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Since the early days of the Republic most forms of transport, including the railroads, especially those built west of the Mississippi after the Civil War, have received some form of subsidy.  These are sunk costs and are irrelevant.  The key question is how much subsidy is currently required to support our transport systems, and is it a good use of scarce resources? In FY 2007 Amtrak received federal and state subsidies to the tune of 24.45 cents per passenger mile.  By comparison the airlines received a federal subsidy of .049 cents per passenger mile whilst motorists garnered a federal subsidy of .013 cents per passenger mile.  These numbers can be verified by information found at Amtrak, FAA Statistics, Pension Benefit Guaranty Corporation, Homeland Security, and the Department of Transportation. They require a bit of number crunching. In addition to the federal subsidies the airlines and motorists received state and local subsidies, i.e. airports built with tax free bonds and roadways funded by property taxes as opposed to fuel taxes.  So too did Amtrak in the form of stations owned by local authorities and refurbished by tax free municipal bonds.  Determining the amount of state and local subsidies is a nearly impossible task. Passenger rail requires a larger subsidy than any other form of transport in America.  Moreover, whilst airline passengers and motorists (the users) pay most of the federal taxes that are transferred to support their preferred mode of transport, rail passengers, especially commuter and light rail passengers, depend on large subsidies from non users. Most people abandoned passenger trains for the airplane because it is swifter and better suited for long distances or the automobile because of convenience, comfort, and economics.  This is why, barring a technological break through, trains only make sense in relatively short, high density corridors where the cost of constructing additional highways or airways is prohibitive. If success is defined by ridership and revenues, the Northeast, Illinois, California, and North Carolina corridors, as well as several others, are successful.  However, if it includes covering the cost of the service, they are a failure.  For FY 2007, the state and local corridors required an average subsidy of approximately 15 cents a passenger mile, with the exception of the NEC, which required a subsidy of 20.99 cents per passenger mile.    The U.S. has a national transportation policy.  It is called highways and airways with some rail where appropriate.  It is also called let the people decide, which is what democracy is all about.
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