a Norfolk Southern train and the wayside detectors of the hot box detectors are owned and operated by Norfolk Southern, the rail cars themselves are actually not owned by Norfolk Southern.

Norfolk Southern inspects the train to make sure everything looks okay. But who is actually liable for the rail car is kind of to be determined.

Most rail cars are owned by either rail car leasing companies such as Trinity Industries or GATX. The other kind of rail car owners are companies — or shippers, as people call them: your chemical manufacturers or your plastics producers or your grain producers or your coal companies.

How are railroads regulated?

Ian Duncan: So the regulation of railroads goes back to the 19th century, because it’s obviously one of the oldest big industries in the country.

The modern era, starting in the 1980s, has been about deregulation. That’s where we get to today, where there is federal oversight, but it’s reasonably limited and a lot of it has to do with safety measures.

There is a part of the US Department of Transportation called the Federal Railroad Administration, and they have the power to set safety rules for the railroads. It’s a little bit like the Federal Aviation Administration for planes, but they’re not running the air traffic control system in the same way. They do some hands-on stuff, they do some inspections, but it’s mostly about setting safety rules.

There’s a body called the Surface Transportation Board, which has some commercial oversight of the relationships between railroads and their customers. And there was some kind of attention on that last year because there was a lot of tension about the service railroads were providing to their customers. But it’s fairly light touch regulation there.

Why does the federal government have such little oversight of railroads? What rules are in place?

Ian Duncan: Transportation in this country … used to be much more tightly controlled.

In aviation and in railroads, you’ve seen deregulation, the idea being that with the railroads, they were struggling financially. And so you had attempts to kind of free them up and help them turn into more viable businesses. And if you talk to the railroads, they would say this has been a period of real growth and financial success and that that’s good for the country because they’re providing this vital service to get goods where they need to go.

There are rules around inspection of tracks and standards for maintaining tracks and equipment on railroads.

I think the big thing that’s come into focus in the last decade or so and certainly in the last few weeks has been around how a special kind of train that’s called a high-hazard flammable train is regulated. They’ve come to be seen as particularly dangerous, full of chemicals that potentially can burn or explode. And so there you have a system of laws like speed limits, braking standards, much more detailed regulation about what the railroads are required to do.

What is the role of lobbying when it comes to railroads?

Ian Duncan: It’s a pretty consolidated industry, so that gives them a reasonable amount of power in Washington. They have an association that also represents them. What we’ve seen in this period where there’s been interest in trying to set new safety standards is that the railroads will often lobby against that.

Their argument is that it’s a period of technological change in the industry, and so if you write rules right now, they might be outdated by the time that they’re put in place.

The Obama administration made some efforts to tighten the rules. But the Trump administration was interested in deregulation especially when it came to transportation. They looked for opportunities to walk things back. The guy who ran the Federal Railroad Administration during the Trump administration had worked as a railroad executive. They were able to get some rules rolled back.

How quickly is railroad technology moving?

Ian Duncan: An example: There’s technology that can automatically check basically the health of tracks. It’s pretty new. The industry thinks this is much better at finding potential problems on tracks that can lead to derailments or other kinds of accidents than human inspectors. And so they’ve been trying to get permission to walk back the number of visual inspections that they do and rely on this technology. The Biden administration allowed some testing to go on. But what they’ve been saying since the derailment in East Palestine is you can do both. You don’t need to get rid of the human inspections in order to use this technology; let’s do both. But the industry obviously also has a kind of commercial incentive to try and use technology that might be cheaper than having people do the work.

Another one of the big disputes currently is how many people need to be on these trains. The standard at the moment is an engineer who essentially drives the train and a conductor who’s responsible for keeping tabs of what’s on the train.

That was reasonably astonishing to me, when you think of just the size of these vehicles. … There used to be five [people]. But the unions that represent these workers on the railroads are worried that the railroads are looking to go down to just one person, just an engineer, and then maybe having someone following in a truck or on the ground.

The union’s view is that you can’t cut this back, that these machines do only work as well as the people. But the industry has seen it’s been able to cut the crews before and I think is interested in seeing if you can go even further.

What are pneumatic brakes, and were they a factor here?

Ian Duncan: This was a huge dispute. It’s really more of a political dispute than an actual dispute. It gets back to this issue of deregulation during the Trump administration.

The current emergency brakes have an air hose that sort of connects between all the cars on a train. So when it’s tripped, that signal kind of pulses down the train, so that all the cars aren’t having their brakes applied at the same time. The electronic brakes would be designed to have this kind of immediate braking on all the cars.

The history is pretty tangled here, but basically the Obama administration wrote a rule and said they should be required on these high-hazard flammable trains. And Congress stepped in and said you need to have another look at that. We’re not convinced. Under the Trump administration, they tried to figure out what would be the cost to the railroads of installing these brakes and what would be the benefits in terms of preventing accidents. In their view, it didn’t pencil out, so they repealed that requirement.

The train that derailed in East Palestine was not one of these high-hazard trains. It didn’t meet the definition. And so even had the rule been in place, it wouldn’t have had these brakes on and then there would have been a question about would they have helped stop it? Maybe they would have. But we just won’t know.

What policy proposals are emerging now that could make railways safer?

Ian Duncan: So there’s a few things, and we’ve seen movement on some of these already.

The sick leave thing. [Transportation Secretary Pete] Buttigieg has cast that as a safety measure. Essentially, if you have workers who are exhausted, who are ill and can’t take time off to get medical care, they’re not going to be working safely. Some of the railroads have sort of made some steps toward offering leave.

And then the other thing that happened is that there’s a close call reporting system that’s run by the government, and that is something that the government sees as a way for workers to kind of come forward and confidentially report safety risks without feeling like there’s going to be reprisals. The big freight railroads had resisted that. The administration came down pretty hard and said that we really want you to join this. And so they’ve all agreed that they will do that.

I think, looking forward, the big dispute that was already playing out before this derailment was this question of crew sizes. The unions really want to get a floor set at two.

There was a bill that was introduced after the derailment that includes that idea. There are some questions about, “Could we set standards for a type of technology that is along the tracks and is designed to detect problems on the train?” — in this case, bearings that are too hot on the trains — and they did that too late. And so could we space them out differently? Could the thresholds at which they send a warning to the crew be changed? There’s interest in putting that into law.

The other big thing that Secretary Buttigieg just called for in this legislation as well is to increase the fines for when railroads break these violations. They cap out at around $200,000. These are companies that make billions and billions of dollars. Buttigieg has said that’s just no kind of deterrent to them. And so, again, that legislation would also ramp up the maximum fines pretty dramatically potentially.

What are the politics of getting anything done here?

Ian Duncan: [The train derailment] took on this political life. A lot of that has been focused on Buttigieg, and I think a big reason for that is that he’s kind of an unusual person to be transportation secretary. This is an office that — they’ve faced crashes and big disasters and things in the past, but it hasn’t been led by someone who was so political and is presumed to have continuing political ambitions. And so Republicans in Congress had already been looking for opportunities to criticize him. Especially with air travel, winter was pretty messy. And so they tried to lay some of that his door — some of it, I think reasonably so. The question was where is he? Why hasn’t he showed up?

It is interesting to see this kind of two-track political response, because [Republican Sens.] J.D. Vance and Marco Rubio, for example, have been some of the loudest critics of Buttigieg over all of this, and yet they’re sponsors of this legislation that does a lot of the things that he’s also been calling for. So when you get down to specifics, there seems to be maybe some room for agreement.

For more on the policy solutions being explored and the political obstacles to getting anything done, listen to the full episode on your favorite podcast app.

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