STB Chair Oberman: NS takeover could be a ‘huge detriment’ to the rail industry
“It’s been a long-term struggle to try to get these railroads to rebuild. It’s a never-ending tension,” said Oberman. “Wall Street will always be there — which is fine, it’s part of our capitalist structure. But the activist investors, such as the ones that have surfaced now at Norfolk Southern, have a very short-term goal and it’s not constructive.”
While such activist investors are free to practice their approach in other industries, the rail industry is different, he said.
“Railroads are a regulated monopoly, and they have a common carrier obligation to the public interest and to the nation’s economy,” said Oberman. “Railroad management and owners are not just free to manipulate the business for short-term gain to drain the resources out of the railroads in the form of enormous stock buybacks and dividends to the determent of the railroads, … labor, and ultimately to the economy and the consumers.”