Most cargo is going long distances that passengers should fly for. The needs of freight and passengers is different enough that they should almost never be on the same track.
When humans are on a train speed counts and they are willing to pay extra for it. When freight is on a train they can save money by going slower.
Freight doesn’t have priority, passenger trains have priority according to the law but the law is functionally unenforceable so freight steals priority from passengers.
Also, the whole scheduling of cargo trains has big dollar penalties for delays in loading, unloading, and not arriving on time. Its amazing how detailed folks get about trains showing up. Cargo rail has a lot of moving parts that need to coordinate to keep the goods flowing.
Typically everyone does both freight and passengers, but it'll be better at one or the other. Passengers want fast trains with few delays that get close to population centers. Freight doesn't care about speed as much but cares about the overall throughput and wants to end up in distribution centers.
The penalties on cargo timing are pretty severe. If that cargo train is supposed to be somewhere to load / unload, it really is a problem if it doesn't arrive on time and costs the railroads money they do not want to pay. Cargo, as many SV startups have discovered, is much more profitable than passenger.
Thing is, freight trains are a far better use of the track than passenger trains: the system is ideal for slow-moving bulk cargo that doesn't care if it has to sit on a siding for a week, not to mention that it's a much less damaging way of moving heavy material around than trucks. Passengers, meanwhile, want to go specific places at specific times, and that just does not coexist well with freight. Better for passengers to travel by air, private car, dedicated high-speed rail, and other systems focused on the job.
Moving freight by train is also a lot more efficient than moving people by train. Freight doesn't need room to walk around, doesn't need to eat, doesn't need to sleep, doesn't need bathrooms.
That’s the problem. What’s good for freight is bad for passengers and good passenger lines are horrible for freight. Even the model is different (B2B versus B2C). The mixing is a big problem and any disruption in the current network would affect a lot of people. The private freight carriers are doing a fine job.
And where does the freight in a big city come from? It doesn't just teleport in.
Freight trains are probably the least bad way for freight to enter a city, given their efficiency and relative greenness. But they do need to be unloaded, maintained, and turned around somewhere, and wherever that is going to happen is going to be noisy.
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