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Affirmative answers: Non-unique: Railroads hurt now ..................................................................................................... 2
Affirmative Answers: No Link ................................................................................................................................................................................ 4
Affirmative Answers: Bottleneck Link Turn .......................................................................................................................................................... 5
Neg Updates: Railroads growing now ................................................................................................................................... 7
Neg Updates: Food Prices Impact ........................................................................................................................................................................ 11


and rail-industry stock prices were battered on Wall Street.The Surface Transportation Board. Wadewitz said that while the financial effect for CSX is minimal. could hurt historically strong railroad pricing. the nation's largest power producer. While other goods remain on hold. It might also lead to more companies filing rate disputes against the railroads. Christopher Rugaber.08... spokeswoman Melissa McHenry said. Most electric utilities also purchase coal through long-term contracts at prices set well before the floods hit. coal shipments. analysts said.S. Union Pacific spokesman Donna Kush said three of the six lines knocked out by floodwaters on Friday are still out of service.forbes.html A regulatory ruling that said CSX Corp. Union Pacific also said "network outages and disruptions" will reduce its second- quarter earnings by about 5 cents a share. accessed 7/28/08 Union Pacific. an economic regulatory agency affiliated with the U. on Monday ordered CSX (nyse: CSX . http://seattletimes. American Electric Power..people ) to reduce its rates and pay fines to DuPont (nyse: DD .html. the railroad is pushing through carloads of coal because it's needed to maintain the nation's power supplies.01. said Tuesday the floods' effects will reduce its quarterly earnings. The STB said the reduced rates and fines could reach $3 million over the next five years. Department of Transportation. That will limit the floods' impact on the prices paid by utilities. Meanwhile. several major railroads have either closed lines or are reporting delays of up to three days on shipments of all types of . That will put Union Pacific's profit toward the lower end of its prior estimates between 90 cents and 98 cents a share. Power producers say the disruptions aren't yet causing shortages of coal supplies because they maintain stockpiles in case of such disruptions.S.people ). freight railroad. Extensive flooding in the Midwest has disrupted railroad networks and delayed coal shipments at a time when tight supplies already have. has "weeks" of coal reserves on hand. the largest U. 2008 Midwest flooding disrupts railroads. the ruling leaves the door open for other challenges to small shipment pricing across all North American June 18. Forbes July 1. including coal and petroleum coke — derived from oil products and used as fuel — make up 20 percent of Union Pacific's total shipments. Energy-related products. was charging "unreasonably high rail rates" to ship chemicals for DuPont Co. http://www. a JPMorgan analyst said Tuesday. Analyst Thomas .RAILROADS D/A MUDI 08 Affirmative answers: Non-unique: Railroads hurt now (_______) Recent court rulings on railroad charges are hurting 2 . according to a regulatory filing. (_______) Recent floods have hurt shipments of coal. 08 Sector Snap: Rate ruling seen hurting railroads Associated Press 07.

Friday's The meeting comes as unemployment report is expected to show another 70. chief meeting/story.S. "The bottom line is that we are not yet near a bottom in the labor market.marketwatch. wrote in a recent report. Market Watch. economy.S. according to analysts polled by MarketWatch.RAILROADS D/A MUDI 08 US Economy Plummeting Britt 7-28 Russ. economist for Deutsche Bank. Obama plans key meeting”.4% drop during the month of May. 3 .3% during April." Joseph LaVorgna.aspx?guid=%7bE6000563-8EDA-4B74-A13E- 36334D1FD72D%7d&dist=msr_1&print=true&dist=printMidSection more gloomy economic data is expected to hit. “As economy worsens." Home prices also are expected to show a 16. 2008 http://www.000 jobs leaving the U. according to Lehman Brothers. "This should keep downside risks to the economy in place for some time. July 28. The Case-Shiller index showed prices dropped 15.

railroads spent little on expansion. is not being buried in landfills (a good thing) but instead is compressed into large chunks. build freight yards and buy locomotives. from ports to major cities. http://mjperry. The growth in freight volume has slowed along with economic growth. Dr. but in the United States the average mouthful of food. Railroads say a load can be moved by rail using about a third as much fuel as it takes to haul it by truck. because it depends on cheap fuel. they say. driver shortages and highway congestion.S. as operators speed their lines and logistics companies build huge warehouse areas along routes. February 16. for instance. and sold to consumers here. For the Outpost Wednesday. Wood July 9. Tight capacity on major routes enabled railroads to raise prices. economy and Asian imports surged starting in 2003. railroads are moving finished consumer goods. But since 2000 they've spent $10 billion to expand which is based on hauling stuff for long distances. professor of economics and finance at U of Michigan. 4 . accessed 7/28/08 For decades. And rail transport is becoming more efficient still.php?option=com_content&task=view&id=20823&Itemid=2 7. 2008 Wilbur Wood. Perry. (________) Other industries. which has struggled with rising fuel prices. such as trade from China. Railroad operators are pressing for advantage over their main competitor. loaded onto railcars (also a good thing. economy.S. increasingly. are key to railroads. since railroads haul stuff more efficiently than trucks on highways) and sent to ports where these containers of garbage are stacked in ships bound for China. even tore up surplus track and shrank routes. Mark J. but shippers say they're still planning to increase their use of rail transport because of the cost. often made in Asia. Now.S. 09 July 2008 http://newbillingsoutpost. and they have $12 billion more in upgrades planned (see map above of recent upgrades).RAILROADS D/A MUDI 08 Affirmative Answers: No Link (_______) Railroads will continue to be used to transport recyclables to China from the US. long-haul trucking.html.S. The entire global economy is threatened in the same way. 08 Railroad Renaissance: Thanks in Part to China Trade. travels some Demand for rail service increased sharply when the U. to be used and discarded and collected (some of it) and shipped back to China for the same thing to happen again. Here’s an example of the global economy at work. industries melt it down and convert it to the plastic stuff that gets shipped back to the U. There.200 miles from its source to our plate. accessed 7/28/08 There is also a larger question about the viability of the U. Statistics on this vary. More and more garbage in the U.blogspot.

moneycentral.15. a crisis is developing under the radar for another form of transportation — the freight trains used to deliver many of the goods that keep the U. 2008. U. said as the crowded hall shifted uncomfortably in their chairs. CEO of Burlington Northern Santa Fe Corp. reductions in infrastructure and industry consolidation: Surging traffic: The main cause of the rail capacity crisis is increased traffic.html With nearly 160.. And it's probably going to get worse over the next two decades.forbes.000 kilometers (km) of track. Rail customers are up in arms." said Paul Bingham. It is also the most efficient and profitable network in the world. One analyst said the rail crunch could add thousands of dollars to the price of a car. This capacity crunch has been caused by dramatic traffic growth." Rose. Forbes in 06 U.S.S. Railroad Profits Tied To New Investment Oxford Analytica 06. this is what it looks like. economy humming.S. The principal sources of this growth are coal and "inter-modal" traffic.000-mile network of rails devoted to carrying everything from cars to grain by freight is already groaning under the strain of B. rail infrastructure is more than double that in Russia or China. May 30. The increased demand for coal has caused bottlenecks on railroads. The nation's 140. Congestion on railroads crush the US economy and destroy the railroad industry. "It's literally chaos in the supply chain. AP in 08 US freight rail congestion a concern." While the nation's attention is focused on air travel congestion and the high cost of fuel for highway driving. according to an analysis of government and industry projections by The Associated Press and interviews with experts on rail freight. economy could climb into the billions of dollars. with trains forced to stand aside for hours because of one-track rail lines. However. a transportation analyst at research firm Global Insight.RAILROADS D/A MUDI 08 Affirmative Answers: Bottleneck Link Turn A. Higher shipping costs would raise prices for everything from lumber to grain. accessed 7/28/08 "For those of you who've ever seen a good rail meltdown. the system suffers from increasing delays and bottlenecks. A cadre of company representatives recently descended on Washington to lobby Congress for reforms aimed at reducing and more fairly distributing the costs created by delays.S.aspx?feed=AP&date=20080530&id=8704 578. http://news. 5 . cx_np_0615oxford.msn. "It's not rocket science to see we have a calamity coming down the road. The damage to the U.

The mines in this region. By Reuters | August 28. Utilities are clamoring for more of this fuel. logistics director at Union Pacific Corp. own a joint 100-mile section of line here and are hauling record amounts of coal from the 10 mines in the area. and second- ranked rival Burlington Northern Santa Fe Corp.RAILROADS D/A MUDI 08 (_______) Large amounts of coal lead to bottlenecks on railroads. said Andy Schroder. train companies seek ways to haul more from Wyoming mines. Reuters 06 As demand rises. ``We are adding capacity and are exploring ways to use that track more efficiently. 6 . 2006. but that's simply not enough. But utilities are unimpressed. the largest U S railroad. http://www." say they are able to increase production. railroads must move mountains over the next few years to match the demand. The bottleneck lies in the railroads." Burlington Northern spokesman Patrick Hiatte said. dubbed the ``Saudi Arabia of coal. Omaha -based Union The long trains that seem to be everywhere in this sparsely populated stretch of land haul nearly 1 million tons of Powder River Basin coal to power plants daily. which has become a popular alternative to costly natural gas. Like the miners that unearth the coal. Both railroads are laying new track and are seeking ways to haul more including using longer trains.

said Thursday its quarterly earnings jumped 19 percent from a year earlier and beat analysts' expectations. The US economy has yet to slip into a recession. reported a 19 percent decline in net income after the market closed. total carloads are higher year over year with ton-miles up 1. (_______) The railroads are growing despite economic slowdowns due to coal. The economy has yet to "officially" slip into a recession. higher fuel costs and a slowing economy were expected to eat into volumes and pricing power.html. accessed 7/28/08 The doomsday predictions about the state of the economy have taken a back seat lately to $200 oil and $7.. accessed 7/28/08 Railroads post solid 2Q profits despite floods. but that has not been the case. a Research Analyst for Wall Street Strategies.00 gasoline. the largest Excluding one-time costs. NEW YORK .S. but everyone from Wall Street to Main Street is feeling a pinch.Despite rapidly accelerating fuel costs and Midwest floods putting a damper on profits. take the railroad industry. Silver on 7-11-08 David Silver. as costs related to an environmental cleanup overshadowed better pricing and strong segment revenue growth. Despite a continued slowdown in the housing market and drastically fewer shipments of automobiles. http://www. grain and soybeans. but the undertones are still there. July 11. Burlington Northern Santa Fe Corp.RAILROADS D/A MUDI 08 Neg Updates: Railroads growing now (_______) The railroad industry is growing because of the current demand for coal. 2008 Business Highlights. http://seekingalpha. 7 . Union Pacific Corp. BNSF's profit came in above Wall Street's views. railroad. meanwhile. Forbes on July 24. Exports have continued to drive the sector. Getting Out of Today's Bear Market. As we enter this next round of earnings releases it will be interesting to see how the market reacts to those multinationals that continue to perform well. coal and improving operational efficiency. Both companies reported robust growth in shipments of agricultural products such as corn.forbes.. For instance. the nation's two largest railroad's second- quarter profits were boosted by demand for farm products.5% year to date. with coal and grains leading the way.

including chemicals. CBO does not make any recommendations in the report. EBSCO U. enabling the railroads to provide more transportation services with fewer resources. rely heavily on rail transportation.S. 168 Issue 3.RAILROADS D/A MUDI 08 (_____) Railroads are currently able to invest in more infrastructure. rail industry employment is well below its historical peak and has been drifting downward until recently. which prepared the report at the request of a House committee to review trends in supply and demand of freight rail transportation. with costs including rights-of way. and the amount of capital investment in the railroad industry has been fluctuating or declining. with coal the dominant commodity carried by Class I railroads. Esther D'Amico Chemical Week. Several industries. 1/25/2006. the report says. "The prospect of future profitability is an open question. says a new report from the Congressional Budget Office (CBO. rerouting traffic. and fuel. However. demand for freight transportation is expected to continue climbing. Washington). If demand for rail transportation continues its rapid rise during the next 20 years. Railroads have responded to increased demand since 2004 by hiring more workers. there is concern about long-term rail capacity and increasing track congestion. says CBO. Vol. tracks." 8 . "It appears that railroads have been able to generate enough profits to finance some investments and attract new capital." it says. "the railroads will need to invest in new tracks and equipment to keep pace. "Yet. freight cars. labor. the report says. the report says. CBO says. productivity has risen markedly. Railroads are a capital-intensive industry. locomotives. p11-11. adding more locomotives and cars. however. and seeking help from shippers. Meanwhile." it says.

" And coal trains are no ordinary trains. Union Pacific . In a country where most homes. and as demand for energy increases. And the Powder River Basin is providing America with a staggering one million tonnes of coal each day .RAILROADS D/A MUDI 08 US Economy is dependent on Coal Cameron 06’ Rob. enough to last for 250 years or more. Some. The task is approached with steely determination by men and women who clearly take deep pride in their jobs. offices and restaurants are heavily air-conditioned. uranium. Nebraska . Republican congressman for the town of Omaha. and so you're going to see a continued reliance. It is also plentiful. uses satellite-based GPS and other state-of-the-art technology to keep track of its trains every minute of the day.stm The United States is the world's most powerful economy.literally . Mention to the average American that you're going to Wyoming. They typically consist of up to 135 cars . "It all boils down to what's cheap and reliable. however. natural this case US's largest. multi-layered seams of coal lie just a few meters below the surface. Wyoming has coal. Getting the coal to its destination is therefore a massive logistical challenge.about a quarter of all US coal production.000 people. Trona is used in the manufacture of glass. So who is at fault? Mile-long trains The railroads . Huge. that spans the border with Montana. "It's the 1. Most of it lies in the Powder River Coal Basin. Don't worry if you haven't heard of it . thick. tan-colored mountains.a crucial transport hub for US rail freight. Mineral rich Wyoming's minerals include crude power the US economy. Union Pacific moves huge quantities of coal from the Powder River Basin to the power stations of the east. But the energy utilities that burn the coal take issue with the reliability. and with just 500. The United States contains the largest coal reserves in the world. Union Pacific's general superintendent of railway operations. Wyoming consists mostly of scrubby grassland or arid. but much of that power is derived from rather old-fashioned sources. "That reliability means and Wyoming has more of the stuff than anywhere else in the world. BBC News. in neighboring Nebraska. so does the pressure on those who supply it. “Coal keeps US economy burning”. But most of all. in Omaha. and they are as likely as anything to ask you why. More than half of the country's electricity is produced by burning coal. It is a fair it is the least populous state in the US. methane and something called trona. "The coal trains represent about 75% of everything that runs in and out of this yard.few 9 . They complain that supplies are not meeting demand. Coal is very cheap. this is clearly a problem. are beginning to question the wisdom of such heavy reliance on a crucial role in the coal supply chain." says Lee Terry. Cheaper than natural gas. 2006 http://news." says Cameron Scott. leaving them low on reserves and Americans potentially exposed to power shortages.000lb gorilla that you have to watch day in day out. But the people of America should be thankful to Wyoming. 52% of America's electricity. in North Platte.making them about a mile and half long. no doubt about that. August 29. because its colossal treasure trove of natural resources is helping ." Power shortages which is why coal is used to generate Cheap it is. Union Pacific's space-age Harriman Dispatching Center.

January 28. 10 .etfresources. with agriculture. http://online. Moving forward. the pricing power of the railroad industry has come into play.wsj. after subtracting income taxes. 2008. incomes rose 3. Commercial paper issuance is rising again. “US Economy Is Fine (Really)”. In fact. Conversely. The boom in exports is overwhelming the loss from housing. Exports are 12% of the the-economy-into-2008 With all of the talk about the economy falling off a cliff as a result of the dismal state of the U. Congress is considering setting prices for the industry. Wall Street Journal.5%). car leases and loans. chemical. rent. housing and credit markets. pricing power should remain in place. the industry has expanded its network enough to be able to handle the peak season which typically begins in August and continues through the end of the year.6% rate. the recent softness in production and durable goods orders is understandable. The fundamental aspects of the industry continue to look strong moving into 2008. Personal income is up 6. The US economy is Fine WESBURY 08’ Brian. Adding capacity is not accomplished overnight. the additional investment will likely have a minimal effect on the day to day operations of individual companies and benefit operating margin and the bottom line as the additional capacity will allow for more efficient operations.695 trillion. the industry experienced record shipment and revenue tallies. and are growing at a 13. debt service on credit cards and property taxes. And it has fallen so much already that it is highly unlikely to drive the economy into recession all by itself. January 13. while small- business income accelerated in October and November. the pricing power the industry enjoys will not be pressured. which began in 2002. with estimated ton-miles being lower by a mere 0. and coal shipments headlining the list.S.4% year over year. The industry continues to invest a great deal of capital into expanding its capacity and improving operating efficiency. if demand remains strong and continues to grow. during the height of the credit crisis.9% to 1.9% faster than inflation in the year through September. statistics out of the Association of American Railroads fail to flesh out these doomsday developments. http://www. as are mortgage applications. But housing is now a small share of GDP (4. 2008. quarterly revenue and volume records were still being set in many commodities. During 2007. a dramatic drop in demand will cool down capital investment for the sector.html?mod=opinion_main_commentaries With housing so weak. Despite of all the talk about higher fuel prices. and save for a pricing re-regulation of the industry. “Investing in Railroads: Transporting the Economy into 2008”. Additionally. it is a multi-year endeavor for all of the parties involved. the fact remains. Annualized total carloads through December 15 were only down 2. mortgages. Since the economic rebound. Research Analyst for Wall Street Journal. For each quarter of 2006. it is still cheaper to transport goods via railroads than it is by way of trucking companies.1% during the year ending in November.RAILROADS D/A MUDI 08 Railroad industry is doing fine now but could easily downturn Silver 08’ David. Amid complaints from large customers that prices have increased too much.

Tue 1 Jul 2008. donors and international organizations to tackle the effects of the global price shock. “Anhydrous ammonia is a vital and essential plant nutrient that is critical to the nation’s food supply. The problem is especially severe in some Sub-Saharan African countries and threatens to wipe out gains made over the past decade to reduce poverty and strengthen their growers-0728/ In written comments to the Surface Transportation Board (STB). It also risks driving up the debts of poor countries as governments increase borrowing to deal with the higher prices. managing director of the IMF. farmers would be unable to produce the amount. We are on the brink." he told a conference to discuss new IMF research on food and fuel inflation. Jul 28. It is necessary for the shipment of anhydrous ammonia. Southeast Farm Press July 28.RAILROADS D/A MUDI 08 Neg Updates: Food Prices Impact 1. U." said Dominique Strauss-Kahn. “Rail is the safest and most efficient method for transporting this critical agricultural product. where the impact of higher oil prices on the balance of payments is around 15 percent of GDP. or quality of food the world has come to rely on. railroads cannot be selective in determining which commodities to transport based purely upon their self-interest. Benedicte Christensen. then some governments will be unable to feed people and at the same time maintain stability in their economy. “Anhydrous ammonia is an essential agricultural nutrient used to grow the nation’s food supply. "Each country is different and exact policy prescriptions will vary considerably. 2008 Soaring prices push economies to tipping point-IMF. a West African country that has slowly emerged from years of civil war. "If food prices rise further and oil prices just stay the same. only Congress has the authority to change this obligation. acting director of the IMF's African Department.” stated NCGA President Ron Litterer. But the universal challenge for all poor and middle-income countries is to find ways to feed the hungry while maintaining hard-won macroeconomic stability.” the letter continued. Strauss-Kahn said the IMF research underscored the need for a coordinated response by countries. NCGA believes that while the STB may have an advisory role in making recommendations to Congress on railroad common carrier obligation. "They need good policy options and they need help from the international community." the head of the International Monetary Fund warned Tuesday.” 2. A successful rail system is key to food production and food prices. as well as food shortages around the world. Among these is Liberia. threatening to derail economic stability and growth. 21:22 GMT. Lesley Wroughton July 1. said combined the price shocks have raised the overall import bill in Africa by 2 percent to 3 percent of GDP. http://africa.S. 2008 NCGA: Continue shipping anhydroous by rail. “With increased concern over escalating food prices. The IMF has identified 18 countries in sub-Saharan Africa that have been hard-hit by higher prices that will need balance of payments and budget support." he Until then. the National Corn Growers Association voiced its concern over the railroad industry’s request to discontinue shipping anhydrous ammonia — a source of nitrogen fertilizer. Increasing food prices leads to instability in Africa. By Lesley Wroughton. 2008. price rises were gradual and countries were able to draw from their international reserves.reuters. threatening hard-won efforts in many African countries to stabilize their economies. NCGA maintains that without anhydrous ammonia. representing nearly all of its international reserves.” According to the Interstate Commerce Act and reaffirmed by the Staggers Act. "The sharp price increase 11 . deputy director of the IMF's Policy Development and Review Department. http://southeastfarmpress. said the situation for countries worsened dramatically when food and fuel prices spiked at the end of 2007. Mark Plant.html Surging food and fuel prices have pushed some countries to a "tipping point. it is critical that American farmers have anhydrous ammonia when and where they need it.

South Africa is a major exception in this respect . outside powers can more easily find client states there than." he said. http://www. Geopolitically speaking. Japan) are powers unto themselves and don't need any "help. Somalia and Sierra Leone. Of course. and some people love to go fishing. or Asia where many of the countries (China. India. No longer can they rely on their reserves to cushion the impact. etc. scientific. Thus. Very few countries in Africa are beholden to any particular power. African stability is key to stopping nuclear war." thank you. 11-18-02. if the other powers are interested in a fight.10. Sudan and other countries. as well as occasional brushfire and other wars (thanks in part to "national" borders that cut across tribal ones) turn into a really nasty stew. ACC: 9.06. an African war can attract outside involvement very quickly. But an African nuclear strike can ignite a much broader conflagration. p. such a strike would in the first place have been facilitated by outside help . Africa is an ocean of troubled waters. who are willing to push the button rather than risk being seen as wishy-washy in the face of a mortal threat and overthrown. online The Rabid Tiger Project believes that a nuclear war is most likely to start in Africa. Dr.html. engineering. Certainly. and domestic instability in Zimbabwe. Rwanda.not to mention in that she also probably already has the Bomb. We've got all too many rabid tigers and potential rabid tigers. a proxy war alone may not induce the Great Powers to fight each other. 12 . 3. Jeffrey Deutsch. Africa is open Thus.RAILROADS D/A MUDI 08 have very much driven many of these countries to the tipping point. Civil wars in the Congo (the country formerly known as Zaire). Contributing Editor for Russian Politics. in Europe where the political lines have long since been drawn.rabidtigers.