The University of Montana School of Law The Scholarly Forum @ Montana Law Faculty Scholarship Faculty Publications 1-1-2009 Captive Regulators, Captive Shippers: The Legacy of McCarty Farms Anthony Johnstone University of Montana School of Law,
[email protected] Follow this and additional works at: http://scholarship.law.umt.edu/faculty Part of the Administrative Law Commons Recommended Citation Anthony Johnstone, Captive Regulators, Captive Shippers: The Legacy of McCarty Farms , 70 Mont. L. Rev. 239 (2009), Available at: http://scholarship.law.umt.edu/faculty/8 This Article is brought to you for free and open access by the Faculty Publications at The choS larly Forum @ Montana Law. It has been accepted for inclusion in Faculty Scholarship by an authorized administrator of The choS larly Forum @ Montana Law. CAPTIVE REGULATORS, CAPTIVE SHIPPERS: THE LEGACY OF MCCARTY FARMS Anthony Johnstone* Montana has more than five thousand farms growing grain and one railroad shipping it.1 In a typical year Montana produces 150 million bush- els of wheat (approximately 500,000 farm trucks), ships 140 million bush- els out of state (approximately 50,000 railcars or 450 110-car grain shuttle trains), and exports 100 million bushels from terminals in the Pacific North- west (approximately fifty 62,000 ton freighter ships).2 The value of this volume of grain depends on its movement to national and world markets beyond Montana's borders. Transporting it from the high plains to these markets requires railroad service to the extent that more than 97% of wheat shipments out of Montana travel by rail.3 Without competitive transporta- tion alternatives to rail, or competitive railroad alternatives to the dominant statewide carrier, Montana's grain producers, and the grain elevators that intermediate between the producers and the railroad, are "captive ship- 4 pers." By definition, the prices offered to captive shippers by a railroad mo- nopoly are not effectively constrained by market competition.