Russ Nelson wrote:
In other words, government is a blunt solution to a problem which admits many other solutions. Try reaching for a feather before you pull out your gun. As they say, "The (accountant's) pen is mightier than the (regulator's) sword."
In theory, Russ, you are 100% correct. And in the overwhelming majority of situations where a prefectly- or relatively-competitive market stucture allows easy entrance and exit, and protection from expropriation (which, let's be truthful, was a primary consideration in the rebuilding of the steel industry, and is likely to figure more prominently in entreprenurial decisions until the Great Socialist Brotherhood again collapses under the weight of its foolishness) you are correct.
But like the electric power grid, the rail network requires huge amounts of capital, and is not mobile. Furthermore, as demonstrated by both UP's upgrading of the former Golden State Route and NS desision to develop a Harrisburg-Roanoke-Memphis gateway as a partial alternative to the former PRR main, grades are by far the driving factor in the current redevelopment of the rail industry. No one is going to suggest re-opening the former Rio Grande Tennessee Pass route in an attempt to go head-to-head with UP or BNSF.
While they came close in the late Ninteenth Century, the railroads have never operated in a complete vacuum with regard to both protection from, and the occasional use of, the state's monopoly on the use of coercion. The principle of eminent domain, which many of us who subscribed to Objectivist doctrines in our undergraduate days viewed second only to military conscription as anathema, was used to condemn private property for rail construction because in some cases, the rigid engineering constraints imposed by rail technology left it the only alternative.
So in the short run, given the increasing likeliehood of both private- and public-sector entities (not to mention the NIMBYs) fighting over a samll, but growing number of critical infrastructural sites, I view a well-thought-out procedure for open access as the lesser evil when compared to slow quasi-natrionalization if the thinking within the Beltway continues to regress.