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‘It’s Going to End Up Like Boeing’: How Freight Rail Is Courting Catastrophe

By Admin

As reported by Aaron Gordon for Vice

Just before 5 a.m. on August 2, 2017, Alice Murray was fast asleep when her entire house shook, almost as if a freight train had crashed into the block, she told the Cumberland Times-News.

That’s exactly what happened.

About 30 yards away, just off Cleveland Street in Hyndman, Pennsylvania, 33 cars in a 178-car freight train belonging to CSX Corporation derailed. The train crashed into one house and damaged two others. The entire town had to be evacuated. Miraculously, no one was killed.

As scary as the derailment in Hyndman was, it could have been much worse. Of the 178 cars on that train, 70 contained hazardous material, including 15 of the derailed cars, according to a National Transportation Safety Board (NTSB) investigation. Luckily, just three of them—which contained molten asphalt, molten sulfur, and propane—either leaked or lit on fire.

The town was evacuated because molten asphalt, if released, can create vapors that, according to the NTSB, are an “explosive mixture with air.” Some of the other derailed cars contained liquified petroleum gas, and one car that did not derail contained Sodium Chlorate, which is potentially poisonous to inhale.

Like plane crashes, freight train derailments are rarely the result of a single failure. Many different things have to go wrong. Also like air travel, freight trains are a highly regulated form of transportation because of the potential for catastrophe.

And yet, freight train derailments are surprisingly common. In 2019, railroads reported 341 derailments on main line track, meaning the parts of the rail system not in yards or other work areas. Of those 341 derailments, 24 were freight trains carrying 159 cars of hazardous material, according to data the railroads voluntarily submitted to the Federal Railroad Administration. Even local news reports provide an alarming window into how frequent derailments are that people actually notice. While reporting this article, freight trains derailed on February 15 in Illinois, February 23 in Pennsylvania, March 3 in California, March 7 in Alabama, and March 11 in both Wisconsin and Minnesota.

None of these derailments resulted in any reported injuries. But according to Greg Regan, President of the Transportation Trades Department, a labor organization consisting of 33 transportation unions, these are red flags.

“If you have increases in the less significant or catastrophic derailments,” Regan said, “it reflects a degrading safety culture, and certainly leads to oversights and an environment that could lead to the more disastrous types of derailment that again grab the headlines.”

To be sure, even on well-run freight railways or rigorously regulated airlines, accidents still happen. And at first glance, the derailment in Hyndman appeared to be just another accident. NTSB investigators found the train derailed largely because of a combination of improper braking procedures and the empty cars being in the front of the train. Long trains have an accordion effect where they expand and contract as they brake and accelerate. Empty cars brake faster than heavy ones, and if the empty cars are in front, the full ones will push against them, possibly forcing the empty cars up and off the tracks.

This is not a new problem. How to properly and safely space empty rail cars amid long freight trains and how to brake so as to minimize derailments are some of the oldest and most basic safety protocols in rail operation. And those protocols, along with other rules and practices meant to ensure as safe a rail network as possible, are now being ignored for the sake of profit.

According to interviews with current and former rail workers, union officials, and independent experts, the Hyndman derailment and others like it are the all-too-predictable result of nearly all the major freight rail companies adopting a business approach called Precision Scheduled Railroading (PSR). Proponents of PSR say it is about leveraging modern technology to improve efficiency. But those who work on the railroads every day say it is little more than a euphemism for draconian cost-cutting in order to achieve an arbitrary metric that pleases shareholders. That metric, called an “operating ratio,” must get below 60 percent, which means only 60 percent of every dollar earned goes towards actually running the railroads. The rest can go towards executive pay and shareholder dividends. All but one of the seven so-called “Class I” railroad companies, which account for 94 percent of the freight rail industry’s revenue, have explicitly adopted some form of PSR.

How freight railroads are being run, and for whose benefit, is not just a railroad industry issue. It is a problem that has ramifications across the American economy. Freight rail moves 57 tons of goods per American per year. It is often the most economical, efficient, and environmentally friendly way to move things over long distances. It is also widely recognized as the safest way to move vast quantities of hazardous materials that, for better or worse, currently undergird our comfortable living standards and economic productivity.

But, as the Hyndman derailment demonstrated, moving those hazardous materials is a potential life-and-death question for communities all along the industry’s 140,000 miles of rail. And unlike our roads, bridges, tunnels, and public transportation systems, the entire Class I freight rail system is privately operated and maintained. In other words, the railroad companies themselves get to decide how much to invest in repair, maintenance and other safety measures, and how much to keep as profit.

Increasingly, railroads are choosing to boost profits and pay shareholders rather than invest in safety. In interviews with Motherboard, workers said that since their respective companies adopted PSR, they barely recognize the work that they do. All of their priorities have changed. What used to be about safety is now about cutting costs. Among the changes:

  • Workers now have to inspect many multiples more rail cars in a fraction of the time, barely giving them enough time to walk the entire train
  • Trains are longer than they used to be and assembled haphazardly, with little thought as to where the heavy and empty cars should go to avoid derailments because it would keep the train in the yard longer
  • Shops and yards that used to perform inspections along routes have been closed, meaning there are fewer inspection points
  • Routes have been changed so cars stop for inspection less frequently
  • Maintenance is deferred as long as possible
  • Knowledgeable and safety-conscious supervisors have often been replaced by businessmen who cultivate a culture of fear and intimidation around reporting unsafe equipment; doing so would keep the train in the yard longer, hurting the metrics on which supervisors are graded
  • While there are strict federal rules governing how often the people running the trains must rest so as to minimize accidents, the workers performing safety-critical inspections have been pushed to compensate for mass layoffs by working 16 hours per shift or more, discouraged from taking lunch breaks, and sometimes required to work overtime or risk losing their jobs

One 40-year veteran railroad worker told Motherboard he has never seen anything like it. “They’re just cutting everywhere, on both ends of everything.” (Motherboard agreed to not name several railroad workers quoted in this article because they feared being fired for speaking out about sensitive safety issues.)

In statements to Motherboard, neither Norfolk Southern nor CSX directly addressed any of these points. Instead, they issued broad defenses of their safety practices, pointing to aggregate safety metrics reported to regulators.

“Norfolk Southern is firmly committed at all levels to operating safely, protecting our employees and the communities that we serve,” said Norfolk Southern’s spokesman Jeff DeGraff. “Our comprehensive approach mirrors that of the freight railroad industry, including significant private investment, employee training efforts, technology implementation, regular inspections, and community outreach, which has led to dramatic safety improvements over the past two decades with respect to train accidents and employee injuries.”

Cindy Schild, director of media relations at CSX, said in a statement to Motherboard, “Safety is a core value at CSX, and while we will always strive to be better, we are proud that after implementing our new operating model in 2017 and 2018, CSX significantly improved our safety performance as evidenced by the metrics reported to our Federal regulator, the FRA [Federal Railroad Administration].”

The impact of PSR on freight rail safety appears to be one of the worst kept secrets in the industry. Workers are afraid to speak out publicly because, several told Motherboard, it would put a target on their backs at a time when one out of every four freight rail workers has lost their jobs in the last five years alone. But there is a bubbling desperation to get someone, anyone, to do something before it’s too late.

To a person, the more than a dozen workers and union officials Motherboard spoke to warned that railroads are courting disaster. Unless something is done to hinder these dangerous practices, they cautioned, derailments like Hyndman will look trivial in comparison to “the big one,” a disaster so bad it will plaster the news and snap Congress and regulators into action.

“Railroads haul the most dangerous gases in the world,” one veteran worker told Motherboard. “I do think it’s a matter of time. There’s going to be a freight car that hasn’t been inspected in 90,000 miles that comes off the track, as it goes off the track and slams into other cars, into a tank car, and either explodes or leaks poisonous gas out. It’s going to take something like that, and a lot of deaths, and then all of a sudden everybody’s going to care.”

This is not a mere theoretical possibility. This exact set of circumstances happened not long ago just a few miles across the U.S. border. On July 6, 2013, a Montreal, Maine and Atlantic (MMA) Railway train carrying two million gallons of liquid petroleum in 72 tank cars crashed into the downtown area of Lac-Megantic, Quebec. 47 people died, 2,000 people were evacuated, 40 buildings were destroyed, and millions of gallons of oil seeped into the soil and nearby river. Among the causes of this tragedy, according to Canada’s Transportation Safety Board’s then-chairperson Wendy Tadros, was “a shortline railway running its operations at the margins” and cutting corners on maintenance and training. Three lower-level employees, including the train’s engineer, were charged with criminal negligence but ultimately acquitted.

Many of the towns’ residents sought accountability at a higher level. Jean Paradis, who lost three friends in the disaster, told Canada’s Global News, “Transport Canada has let those cheap companies run railroads for less money, for making more money instead of acting for security for people.”

Now, those familiar with the rail industry stateside say the same is happening here. “It’s only a matter of time before fatigued workers, unrealistic inspection policies, and unqualified inspections result in a major incident in someone’s neighborhood,” said Jason Cox of the Brotherhood of Railway Carmen in a video posted to Youtube in early February. “I implore anyone who might be watching who has the authority to act to please act now.” As of this writing, the video has nine views.

SMART-TD union president Jeremy Ferguson, who has been involved in the freight rail industry since 1997, offered a grim warning. He compared what is occurring in the freight industry to a high-profile transportation disaster from not too long ago in which 346 people died and from an industry that, in a lot of ways, has a lot in common with freight rail.

“It’s going to end up,” he said, “like Boeing.”

“Safety Fourth”

Norfolk Southern (NS) used to be one of the safest railroads in the country. It won an industry award for safest Class I railroad 20 years in a row until the award was discontinued in 2012. Safety was always the highest priority, workers told Motherboard, but that started to change when NS implemented PSR.

In early February 2019, NS announced it would implement its own version of PSR. Although its workforce had already been declining, in order to lower its operating ratio by about five percent in two years, the railroad planned to reduce its workforce by 3,000 people.

Motherboard spoke to four NS workers who asked to remain anonymous because they fear retaliation from the company for speaking to the press. They all said these cuts have resulted in a dramatic personnel shortage, and since none of the company’s efficiency metrics measure safety, supervisors and workers are placed in the thankless position of either sacrificing safety in order to hit the numbers or do the responsible thing and risk getting punished.

Across the different crafts, workers highlighted the same general problem: in the push for efficiency, fewer workers are being tasked with more, rushed through safety-critical inspections and repairs, and are pressured not to report defects or potential safety issues that will take cars out of service and require manpower to fix.

As an example, several workers told Motherboard about car inspections. When a freight train comes into a yard, Federal Railroad Administration (FRA) regulations require the cars be inspected, with dozens of different inspection points per car to make sure the freight was up for another punishing run on the rails. When these workers first started years or even decades ago, there was no set rule about how long these inspections should take because cars are different lengths and designs vary with some having more inspection points than others. But, as a rule of thumb, carmen generally estimated it would take three minutes per car. About five years ago, NS management mandated inspections take no more than two and a half minutes per car. Some of the workers Motherboard spoke to thought this was reasonable enough.

But in the past two years, management started mandating workers spend no more than two minutes per car. Then 1.8. Then 1.5. Now, it’s 1.4, barely giving workers any time to stop and look at the car they’re supposedly inspecting, which can be up to 100 feet in length. Thanks to the staff cuts, rail yard closures and operation consolidation, workers that used to inspect perhaps 300 cars a day are now inspecting three or four times that. Company notices and presentations that used to highlight the importance of safety now talk about efficiency. In one bulletin board material, a worker said, safety was listed as the fourth most important thing, behind measures like reducing car dwell time and getting trains back on the rails. The workers have a joke around the shop floor now: “Safety Fourth.”

This forces workers into an impossible situation that can only be solved one of two ways. The first way is, as one worker told Motherboard, to lie on the inspection sheet about how much time it took per car. “Basically, our bosses now, they basically told us, just lie,” one worker told Motherboard. “Please just lie on that inspection sheet. Just lie, write bogus times, to satisfy ’em.”

The second way is to not really do the inspections, at least not properly. Management doesn’t explicitly tell workers to do this but “you’re just made to feel you’re an idiot,” another worker said, like “you’re the only one in the world who would care about this stuff, now you’re holding up the train and pushing everything back.” And it is made clear to them that if they keep holding trains back, their yard will be shut down and they’ll lose their jobs.

As a result, “normal maintenance is getting neglected severely,” that worker said. A different NS worker concurred, telling Motherboard that recently a train came into his yard with some freight cars that hadn’t received a basic walk-around inspection in 90,000 miles. Per FRA regulations, trains are not supposed to travel 3,500 miles without an inspection. He estimated about 13 out of the 60 cars had “major defects.”

The consequences of these policies are deadly. In the early evening of October 4, 2018, a Union Pacific train collided into another in Granite Canyon, Wyoming. The moving train was speeding down a hill at 50 miles per hour unable to stop due to problems with the air brakes. Both the engineer and conductor were killed. NTSB investigators determined six of the 10 cars added to the train at the previous stop were overdue for air brake testing by a period of a few weeks to two years. The NTSB concluded that, had the cars been tested per federal safety regulations, the air brake problems would almost certainly have been detected.

In a statement, Union Pacific spokesperson Kristen South told Motherboard, “Union Pacific has recognized many operational efficiencies in the past few years that have reduced the amount of equipment and resources on our network.”

Echoing many PSR proponents over the years, South asserted these PSR-esque initiatives actually improve safety. “The ability to operate trains with more rail cars results in fewer trains, reducing the potential for employee injuries and derailments. Additionally, we successfully utilized Distributed Power locomotive technology and improved train consist parameters to enhance braking ability and train handling capabilities. This technology allows for new train lengths without compromising our high safety expectations.”

South disputed claims their equipment is not properly inspected, saying it undergoes “detailed inspections, meeting federal requirements, before departing and after arriving at destinations” and leverages various technologies to supplement inspections.

The Moneyball of Railroading

Precision Schedule Railroading is the brainchild of Hunter Harrison, who by most accounts is the single most important figure in North American railroading of the last 50 years. And even he understood the dire consequences of his innovations.

In October 2017, just two months after the CSX derailment in Hyndman, Harrison appeared before the Surface Transportation Board to hear complaints from shippers about how his cost-cutting at CSX tanked service. Harrison had been receiving oxygen for some months to treat his emphysema and would die two months later.

“I got blood all over my hands,” Harrison said in a somewhat bizarre non sequitur. “From injuries in this industry that should have been avoidable. And I think these issues of safety never fall to the wayside with us. And they always will be.”

Harrison started his railroading career in 1963 as an oiler on the St. Louis-San Francisco Railway, which, like many misleading railroad names, ran in the south and nowhere near San Francisco. The “Frisco,” as it was nicknamed, was acquired by Burlington Northern (the “BN” in BNSF, a Class I railroad) in 1980. Harrison worked his way up the management ladder. He left BN in 1989 to take an executive job at Illinois Central, a railroad that mostly ran down the midwest from Chicago to Alabama and had recently been purchased by an investment group. It was here that Harrison first implemented PSR.

PSR is the Moneyball of railroading. In an industry that at the time did not run on set schedules, struggled to be profitable, and didn’t bother to measure or track many key performance indicators, Harrison brought a rigorous, data-driven approach to railroad scheduling and asset management that made them run more efficiently. Rather than run hub-and-spoke networks with inefficient branch lines, Harrison sold off unprofitable parts of the business, ran longer, heavier trains at faster speeds on set schedules and eliminated as many intermediate stops to change cargo as possible. Howard Green, Harrison’s biographer, wrote that few things bothered Harrison more than “underutilised assets.” Harrison himself wrote “If an asset isn’t used, it’s a liability” because, he believed, railroads only make money when cars are moving.

These are all solid enough management principles, but like any cost-cutting or efficiency obsessions, they have their limits. At some point, all the fat has been trimmed, all the underutilized assets sold off, and all that’s left is muscle and bone. The remainder of Harrison’s railroading career was premised on rejecting this idea, on assuring shareholders that there was always more fat to trim.

In 1999, Illinois Central was absorbed by Canadian National Railway (CN), a Class I railroad. Harrison became CEO in 2002, doing the PSR thing there, too. He left in 2009 having made CN the most efficient Class I in North America and a celebrated railroadman in industry circles.

Three years later, an activist investor from Pershing Square Capital Management named William Ackman installed Harrison as CEO at CN’s rival, Canadian Pacific Railway (CP). Harrison did a kind of PSR-Plus at CP, stepping up the cost-cutting measures, leaving CP’s operating ratio on par with CN’s.

In 2017, yet another activist investor at Mantle Ridge replicated the process at CSX Corporation, another Class I railroad, where Harrison implemented a mega-PSR. He got rid of 900 locomotives, 26,000 wagons, and aimed to slash the 31,000-person workforce by a third. Before he could do so, Harrison died in December 2017.

According to Harrison’s biographer, shareholders of the railroads Harrison ran benefited to the tune of approximately $50 billion in increased stock value. Meanwhile, as CSX’s competitors saw the writing on the wall and implemented their own versions of PSR, according to Surface Transportation Board data, the Class I railroad workforce has been cut by 25 percent since 2016.

Harrison ushered in a generation of freight railroading with many advocates. But it also has many skeptics who argue, whatever its merits may have been back when railroads were less efficient and struggling for profitability, PSR is now little more than cover for a mass corporate looting of North American freight rail.

“PSR appears to have definite advantages to some parties,” independent railway economist Jim Blaze told Rail Journal in 2019. “However, the focused cost cutting is done with a slash-and-burn zest rarely seen before by previous cost-cutters.”

In fact, one has to go back to the Gilded Age to find a similar period in railroad history. Richard White, a Stanford historian and author of Railroaded: The Transcontinentals and the Making of Modern America told Motherboard that, while the analogy is not exact, PSR reminds him a lot of the “Fast Freight Lines” of the late 19th Century, “whose goal was to keep freight in motion by moving directly between points of origin and destination and avoiding the long delays when cars were switched at division points.” There are differences between then and now; for example, that was a period where railroading was stupendously competitive and technology has advanced to the point where coordinating a continent-spanning freight network is actually feasible. Plus, the workforce now is almost entirely unionized providing protections 19th Century workers fought bitter and often deadly battles to win.

But, some of the overarching lessons from the Fast Freight era still apply. While accounting was far more primitive—and often done with cooked books—more than a century ago, the end result was surprisingly similar. As White described it, “Insiders took over Fast Freight lines and siphoned off the profits.” And that, he added, “meant less for maintenance and safer technologies.”

Just as workers a century ago were a driving force in making railroads safer for everyone, so too do workers today want reforms before disasters. The workers Motherboard spoke to said they agreed to talk because they considered it their duty to make the railroad as safe as possible. Their jobs, both before and since PSR, are to report any defects they see.

Now, things have gotten to the point where the defects are not limited to the freight cars. To them, the entire corporate philosophy is defective. And they’re worried more people will get hurt. As one put it, “if I don’t shop it and it gets a conductor hurt or a train derails, that’s on me.”

One worker framed the issue slightly differently. In much the same way workers accept responsibility if a car they inspect ends up having a defect that isn’t fixed and hurts someone, the executives making the decisions that make these types of accidents inevitable need to be held accountable as well.

Harkening back to the Boeing comparison, another worker said he thinks it’s important to speak out so executives cannot claim after the fact that they had no knowledge of what they were doing, that whatever catastrophe may occur is not “just another accident.” In case a railroad executive is ever, say, hauled before Congress to account for his actions, he wants it on the record before the fact that everyone working on the railroads knows a catastrophic derailment is “totally foreseeable.”