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[quote user="CMStPnP"] [quote user="Sam1"]The idea for Southwest Airlines germinated in the minds of a pilot businessman and attorney.  The first president was a CPA.  His business acumen, which reflected a wide variety of tools and techniques used by accountants, laid the operating and financial strategy that ensured Southwest's success.  Amongst other things the founders knew that their vision would not fly (no pun intended) unless they had a solid business and financial plan.  Needless to say, they got it right.  Unlike government projects, success in business requires a viable business plan.  And that means accountants, financial planners, etc.    [/quote] Heh-heh, better do some research on how Southwest Airlines used the Wright Amendment to reduce competition for a number of years.     I believe that America West was trying to compete head to head against Southwest but Southwest effectively used the Wright Amendment along with political lobbying to prevent the competition.     I really do not see Airlines as a model of unsubsidized travel. Southwest Airlines was founded in 1971 and became operational that year.  It morphed from a small charter operation out of San Antonio.  It launched its Dallas operations from Love Field.  Immediately, American, Braniff, etc. sued in federal court to stop its operations, claiming that it could not operate from Love because the Love based carriers had agreed to fly from the new DFW Airport.  Southwest countered that it was not part of the agreement to operate from DFW and could not be prohibited from operating an intrastate carrier from Love.  Ultimately, it prevailed in the courts. American, Braniff, etc. convinced Speaker of the House Jim Wright to have the Congress pass an amendment prohibiting common carriers from serving cities beyond Texas' contiguous states.  Southwest Airlines had nothing to do with the amendment; in fact, it was bitter opposed to it.   Several airlines, including American and Continental, have attempted to compete with Southwest out of Love.  All of them failed, with the exception of Continental Air Express, which has a commuter run to Houston Intercontinental Airport.  America West was formed in 1981 and became operational in 1983, which was long after Southwest had established itself at Love.  I don't believe America West ever seriously considered taking on Southwest at Love.  It flew out of DFW prior to the merger with  U.S. Airways. The key point of my posting, however, was to show that accountants, contrary to a previous posting, wear many hats, including on occasion CEO, and tend to facilitate rather than squash business visions.  Bean counting is something accountants do early in their career; the ones with ambition and brains become an integral part of the management team.  As my experience showed, their advice is sought from the get go.      [quote user="Sam1"]Some proposed U.S. HSR corridors may be economically viable, although they are unlikely to cover their cost through ticket revenues. Decision makers have had difficulty ascertaining their viability due to the uncertainties of ridership forecasts, cost estimates, and public benefits. [/quote] That maybe true, however, I think you'll find the GAO tends to look at just one specific line vs a entire system or network.    Kind of like looking at a single airline spoke without the hub. The GAO, which is arguably the most objective U.S. Government Agency, looked at 16 domestic high and moderate speed passenger rail projects.  That strikes me as more than a single spoke.  I spent more than 40 years working for corporate America, including 33 years in Dallas.  I was an accounting and audit manager.  The only government agency that we looked to for best practice ideas was the GAO, primarily because of its objectivity and the excellent quality of its work.   [quote user="Sam1"]Project sponsors must typically trade-off some level of ridership to reduce costs. For example, most domestic projects being considered are incremental projects on track shared with freight operators-a choice that limits the travel time competitiveness and reliability valued by riders that would be possible on more expensive, dedicated track. [/quote] Not mentioned here is that rail frieght in most cases can be cheaply routed to other lines off the shared lines or on new lines which avoid the increasing frequency passenger service.      I think this is a flaw in this logic. These is scant evidence to support this point.  For example, the Union Pacific said that it would cost more than $1.86 billion to route freight traffic off of its line from Taylor to San Antonio to enable the Austin to San Antonio commuter rail project.  That is just the cost of the relocation work.  It does not include the financing.  Depending on the length and terms of the financing, it could easily double the total cost over the life of the debt financing, which usually runs in the neighborhood of 30 years.  [quote user="Sam1"]While all U.S. sponsors of HSR cited a variety of public benefits that would flow from their projects, the extent to which benefits have been quantified and valued varied across projects. Ridership and revenue projects are often significantly (overly) optimistic.[/quote] Very true.    Politicians and HSR do not mix. [quote user="Sam1"]In each of three countries the auditors visited, the central government paid the up-front construction costs of their country's high speed rail lines, with no expectation that its investment would be recouped through ticket revenues.[/quote] Same with the Interstate Highway system and our current alleged "private" airline system.      So ho-hum here. The U.S. Highway Trust Fund, which was established to fund the Interstate Highway System, as well as other federal road projects, received a start-up infusion from the general fund of $25 billion.  It was quickly recovered from user fees.  In fact, until 2000, when the fund balance reached $31.1 billion, it ran a surplus, but because the Congress refused to raise the federal fuel taxes, the fund mangers were required to draw down the surplus.  In addition, during the Reagan and first Bust administrations, monies were transferred to the Mass Transit Fund and for deficit reduction. In FY08 the fund required a transfer of $8 billion from the general fund to remain viable. The cost of the airways system has been paid for by the commercial airlines, general aviation, and the military operatiing in civilian airspace.  All modes of transport, however, recieve some subsidy from the federal, state, and local governments.  But nothing comes close to the amount of subsidy required by passenger rail.  In FY2008 Amtrak, as an example, received an average federal subsidy of 22.61 cents per passenger mile compared to .42 cents for the airlines and .026 cents for vehicle miles travelled.  Closer to home, Trinity Railway Express (TRE) received an average subsidy of 20.5 cents per passenger mile.  [quote user="Sam1"] <LI> <DIV>Federal funding for rail in general, and high speed rail in particular has largely been obtained from general revenues, as opposed to trust funds or other dedicated federal funding sources, such as those that fund other transportation modes. </DIV> <LI> <DIV>Federal, state, and private funding constraints raise questions about how HSR is to be funded for the long haul. For example, private funding is difficult to obtain without significant federal and state government support.</DIV>[/quote] Thats fine so all we need to do to fix that is establish a trust fund I believe thats been partly taken care of by the Federal DOT has it not?     Can't Interstate Highway funds or parts of the gas tax be diverted to rail or mass transit projects.      I don't see this as particularly bad thing, just says we have to get our funding in order so as to not add to the deficit.     I agree with this. [quote user="Sam1"]The Federal Railroad Administration, which has a key role to play in evaluating proposals for HSR projects, has not yet determined how performance and accountability will be incorporated into the review and evaluation of grant applications.[/quote] Well the FAA hasn't replaced our Air Traffic Control system, so my guess is if we wait on the FRA it could be a Century longer of waiting.</LI> The FAA is replacing the air traffic control system.  Although the current system is outmoded, it is not dysfunctional.  Monies for Next Gen, which will cost approximately $20 billion, is in the FY10 and FY11 budgets. <LI>  [quote user="Sam1"]The auditors did not find a national strategy for HSR, i.e. objectives, benefits, accountabilities, etc., and, therefore, recommended to the Secretary of Transportation that a HSR strategy be developed.  The Secretary agreed. [/quote] The Strategy for the Interstate Highway initially was National Defense.    Why can't the strategy for HSR be increased mobility and increased productivity.      Interesting throughout all these bullet points with a PhD in Economics mentioned......it is never mentioned how increased mobility and intermodalism adds to productivity..............which contributes to our GDP.       Wonder why that is?</LI>[/quote]
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