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Rounds Wrong About Rail Congestion and Keystone XL

Among the less-than-truths Mike Rounds used in 2014 to become our U.S. Senator was his claim that we needed to build Keystone XL to free up our overtaxed rail system to haul farm commodities. Big rail operator BNSF said that was bunk before Mike Rounds said it.

But here we are a year and a half later, with no Keystone XL (and $2-a-gallon gasoline). The railroads must be jampacked, right, Senator Rounds?

BNSF Railway has about 4,800 workers on furlough nationwide, according to a company official, but just what that means for local railroad workers isn’t known.

The furloughs are because 2015 ended with an unusually low number of average weekly rail carloads in the U.S., according to data compiled by the Association of American Railroads [Victoria Lusk, “Low Rail Traffic Leads to Furloughs at BNSF,” Aberdeen American News, 2016.03.24].

Since December, BNSF has been laying off workers and spending less on new rail in response to a changing market. According to the American Association of Railroads, the volume of petroleum products hauled by rail peaked right around election time in 2014 and has declined significantly since:

American Association of Railroads, chart downloaded 2016.03.25 (click for updated AAR interactive chart)
American Association of Railroads, chart downloaded 2016.03.25 (click for updated AAR interactive chart)

And what’s going on with grain?

“(Grain) is moving like it typically would,” said Roger Krueger, Wheat Growers’ senior vice president.

That means it’s moving out of the region more quickly than it has in recent years, Krueger said. That’s because it was especially difficult to get grain out of the region in 2013-14, according to past American News accounts.

…The number of grain carloads this year is up substantially when compared to the first nine months of 2013. Numbers for that stretch indicate that between 15,000 to 17,000 grain carloads shipped on average each month [Lusk, 2016.03.24].

So Mike Rounds got into the Senate by proposing a doomed solution that wasn’t really needed. Rounds persisted in peddling the myth that Keystone XL could ease rail congestion last November when the President killed Keystone XL. Rounds was apparently oblivious to the data above and to the layoffs that lower volumes were already prompting among the big rail operators.

Mike Rounds gets another five years to fantasize in Washington. We’d better elect Jay Williams so we have at least one reality-based Senator.

9 Comments

  1. Don Coyote 2016-03-25 09:54

    @cah: The excess capacity on BNSF lines appears to not only come from a decrease in oil shipments (both Canadian and Bakken) but also from decreases in coal shipments as electric companies switch to natural gas (transported by pipeline) and a decrease in grain shipments because of lower crop yields after the 2014 bumper crops. It’s not all about the now. $2@gal gas is not forever. Oil prices will rebound (the Saudi economy can’t survive on $25 – $40 @ barrel of oil) and pipelines built today will be in place when the time comes.

  2. mike from iowa 2016-03-25 10:22

    Considering we were told we’d soon run out of oil back in 73 or thereabouts, sure is amazing how well the Saudis have done for themselves.

    A Drumpf presidency is likely to see new abuses in eminent domain takings from John Q Public to build unnecessary pipelines hither and yon,most which will be used to move the 1% extra money from all them new tax breaks Drumpf wants for his self and wealthy fiends.

  3. Douglas Wiken 2016-03-25 12:23

    What has Round ever been right (as in correct) about?

  4. Don Coyote 2016-03-25 13:20

    @mia: Peak Oil in the 70’s didn’t/couldn’t anticipate the increases in oil production brought about by the technological advances of fracking and horizontal drilling. The IMF says that the Saudis need $100 @ barrel oil to balance their budget. With very little taxation the Saudi economy derives 75% of it’s revenue from oil. Their cash reserves might last 5 years at the current rate of depletion. They do not have a very diverse economy especially with 90% of the Saudis working for the government. If too many government provided benefits are cut, the Saudi government could implode in an Arab Spring Redux.

  5. Paul Seamans 2016-03-25 14:06

    During the campaign Mike Rounds claimed that building the Keystone XL would take four unit trains off the rails for the supposed 100,000 barrels per day of Bakken Oil. A little bit of calculating by Mike would have shown him that it was less than 1 1/2 unit trains rather than 4 unit trains. Well I guess that Mike should be happy that all this rail capacity has opened up for his grain growing constituents.

  6. caheidelberger Post author | 2016-03-25 19:06

    Don, Rounds’s arguments in 2014 were certainly all about the now, about a rail capacity crunch that resolved itself. Heck, if decrease petro-hauling can put this many BNSF workers out of work right now, imagine how many more Keystone XL would have laid off? It probably would have canceled out all of its meager job creation.

  7. Mark Winegar 2016-03-25 19:35

    This story leaves one choice. Either Rounds was stupid or he was bought by BIG FOSSIL FUEL MONEY like the Koch brothers. What do you think?

  8. Darin Larson 2016-03-25 19:53

    Mark, you probably know that Mike Rounds’ father, Don, was the long-time oil industry lobbyist in South Dakota so the oil industry has had a fond place in the collective Rounds family heart, so to speak.

  9. leslie 2016-03-25 21:33

    maybe Saudis could consider taxation

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