Amtrak Politics

[Rob_C]

A topic on another forum got me thinking. There seems to be a pretty strong segment of the population that believes Amtrak should not have government subsidies. Presumably because they feel as a business it should be accountable for it's costs of doing business.

Some of the obvious responses to that come to mind:

Amtrak is not a business, it's infrastructure (like Highways/airports - I think Airlines get subsidies, correct?)

And how do you answer a question like, why can Amtrak not pay its expenses with ticket sales and other revenue streams to cover its costs?

What other talking points have you come across regarding this issue and where do you stand on Amtrak when it comes to Federal subsidies?

Thanks!

 

[had8ley]

You don't have to dig very far. To my knowledge there isn't a major pax rail system in the world that makes money. Many pax RR's are heavily subsidized by foreign countries and have great high speed trains to prove it. Amtrak got caught in its own web by Presidents like George Warrington, and others, by saying "profit is just around the corner" while cooking the books to make things look rosier than they ever could be. Madison Avenue took all the 40 years of "profit" hype and added a few swipes, to make a system that will probably never make money, look like an archaic dinosaur undeserving of any type of subsidies. Unfortunately, we are a capitalistic society that feels you are only successful if you are profitable.

 

[Shanghai]

If ALL of the costs for airline travel, highway travel and train travel were computed, none are profitable.

All receive govermental subsidies in various forms. The only form of travel that makes a profit is ships, mainly cruise ships.

I don't think the transatlantic routes are profitable and are often referred to a repostioning cruises.

There are several reasons why railroads, both local and long distance, are important to the economic and social lives of

people in the world. In the US, national security is also an issue, although I'm not certain how valid this arguement may be.

I think it is valid to say that Amtrak is an important method of transport in America and serves many of our citizens.

 

[Tony]

And how do you answer a question like, why can Amtrak not pay its expenses with ticket sales and other revenue streams to cover its costs?

Ask the questioner to name a trucking company that pays, in full (all capital and all maintenance), for all the roads, highways, bridges, and tunnels it uses to run its for-profit business of transporting goods?

We are in a form of economy where it is normal and expected that the government subsidizes with taxes all forms of transportation.

 

[Bootman4U]

IMO, one of the major differences between the view of so-called "public transportation" in the US vs. some other places is ATTITUDE. Some people actually believe that having abundant and wide-ranging transportation assets is beneficial in many ways and is WORTH subsidizing as necessary.

I cannot begin to tell you how many people I know who have traveled to Europe or Japan have never ever been on a train, even once, and they are often astounded at what they see. Of course, they are so used to having their own cars and using them to get everywhere, etc.

But, of course, there is a big difference in geography which has to be covered when you look at the US vs. areas such as Western Europe.

AMTRAK "is not a business"....hmmm, IMO it is a business and should be run with proven business practices. However, I haven't heard a lot of people saying the airlines should all shut down if they don't make a profit..if they did then we'd have about one airline left in the US.

No, I think it is all about what people (think they )want and, of course, the various political maneuverings in Congress and elsewhere that come along with it. I am certain the airline executives and groups like AAA would be thrilled to see AMTRAK getting better..yeah, sure.

 

[Guest]

The only form of travel that makes a profit is ships, mainly cruise ships.I don't think the transatlantic routes are profitable and are often referred to a repostioning cruises.

On that note the cruise ships are only profitable because they register under countries that allow them to pay their workers peanuts and make them work very long hours.

Of course that is how most things work in the American economy. We take advantage of third world workers to make our life easier.

 

[TVRM610]

I firmly believe that most people can only justify the cost of something THEY personally use everyday. Which is why to them, the government roads that they drive on everyday are a completely justifiable expense. But Amtrak, and other forms of public transportation, are not needed.

Argument: "If amtrak was shut down people would just find another way to travel (bus, plane, etc,), this would free up the tax dollars spent on passenger rail and allow those people to better use the other systems..."

this is true.. the country would still work if Amtrak did not exist... Amtrak is not necessary period.

HOWEVER...

The exact same thing could be said about the street that my house sits off of. If the city closed that street, I would just have to find another way to get home, I would probably park in a pay lot, and then walk to my house. The city would save money by not having to upkeep the road for vehicle traffic etc. America, and my city, would still work if my street did not exist.

I hope I'm making my point... it just makes SENSE for there to be a road that leads to my house. It just makes SENSE for there to be a railroad linking the major cities of this country. The fact that it doesn't turn a profit, really doesn't matter.

 

[railiner]

The only form of travel that makes a profit is ships, mainly cruise ships.I don't think the transatlantic routes are profitable and are often referred to a repostioning cruises.

On that note the cruise ships are only profitable because they register under countries that allow them to pay their workers peanuts and make them work very long hours.

Of course that is how most things work in the American economy. We take advantage of third world workers to make our life easier.

You may believe we are taking advantage of third world workers, but have you asked any of them what their job means to them? How it compares to what they could get if it wasn't available?

This is a world economy now, good or bad, but the bottom line is that as a result, eventually it will mean the leveling of wealth globally, and when it no longer is the haves versus the have nots, world peace will be more likely.

 

[railiner]

I am certain the airline executives and groups like AAA would be thrilled to see AMTRAK getting better..yeah, sure.

What can possibly make you skeptical about AAA supporting Amtrak? I have been an AAA member for a long time, and I believe they probably sell more Amtrak tickets than anyone else outside of Amtrak. Their magazine occasionally has a nice travel arcticle on the pleasures of riding the train, and their lobbying for the motorist doesn't include taking anything away from Amtrak.

 

[volkris]

A topic on another forum got me thinking. There seems to be a pretty strong segment of the population that believes Amtrak should not have government subsidies. Presumably because they feel as a business it should be accountable for it's costs of doing business.

That's not the root of the attitude. Business or not, if something's worth subsidizing people will be willing to see it subsidized. The reason people don't want to spend money on Amtrak is simply because they don't see it as valuable enough to pay for. It's just that simple.

You can talk about funding of roads and airports and fairness and unions and on and on... but regardless, people simply don't want their government spending money it doesn't have to pay for a service they don't want.

Until you convince people that passenger rail is a valuable piece of infrastructure, money spent on Amtrak will be perceived as money taken out of citizen's pockets to pay for railfans' toys.

 

[Joel N. Weber II]

I think a lot of the problem here is that there are certain rail freight routes in the US that are so profitable that they can charge their customers enough to pay 100% of the maintenance costs for the track, and property taxes on the land occupied by the track, and still beat the trucking industry which pays no property taxes on the roads, and probably isn't paying 100% of the road maintenance costs either.

And I think the executives who have run these highly profitable railroads over the years have failed to notice that since WWII, government subsidy for passenger and freight transportation has become the norm as long as that transportation happens to not involve steel rails. They have wanted to avoid being stuck in the passenger rail business, though, which I suspect is a source of a lot of the ``passenger rail isn't profitable'' rhetoric.

The unfortunate consequence of all of this is that, since railroads 80 years ago were run by profitable for profit companies that haven't realized they should be accepting subsidizes to stay competitive as things have changed since then, rail has become less available both to passengers, and to rail freight routes that aren't quite economically viable, but only because they don't get the same maintenance subsidies and property tax exemptions that are available to roads.

Has anyone ever done a study on what it would cost to maintain the NEC for 30 years if it started in a state of good repair, and how many passenger miles it handles every day, and how much it would cost to maintain for 30 years a parallel Interstate highway with the same passenger mile carrying capacity when used by single occupancy vehicles, again starting from a state of good repair?

The other problem is that the US has seen major speed improvements for both roads (the Interstate Highway system) and airplanes (I believe the typical runway today which supports a jet is longer than the typical pre-WWII runway) since WWII, but passenger rail speed has not seen much in the way of improvement in the US since WWII.

 

[Abe Zumwalt]

A topic on another forum got me thinking. There seems to be a pretty strong segment of the population that believes Amtrak should not have government subsidies. Presumably because they feel as a business it should be accountable for it's costs of doing business.
Some of the obvious responses to that come to mind:

Amtrak is not a business, it's infrastructure (like Highways/airports - I think Airlines get subsidies, correct?)

And how do you answer a question like, why can Amtrak not pay its expenses with ticket sales and other revenue streams to cover its costs?

What other talking points have you come across regarding this issue and where do you stand on Amtrak when it comes to Federal subsidies?

Thanks!

I think the best point, and what usually shuts arguments like that down would be a simple comparison of subsidy. According to Amtrak's fleet renewal strategy, Amtrak covers over 80% of it's operating costs, which is to say that <20% is subsidized. Our highways are extraordinarily expensive (perhaps the most expensive infrastructure we know how to build), and in "Moving Minds: Conservatives and Public Transportation" by William S. Lind and Paul Weyrich, Highways, including tolls, license fees, gas taxes ect. only cover about 58% of their costs, which is to say that at least 42% is subsidized!!!

Another good argument, also presented in that book, is that we had a private transportation system in this country that paid taxes- in our railroads and interurban companies. MASSIVE government subsidies to roads and airports changed the game- the two dominant modes we have now quashed the railways in large part because we were subsidizing them, while the rails were paying taxes. Well gee, what do you think was going to happen?! Because of our unwise development patterns, and nowadays because of the governments actions during the 20th century, along with land being much more expensive, and with imminent domain being the touchy subject it is, it is very unlikely we will ever have a fully private transportation system ever again. All of those pundits that yell and scream about subsidies seem to be in denial of the fact that they benefit from them every day- every time they fly, drive on a road, or use a sidewalk. And the sad reality of it is, is that in all likelihood, the subsidies going to the rails are being used far more efficiently.

 

[RailFanLNK]

Whenever someone throws the quote, "Amtrak doesn't make any money and I don't like my tax dollors being used that way". I always bring up I-80 in Nebraska. They are adding a 3rd lane from Omaha to Lincoln and my rebuttal always is, "well the Interstate system hasn't made the country any money since being built in the 50's and 60's and now they are spending $600 million for 50 miles of a third lane, should we just close down all the highways and interstates too?" That usually gets them thinking. I am reading James McCommons book titled, "Waiting On A Train" and reading it a second time. So much of this topic is discussed in his book. Its a book by a person who supports rail travel but he is NOT a "foamer" as much as we would like to say that he is. To me, for all of us on this forum its a must read.

 

[RailFanLNK]

Was just at the hardware store. I am NOT handy so lets just say that I'm hardly ever there. I'm there former delivery driver so I know most of the employees. As I was "catching up" with them and vice versa, I told them about my upcoming marriage and honeymoon on Amtrak to Seattle. One of the clerks in the checkout lane about 3 rows away stopped me and said, "I ride Amtrak all the time, so glad you enjoy it too!" That made me feel good!

 

[Joel N. Weber II]

I think the best point, and what usually shuts arguments like that down would be a simple comparison of subsidy. According to Amtrak's fleet renewal strategy, Amtrak covers over 80% of it's operating costs, which is to say that <20% is subsidized. Our highways are extraordinarily expensive (perhaps the most expensive infrastructure we know how to build), and in "Moving Minds: Conservatives and Public Transportation" by William S. Lind and Paul Weyrich, Highways, including tolls, license fees, gas taxes ect. only cover about 58% of their costs, which is to say that at least 42% is subsidized!!!

For an honest comparison here, you need to take into account not only the costs of highway maintenance, but also the costs of automobile manufacturing and maintenance. Aside from the recent GM bailout, I doubt automobile ownership is anywhere near 42% subsidized.

On the other hand, when you take into account medical costs resulting from accidents, Amtrak probably has a bit of an advantage over the roads.

 

[volkris]

One thing you have to be careful of is winning the battle but losing the war.

Some of you sound happy to sit back with a smug look on your face saying "Ha! Won that argument!" when in the end you've actually gotten nowhere: the other guy is no more likely to want federal dollars spent on rail, but now he is annoyed at the smug jerk he's sitting across from

Don't just point out the cost of expanding that interstate, point out that the cost of the expansion would pay for this much rail along the route and going that way would relieve congestion on the remaining interstate lanes by this amount. Win people over to the benefits of rail not as a lesser of evils (by trashing funding of highways) but as a part of the nation's transportation infrastructure that's valuable in its own right.

 

[rrdude]

Whenever someone throws the quote, "Amtrak doesn't make any money and I don't like my tax dollors being used that way". I always bring up I-80 in Nebraska. They are adding a 3rd lane from Omaha to Lincoln and my rebuttal always is, "well the Interstate system hasn't made the country any money since being built in the 50's and 60's and now they are spending $600 million for 50 miles of a third lane, should we just close down all the highways and interstates too?" That usually gets them thinking. I am reading James McCommons book titled, "Waiting On A Train" and reading it a second time. So much of this topic is discussed in his book. Its a book by a person who supports rail travel but he is NOT a "foamer" as much as we would like to say that he is. To me, for all of us on this forum its a must read.

Yeah, I'm reading it too, should fini in a few weeks. If anyone wants when I'm done, pay the shipping, and it's yours to read, and hopefully pass on again.

It took me a while to get into the book, but agree with RailFanLNK, it should be required reading for anyone who wants to broaden their horizon on the state of Amtrak today, and how we got where we are. It's not earth-shattering news of any kind, just a lot of information that a lot of us "know", put together and laid out in a very readable format.

What I'd like to hear is how the highway lobby, oil lobby, and construction lobby folks COUNTER arguments like have been put forth on this board.

The old saw that "railroads got subsidies too, land grants, etc., doesn't hold ANY water, when you dive into what the RR did for the nation in WWI and WWII. But, if anyone has heard good powerful arguments, that hold water and are currently used, AGAINST Amtrak funding, I'd like to hear.

"Keep your friends close, and your enemies even closer.........." The more you know the competition, the better you are at beating them.

 

[birdy]

"Don't just point out the cost of expanding that interstate, point out that the cost of the expansion would pay for this much rail along the route and going that way would relieve congestion on the remaining interstate lanes by this amount. Win people over to the benefits of rail not as a lesser of evils (by trashing funding of highways) but as a part of the nation's transportation infrastructure that's valuable in its own right."

Yep. I think its important and much easier to listen to you if you are positive. "We should build." "We should take care of our infrastructure." "This is worthwhile". As opposed to: "The oil barons have been ripping us off for too long!" "how many more people have to die in the middle east before we learn our lesson!"

Two arguments that work:

Historical perspective: Erie Canal made NYC NYC.

Highly subsidized transcontinental railroad (gov't gave railroads alternating sections of land along right of way) made that possible.

Subsidized interstate highway system has been good too.

Perspective argument as alluded in the last post is important: Until the stimulus came along, Amtrak limped along with a subsidy in the $675 million per year range. That's the cost of our wars --for one day. Amtrak is very high profile in comparison to the money it receives. People just assume it loses money about as fast as the post office. Also, the politicians have been able to get away with the "billions of dollars of subidy for Amtrak" line for too long--evidently they just multiply the yearly subsidy by the 40 yr history of Amtrak and its "billions and billions" in subidy

As stated in the last post, its not an "either/ or" proposition. We have neglected all of our infrastructure for over thirty years.

I've weighed in on my hometown newspaper's debate a couple of times on line. The thing I notice is that if I am extra-polite avoid the baiting that takes place (not easy to do) and weigh in early, the whole tone of the thread afterwards changes towards reasoned debate. So it makes a difference to discuss this stuff outside of the forum.

 

[PRR 60]

...Until the stimulus came along, Amtrak limped along with a subsidy in the $675 million per year range.

The Amtrak federal subsidy has been over $1 billion per year for the last eight years. The average over those eight years has been about $1.3 billion.

 

[birdy]

...Until the stimulus came along, Amtrak limped along with a subsidy in the $675 million per year range.

The Amtrak federal subsidy has been over $1 billion per year for the last eight years. The average over those eight years has been about $1.3 billion.

Well, you are right. That's what I get for operating from memory. Sorry. Still, its a tiny number.

 

[saxman]

I think the best point, and what usually shuts arguments like that down would be a simple comparison of subsidy. According to Amtrak's fleet renewal strategy, Amtrak covers over 80% of it's operating costs, which is to say that <20% is subsidized. Our highways are extraordinarily expensive (perhaps the most expensive infrastructure we know how to build), and in "Moving Minds: Conservatives and Public Transportation" by William S. Lind and Paul Weyrich, Highways, including tolls, license fees, gas taxes ect. only cover about 58% of their costs, which is to say that at least 42% is subsidized!!!
Another good argument, also presented in that book, is that we had a private transportation system in this country that paid taxes- in our railroads and interurban companies. MASSIVE government subsidies to roads and airports changed the game- the two dominant modes we have now quashed the railways in large part because we were subsidizing them, while the rails were paying taxes. Well gee, what do you think was going to happen?! Because of our unwise development patterns, and nowadays because of the governments actions during the 20th century, along with land being much more expensive, and with imminent domain being the touchy subject it is, it is very unlikely we will ever have a fully private transportation system ever again. All of those pundits that yell and scream about subsidies seem to be in denial of the fact that they benefit from them every day- every time they fly, drive on a road, or use a sidewalk. And the sad reality of it is, is that in all likelihood, the subsidies going to the rails are being used far more efficiently.

I use this same argument too. You pretty much said what I was going to say.

Besides reading "Waiting on a Train" you should also read "Moving Minds: Conservatives and Public Transportation." Its pretty technical and has lots of facts and figures, but still a good read if your transit geek.

I always say the same argument when I come across a negative comment about Amtrak. I had to straighten out my uncle the other day when he said he heard Amtrak loses $32 per passenger on average and some routes lose $400 per passenger. :huh:

Well my response to that is to ask him how much money it costs per passenger to drive his truck? He said it depends. Obviously he couldn't give me an accurate answer because it depends on many variables, like how far you travel and how many people you have in your truck. Different passengers travel different distances and connect from other Amtrak trains.

 

[MikeM]

I'd also recommend reading Don Phillips latest column in Trains magazine, where he discusses Amtrak's "lost year" of 2009. Don typically has pretty good instincts for Washington, and his main premise is that Amtrak is thinking tactically, not strategically. Specifically, he's worried that Amtrak leadership lost a major opportunity to get more funding last year in the stimulus program, and questions if Amtrak has the backing / clout / plan to achieve the strategic equipment purchase program. It'll be interesting to hear next week what Boardman has to say in the Trains meeting in Chicago, I hope this topic gets lots of discussion. Right now, we seem to be trapped in a loop of not buying new equipment on a national basis, leaving it up to states to buy equipment. Which is fine, but will lead to a crazy quilt of equipment and routes without any national cohesion if without some semblance of national leadership and funding. I hope I am wrong, it just feels like Congress, and particularly the Senate, is dissolving into a fracas where one of the two parties just wants to pout and take the toys of the other party. (Where's my kindergarten teacher of 1965 when we need her?)

 

[volkris]

I hope I am wrong, it just feels like Congress, and particularly the Senate, is dissolving into a fracas where one of the two parties just wants to pout and take the toys of the other party. (Where's my kindergarten teacher of 1965 when we need her?)

It's the civics teacher you should be calling for.

The Senate is operating as the entire federal government was supposed to operate: do nothing on a skin of the teeth majority, but instead require widespread consensus before forcing the entire country in any particular direction. What you see as pouting and taking of toys is really just a refusal to get in lock step and allow a few people to dictate the policy for a whole lot of Americans who strongly disagree.

I bring this up not to get into a political argument but because it's relevant to the question. Why is it so hard to get funding for Amtrak? In part it's because the federal approach requires taking money from a lot of people who for good reason just aren't interested in funding the service. They'll resent being forced to pay for services that benefit others, just as some here seem to resent being forced to pay into the highway trust fund. But two wrongs don't make a right, and the argument that railfans help pay for highways probably won't really convince many people far away from Amtrak's routes that they should be forced to pay for rail. It's not that they're taking their toys (well, wallets) and going home; it's that they actually disagree with being forced to do something lots of people don't want to do.

That's why I think the national focus is questionable. Focus on regions that actually want and value rail, and focus on intercity service that can benefit people pretty directly. Together these can demonstrate to the rest of the country that rail has value, and then national networks can be fought for from a much stronger foundation.

Until then you're working from a base of forced charity... and that's just not a recipe for sustainable success.

 

[gmcguire]

The Senate is operating as the entire federal government was supposed to operate: do nothing on a skin of the teeth majority, but instead require widespread consensus before forcing the entire country in any particular direction. What you see as pouting and taking of toys is really just a refusal to get in lock step and allow a few people to dictate the policy for a whole lot of Americans who strongly disagree.

I won't argue against this except to say that this is a very controversial opinion. I say this not to start a political debate, but only to make sure that everyone knows there's another side, which I, of course, agree with

 

[dedhd]

...Until the stimulus came along, Amtrak limped along with a subsidy in the $675 million per year range.

The Amtrak federal subsidy has been over $1 billion per year for the last eight years. The average over those eight years has been about $1.3 billion.

I am wondering if anyone has ever broken down the subsidy in usage. The interstates are heavily used by everyone. How does the number of passengers served/mile relate. On any given day if all trains are at full capacity how many passengers are served? How does that break down into a subsidy ratio with the highways, or the airlines? Don't know if this is like comparing apples and oranges or if this can be calculated.