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On Amtrak's Costs and Other Costs

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On Amtrak's Costs and Other Costs
Posted by John WR on Sunday, February 24, 2013 7:47 PM

According to Railroad Net in 2011 the Federal Government spent $1.4 billion on Amtrak.  Many ask if this cost is justified.  I think it is.  And here is the reason why.  Automobile injuries and deaths cost us not $1.6 billion, not $16 billion but about $ One Hundred and Sixty Two Billion a year.  That is all of the dollar costs -- costs to both government and individuals.  It included things like lost earnings and disability payments.  But it is only dollar costs.  It does not include individual suffering and pain or the deep emotional hurt to survivors when some one dies.  Can we do something about this?

Well, one thing we can do is to take the train.  If I take the train from New York to Providence of course I don't know that I would have had an accident had I drove.  But I can avoid that risk.  Some will argue that the risk avoided by taking the train is very small.  Indeed it is.  But I like what Edmund Burke said about that:  "No man made a bigger mistake than the one who did nothing because he could only do a little."

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Link to the study:  http://money.cnn.com/2008/03/05/news/economy/AAA_study/

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Posted by Paul Milenkovic on Monday, February 25, 2013 10:55 AM

Or you could take an airplane.  Or a bus.  All of the common carrier modes have a safety record that is at least an order of magnitude better than automobiles.

But don't airlines have crashes as do buses?  Yes they do, and Amtrak a while back actually sank a Superliner coach with loss of life.  It wasn't Amtrak's fault -- a barge operator hit a "swing bridge" just as the train was crossing, but a large number of people lost their lives just the same.  Amtrak may be much safer than driving, but it doesn't have the perfect safety record of the Japanese bullet trains.

There is also a "numeracy fallacy" in your reasoning.  It is like the Dr. Evil character in Mike Meyers "Austin Powers" comic movies.  "If the world does not meet my Evil demands and pay me one mill-yon dohllars!" and his sidekick played by actor Robert Wagner turns to whisper in his ear that one million dollars is not much money after inflation over the time Dr. Evil had been in frozen suspended animation from the 1960's.

Amtrak carries roughly 1 for every 1000 automobile passenger miles.  I could, hypothetically, have a tourist passenger line with a perfect safety record and demand a million per year to keep it running -- see, auto lack-of-safety costs 160 billion per year, 160,000 times more than what I want for my rail line!  This does not take into account the scale of my rail line.

So if the rationale for Amtrak is spending money on safety, one could perhaps justify an Amtrak subsidy of 162 million dollars per year?

As to your good English/British friend Edmund Burke, what profit is there is spending 1.4 billion dollars to save 30 lives (take 30,000 yearly highway fatalities, prorate them by the Amtrak market share and you come up with 30 lives -- the Superliner coach accident along brings Amtrak's fatality rate up to at least 2 per year, comparable with the safety record of airlines and bus lines), when you could spend that same 1.4 billion saving many more lives shoring up highway safety?

I mean, go ahead and ride Amtrak if that it is your desire and your interest.  But the "little bit" done by an individual is not the same as the "lot of bit" done by public policy choices, where a well meaning public policy choice could have the opposite effect of what is intended.

If GM "killed the electric car", what am I doing standing next to an EV-1, a half a block from the WSOR tracks?

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Posted by oltmannd on Monday, February 25, 2013 2:35 PM

John WR

According to Railroad Net in 2011 the Federal Government spent $1.4 billion on Amtrak.  Many ask if this cost is justified.  I think it is.  And here is the reason why.  Automobile injuries and deaths cost us not $1.6 billion, not $16 billion but about $ One Hundred and Sixty Two Billion a year.  That is all of the dollar costs -- costs to both government and individuals.  It included things like lost earnings and disability payments.  But it is only dollar costs.  It does not include individual suffering and pain or the deep emotional hurt to survivors when some one dies.  Can we do something about this?

Well, one thing we can do is to take the train.  If I take the train from New York to Providence of course I don't know that I would have had an accident had I drove.  But I can avoid that risk.  Some will argue that the risk avoided by taking the train is very small.  Indeed it is.  But I like what Edmund Burke said about that:  "No man made a bigger mistake than the one who did nothing because he could only do a little."

**************************

Link to the study:  http://money.cnn.com/2008/03/05/news/economy/AAA_study/

You have the tail wagging the dog.  The problem statement you are proposing is really:  "How do I best mitigate $162B in injuries and death with $1.4B in annual spending?"

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Posted by Bob Keller on Monday, February 25, 2013 3:03 PM

For year's we've heard from the US Traffic Safety Council that most auto deaths are within 25 miles of home.  With the exception of some commuters, I don't think justifying the outlay of Amtrak's costs at the foot of highway safety is a sure-fire winner. You could probably come up with some justification, but not for a national system.

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Posted by John WR on Monday, February 25, 2013 5:22 PM

Paul Milenkovic
Or you could take an airplane.  Or a bus.  All of the common carrier modes have a safety record that is at least an order of magnitude better than automobiles.

You are absolutely right, Paul.  Any common carrier has a far lower accident rate than private automobiles.  The automobile accident rate really is horrendous and yet it is generally ignored.   

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Posted by John WR on Monday, February 25, 2013 5:28 PM

Paul Milenkovic
when you could spend that same 1.4 billion saving many more lives shoring up highway safety?

But Paul, we are not going to spend an additional $1.4 billion or even an additional $140 to shore up highway safety.  Congress is just not inclined to do that.  If Amtrak did not exist there is no reason to believe Congress would spend additional money to improve highway safety.  

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Posted by John WR on Monday, February 25, 2013 5:30 PM

oltmannd
You have the tail wagging the dog.  The problem statement you are proposing is really:  "How do I best mitigate $162B in injuries and death with $1.4B in annual spending?"

I don't follow you Don.  How is Amtrak somehow the tail on a a dog that is highways?  

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Posted by John WR on Monday, February 25, 2013 5:32 PM

Ogaugeoverlord
For year's we've heard from the US Traffic Safety Council that most auto deaths are within 25 miles of home.

No doubt that is true.  But many injuries and deaths do occur far from home too.  

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Posted by Paul Milenkovic on Monday, February 25, 2013 8:06 PM

John WR

Paul Milenkovic
when you could spend that same 1.4 billion saving many more lives shoring up highway safety?

But Paul, we are not going to spend an additional $1.4 billion or even an additional $140 to shore up highway safety.  Congress is just not inclined to do that.  If Amtrak did not exist there is no reason to believe Congress would spend additional money to improve highway safety.  

John

You are right.  There is no more money for highway safety, and the 1.4 billion spent on Amtrak that saves 30 lives per year is being denied programs that could save many more than 30 people per year.  On the CBS Evening News there was a medical scientist with a cure for the flu that maybe kills more people than cars, but there is a shortage of government funding.  So by supporting trains we are active parties in killing a lot of people.  I wouldn't have thought of it that way, but the way it was brought up made me think through the consequences.

So you know what else Edmund Burke said, "For evil to prevail, it is required that good men do nothing" or something along those lines.  Mr. Burke was a "neo-Conservative" of his era who wanted British military intervention against The Terror in France, by the way. 

I have nothing against spending 1.4 billion on trains.  I could support higher spending on trains if one can establish cost effectiveness.  But I understand where someone would want to "raid the Amtrak budget" as there are higher social priorities than funding passenger trains.

If GM "killed the electric car", what am I doing standing next to an EV-1, a half a block from the WSOR tracks?

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Posted by schlimm on Monday, February 25, 2013 8:23 PM

Passenger rail service needs to be justified on the basis of being an efficient transportation alternative to cars and planes, at a price that people will pay, that covers above the rail operating expenses (not capital infrastructure).   It needs to stand on those merits alone, not on eco-benefits, preventing highway deaths, providing ADA service or providing an LD alternative to flying because some folks don't like flying or because some folks want a subsidized land cruise on a Nostalgia Express.  If that is what Paul M. is basically saying, then I, for one, agree.

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Posted by oltmannd on Tuesday, February 26, 2013 4:49 AM

John WR

oltmannd
You have the tail wagging the dog.  The problem statement you are proposing is really:  "How do I best mitigate $162B in injuries and death with $1.4B in annual spending?"

I don't follow you Don.  How is Amtrak somehow the tail on a a dog that is highways?  

John

You are starting with an answer and working back to the question.  Your answer is "Amtrak" and your question is "how to improve safety thru subsidies".
As others have already mentioned, you might get more safety spending it elsewhere.

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Posted by oltmannd on Tuesday, February 26, 2013 4:51 AM

John WR

Ogaugeoverlord
For year's we've heard from the US Traffic Safety Council that most auto deaths are within 25 miles of home.

No doubt that is true.  But many injuries and deaths do occur far from home too.  

All those traffic accidents occur close to home because that's where people do the most driving - at least in part. (and that's where they make all their left turns)

Kind of like saying, "most injuries with knives occur in the kitchen."  So, I should chop veggies in the living room?

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Posted by daveklepper on Tuesday, February 26, 2013 5:12 AM

I would agree with Schlimm completely if highway transportation in general was not so very highly subsidized.   Even then I think an economic case should be made for every Amtrak service including long distance services, and I think the economic case can be made in terms of overall effect on the economy, tourism, reduction of highway subsidies and requirements for new construction with reduction of loss of valuable land, etc.

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Posted by schlimm on Tuesday, February 26, 2013 7:20 AM

schlimm

Passenger rail service needs to be justified on the basis of being an efficient transportation alternative to cars and planes, at a price that people will pay, that covers above the rail operating expenses (not capital infrastructure).   It needs to stand on those merits alone, not on eco-benefits, preventing highway deaths, providing ADA service or providing an LD alternative to flying because some folks don't like flying or because some folks want a subsidized land cruise on a Nostalgia Express.  If that is what Paul M. is basically saying, then I, for one, agree.

To more accurately reflect what I believe Paul M. is saying, I should add that continuance of the higher levels of Amtrak subsidy (out of date LD routes) because of the real highway or air or river subsidies on the basis of "fairness" is not a good reason either.

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Posted by oltmannd on Tuesday, February 26, 2013 7:05 PM

schlimm

schlimm

Passenger rail service needs to be justified on the basis of being an efficient transportation alternative to cars and planes, at a price that people will pay, that covers above the rail operating expenses (not capital infrastructure).   It needs to stand on those merits alone, not on eco-benefits, preventing highway deaths, providing ADA service or providing an LD alternative to flying because some folks don't like flying or because some folks want a subsidized land cruise on a Nostalgia Express.  If that is what Paul M. is basically saying, then I, for one, agree.

To more accurately reflect what I believe Paul M. is saying, I should add that continuance of the higher levels of Amtrak subsidy (out of date LD routes) because of the real highway or air or river subsidies on the basis of "fairness" is not a good reason either.

Amen and amen.

I like the LD trains, but it's not right to use that as your starting point for justification of the subsidy.

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Posted by John WR on Tuesday, February 26, 2013 8:56 PM

For the record,  

I think this thread is going in the same direction that the "How I Would Approach Passenger Rail" has already gone.  Rather than continue down that path I am reserving further comments.

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Posted by I C Rider on Thursday, February 28, 2013 2:15 PM

When talking about any railroad and especially Amtrak compared to any other mode of transportation let's look at the fact that railroad furnish their own infrastructures . Who furnish airports and highways ? The tax payers. Who maintains(?) them. The tax payers. We are levied taxes on gasoline to help maintain highways. Airports are built by communinities and even airlines are charged for the privilege of using them . It's the consumer who pays . The people who controll air traffic are government employees. and rules and regulations are made by the FAA. Railroad  infrastructures are maintained by the company that owns it but is regulated by the government. We are probably the only civilized nation that does not have a passenger service that is independant of freight service. And the Acela is the only thing that looks up to date. Just look how clumsy a P42 engine looks pulling superliners. It looks third world. Gentlemen , We should be grateful that we have some resemblance of passenger service but until we have an independant up to date passenger rail service all the other facts are moot. Amtrak need to be as is is in the Norhteast Corridor the owner of it's own rail. The Class 1 road really don't want Amtrak and may some of their investors have ties in Congress. After all would you want a later seven car passenger train, with maybe 100 people, holding up several unit and intermodals because they are late because they go hung up behind a  junk train? It's all about the Benjamins.

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Posted by John WR on Thursday, February 28, 2013 7:22 PM

IC

You took a lot of words right out of my mouth.  No doubt Amtrak could be improved.  Perhaps greatly improved.  But no doubt Amtrak is much better that no passenger rail at all.  I would not get rid of it with out having something better in place.  

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Posted by oltmannd on Thursday, February 28, 2013 8:16 PM

I C Rider
We are probably the only civilized nation that does not have a passenger service that is independant of freight service.

Outside of a few HSR lines, the bulk of Europe passenger service is co-mingled with freight.

Other than you "keeping up with the Jones" argument, that my parents warned me about, what's the case for spending mega-Benjamins on HSR here?

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Posted by oltmannd on Thursday, February 28, 2013 8:17 PM

John WR

IC

You took a lot of words right out of my mouth.  No doubt Amtrak could be improved.  Perhaps greatly improved.  But no doubt Amtrak is much better that no passenger rail at all.  I would not get rid of it with out having something better in place.  

John

So, John, who should hold Amtrak accountable for improving?

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Posted by schlimm on Thursday, February 28, 2013 9:14 PM

oltmannd

Outside of a few HSR lines, the bulk of Europe passenger service is co-mingled with freight.

Other than you "keeping up with the Jones" argument, that my parents warned me about, what's the case for spending mega-Benjamins on HSR here?

1.  My observation in Germany was that on many ROW's where HSR co-mingles with freight and RB's and RE's and S-Bahn trains, the HSR trains have two tracks and the other services have two others.

2. There are many good reasons why the "Joneses" started HSR services.  it makes rail travel competitive with air up to about 400 miles.

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Posted by John WR on Friday, March 1, 2013 4:04 PM

oltmannd
So, John, who should hold Amtrak accountable for improving?

Don,  

Amtrak is accountable to the Congress.  However, there is a problem.  Where Amtrak loses money it is criticized.  And where Amtrak earns money, on the Acela, those same critics call for the service to be sold to the private sector.  Whatever Amtrak does it can only lose.  

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Posted by oltmannd on Friday, March 1, 2013 4:38 PM

John WR
Amtrak is accountable to the Congress.

Who is Congress accountable to?

John WR
Whatever Amtrak does it can only lose.  

That is what turned them into the inert blob that they are....  But, this is not a "law of physics".  Change is possible.  I think it starts with passenger rail advocates abandoning the "enabler" role and pushing for a functional Amtrak.

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Posted by oltmannd on Friday, March 1, 2013 4:40 PM

schlimm

oltmannd

Outside of a few HSR lines, the bulk of Europe passenger service is co-mingled with freight.

Other than you "keeping up with the Jones" argument, that my parents warned me about, what's the case for spending mega-Benjamins on HSR here?

1.  My observation in Germany was that on many ROW's where HSR co-mingles with freight and RB's and RE's and S-Bahn trains, the HSR trains have two tracks and the other services have two others.

2. There are many good reasons why the "Joneses" started HSR services.  it makes rail travel competitive with air up to about 400 miles.

That was not the case where I rode.  Hamburg to Hannover is double track and we went rocketing by intermodal trains in the hole at 125.

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Posted by oltmannd on Friday, March 1, 2013 4:42 PM

schlimm
There are many good reasons why the "Joneses" started HSR services.  it makes rail travel competitive with air up to about 400 miles.

The "Jones" had good reasons on their own.  If it makes sense for us, we should do it.  Envy is a poor motive.

Check out the latest Brooking's thing. I think the worm is starting to turn.  I hope so, anyway.

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Posted by John WR on Friday, March 1, 2013 7:15 PM

oltmannd
Who is Congress accountable to?

The traditional answer is that Congress is accountable to the people.  But as the current House of Representatives shows individual members are accountable to the voters in their own districts.  And the voters in those districts have widely differing opinions.

 

oltmannd
That is what turned them into the inert blob that they are.

I don't express myself the way you express yourself, Don.  But I think we agree that Amtrak management's moral is low because of its relationship to the Congress.  But I found Fred Frailey's Amtrak article pretty interesting.  Joe Boardman seems not inclined to really buck the Congress but he did challenge the Transportation Subcommittee by pointing to the $50 billion general fund appropriation for roads.  He knows he can be forced out and he accepts that.  But until the day that he is he will hang tough.  

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