re: #351 oaktree

If you read the history railroads are not any sort of natural monopoly. In a fully developed industrial complex where the capital needed to break into the market is semi-astronomical it becomes a lot more entrenched. And rail transport is very heavily regulated and rate restrained as it is.

I still think rail is a natural monopoly in the same way that highways are: it doesn’t make sense to build two competing highway systems - you raise a tax, build the road, and everyone benefits. Running a rail transport system then becomes a thornier issue than the roads, because it’s harder for multiple small carriers to share a rail line, whereas truckers can just hop on and off the highway.

And as a reading of the history of the Transcontinental Railroad indicates perhaps there is some leeway to give the owners of the SP (and the UP to some degree) to charge high rates given the capital risks they took to get the railways initially built.

I somewhat agree. On the other hand, I would be really interested, if it were possible, to map out what happens to people who start off with a bunch of money, and invest in highly risky ventures - what are the success/failure statistics, and what does “failure” actually mean (do you end up on the streets a la Trading Places)? I’m not saying it doesn’t happen, but when I hear about “high capital risks” I am a bit skeptical by default of what the worst case scenario for these wealthy investors is.