[Congressional Record Volume 155, Number 81 (Tuesday, June 2, 2009)]
[Senate]
[Page S5916]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   RAILROAD ANTITRUST ENFORCEMENT ACT

  Mr. KOHL. Mr. President, I rise to speak about an agreement we have 
reached with Senator Rockefeller regarding today's planned 
consideration of the Railroad Antitrust Enforcement Act. Before 
describing our agreement, I would like to say a few words about this 
legislation.
  We believe this legislation is essential to restoring competition to 
the Nation's crucial freight railroad sector. Freight railroads are 
essential to shipping a myriad of vital goods--everything from coal 
used to generate electricity to grain used for basic foodstuffs. But 
for decades, the freight railroads have been insulated from the normal 
rules of competition followed by almost all other parts of our economy 
because of their outmoded and unwarranted antitrust exemptions. Our 
legislation is designed to eliminate the obsolete antitrust exemptions 
that protect freight railroads from competition.
  This bipartisan legislation has 11 cosponsors, including members of 
both the Judiciary Committee and Commerce Committee, and was reported 
out of the Judiciary Committee on a unanimous 14-to-0 vote in March.
  The railroad industry's obsolete antitrust exemptions resulted in 
higher prices to millions of consumers every day. Consolidation in the 
railroad industry in recent years has resulted in only four class I 
railroads providing nearly 90 percent of the Nation's freight rail 
transportation. Three decades ago, by contrast, there were 42 class I 
railroads. A 2006 GAO report found shippers in many geographic areas 
``may be paying excessive rates due to a lack of competition in these 
markets.''
  The ill-advised effects of these consolidations are exemplified by 
the high prices paid by captive shippers; namely, industries served by 
only one railroad. A recent study by the Consumer Federation of America 
found that rail shipping rates for captive shippers are $3 billion 
higher than they would be if the market were competitive. These 
unjustified cost increases cause consumers to suffer higher electricity 
bills because a utility must pay for the high cost of transporting 
coal, results in higher prices for goods produced by manufacturers who 
rely on railroads to transport raw materials, reduces earnings for 
American farmers who ship their products by rail, and raises food 
prices paid by consumers.

  Repeal of the railroad antitrust exemption is supported by the 
attorneys general of 20 States and a wide range of consumer 
organizations and leading industry trade organizations, including the 
American Public Power Association, the American Chemistry Council, the 
National Farmers Union, the American Corn Growers Association, and the 
National Industrial Transportation League, as well as many more.
  Once their outmoded antitrust exemptions are removed, railroads will 
be subject to the same laws as the rest of the economy. Government 
antitrust enforcers will finally have the tools to prevent 
anticompetitive transactions and practices by railroads. Likewise, 
private parties will be able to utilize the antitrust laws to deter 
anticompetitive conduct and to seek redress for their grievances. On 
the Antitrust Subcommittee, we have seen that in industry after 
industry, vigorous application of our Nation's antitrust laws is the 
best way to eliminate barriers to competition, to end monopolistic 
behavior, and to keep prices low and quality of service high. The 
railroad industry is no different. All those who rely on railroads to 
ship their products deserve the full application of the antitrust laws 
to end the anticompetitive abuses all too prevalent in this industry 
today.
  That is why I am so pleased by the agreement that I have reached 
today with Senator Rockefeller. He has agreed to include this necessary 
repeal of the railroads' unwarranted antitrust exemption in his 
comprehensive bill to reform the freight rail industry and the Surface 
Transportation Board when that bill is introduced in the coming weeks. 
Senator Rockefeller has also agreed that his comprehensive rail reform 
bill will address a specific railroad practice that is of great concern 
to me--a practice known as paper barriers. He has pledged that his 
legislation will give the STB enhanced power to address this issue so 
that shippers are not denied the benefit of competition in relation to 
these arrangements. With this agreement, we have avoided a potentially 
divisive floor debate and we have the solid support of the 
distinguished chairman of the Commerce Committee for repealing the 
antitrust exemption and addressing paper barriers.
  I thank my friend from West Virginia for his compromise as well as 
his support for the need to reform the freight rail system in the 
United States in the interest of all parties, including rail shippers 
and consumers.
  Mr. President, I yield the floor, and I suggest the absence of a 
quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The assistant bill clerk proceeded to call the roll.
  Mrs. BOXER. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.

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