it’s a chicken and egg problem

It is indeed. I.e. a prime example of cases where state invention works better than the free market. At least the rails and stations need to be run by the state and workers who can’t strike (as I explained in another comment, we have good solutions for that in Germany). And of course they need to be provided for free (just like roads are, at least for the most part).

Whether we need huge railway company or whether having lots of a competing companies like in airtravel is a better option, is a different question. If there only were smaller companies running the trains, strikes wouldn’t be a serious problem for the whole of society, but mostly for the companies running the trains.