Amtrak woes again

Amtrak, the passenger railroad "subsidized" by the federal government, is under financial attack again. Amtrak never had it easy. It was created to absorb passenger railroad operations driven into bankruptcy by the subsidization of the paved road system. Here are a couple articles from the Washington Post about the latest proposals: 1; 2.

Every time you read a letter to the editor of your local newspaper calling for users of transit "to pay their own way" do you wonder, as I do, if the letter writer realizes that gasoline excise taxes only cover 1/3 of the cost of roads? If you don't believe it, read this column by Neal Peirce.


Peirce's column, "GAS TAX HIKES: NEEDED BUT POLITICALLY PERILOUS", from May 2003, says:

"Another argument for hiking gas taxes: higher pump prices might help curb our appetite for SUVs and other gas-guzzling (and polluting) vehicles.Yet it's a danger for us to be fixated on gas taxes alone, University of California-Berkeley Professor Martin Wachs warns in a ground-breaking analysis of our highway funding dilemmas published by the Brookings Institution . Gas taxes are critical right now, reports Wachs, but in fact they're covering only 35 percent of our governments' cumulative spending on roadways, from big expressways to meandering country roads.

What? Weren't we always told highways are sort of self-financing through the gas tax? Not true, says Wachs. Even when you add in vehicle taxes (another 20 percent of road funding) and tolls (4 percent), it turns out auto- and truck-user-related revenues are larger, but only slightly, than the billions flowing in from local property taxes, bond issues and governments' general fund appropriations.

So much for the tired argument public transit depends on 'subsidies,' and roads don't!"





Amtrak is expected to be financially self-sufficient, while its road-based competition is deeply subsidized. I am not intimately familiar with airline economics, but I have to believe airports are subsidized in part by local governments, and airlines as an industry have never made any money (Southwest Airlines and other individual airlines are an exception, but their profits are dwarfed by the losses and bankruptcies of other airlines) not to mention the billions in loans and other subsidies proffered after 9/11 and the falloff in patronage.


The odd thing is that there are many short haul airline routes (Dallas-Houston, Dallas-Austin, Chicago-Detroit, etc.) that would work better as short (up to 200-250 miles) train trips if the trains were faster. Plus, it makes sense to have other transportation options, as the closure of airports and airlines after 9/11 should have made clear.


But the Bush Administration is ideologically driven, and wants to privatize the railroads andor get rid of a national railroad and devolve the functions to the states, or at least privatize the infrastructure.


You'd think the debacle in Britain, where this was done, and maintenance was given short shrift and many people died in train accidents, so the "state" took control again of the infrastructure, would have some impact on this discussion?


As William Pfaff said in a column in the International Herald Tribune in 2001, "The disasters that have overtaken electricity privatization in California and rail privatization in Britain have failed to provoke much comment on a basic issue, which is how often people in power are prepared to let themselves become prisoners of ideology. "


Pfaff closes his column discussing the experience with the privatization of British Rail by saying: "The neglected reality was that non-financial management determines the success of such an enterprise. There can be excellent management in public enterprises, including armies and navies. There can be disastrous management in private ones. The ownership of the enterprise is a secondary concern. "

"The other neglected reality was that if an enterprise cannot function efficiently when profits are not demanded from it, introducing the profit requirement makes reform harder, not easier. The profit motive may incite management to work harder, but it doesn't make management smarter or more effective."


And it certainly doesn't have the power to change the underlying business model, which is flawed because of the subsidies provided to the other forms of transportation with which U.S. passenger railroads compete.


In "Getting on board for Amtrak" the Philadelphia Inquirer reports that the "CEO Council for Growth," recognizing the importance of Amtrak to its efforts to attract jobs, is "throwing its weight behind fizing Amtrak." The printed article (Tuesday paper) has a nice graphic of Amtrak's Northeast Corridor from Washington to Boston, which provides service to 13 cities in between including Baltimore, Wilmington, Philadelphia, Newark, New York, New Haven, and Providence.


The Washington region should be as active in discussing and challenging the threat to Amtrak as is the Philadelphia region. The H Street neighborhood has some of the best transportation assets in the region and in the United States because of the proximity of Union Station.


Other resources on rail include the United Rail Passenger Alliance.