Railroads have warned that they will suspend freight and passenger operations on Jan. 1 if Congress does not extend a year-end deadline for them to install a collision-avoidance system called positive train control.

The American Chemistry Council calculated that a month-long rail service disruption could cost the economy $30bn. By comparison, the Standard & Poor's credit ratings service estimated that the government shutdown two years ago cost $24bn.

Cal Dooley, the chemistry council's president and CEO and a former congressman from California, said in a statement that a freight service shutdown could harm the entire economy.

"A prolonged shutdown would be truly catastrophic, likely resulting in a recession," he said. "We cannot afford to let this self-inflicted crisis happen."

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