Are Amtrak Subsidies Outrageous?

By Don Nadeau, on October 31, 2009, in Travel

Lately, the subsidies Amtrak receives for long-distance trains have entered the national conversation again. Outrageous, some say.

However, when thinking of rail transportation in the U.S., it is important to remember that more people use New York Penn Station each day than all the airports serving New York City combined. This doesn’t include commuter trains serving Grand Central Station.

Also, somehow the thinking is that all passengers get on at the first station of a long-distance train and get off at the last—”Who’d want to take a train all the way from Chicago to Los Angeles?”—but most passengers travel just portions of these lines.

Favoritism

In spite of being significantly more environmentally friendly, Amtrak must compete with transportation modes that are far more heavily subsidized than it is.

For example, Amtrak must battle airlines whose fees and taxes passengers pay do not begin to cover the costs of airport infrastructure, air traffic control, and security. It must compete unequally with a mode that contributes far more per passenger to energy trade deficits perhaps to the detriment of national security.

Thinking beyond Amtrak

Now, I’m not married to Amtrak. Far from it.

Perhaps those who have operated under a basic survival mentality for years do not possess the creativity and initiative to lead us into a new age of transportation.

It is certainly true that some of the most successful Amtrak operations have been initiated by states, e.g., in California, Illinois, North Carolina, Oregon, and Washington. And, I have experienced excellent service with independent operators like Sir Richard’s Virgin Trains in the UK.

This is not to say that we should necessarily give up control totally to the states or to independent private operators. For example, some states such as Maine, Massachusetts, and New Hampshire have proven unable to coordinate fairly cross border services among themselves. And, the days that private rail companies can easily lay tracks across vast sections of the U.S. are long gone. Some sort of national coordination of services seems necessary, as was done in the UK with private companies.

Leveling the playing field

Passenger rail, even in its existing form, would be more economically viable if the subsidies provided to different modes were made more equal or eliminated altogether. I wonder how many people would fly between Washington and New York, instead of taking the train, if flights were not so heavily subsidized?

From the beginning, Amtrak has been sorely undercapitalized and at the mercy of the railroads it operates on for on-time performance, etc., a situation that severely impacts its public image.

Lack of funding creating inefficiences

With just equipment for one trip or less per day on most Amtrak long-distance routes, people at most stations along these routes cannot make day return trips. In other words, someone in Pasco cannot go to Spokane and come back the same day. This considerably limits the potential of most long-distance rail routes in the U.S.

And, although it tries to serve as many patrons as possible at convenient times, Amtrak does not have the funds for the necessary equipment to make this universally possible.

For example, the sole eastbound trains from these cities leave at
Cleveland 1:54 a.m., 5:20 a.m.
Houston 5:10 a.m.
Little Rock 11:39 p.m. (better than 3:10 a.m. westbound)
Salt Lake City 4:10 a.m.
Spokane 1:15 a.m.
Tucson 1:55 a.m.

These times cannot be helping the financials of trains on these routes.

Moreover, Amtrak not only faces the cost of providing and staffing stations to serve trains at such inconvenient times, it faces the cost of providing and staffing stations on long-distance routes that usually serve just one train each way per day. That is not efficient.

The Sunset Limited

Critics never fail to point out to the most egregious example of Amtrak “waste,” the Sunset Limited from New Orleans to Los Angeles.

Its loss per passenger is truly horrific, but not in this extreme form typical of Amtrak and not immune to improvement. In fact, as nearly unbelievable operational problems on Union Pacific, whose tracks Amtrak uses for this train, improve (and these are improving), we should see the financial performance of the Sunset Limited improve.

Thinking about the future

In closing, I would like to ask that you think about a world with $400 oil. In case that happens, do we really want to reduce our transportation options in the U.S. by shutting down long-distance rail service?

And, although the U.S. Constitution does not call for airline or rail passenger service—of course, none existed at the time–I would ask you to reflect on what the framers of the Constitution were thinking when they felt it important for the Federal government facilitate communication in this country by creating national roads (Article I, Section 8). Did they merely want to move mail about or did they believe it important for Americans to interact and experience each other?

Do we want a country where it is no longer readily possible for anyone besides the most well-to-do to move about?