Warren Buffett may end up owning Amtrak

Posted by Fred Frailey
on Wednesday, February 29, 2012
Breaking news: In the next few years Amtrak may be privatized, ending up in the portfolio of companies owned by Warren Buffett's Berkshire Hathaway. Ridiculous, you say? Yes, it is a bit far fetched, so you're going to need to read what I'm about to say slowly and carefully, not skipping over a single syllable.

I now have it from two very reliable sources within the upper reaches of Amtrak that Berkshire Hathaway subsidiary BNSF Railway has been sending Amtrak monthly bills for maintenance of the right of way between LaJunta, Colo., and Lamy, N.M. BNSF reasons that because it hasn't run freight trains over this track for some 18 months, any upkeep of the line is Amtrak's responsibility.

But Amtrak has not been paying these bills. It's attitude is that this is . . . well, I'm not sure why it is being obstinate. I mean, considering the shape its P42 locomotives are in, I would not want to tempt my landlord to say, next time a crankcase blows up in Arizona, that it doesn't lend rescue locomotives to deadbeats. But in any event, the debt is building.
Here is where you have to use your imagination. I divide Republicans into two camps. There are good Republicans, like Texas Sen. Kay Bailey Hutchison and me, who like Amtrak. And there are bad Republicans, like presidential wannabe Mitt Romney, who do not like Amtrak. Alas, bad Republicans appear to substantially outnumber good Republicans in the halls of Congress.
Now suppose the Republicans this year sweep those rascal Democrats out of control of the U.S. Senate. They will then dominate both houses of Congress. And suppose that Romney whips Obama. Should this happen, the bad Republicans could have it within their power to cut off funding for Amtrak. Very quickly it would slide into bankruptcy.

In bankruptcy court the creditors line up. In this instance, most would opt for liquidation so that they can get at least some of their money back. But the courts often favor the plans of creditors who want to keep the business going, in hopes of a recovery. (In the case of Amtrak, recovery would mean Democrats bounce back in the 2014 election.) And we know for a fact that Warren Buffett, the CEO of Berkshire Hathaway, likes trains. He likes them so much he bought his own 1:1 model railroad named BNSF. In my scenario, as a creditor, Buffett's company would step forward to champion running Amtrak in bankruptcy and would take control of the passenger train company.
Are you still with me? OK, it's a stretch. But stranger things than this happen to people and to companies that don't pay their bills. -- Fred W. Frailey
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