Republicans say they will destroy Amtrak.

[Dinner]

Felch: So you don't think there is a compelling national interest in having a national railway netwrok? You also think it was fair of Congress to make it illegal for Amtrak to make money and then get mad at Amtrak for not making money?

[Imran Siddiqui]

So you don't think there is a compelling national interest in having a national railway netwrok?

No matter what Felch says, no, I don't think there is a compelling national interest in a national railway network .

[rev]

From the original article:

During the 1970's and 1980's Congress provided a subsidy to Amtrak in recognition that Congress's mandate that all rail lines continue to be oppurated, including the money losing lines, and so Amtrak continued to exist. ... The Republicans did not repeal the congressional mandate that Amtrak continue to maintain and oppurate unprofitable rail lines since this would have offended representatives from rural states.

There's the problem.

How can you expect a public utility to turn corporation-level profits if it can't be run like a corporation?

Either let Amtrak choose to run certain lines that will make them a profit, or don't expect them to.

[Dinner]

Rev: My point exactly.

Free there hands and let them compete but don't hog tie them and then whine about them not running fast enough.

[Adam Smith]

A couple years ago I helped write a study of Amtrak's long-term viability. I don't have a link handy, but here's what I can tell you off the top of my head.

First, some background. Unlike Europe, Oerdin,the vast majority of the US railroad system is privately owned and handles mostly freight. Something like 98 percent of revenue comes from freight, and these companies are able to turn a profit. There is no particular need to nationalize the system for the sake of the two percent of traffic involving passengers.

Second, Amtrak has much higher costs than it needs to. Some of these are the result of being forced to maintain unprofitable routes. On one particular long-distance route, the train picked up or dropped off an average of six (count 'em) passengers per day on the almost 600 miles between Denver and Salt Lake City. That's just plain nuts.

However, many of Amtrak's costs are much higher than they need to be. Part of this is due to absurd labor contracts. Under the infamous New York Dock conditions, anybody who is laid off gets six years severance pay. This has obviously kept Amtrak from getting down to an efficient sized labor force. Another good example is the launch of the new Acela train between Washington and Boston. Amtrak insisted on a new technology when an acceptable off the shelf technology was available. This drove up costs and greatly delayed introduction. Moreover, while it is nice to have a shiny new toy that can run 150 miles per hour, Amtrak failed to consider all the other costs that go with introduction of the new train. For example, Amtrak failed to install new cross overs, so the faster trains can only pass slower ones about once every 20 miles. This greatly reduces the effective speed of the new trains. In sum, a consultant found that Amtrak could have gotten 80 percent of the speed gains for about 20 percent of the cost.

Third, Amtrak's financial position is much worse than it looks. This is because Amtrak gets several hidden subsidies which do not appear anywhere on its books. The US Department of Transportation pays Railroad Retirement (i.e. Social Security) for all Amtrak workers. This amounts to something like 16 percent of total labor costs. Second, states and localities pay for essentially all the stations and terminal improvements. Third, Kidicious, the rates Amtrak pays to freight railroads for the use of their tracks are effectively frozen at 1956 levels. Costs have obviously increased since then.

Lastly, splitting US railroads into maintenance and operating companies would be a bad idea. Its true that British Rail had substantial underinvestment, but they created a lot of new problems by splitting up. IIRC, Railtrak gets paid by the train, which led to incentives to run lots of trains with few passengers. There were also problems coordinating maintenance windows and operations between the track company and various operating entities.

[Adam Smith]

So what to do?

First, automobile transportation does not pay its full social cost. (e.g., pollution, congestion, etc.). Resources for the Future recently calculated that a 58 cent per gallon increase in the gas tax was necessary to cover this shortfall. Politically I am not holding my breath, but this would be a good start for Amtrak and a lot of other issues.

Second, Amtrak needs to drop its long-distance routes. These are losers, plain and simple. Bus service should be an adequate replacement.

Third, poor cost control means that Amtrak wont make it even if they drop their long-distance routes. It therefore needs to be broken up into a number of regional entities which are a bit more accountable to the local states which provide money. The idea is to focus each entity on a set of commuter and short-distance routes which generally do not involve overnight trains. Examples include:

Northeast Corridor (Washington to Boston)
Southeast Region (Richmond to Atlanta)
Midwest Region (Chicago to Minneapolis, Milwaukee, St. Louis, Indianapolis, Cincinnati, Detroit, and Cleveland)
California (San Francisco, Sacramento, Los Angeles, and San Diego areas)
Pacific Northwest (Portland, Seattle, Vancouver BC)
Texas (Houston, Dallas, San Antonio, if they ever get their act together)
Florida (Miami, Tampa, Orlando, Jacksonville, if they ever get their act together)

By getting out of the existing legal structure, getting more accountability to funding entities, and cutting long-distance trains, this might actually have a shot at succeeding.

[CerberusIV]

Do US domestic airlines pay their actual costs? I ask because one of the current environmentalist issues in europe is that aviation fuel is not taxed on a comparable basis to diesel and gasoline. If aviation fuel was taxed the cost of air travel would rise substantially.

[Kidlicious]

Thanx for the good info AS

[Arrian]

AS.

[chequita guevara]

I wuld like to argue with one point made by AS.

Busses are NOT an adequate replacement for trains. Busses suck, big time. They are overcrowded, with tiny bathrooms, and filled with questionable people. We were even forced to submit to police inspection of our bags in Macon, GA. The only advantage to busses is the extremely low cost of travel, but you pay a price in time and physical discomfort if not outright pain (though it wasn't as bad as driving a Geo Metro, which must be the most painful form of transportation I've ever experienced).

The seats in trains are bigger and have more room to recline. The aisles are bigger, the bathrooms are bigger, there are smoking cars (or were) for those who smoke, and you can purchase food and drink on the train (albeit exensive and of poor qualty).

I much prefer the train to the bus, and if it were not for the fact that train travel is more expensive from Jacksonville to Chicago than air travel, I'd happily use it. Sure, it takes an extra day, but you get to see and enjoy so much more of the country.

[Dinner]

Originally posted by Imran Siddiqui

So you don't think there is a compelling national interest in having a national railway netwrok?

No matter what Felch says, no, I don't think there is a compelling national interest in a national railway network .

Imran: Fair enough, however, you didn't answer the other question. Clearly Congress sabataged Amtrak so wouldn't you agree it is hypocritical in the extreme for Congress to get mad about Amtrak not being profitable. Don't you also feel Congress should try repealing the outlawing of cutting unprofitable routes before we go through with Bush's plan to liquidate Amtrak?

[Sava]

wtfZ! I wish the airline industry would die, but noooooo the government keeps giving them fat bailouts. What a shame, train is the best way to travel.

[DinoDoc]

Originally posted by Adam Smith
Part of this is due to absurd labor contracts. Under the infamous New York Dock conditions, anybody who is laid off gets six years severance pay.

Please tell me that you are kidding.

[Dinner]

Being a government entity I have no doubt absurd labor contracts exist and are a big part of the problem. That just makes it more imparitive to inject competetion into the system to help keep costs down. My plan provides for this competetion but the President's doesn't. Bush's plan basically calls for Amtrak to be broken up into a bunch of unprofitable pieces who will all just die or at best will limp along unable to afford to create higher speed routes.

Having nationally owned rail lines (like nationally owned road ways and airports) with privately owned service providers will create better service and cheaper service. I don't see another plan out there which will accomplish those two things.

[Sprayber]

Originally posted by Oerdin


At the very least Congress should repeal the "Amtrak may never stop oppurating any rail line" statute and then see if they are profitable or not.

Then you get someone from South Dakota wondering why part of their money is going to improve track from DC to NY when they don't even operate in their state. I think the idea of regional areas may solve that. But why should South Dakota pay money to get people to work in DC?