Amtrak snack bars lost $84.5 million last year

[NAVYBLUE]

Or, more accurately, it's the truth. If you choose to pretend that a tax deduction for oil companies only (percentage depletion, domestic activities production credit) is not a subsidy, this is simply not the modern (post-1900) meaning of the word subsidy. If you choose to pretend that a below-market royalty rate is not a subsidy, this is simply a misuse of the word subsidy. If you want to say that it's not a *government expenditure*, that's fine and accurate, but these are *all* subsidies, just as any below-market deal or special tax break for an industry is in fact a subsidy.

Next you'll be saying that providing rent-free housing isn't "providing a subsidy". Consider this definition from the Concise Encylopedia: "Financial assistance, either through direct payments or through indirect means such as price cuts and favourable contracts, to a person or group in order to promote a public objective."

This doesn't make the subsidies inherently bad, but pretending that they're not subsidies is economically unjustifiable. As you know, having studied economics.

You can have your own opinion, BUT you can not have your own facts. DO NOT use definitions from Concise Encyclopedia/Wiki when they have "legal" consequences. As a former business manager, I deal in the LAW, not touchy feely anti capitalism dissertations from dictionaries, Yahoo finance, Wiki, Huffington Post, PMSNBC etc.

http://definitions.u....com/s/subsidy/ Subsidy Law and Legal Definition

"A subsidy is generally a special money payment by a government to one or more firms in a favored industry, usually for the purpose of enabling them to sell one or more of their products at a price below their costs of production, or at least at a price below the free market price. "

"An example of a subsidy is a farm subsidy paid annually to farmers by the U.S. Department of Agriculture (USDA). The most expensive USDA programs are the field crop programs such as the wheat and corn programs. Annually the USDA gives farmers more than $9 billion a year in direct payments. The USDA offers to pay farmers per bushel of commodity at a guaranteed price, invariably set above the market price."

Oil companies sell their products ABOVE the their costs of production WITHOUT subsidies..

http://www.nypost.co...U9QIO0BKHs1Be7M

"Oil companies can deduct their expenses for things like equipment purchases and rig-technicians' salaries. Oil companies can also deduct expenses related to exploration or development. The point of these deductions as for any other industry or individual — is to ensure taxes are only levied on income after expenses."

"But even these deductions aren't unique to energy companies. Many provisions in the tax code seek to encourage certain kinds of behavior. Mortgage deductions reward home ownership. Special tax benefits promote savings in individual retirement accounts or 401(k)s."

"Now, some energy-sector players do get federal subsidies. The wind and solar sectors alone take in $12.5 billion annually in direct subsidies. (Actually they are GRANTS)"

I've tried to make it as simple as I could. The IRS is the law, not anti capitalism rhetoric. The IRS spends millions of dollars a year on accountants to make sure you report expenses and income correctly. I think I'll trust them first.

You can call LEGAL tax deductions subsidies all day, That doesn't make it true. I know it is "cool" in certain circles and political groups to demonize the oil and gas business (which I have NEVER worked for) and it makes them feel angry like they are getting screwed somehow and they "feel" they "need" to right a wrong and vote for someone who will stop them from taking LEGAL deductions. I'm sorry. I can't help people like that.

Also, I'm sorry I took so long to reply to you. I have been on my other favorite sites for a couple of days. I was explaining on one site (at length) the Social Security Retirement and Disability system (which I taught for 20+ years in Navy benefits classes). Can you believe it. Some of the people were so stupid, oops, UNEDUCATED, that actually thought there is real cash in the Social Security trust fund in Parkersburg WV.

 

NAVYBLUE

Is there a field in which you have not worked as an expert? Do you do brain surgery in your spare time? You may be correct; however your method of delivery leaves a lot to be desired. Let's stick to trains and we all will be happy as "uneducated" as we are!

Yes there is. Remember my expertise is in Economics, weapons law and determining if someone is mentally and/or physically disabled under Federal law.

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[jis]

Me thinks some AUers have been indulging in AMBeer too much lately. :giggle:

It was just an attempt, and perhaps a poor and misinterpreted one, and bringing some levity and also making a very basic point about the silliness of the way in which the whole OBS and its costs is handled by some. It is quite possible that the underlying message was lost to many.

 

[AmtrakBlue]

Me thinks some AUers have been indulging in AMBeer too much lately. :giggle:

It was just an attempt, and perhaps a poor and misinterpreted one, and bringing some levity and also making a very basic point about the silliness of the way in which the whole OBS and its costs is handled by some. It is quite possible that the underlying message was lost to many.

It wasn't lost on me.

 

[TrackWalker]

Federal spending over the past 20 years has surged 71 percent faster than inflation, much of it on bloated and wasteful programs and services, including Vice President Joe Biden's favorite mode of travel: Amtrak.
According to the newly revised Heritage Foundation report, "Federal Spending by the Numbers," the rail service lost $84.5 million alone on its food and beverage services in 2011, and $833.8 million over the past 10 years. "It has never broken even on these services," said Heritage.

The regularly revised analysis found that federal spending spiked this year to $3.6 trillion, which is nearly 23 percent of the U.S. economy. And to illustrate why the federal deficit has reached $1 trillion each year of the Obama presidency, Heritage determined that for every $6.80 Washington collects in taxes, it spends $10, meaning that the Treasury has to borrow the remaining $3.20.

More

This little classic book can explain a lot as to how these numbers came about. (And it is still in print)

http://en.wikipedia.org/wiki/How_to_Lie_with_Statistics

TW

 

[dlagrua]

I've always been pro-Amtrak as the benefits that it provide to the USA and to the American people are numerous. It helps reduce highway traffic, lowers the amount of travel pollution, is energy efficient, provides a vital transportation link to those living away from the major cites, but above all it serves the public interest. As pinted out many times on this forum, the amount of money spent on Amtrak is such a small part of the total transportation budget that eliminating it completely is not going to make even a 1% reduction in the federal deficit. The representatives who are against it are, by and large, typically those who's districts are not served by Amtrak.

 

[George Harris]

Correspondingly, if the loss was caused by high personnel costs, was that due to the number and pay of the front-line employees or the loaded cost because of too much management overhead and how much of the management overhead was put on that employee "cost"?

This is a very good point. At one time the San Diegan service was showing a profit, but the the overhead costs were recalculated by Amtrak, and brought that to an end.

There are some businesses where there is almost no economy of scale. Make it bigger, and the cost per unit increases as more in the way of management is needed but the manhours and direct overhead per unit of product does not improve, so the total sale price per unit must increase to cover the increased overhead.