Railroad mergers are driven by stagnation in demand | Why not focus on increasing demand?

The US has 6 "Class I" railroads after multiple mergers, two are in the West, two are in the East, two are (with some exceptions) north-south.  

Different railroads have different mixes of loads, but the decline of coal production as electricity plants shift to natural gas has really hurt.  

RRs have long since given up on short loads delivered fast enough.  That traffic has been diverted to trucks.  

Although CSX among others has invested a lot in truck-trailer/container portage ("Back on Tracks," Washington Monthly).  

Note that railroad demand is increasing, but in the context of including truck delivery, it's far less as a proportion of the total market, compare to the prime of railroading.

Over the weekend there have been reports that Union Pacific wants to buy Norfolk South, creating the first true transcontinental railroad ("UP-NS rail merger spotlights individual legacies in a legacy business," Freight Waves).

There are some proposals out there to divert trucks to rail, mostly to provide more capacity on constrained interstate freeways including I-81 in Virginia ("Why Putting Trucks on Trains to Bypass I-81 Won't Work," Heavy Duty Trucking,  Feasibility Plan for Maximum Truck to Rail Diversion in Virginia’s I-81 Corridor, VDOT) and I-70 in Colorado ("'Truck Train': Former Amtrak conductor shares plans to reduce semi-truck traffic on I-70," ABC Denver).  

From the I-81 article:

As the Roanoke Times reports, several members of the Roanoke Valley Transportation Planning Organization really liked the idea put forth by Rail Solution. The nonprofit says instead of pouring money into widening I-81, the state should double-track the Norfolk Southern rail line that runs alongside the highway to carry “through” trucks that don’t need to make a stop in the state. 

Envisioned is a service that could run the 600-mile corridor between Knoxville, Tennessee, and Harrisburg, Pennsylvania, and allow truck drivers to sleep on the train. At terminals on each end, truckers would drive their rigs onto a train with perhaps 30 truck positions, and the train would go once it reached a certain number of trucks, such as 30.

From the I-70 article:

The idea? Moving semi-trucks and other large commercial vehicles off the highway and putting them on rail lines instead. Swartzwelter and his family, like many Coloradans, enjoy going into the mountains, but are fed up with the traffic they have to deal with when traveling there. Swartzwelter said the roll-on, roll-off bridge would remove around 1,100 commercial trucks a day from I-70.

“I-70 is the biggest problem with that entire endeavor for everybody in the state,” he said. “Congestion and the danger of accidents, and then sometimes the highway itself is just closed.”

He said his idea is based on a successful European model. “Semi-truck drivers would drive their entire truck — the cab, the trailer, the whole rig — right onto a flatbed train," he explained. "That train would then traverse the mountains, and then the driver would be in a sleeping car up at the front of the train. At the end of the trip, the driver would get out fully rested, climb back into his truck or her truck, and continue on."

This would also address the shortage of truck drivers, even as the industry is shrinking too.

Freight Rail webpage, Federal Railroad Administration

Other freeway corridors like I-95 or I-15 probably have a similar profile that supports truck diversion.

The other is to ensure that when appropriate industrial businesses can still be served by the big railroads assisted by short line operations--even when car volumes are low transportation demand management requirements might make it efficacious.  This means industrial parks, logistics hubs, warehouse districts etc. ("This logistics hub plan is a huge win for the Illinois economy," Crain's Chicago Business).

Related to the connecting industrial businesses to railroads point is building to transit to serve new urban neighborhoods ("More than 100,000 people are expected to move into this new Toronto neighbourhood. So why is there still no transit line?," Toronto Star).

In any case, mergers approved going forward should have significant transportation demand management requirements, like the ones suggested here, the Chicago railroad decongestion initiative, etc.  

It should also include better support of passenger rail service.  The expansive powers given to railroads through federal franchises, at the time, was also based on railroads providing necessary travel services, which have since been offloaded to Amtrak and local rail passenger services.