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      Canadian Pacific train

      The Last Thing the Railway Industry Needs Is Another Giant Merger

      The only win if Canadian Pacific acquires Kansas City Southern is for freight rail's hedge fund investors, who are squeezing operating cash out of these railroads at the expense of workers, community safety, and the overall economy.

      David Segal
      Apr 07, 2023

      On March 15th, the Surface Transportation Board (STB)—the federal agency that regulates the U.S. freight rail industry—gave final approval to the acquisition of Kansas City Southern by Canadian Pacific. Approving this merger between America's sixth- and seventh-largest railroads was a dire mistake, which will have enormous economic and social costs that resound for decades.

      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."

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      Opinion
      railway safety
      Canadian Pacific

      'The Last Thing We Need': Critics Decry US Government's OK of $31 Billion Railroad Merger

      "The East Palestine disaster raised significant questions about rail safety," Sen. Elizabeth Warren said in response to the approval of Canadian Pacific's acquisition of Kansas City Southern. "Allowing this merger is a mistake."

      Brett Wilkins
      Mar 15, 2023

      U.S. federal regulators on Wednesday approved the first major railroad merger in more than two decades, a move that follows the East Palestine rail disaster and that critics warned would reduce competition, raise prices, cost jobs, and threaten safety.

      The Surface Transportation Board (STB) approved Canadian Pacific Railway Limited's proposed $31 billion acquisition of Kansas City Southern Railway Company, a merger that will create a single railroad linking Canada, the United States, and Mexico. The agency said the merger will take roughly 64,000 truckloads off the road and add more than 800 union jobs.

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