Regulators love to say they’re protecting consumers. But too often, “protection” really means blocking innovation that would improve efficiency, save money, and strengthen the economy. That is what is at stake as the Surface Transportation Board (STB) weighs the proposed merger of Union Pacific and Norfolk Southern. It’s a deal that would create the first coast-to-coast freight railroad in U.S. history, but only if the government gets out of the way.
Right now, freight moving from the Atlantic to the Pacific has to be handed off between railroads, often at clogged junctions like Chicago or New Orleans. These transfers waste time and money. The combined Union Pacific–Norfolk Southern network would eliminate those chokepoints, cutting delivery times by up to two full days. For cross-country shippers, whether it be for agriculture, petroleum, or manufactured goods, that means lower inventory costs and more resilient supply chains. For consumers, it means products that arrive faster and cheaper.
Critics and special interests vying for government intervention warn of consolidation. What they ignore is that Union Pacific and Norfolk Southern are not competitors today. They operate in separate parts of the country with little overlap. Instead, they are each other’s largest partners, exchanging around 1 million shipments per year between their networks. Allowing all these goods to transit without clogging terminals would be a huge boon.
Insofar as regulators are looking at the merger’s impact on competition, they should do so with the broadest possible lens. There is, after all, more than one way to transport goods. Railroads compete daily with freight sent by air, by sea, and—primarily—by road. Almost 3 out of every 4 pounds of freight is carried by truck. So, if rail service falters or rates rise, shippers switch modes. That’s real market discipline that requires no government intervention.
Likewise, an improvement to rail efficiency means more competition in the overall transportation market, not less.
This merger is also a shot in the arm for the economy. The companies project nearly $3 billion a year in efficiencies, a 10 percent boost in traffic by 2030, and billions in new investment. At a time when supply chains are still fragile, a faster and more integrated rail system would make American manufacturing stronger and more globally competitive.
The Biden administration embraced an expansive and aggressive use of antitrust powers, often treating corporate size and efficiency as inherently suspect. It threw out the consumer welfare standard, choosing instead to subject economic activity to the often-arbitrary whims of unelected bureaucrats. The result was a loss of innovation and economic dynamism.
The Trump administration has now both the opportunity and the obligation to separate itself from the failures of the Biden approach. The recent firing of an STB board member sympathetic to the heavy-handed approach is hopefully a positive sign.
America was built by railroads that connected east and west. Approving this merger would echo that achievement, creating a modern transcontinental system fit for today’s economy. Blocking it would mean clinging to discredited progressivism at the expense of growth, efficiency, and consumer benefit.
The STB faces a simple test. Does this deal make our freight system faster, cheaper, and more competitive? The answer is yes. Regulators should step aside and let the market work.
Brian Garst is Vice President of the Center for Freedom & Prosperity.
