Conference committee sets Amtrak budget

[Trogdor]

Alan,

I know I'm about the fourth person to ask this, but at least last year, Amtrak's operating loss less accounting tricks (i.e. depreciation in Amtrak's case) was far less than its subsidy. What happened to that money? Did Amtrak just never get the cash on hand, or did it get to put it in an account somewhere?

Depreciation is not an "accounting trick."

It may not be a cash outlay in that period, but it is standard in all accounting systems in the country (and probably the industrialized world). It's not a "trick" by any means.

 

[Anderson]

Henry,

Thanks a bunch. I just wanted to be sure...I've read over that report more than once, but I wanted to be sure that I hadn't missed an updated summary report for the year including the data they couldn't include because their computer system ate it (or so the report implies).

Alan,

I know I'm about the fourth person to ask this, but at least last year, Amtrak's operating loss less accounting tricks (i.e. depreciation in Amtrak's case) was far less than its subsidy. What happened to that money? Did Amtrak just never get the cash on hand, or did it get to put it in an account somewhere?

Depreciation is not an "accounting trick."

It may not be a cash outlay in that period, but it is standard in all accounting systems in the country (and probably the industrialized world). It's not a "trick" by any means.

It is and it isn't. If there was the reasonable expectation that Amtrak would replace its rolling stock, engines, etc. out of their own funds, then I'd consider it to be fair to depreciate that equipment. If Amtrak was likely to keep its portion(s) of the NEC in a SOGR out of its own capital budget and not one provided by Congress, then I'd consider it to be fair to depreciate the tracks and so forth. But neither is the case, with the possible exception of the Acelas...and even there, I believe that the expectation is that the Acela IIs will get at least some sort of capital grant from Congress (otherwise, I sincerely expect that Amtrak would just go ahead and spec that order out so they could get the new cars into service sooner rather than later as opposed to fiddling with the 40-car stand-alone order...if nothing else, a supplemental order for extra cars could always be added to the larger order, one suspects).

 

[jis]

The issue of depreciation is not as cut and dried as is made out to be, and it is certainly not something that is used everywhere in the world. In the US GAAP accounting standards require its use today.

Traditionally railroads expensed their capital assets in current account. They did not fully go over to depreciation based financial accounting for fixed assets until the 4R Act, which required them to do so, and it produced a huge tax windfall for those that were profitable, and it even established an unused depreciation trading system which allowed the likes of Amtrak to sell their imputed depreciation related tax savings to others, which gave even Amtrak an additional cash infusion.

Depreciation has also nothing to do with replacement funding. It is just a means of recognizing the cost of a capital asset over the lifetime of the asset instead of at the point of acquisition. If one already recognizes the cost at acquisition then there is no point in depreciating it over and above that. That's why the 4R thing with depreciation was in some sense recognizing the cost of the Capital assets twice and in effect was a nice hidden subsidy for all railroads for part of the cost of the assets which had already been wholly accounted for in their books. It should be added, that this act played a significant role in putting most railroads on a very firm financial footing and allowed them to start funding capital investments through open market borrowing.

See Main Lines, Rebirth of the North American Railroads, 1970 - 2002 by Richard Saunders Jr. (ISBN 0-87580-316-4) if the gory details interest you.

This is the main reason that I find the whole hoo-haa about depreciation that some Congress-critters moan about to be a somewhat disingenuous. Yes GAAP requires such these days, and therefore it is useful to have at least one version of the accounts that are presented in that form. But there is nothing else that causes it to be particularly holier than anything else.

Also interestingly, the GAAP rules about depreciation differs from the IRS rules, and neither has much direct impact on current cashflow (except when depreciation can be used cleverly in the context of tax laws to increase cashflow as was done with the 4R Act.), which is what matters a heck of a lot more in the day to day operation of the business.

 

[AlanB]

Continuing on with the subsidies idea, I'm sure that most of us have heard the wonderful quotes about how the Sunset Limited loses $400 or more per passenger while on its run. And yes, based upon how things are allocated by Amtrak, that is indeed what it costs.

On the other hand one thing that you'll never hear from the anti-rail side is what does Amtrak's subsidy actually mean to the average American in terms of their taxes. A newspaper issued a Taxpayer's receipt for 2009 for our Federal Income Tax. A married couple with 2 kids earning $80K paid a whopping $3.83 towards Amtrak. On the other hand that same couple paid $110.06 towards the Interstate Highways via their Income Tax. If they actually drove a car, then of course they paid even more money towards the highways via the Federal fuel tax.

A married, retired couple with income of $100K paid $3.11 to Amtrak and $89.38 to the highways, even if they no longer own a car and are unable to drive.

 

[PRR 60]

...Not sure about planes, but according to Subsidyscope we drivers only cover 51% of the Federal outlays for the Interstate Highways via the Federal fuel tax. Amtrak on the other hand between fares, state fees, contract services, rents, interest, etc. covered 69% of it's 2010 budget; leaving 31% for the Fed to pick up.

First, I think you are misreading the report. The 51% figure is for all highways - interstate though local streets - not just interstate, and the taxpayer support is for all government, federal through local, not just federal. Even the 51% figure is somewhat bogus since about 25% of the federal fuel tax revenues are diverted to non-highway uses, including rail. If all federal fuel tax revenue went to highways, the payment rate is over 60%.

Second, highway users pay 100% of the costs of their vehicle, insurance, maintenance, license and registrations fees, and fuel. If you or I drive 100 miles, we pay over 95% of the total cost of that trip. Amtrak users pay about 69% of the total cost of their trip, and less if you add in state support subsidies. To equate 51% support of highway infrastructure only (with the rest 100% paid by users) to 69% of all costs for Amtrak, is apples and oranges in the truest sense.

 

[afigg]

It is and it isn't. If there was the reasonable expectation that Amtrak would replace its rolling stock, engines, etc. out of their own funds, then I'd consider it to be fair to depreciate that equipment. If Amtrak was likely to keep its portion(s) of the NEC in a SOGR out of its own capital budget and not one provided by Congress, then I'd consider it to be fair to depreciate the tracks and so forth. But neither is the case, with the possible exception of the Acelas...and even there, I believe that the expectation is that the Acela IIs will get at least some sort of capital grant from Congress (otherwise, I sincerely expect that Amtrak would just go ahead and spec that order out so they could get the new cars into service sooner rather than later as opposed to fiddling with the 40-car stand-alone order...if nothing else, a supplemental order for extra cars could always be added to the larger order, one suspects).

Either Amtrak will be getting direct funding in future years from Congress to buy equipment or take out loans that are in part paid for by the annual debt service grant from Congress. However the equipment is paid for, it will be subject to depreciation in accordance with the appropriate accounting standard.

As for the 40 Acela cars, the sole source RFP was issued in late August. The Acela IIs, whenever they are ordered, are likely to be able to be paid for out of increased revenue, so Amtrak may not wait for capital grants from Congress for that order. The Acelas IIs are some years away from being ordered however. Amtrak should not order them until they have a much better handle on what the NEC and Next Gen NEC will look like in 10-20 years and, for that matter, what the FRA regulations will be.

As for paying for the 40 Acela cars and eventual orders for Amfleet, Superliner I, and diesel locomotive replacements, I expect that - for the next 2-3 years at least - that the initial orders will be paid for with FRA RRIF loans so long as they have a favorable Administration and FRA/DOT to issue the loans. RRIF loans are at US Treasury interest rates which are currently at around 2.1% for a 10 year note and 2.8% for a 20 year note. Interest rates that low provide a LOT of leverage.

Read pages 53 to 55 of the revised FY 2011-2015 Five Year Financial Plan. My take is that it is telling us how Amtrak intends to pay for orders for new rolling stock. The key is that current total debt service payments are projected to be reduced from $270.6 million in FY12 to $127.8 million in FY15 with EBOs of leases. Do the math on how much of a loan one can take out with, for example, $120 million a year available for new loan payments, if the interest rate is, say 3.5% for a 20 year loan. Or for 30 year loans.

 

[AlanB]

...Not sure about planes, but according to Subsidyscope we drivers only cover 51% of the Federal outlays for the Interstate Highways via the Federal fuel tax. Amtrak on the other hand between fares, state fees, contract services, rents, interest, etc. covered 69% of it's 2010 budget; leaving 31% for the Fed to pick up.

First, I think you are misreading the report. The 51% figure is for all highways - interstate though local streets - not just interstate, and the taxpayer support is for all government, federal through local, not just federal. Even the 51% figure is somewhat bogus since about 25% of the federal fuel tax revenues are diverted to non-highway uses, including rail. If all federal fuel tax revenue went to highways, the payment rate is over 60%.

Second, highway users pay 100% of the costs of their vehicle, insurance, maintenance, license and registrations fees, and fuel. If you or I drive 100 miles, we pay over 95% of the total cost of that trip. Amtrak users pay about 69% of the total cost of their trip, and less if you add in state support subsidies. To equate 51% support of highway infrastructure only (with the rest 100% paid by users) to 69% of all costs for Amtrak, is apples and oranges in the truest sense.

While I agree that the reports is for all highways, not just Interstate; it does not include local streets as they are not highways. And that in and of itself could be considered a subsidy to the highways, since you still paid the Federal fuel tax while driving down the local street even though none of that money went to help build/pave the local street. And in most states those local streets are paved via property taxes, not fuel taxes, yet another subsidy to drivers.

Returning to the streets vs. highways, I quote from the story:

Using Federal Highway Administration statistics, Subsidyscope has calculated that in 2007, 51 percent of the nation's $193 billion set aside for highway construction and maintenance was generated through user fees

Next, I disagree with the idea that 25% of the funds is redirected to non-highway things. Yes, if one uses the ultra-conservative approach from some Congressmen, it might be that high. But I for one don't consider sound walls, testing for auto & motorcycle safety to be mis-directed funds. And then of course there is that nagging issue that all the monies collected by the Fed via the fuel tax as I noted earlier are already mis-directed. That money is supposed to be paying down our national debt. So complaining about mis-directed money that was already mis-directed in the first place doesn't really wash for me.

And then there is the issue that even if we do agree on just how much each side is actually paying, if we could ever get a true clear picture from government, is the fact that even a 5% Federal subsidy to roads is still more money annually than Amtrak gets each year. So from the perspective of national debt and what each taxpayer must pay, Amtrak is still costing us less.

Perhaps the best answer here is simply the fact that thanks to how government works and moves money around, we'll probably never truly know just how much subsidies each form is getting. But that still doesn't change the fact that both are getting subsidies, as well as airplanes. Therefore expecting one form of transportation to survive without subsidies while the others get subsidies is completely unfair.

 

[PRR 60]

While I agree that the reports is for all highways, not just Interstate; it does not include local streets as they are not highways.

While the Subsidyscope report says "highway", the term highway is being used generically to apply to all public roads. It is not based on any transportation engineering defintion of "highway". I refer you to the drill-down data which defines the report scope as "public roads" as defined by the FHWA Highway Statistics reports and tables. If you pull-up the Subsidyscope's data for New York State you will find that the report included 113,741 miles of "State Public Road Length" of all types, including 76,944 miles of what they describe as "City". If you go to FHWA Table HM-20 for 2007 (the year used for the Subsidyscope report). you will see 113,740 miles of public roads in New York State, including 32,239 miles of local urban roads less than "collector" category, and 44,489 miles of local rural roads less than "minor collector" category. ("Collector" is the lowest category of through highway. Everything less than that is a local street or local rural road.) What the report calls "City" roads, and the FHWA calls local urban and local city, is what you and I would call local streets and roads.

Notwithstanding the report's use of the term "highway", the report includes costs associated with all public roads down to and including local streets and roads. It is true that local streets and roads are supported largely by local property taxes. In it's analysis, the report includes property taxes used for local road maintenance as a "non-user" contribution to highway construction and maintenance.

Subsidyscope data by state

FHWA Table HM-20 (2007)

My statement concerning the fact that the numbers could be misleading due to the diversion of some highway user-paid taxes and fees to non-highway purposes did not come from an "ultra-conservative approach from some Congressmen". It came from the Subsidyscope report.

From the report:

Not all user fees collected are made available for highway purposes. Of the 18.4 cent per gallon federal tax on gasoline, 2.86 cents are allocated specifically for mass transit projects. Another 0.1 cent per gallon is used to pay for environmental cleanup resulting from leaking fuel storage tanks. From 1990 to 1997, the federal government also set aside a portion of taxes on gasoline, diesel and other fuels to reduce budget deficits.
However, even if those funds were fully devoted to highways, total user fee revenue accounted for only 65 percent of all funds set aside for highways in 2007, according to Subsidyscope calculations. This is down from 84 percent in 1997 and 77 percent in 1967. Subsidyscope provides a complete data set of user fee revenues and allocations for download.

Lastly, you continue to equate all non-user support of highways to federal support:

And then there is the issue that even if we do agree on just how much each side is actually paying, if we could ever get a true clear picture from government, is the fact that even a 5% Federal subsidy to roads is still more money annually than Amtrak gets each year. So from the perspective of national debt and what each taxpayer must pay, Amtrak is still costing us less.

The majority of non-user support of highways comes from local governments - county and municipal, not federal. In New York State, the largest single non-user contributor to highway construction and maintenance was county and local governments - 32% off all funding. If local and state tax revenue used for highways is a non-user subsidy, then shouldn't state and local tax revenue used to support Amtrak also be a subsidy, not revenue? The 69% user support of Amtrak includes state subsidy payments as user revenue.

My overall point is that the use of a 51% or even a 65% user contribution to highway construction and maintenance as somehow comparable to a 69% user contribution toward Amtrak is not a valid comparison. It takes the public support of only a small segment of highway transportation - road contruction and maintenance (with the rest 100% user supported) and compares it to the entire cost of Amtrak. Using that invalid comparison, it is then implied that Amtrak covers more of its costs than someone driving a car. That is simply not true. There are lots of good reasons to support Amtrak. Stating that Amtrak covers more of it's costs than someone driving a car is not one of them.

 

[henryj]

Publishing income statements with depreciation listed on them as an expense is a useless gesture by Amtrak and only satisfies the accountants. Amtrak does not even cover it's operating costs, so it is not generating any funds for future capital expenditures. Amtrak's reports should all be on a cash basis. Cash in and cash out only. All their capital expenditures are financed by grants from Congress. Depreciation is just a way to recognize the cost of using up capital equipment which for Amtrak is meaningless since it's all a gift anyway.

 

[Trogdor]

Publishing income statements with depreciation listed on them as an expense is a useless gesture by Amtrak and only satisfies the accountants. Amtrak does not even cover it's operating costs, so it is not generating any funds for future capital expenditures. Amtrak's reports should all be on a cash basis. Cash in and cash out only. All their capital expenditures are financed by grants from Congress. Depreciation is just a way to recognize the cost of using up capital equipment which for Amtrak is meaningless since it's all a gift anyway.

Amtrak is a corporation, and has to publish financial statements as such. It has nothing to do with whether or not it covers its operating costs or future capital requirements with fares.

What you are looking for is called a statement of cash flows, and, guess what: Amtrak publishes that, too.

The income statement, balance sheet, and statement of cash flows are all basic financial statements, and all can be found in Amtrak's published annual reports.

 

[henryj]

Amtrak is a corporation, and has to publish financial statements as such. It has nothing to do with whether or not it covers its operating costs or future capital requirements with fares.

What you are looking for is called a statement of cash flows, and, guess what: Amtrak publishes that, too.

The income statement, balance sheet, and statement of cash flows are all basic financial statements, and all can be found in Amtrak's published annual reports.

Trogdor, you seem to know all about Amtrak finances. If you will, please explain these things to me. In their audited financial statements they show a cash operating loss of 618.7 million and an operating subsidy from the Feds of 563.0 million. The 2010 Performance report for FY2010 shows an operating subsidy requirement of 437.6 million with an operating subsidy from the Feds of the 563 million. Further down in the operating stats by train they show the total operating loss for all the trains to be 733.7 million. How do you reconcile those differences, 618.7 vs 437.6 vs 733.7? Depreciation is not included in any of them.

 

[Trogdor]

Amtrak is a corporation, and has to publish financial statements as such. It has nothing to do with whether or not it covers its operating costs or future capital requirements with fares.

What you are looking for is called a statement of cash flows, and, guess what: Amtrak publishes that, too.

The income statement, balance sheet, and statement of cash flows are all basic financial statements, and all can be found in Amtrak's published annual reports.

Trogdor, you seem to know all about Amtrak finances. If you will, please explain these things to me. In their audited financial statements they show a cash operating loss of 618.7 million and an operating subsidy from the Feds of 563.0 million. The 2010 Performance report for FY2010 shows an operating subsidy requirement of 437.6 million with an operating subsidy from the Feds of the 563 million. Further down in the operating stats by train they show the total operating loss for all the trains to be 733.7 million. How do you reconcile those differences, 618.7 vs 437.6 vs 733.7? Depreciation is not included in any of them.

Please explain to me where I said I knew "all about Amtrak finances." I eagerly await your response.

 

[Ryan]

Even the 51% figure is somewhat bogus since about 25% of the federal fuel tax revenues are diverted to non-highway uses, including rail.

My statement concerning the fact that the numbers could be misleading due to the diversion of some highway user-paid taxes and fees to non-highway purposes did not come from an "ultra-conservative approach from some Congressmen". It came from the Subsidyscope report.

From the report:

Not all user fees collected are made available for highway purposes. Of the 18.4 cent per gallon federal tax on gasoline, 2.86 cents are allocated specifically for mass transit projects. Another 0.1 cent per gallon is used to pay for environmental cleanup resulting from leaking fuel storage tanks. From 1990 to 1997, the federal government also set aside a portion of taxes on gasoline, diesel and other fuels to reduce budget deficits.
However, even if those funds were fully devoted to highways, total user fee revenue accounted for only 65 percent of all funds set aside for highways in 2007, according to Subsidyscope calculations. This is down from 84 percent in 1997 and 77 percent in 1967. Subsidyscope provides a complete data set of user fee revenues and allocations for download.

2.96 cents/gallon of 18.4 is only 16%, not 25%.

 

[henryj]

Amtrak is a corporation, and has to publish financial statements as such. It has nothing to do with whether or not it covers its operating costs or future capital requirements with fares.

What you are looking for is called a statement of cash flows, and, guess what: Amtrak publishes that, too.

The income statement, balance sheet, and statement of cash flows are all basic financial statements, and all can be found in Amtrak's published annual reports.

Trogdor, you seem to know all about Amtrak finances. If you will, please explain these things to me. In their audited financial statements they show a cash operating loss of 618.7 million and an operating subsidy from the Feds of 563.0 million. The 2010 Performance report for FY2010 shows an operating subsidy requirement of 437.6 million with an operating subsidy from the Feds of the 563 million. Further down in the operating stats by train they show the total operating loss for all the trains to be 733.7 million. How do you reconcile those differences, 618.7 vs 437.6 vs 733.7? Depreciation is not included in any of them.

Please explain to me where I said I knew "all about Amtrak finances." I eagerly await your response.

Sorry, that just seemed to be the tone in the statements above. I would still like someone to explain the differences as I have tried and can't find a way to do it.

 

[jis]

Amtrak is a corporation, and has to publish financial statements as such. It has nothing to do with whether or not it covers its operating costs or future capital requirements with fares.

What you are looking for is called a statement of cash flows, and, guess what: Amtrak publishes that, too.

The income statement, balance sheet, and statement of cash flows are all basic financial statements, and all can be found in Amtrak's published annual reports.

Trogdor, you seem to know all about Amtrak finances. If you will, please explain these things to me. In their audited financial statements they show a cash operating loss of 618.7 million and an operating subsidy from the Feds of 563.0 million. The 2010 Performance report for FY2010 shows an operating subsidy requirement of 437.6 million with an operating subsidy from the Feds of the 563 million. Further down in the operating stats by train they show the total operating loss for all the trains to be 733.7 million. How do you reconcile those differences, 618.7 vs 437.6 vs 733.7? Depreciation is not included in any of them.

Please explain to me where I said I knew "all about Amtrak finances." I eagerly await your response.

Sorry, that just seemed to be the tone in the statements above. I would still like someone to explain the differences as I have tried and can't find a way to do it.

If you give me some time I will try to take a crack at it. Which specific document are you talking about? Please give me a URL.

Thanks.

 

[PRR 60]

Even the 51% figure is somewhat bogus since about 25% of the federal fuel tax revenues are diverted to non-highway uses, including rail.

My statement concerning the fact that the numbers could be misleading due to the diversion of some highway user-paid taxes and fees to non-highway purposes did not come from an "ultra-conservative approach from some Congressmen". It came from the Subsidyscope report.

From the report:

Not all user fees collected are made available for highway purposes. Of the 18.4 cent per gallon federal tax on gasoline, 2.86 cents are allocated specifically for mass transit projects. Another 0.1 cent per gallon is used to pay for environmental cleanup resulting from leaking fuel storage tanks. From 1990 to 1997, the federal government also set aside a portion of taxes on gasoline, diesel and other fuels to reduce budget deficits.
However, even if those funds were fully devoted to highways, total user fee revenue accounted for only 65 percent of all funds set aside for highways in 2007, according to Subsidyscope calculations. This is down from 84 percent in 1997 and 77 percent in 1967. Subsidyscope provides a complete data set of user fee revenues and allocations for download.

2.96 cents/gallon of 18.4 is only 16%, not 25%.

The 2.86 cents to the Transit Account and the 0.10 cent to the leaking tank account occurs before the remaining funds are added to the Highway Trust Fund. As you calculated, that is about 16% of the fuel tax revenue. The remaining diversions from the original intent of funding highway construction and maintenance occurs with funding out of the Highway Trust Fund itself.

The Highway Trust Fund, originally limited to highway construction and maintenance grants only, now funds lots of different things. Highway Trust Fund grants go to such activities as bike trails, trucker safety programs, safe routes to school programs, transportation museums, highway beautification, and congestion mitigation funding for transit operating support (grants that have kept some transit systems afloat). If you take the sum of all the non-highway construction and maintenance grants of the Trust Fund and add them to the 16% of the fuel tax that does not even get into the Trust Fund, you get about 25%.

Certainly some of the programs funded from the Trust Fund, such as trucker safety programs, can be considered highway related. Others, like bike trails and transportation museums, less so. Grants to transit to reduce highway congestion, maybe. Probably most are well worthwhile. However, the point is not individual programs and numbers, but that the shortfall of the Trust Fund to support highway construction and maintenance is not solely caused by a lack of funding from the federal fuel tax.

 

[henryj]

If you give me some time I will try to take a crack at it. Which specific document are you talking about? Please give me a URL.

Thanks.

Jis, I am just looking at the Fy2010 Financial Statements and the September 2010 Performance reports on the Amtrak web site. They are filed under News & Media/Reports & Documents. http://www.amtrak.com/servlet/ContentServer?c=Page&pagename=am%2FLayout&p=1237608345018&cid=1241245669222

 

[scientist]

Seems like both the house and the Senate have voted on the bill, and it will go to the President tomorrow for signing. High speed rail takes the hit. But as one Congressperson notes, they are ready to support proposals "where it makes sense." Posted just a couple of hours ago on TheHill.com:

http://thehill.com/b...rail-plans-dead

 

[The Davy Crockett]

High speed rail takes the hit. But as one Congressperson notes, they are ready to support proposals "where it makes sense." Posted just a couple of hours ago on TheHill.com:

http://thehill.com/b...rail-plans-dead

I'm sorry, but saying one will support something "where it makes sense" is a meaningless, both-sides-of-the-mouth political statement. There are all sorts of things one can support "where it makes sense." Full scale war, company bailouts, death row pardons, etc, etc,

The facts are in the votes in Congress. As things stand, high speed rail is taking a bad hit this year. Who knows what will happen in the future, but another, longer term fact is that the on-again, off-again approach being taken wastes a lot of time and money and sure messes with some peoples' livelihoods.

 

[jis]

High speed rail takes the hit. But as one Congressperson notes, they are ready to support proposals "where it makes sense." Posted just a couple of hours ago on TheHill.com:

http://thehill.com/b...rail-plans-dead

I'm sorry, but saying one will support something "where it makes sense" is a meaningless, both-sides-of-the-mouth political statement. There are all sorts of things one can support "where it makes sense." Full scale war, company bailouts, death row pardons, etc, etc,

The facts are in the votes in Congress. As things stand, high speed rail is taking a bad hit this year. Who knows what will happen in the future, but another, longer term fact is that the on-again, off-again approach being taken wastes a lot of time and money and sure messes with some peoples' livelihoods.

This is getting a bit off topic, but IMHO the US system is designed to operate that way. Things in which a lot of people's livelihood is invested tends to get funded at astronomical and illogical levels. Witness Defense and Homeland Security establishment for an example.

Getting back to HSR, funding is but one leg of the overall thing. I think a bigger problem is that we do not really have a regulatory and governance framework in place that can actually bring to reality a properly balanced public-private partnership to bear on this potentially huge investment, and everyone is running about pretending that all we need is a huge pot of money and all will be fine.

One must also remember that in the US we generally try to make every mistake up front before stumbling into doing the right thing. One just hopes that in the fast moving world we have the time for that indulgence. But the fact of the matter is that the reality of how one would go about providing the mobility needed for maintaining a vibrant growing economy will strike and decisions will have to be made. It is not about whether the money will eventually be spent or not but how it will be spent when the powers that be get hit on their head by the requisite 2 by 4s of reality.

Here is one perspective on that:

http://www.railroad.net/despite-2012-spending-bill-high-speed-rail-will-find-some-funding-388.html