United Transportation Union Blasts DM&E Loan
by Leigh Pomeroy
The president of the United Transportation Union today blasted the proposed $2.3 billion federal loan to the DM&E Railroad as a bad deal for its members and would likely be a poor investment for American taxpayers. The UTU represents DM&E employees.
"If the DM&E were credit worthy, it would be able to obtain a loan in the private sector," said UTU president Paul Thompson. "In fact, the railroad poses a substantial credit risk and may be no more than a stalking horse for cash-rich Union Pacific. Moreover, the DM&E has severe safety problems that threaten the public and national security."
He termed the proposed loan a taxpayer subsidy.
"With 46 million Americans lacking health care, with a war that is draining the U.S. treasury, with the administration reluctant to fund Amtrak in spite of sharply higher oil prices and increased evidence of global warming, and with Congress being asked to eliminate almost 150 domestic programs to help narrow the budget gap, there is absolutely no legitimate justification to provide a $2.3 billion taxpayer financed federal loan to a railroad unlikely to pay it back," Thompson said.
If the DM&E received the loan, now under consideration by the Federal Railroad Administration, it would go into competition with the Burlington Northern Santa Fe and Union Pacific railroads hauling coal from Wyoming's Powder River Basin to utilities in the Midwest. But any chance of repaying the $2.3 billion dollar loan would be based upon the DM&E gaining major safety, health care and wage concessions from union members, said the UTU's national legislative director, James Brunkenhoefer.
"BNSF and UP employees already make one-third more than DM&E employees," said Brunkenhoefer. DM&E employees also have a worse health care plan and fewer benefits than workers at the larger two railroads.
Another way the DM&E proposes to cut labor costs is to run trains with one-man crews, said Brunkenhoefer, bringing up questions of safety for a railroad that already has a controversial safety record. "DM&E consistently has had among the worst safety records of any railroad in the country," the UTU's Thompson said. "In virtually every major category of railroad safety statistics, the railroad has usually ranked last. Compared with national averages, DM&E is off the charts on the south end."
Brunkenhoefer noted that the UTU has been trying to bargain with the DM&E to bring its employees' wages and benefits up the the level of its competitors, but that the railroad's CEO, Kevin Schieffer, has consistently stonewalled the effort.
A spokesperson for the DM&E said he was not yet aware of the UTU's statement.
The president of the United Transportation Union today blasted the proposed $2.3 billion federal loan to the DM&E Railroad as a bad deal for its members and would likely be a poor investment for American taxpayers. The UTU represents DM&E employees.
"If the DM&E were credit worthy, it would be able to obtain a loan in the private sector," said UTU president Paul Thompson. "In fact, the railroad poses a substantial credit risk and may be no more than a stalking horse for cash-rich Union Pacific. Moreover, the DM&E has severe safety problems that threaten the public and national security."
He termed the proposed loan a taxpayer subsidy.
"With 46 million Americans lacking health care, with a war that is draining the U.S. treasury, with the administration reluctant to fund Amtrak in spite of sharply higher oil prices and increased evidence of global warming, and with Congress being asked to eliminate almost 150 domestic programs to help narrow the budget gap, there is absolutely no legitimate justification to provide a $2.3 billion taxpayer financed federal loan to a railroad unlikely to pay it back," Thompson said.
If the DM&E received the loan, now under consideration by the Federal Railroad Administration, it would go into competition with the Burlington Northern Santa Fe and Union Pacific railroads hauling coal from Wyoming's Powder River Basin to utilities in the Midwest. But any chance of repaying the $2.3 billion dollar loan would be based upon the DM&E gaining major safety, health care and wage concessions from union members, said the UTU's national legislative director, James Brunkenhoefer.
"BNSF and UP employees already make one-third more than DM&E employees," said Brunkenhoefer. DM&E employees also have a worse health care plan and fewer benefits than workers at the larger two railroads.
Another way the DM&E proposes to cut labor costs is to run trains with one-man crews, said Brunkenhoefer, bringing up questions of safety for a railroad that already has a controversial safety record. "DM&E consistently has had among the worst safety records of any railroad in the country," the UTU's Thompson said. "In virtually every major category of railroad safety statistics, the railroad has usually ranked last. Compared with national averages, DM&E is off the charts on the south end."
Brunkenhoefer noted that the UTU has been trying to bargain with the DM&E to bring its employees' wages and benefits up the the level of its competitors, but that the railroad's CEO, Kevin Schieffer, has consistently stonewalled the effort.
A spokesperson for the DM&E said he was not yet aware of the UTU's statement.
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