Amtrak
The little engine that couldn't.
By Chris Suellentrop

Posted Wednesday, June 26, 2002, at 1:53 PM PT

"No one wants to see Amtrak die," Transportation Secretary Norman Mineta said Tuesday, echoing the consensus about a government-owned corporation that lost more than $1 billion last year. While not literally true, Mineta's statement reflects the political reality that Amtrak will no doubt survive this week's death threats, as it has survived so many before. And that's unfortunate. We need to let Amtrak die, so that others might live.

Amtrak's beginnings were inauspicious—it was formed because railroad companies wanted to get out of the passenger rail business so they could focus on their more lucrative business, carrying freight. It's not surprising, then, that the government has had trouble making a profit from a business that the private sector was glad to be rid of. Many predicted an early death: According to Monday's Washington Post, President Nixon's aides thought Amtrak would disappear within two years of its May 1, 1971, creation.

But over the years, Amtrak has proved itself masterful at one thing (and no, it's not train travel): self-preservation. A potent combination of Beltway pork, an organized lobby of train buffs, and a nation's nostalgic fondness for railroads have kept Amtrak alive despite 31 years of mismanagement, cost overruns, and poor service. The political and popular support for Amtrak becomes even more astonishing when you realize that almost nobody uses it. Amtrak carries about 64,000 passengers a day. That compares to 1.8 million passengers daily for domestic airlines and 984,000 passengers daily for intercity buses. That's right, more than 15 times as many Americans use intercity buses than use Amtrak. And those are just the mass-transit options for intercity travel. More people drive between cities than take a plane.

Amtrak should be dismantled for practical reasons, not ideological ones about the size and purpose of government. Our intercity passenger rail system works exactly the opposite way that our other systems of intercity transportation work, notes Anthony Perl, author of the book New Departures: Rethinking Rail Passenger Policy in the Twenty-First Century. With air travel and road travel, the government provides the infrastructure, and the private sector moves the passengers. The government runs the airports, and the private sector flies the planes. The government builds the highways, and the private sector handles the cars, trucks, and buses. But with passenger rail, we've got it backward. The government (Amtrak) runs the trains, and the private sector (the freight railroads) owns the rails, except in the Northeast Corridor between Washington and Boston. That creates a double whammy—the private companies don't have the deep pockets or the interest in maintaining the infrastructure needed for a viable passenger rail system, and the government doesn't have the market incentives to be entrepreneurial or customer-focused. The result is a lot of decrepit tracks and routes that respond to political, rather than consumer, demands.

Why Is Amtrak So Screwed Up?

Further compounding Amtrak's problems are its labor agreements, which help to make traveling by train so expensive. "The average Amtrak salary is about 20 percent higher than the average airline salary," says Ronald D. Utt, a senior research fellow at the Heritage Foundation. "No one views airline employees as underpaid people." Amtrak critic Wendell Cox notes that Amtrak workers can receive severance packages of up to five years, with medical and dental benefits—"ultimately guaranteed by taxpaying workers who typically have little or no coverage themselves." The cost-cutting program already undertaken by Amtrak President David Gunn indicates the depth of the problem. Gunn plans to reduce the number of vice presidents from 80 to 25, which means that Amtrak was employing 55 superfluous VPs.

It should be uncontroversial to suggest that having the government run a monopoly on intercity passenger rail service is a bad idea. Breaking Amtrak up into several competing units that operate like our deregulated airlines would cut costs and improve service. True, unprofitable routes would be eliminated, but so what if you can't ride the train anymore from Orlando to Los Angeles? Not all routes would be canceled permanently; some of them could be reinstated once the system was back on its feet. Besides, train buffs interested in transcontinental rail journeys can opt for high-priced, privately run "land cruise" trips that do for train travel what luxury liners have done for ocean travel—they've made the journey an end in itself. And who knows, removing Amtrak's monopoly on taking train passengers from point to point might allow these land cruises to add on some less expensive "steerage" cars, if there's enough demand.

The monopoly that the government granted Amtrak (or rather, granted itself) has made "passenger rail" in the United States synonymous with a single company—Amtrak. But it doesn't have to be that way. Focusing on saving Amtrak (or destroying it for ideological reasons) misses the point: creating a viable passenger rail system. And the first step in doing that is killing Amtrak.

Your clip is nothing that none of us haven't heard a million times before. Let me say only that I disagree considerably with what your post said!!

Thanks for the post anyway -- it does us all good to see "the other side" of things as well as the side most of us are promoting.

Unlike Rich I will make a few comments (but I too don't have the time nor enegy to do it)...

First off, some of the things Chris stated are quite valid. These are mostly contained within the first (fact) stage of the statement.

On the other hand, during the later (opinion) portion there are quite a number of items I disagree with.

Just to make one specific comment. Chris said "train buffs interested in transcontinental rail journeys can opt for high-priced, privately run "land cruise" trips...they've made the journey an end in itself". While this can sometimes be the case, I usually want to spend some time at a destination and use the train as a method to get there and back. I have done this numerous times. For example, Glacier Park (Essex MT) and Grand Canyon (Flagstaff AZ).

Rail travel is my passion. I've taken numerous trips on on Amtrak, logging over 10,000 miles in the past 12 months. But avid rail traveler as I am, I feel rail passenger service in this country needs to be fundamentally changed.

Though many posting to this forum agree change is needed, their concept of change seems to be defined as "status quo with more government funding and control." Any thinking outside this box is too often greeted with "...nothing new here" responses or a political slap.

With all of the talk about unprofitable routes, no one except George Warrington, has named a route that is unprofitable, and he believes that everything outside of the NEC is unprofitable.

Amtrak will always have to have government subsidies unless an independent person really takes a look at where the money is being wasted.

But I totally concur with Mr. "Reggierail" Atwell; don't take it on Mr. Bianco because he chose to alert the Forum that this material was out there.

quote:

---

Originally posted by rbianco:
...

*** Pick this apart fellas ***

---

As the original post by rbianco closed with the above, I expect he too was not in "total agreement" with the statement by Chris Suellentrop.

quote:

---

Originally posted by zephyr:
rbianco--Thanks for your excellent post.

Rail travel is my passion. I've taken numerous trips on on Amtrak, logging over 10,000 miles in the past 12 months. But avid rail traveler as I am, I feel rail passenger service in this country needs to be fundamentally changed.

Though many posting to this forum agree change is needed, their concept of change seems to be defined as "status quo with more government funding and control." Any thinking outside this box is too often greeted with "...nothing new here" responses or a political slap.

Again, ribianco, thanks for posting something "outside the box." I found it refreshing, and hope to hear more from you.

---

WOW !!! :} 10,000 miles a year! I'm impressed. Please tell more about what you think should be done about this. I'm sure many others would like to read more about your thoughts and ideas as well

quote:

---

A potent combination of Beltway pork, an organized lobby of train buffs, and a nation's nostalgic fondness for railroads have kept Amtrak alive....

---

Here's a great counter argument from James Repass of NCI: "Amtrak has to be funded each year by whatever its budget request is. And as a consequence it always looks like it's asking for money, like it's going to the government and saying, 'Please give me money because I don't have any.' Whereas the airlines and the highways are getting billions upon billions upon billions of dollars each and every year automatically. The difference is that Amtrak gets attention and the others don't.... It's the way we fund our transportation system. It's stupid. It causes unnecessary time to be consumed by Congress and by Amtrak to try to work things out each year.

"You know, this isn't a question of being able to have trains because everybody likes to go ride on choo-choos. This has nothing to do with nostalgia. It has everything to do with a balanced transportation system, and one that is robust."

quote:

---

The political and popular support for Amtrak becomes even more astonishing when you realize that almost nobody uses it.

---

Ah, but he doesn't know that the trains we do have are full. Somebody tell him that People use trains when they are available. They just aren't enough trains available to meet the demand, hence the small market share. There is a huge latent market for train service. Almost everywhere new trains start running, ridership consistently exceeds expectations.

quote:

---

Our intercity passenger rail system works exactly the opposite way that our other systems of intercity transportation work, notes Anthony Perl, author of the book New Departures: Rethinking Rail Passenger Policy in the Twenty-First Century. With air travel and road travel, the government provides the infrastructure, and the private sector moves the passengers. The government runs the airports, and the private sector flies the planes. The government builds the highways, and the private sector handles the cars, trucks, and buses. But with passenger rail, we've got it backward. The government (Amtrak) runs the trains, and the private sector (the freight railroads) owns the rails, except in the Northeast Corridor between Washington and Boston. That creates a double whammy—the private companies don't have the deep pockets or the interest in maintaining the infrastructure needed for a viable passenger rail system, and the government doesn't have the market incentives to be entrepreneurial or customer-focused. The result is a lot of decrepit tracks and routes that respond to political, rather than consumer, demands.

---

He got that right but then he asks...

quote:

---

Why Is Amtrak So Screwed Up?

---

If he would just read the paragraph he wrote above he would have his answer!!! What a maroon.

quote:

---

Breaking Amtrak up into several competing units that operate like our deregulated airlines would cut costs and improve service.

---

Maybe. But has anyone run the numbers to see if private operators would find that feasable?

quote:

---

True, unprofitable routes would be eliminated, but so what if you can't ride the train anymore from Orlando to Los Angeles?

---

First, eliminating long-distance trains places greater financial burdens on regional trains (most of which actually cover a lower percentage of their costs from ticket revenue than LD trains do.) LD trains share common costs with regional trains, such as stations, yards, etc. Long distance trains also feed passengers to and from regional trains, making the revenue stream of each higher than it would be otherwise.

Second, Eliminating routes reduces the mobility choices of everyone, and forces people into already clogged air and road systems.

Third, because eliminating LA to Orlando service also eliminates many shorter travel opportunities on the same train. 60% of all travel in the US begins or ends in small communities. Ever try getting a cheap flight to a small town?

quote:

---

Besides, train buffs interested in transcontinental rail journeys can opt for high-priced, privately run "land cruise" trips that do for train travel what luxury liners have done for ocean travel—they've made the journey an end in itself.

---

Of course, very few of Amtrak's riders are "train buffs." A full 40% are using the trains to visit family, 16% for personal business, and 24% for business travel. Only 20% are riding Amtrak for sightseeing/tourism opportunities. (This according to NARP) Such travel requires regularly scheduled service (i.e. at least daily) and a reasonable price to be competitive. Occasional tour trains cost a bundle don't serve those needs.

By the way, I believe the above percentages are more or less consistent across all modes of transportation.

quote:

---

The monopoly that the government granted Amtrak (or rather, granted itself) has made "passenger rail" in the United States synonymous with a single company—Amtrak. But it doesn't have to be that way.

---

Actually it does have to be that way. The freight railroads have made it very clear they will not deal with a hodge podge of passenger operators on their tracks. They will deal with only one entity, and that is Amtrak. If it were otherwise there might be some room for experimenting. But facts is facts.

quote:

---

Focusing on saving Amtrak (or destroying it for ideological reasons) misses the point: creating a viable passenger rail system. And the first step in doing that is killing Amtrak.

---

The first statement is correct. But he needs to back up his conclusion with real numbers, marketing studies, and the like, not just superficial theories.

------------------
Trust God, love your neighbor, and never mistake opinion for truth.
-Mr. Toy

My mention of my mileage was simply meant to establish I have some recent long distance Amtrak experiences. My wife and I enjoyed every mile of it, and are looking forward to our next trip in two weeks. But my personal observation is there seems to be a growing number of disgruntled fellow passengers (I call them "fumers" as opposed to us foamers) on the trains I have taken.

On our last trip, the Coast Starlight was 3 1/2 hours late getting into Portland. For my wife and I,it was no big deal. We actually enjoyed seeing areas of the route (Sacramento River and Mount Shasta)that are normally traversed in darkness. However, the majority of the other passengers didn't seem to be so tolerant. The lounge was taken over by conversations of how to get refunds, and the taking of oaths never to take Amtrak again. At times, I thought I might be witnessing a sort of revolution brewing.

Many of these disgruntled passengers seemed to be on their first train trip. Though people of limited mileage, by definition, they had valid complaints that need to be considered and addressed. My enjoyment of rail travel gives me a pretty high pain threshold for service flaws, but that is not the case for the majority of passengers. They expect Amtrak to be, among other things, a reliable form of transportation (and, those low mileage people outnumber you and I). It isn't at this time, and that's why I feel it needs fundamental change--changes that go beyond just throwing more money at the current model.

What kind of change? I don't know, Ken V. Like many, I haven't paid much attention to public policy issues concerning Amtrak, as I haven't (and don't) pay much attention to many other political issues until something brings it to my attention. The threat of the Amtrak shutdown got my attention.

So I'm in the process of getting up to speed on this policy issue. I have found this forum to be an excellent source. My previous post was meant to simply thank ribianco for sharing an article with a viewpoint not normally found here. It also meant to express my desire to see less partisan political rhetoric on this forum. Amtrak certainly is a political issue, but I appreciate the posts that go beyond the simple name-calling and partisan dogma. Many (if not most) of you do just that--you are excellent in articulating your positions. Whether I agree or disagree, I thank you.

And, reggierail, please accept my thanks for posting the TRAC's article today. But be forwarned--I might be a mileage-challenged now, but I plan on catching up with you (with a little help of my Guest Rewards Card mileage extender). I'll crow (ah, let you know) when I do.

[This message has been edited by zephyr (edited 06-28-2002).]

(Having fun Scott????)

Reggie

If I knew how to post pictures in this forum, I could post a picture of Reggierail doing his best "fumers" imitation as he was sitting on the bus to Dallas!

But Mike has alerted me to a potential problem. You're not including those bus miles in your Amtrak totals, are you? Fess up if you are.

And Mike, the "Reggie the Fumer" picture would be a nice post to this Forum. Maybe someone can post instructions on how they include pictures with their messages. I'd like to know.