We've beat this point to death, but I think a comment about money is appropriate. Lots of people glaze over when the issue of money is thrown on the table, but it is an ugly fact of economic life.
As Senator Dirksen put it, "A billion here and a billion there, and soon you're talking about real money." The more than $1.3 billion proposed for Amtrak is not the swing issue associated with deficit spending in the U.S., but it is part of a problem that has led to a large debt burden for this country. At best the debt has to serviced, which means taxes will be used to pay the interest on it. The taxes come from you and me.
If a person is over weight, he or she is not likely to lose it by increasing his caloric intake or reducing her exercise routine. Cuts need to be made all around. Discontinuing the funding of long distance trains, which have a low social value, would be a good place to start trimming our national debt binge.
Samantha wrote: As Wilbur Mills, former Arkansas Representative and Chairman of the House Ways and Means Committee put it; a billion here and a billion there and first thing you know it adds up to some real money.
As Wilbur Mills, former Arkansas Representative and Chairman of the House Ways and Means Committee put it; a billion here and a billion there and first thing you know it adds up to some real money.
Everett McKinley Dirksen.
I have taken the Sunset from LA to San Antonio, as well as Houston, approximately five times, although I have not ridden it from LA since its departure time was change from 10:30 p.m. to 2:30 p.m. I rode it twice last year from El Paso to Dallas; it is the Texas Eagle from SA to Dallas. Amtrak says it is the Texas Eagle from LA to SA, as well as the Sunset, but only two cars go north or west from SA as the Eagle.
A trip on the Sunset can be a nice experience as long as you are not bothered by delays. Make sure to take plenty of reading material.
I have been tracking the on-time performance of Number 2 since August 1, 2007. It has been late by an average of 119 minutes at El Paso and 108 minutes at San Antonio. It usually arrives late in New Orleans, but it makes up considerable time between SA and New Orleans.
Speaking of El Paso, make sure you go inside the station during the layover there. It is a beautiful example of a turn of the century station. It has been restored.
The best scenary in Texas is from about 1.5 hours west of Alpine to about an hour east of Sanderson. The best of the best is from Marfa to Sanderson. I have been going there for more than 25 years to bicycle along the roads near Alpine. Make sure to grab a seat in the lounge car, although it should not be difficult to get one in February.
Samantha wrote:Speaking of El Paso, make sure you go inside the station during the layover there. It is a beautiful example of a turn of the century station. It has been restored.The best scenary in Texas is from about 1.5 hours west of Alpine to about an hour east of Sanderson. The best of the best is from Marfa to Sanderson. I have been going there for more than 25 years to bicycle along the roads near Alpine. Make sure to grab a seat in the lounge car, although it should not be difficult to get one in February.
Keep the train runnin' and one of these days I'll do it!
West Texas is a large area. If by west Texas you mean Midland, Odessa, Monahans, etc., they are not much for scenery unless you are into flat and dusty. They are, however, interesting.
Fortunately west Texas is not just the Permian basin, where the aforesaid communities are located. Alpine, Fort Davis, and Marfa are located in the Davis Mountains. They are not as dramatic as the upper Rocky Mountains, but they are beautiful. The Guadalupe Mountains are equally beautiful. And the Big Bend area, which is about 110 miles south of Alpine, draws tens of thousands of visitors every year because of its awesome beauty.
Beauty is in the eyes of the beholder. Some people like mountains; others prefer the sea coast; some are awestruck by the plains; many like deserts. It all depends on what floats your boat.
Interestingly, among all the facts Samantha cited, she neglected to mention that ridership of the Sunset Limited increased by more than 22 percent and ticket revenues grew by nearly 32 percent during FY2007. This is significantly outpaces the growth of any of Amtrak's other long-distance routes and many of the short-distance corridor routes.
That this train, with its tradition of late arrivals and myriad of other issues, can generate this kind of growth -- without any of those issues being resolved, speaks volumes about the importance of and need for this route. Yes, in many ways it is still the poster child for what is wrong with American rail travel (and having ridden it, I have no problem admitting that) but it must being doing something right to produce these numbers.
Oh, and for the record, I would, and plan, to ride this train again. Despite the problems, it was a fascinating and enjoyable adventure...as long as you aren't on a tight schedule!
The number of riders on the Sunset Limited, as well as the corresponding revenues, did indeed increase in the fiscal year ended September 2007. The increases appear to be dramatic because the base was low.
The figures for riders and revenues are interesting. Although I did not mention them, I did not ignore them. But the key number is how much does it cost to provide the service and how well is the cost covered by the revenues, which is the best indicator of the social and economic benefit of the service.
The number of riders on the Sunset increased significantly in 2007, but given the poor performance in 2006, it is hardly surprising. It carried 63,336 riders in 2007, compared to 96,896 on the Cardinal and, interestingly, 68,246 on the Heartland Flyer. It had the lowest number of riders of any of the long distance trains.
The bottom line number for the Sunset, which is a key business indicator, improved in 2007. Nevertheless, at the end of the year this train racked up the most red ink per passenger mile of any of the long distance trains. It lost 48.5 cents per passenger mile before interest and depreciation compared to 57.2 cents per passenger mile in fiscal year 2006. By comparison, the Cardinal, which is the next worst performing long distance train, lost 35.9 cents per passenger mile.
As I pointed out, it is hard to see how the Sunset provides an important service to the communities it serves. Fourteen of the 19 stops between Los Angles and New Orleans have commercial air service, i.e. trunk carrier or commuter air. Four of the others are within a two hour drive of a city that has air carrier service. Only Lordsburg is more than two hours from a commercial airport; it is about 2.5 hours from Tucson. Moreover, all but one community - Sanderson, Texas - are served by an intercity bus company with two to four services a day.
The avoidable cost or subsidy for a passenger traveling on the Sunset from one end point to another, at $.535 per mile, which includes an estimate for interest and depreciation, is $1,067.33. The 14 day economy airfare from Los Angles to New Orleans on Southwest Airlines, for example, is $221. Or if a person acts quickly, as of today, he or she can get a $99 Internet special fare.
If Amtrak were permitted to operate like a business, it would have dropped the Sunset, as well as most if not all of the other long distance trains, years ago. Unfortunately, it is a political creature that must bow to the pressures of the politicians and a tiny percentage of the population who argue that America cannot live without long distance trains.
If the RAILROADS had been allowed to treat passenger trains as a business in the 1960's, I'm not sure there would be any intercity passenger trains left!
-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/)
Samantha, you've made your point many times over. You are obviously well qualified to analyze numbers. But numbers don't tell the whole story, and shouldn't be the sole basis for deciding what services should or should not be provided.
One fellow who serviced equipment in our workplace was barred from flying for five years after sinus surgery. I met a woman on the train with a heart condition who cannot fly, either. I have a relative who doesn't fly because she finds even the normal sensations of flight to be extremely uncomfortable, and she is also not skilled enough behind the wheel to drive long distances or in unfamiliar territory. And Greyhound these days is barely fit for man or beast. I would be very upset if people like these lost their ability to move about the country in comfort and safety just because the numbers don't work for you.
There are many other reasons why people choose LD trains. Some are Amish or Mennonites who don't fly. Many are traveling coach on limited budgets to attend to personal business, family matters or to shuttle to school (as I did many years ago). Many are combining their need to get somewhere with a desire to see the country along the way. Their reasons are quite diverse.
People aren't numbers. If you go strictly by statistics you get a distorted view of the world. Individuals have individual needs. You can't turn them into statistics and tell them to do what you think they should do. Some people choose long distance trains because that is the best option given their needs. My philosophy is that we're all in this together, that everyone is my brother or sister. Thus I have no qualms about spending money for a service that benefits a relative few, but that does, indeed, make life better for them. This is one reason why the politicians didn't pull the plug years ago.
As I've stated before, I believe there are steps that could be taken to improve the Sunset's bottom line, such as daily service, and I really wish Amtrak would take a more serious look at them. I want to make the long distance trains as efficient and useful as possible. But there's no way you're going to convince me with a set of numbers that they should just go away.
conrailman wrote:Amtrak carried 25 Million people in 2007, that aot of people who use amtrak.
25M ain't nothin' to write home about. Historically, Amtrak ridership hasn't even kept pace with the population growth.
If you took all those passengers, assumed they rode an avg of 24 hrs (which is way high) and concentrated them on one corridor, it wouldn't even amount to the capacity of a single lane highway.
(25,000,000 /365 /24 /2 = 1400 people per hour in each direction. A highway lane capacity is 1900 vehicles per hour)
...which brings us to....
Moving those 25M people took about $1.3B in total subsidy (a little less than half was direct operating subsidy) What if it were $2.5B? Would that be "too much"? How about $10B to move 25M people? $50B? At what point would you say, "That's too much. Kill it".
For the fiscal year ended September 30, 2007, the Sunset Limited was on time at its end points - New Orleans and Los Angles - 13.5 per cent of the time.
I have tracked its on-time performance at El Paso and San Antonio since August 1, 2007. It has been late, on average, by two hours at El Paso and 110 minutes at San Antonio. However, it has a long scheduled lay over at San Antonio, so it is usually able to make up some schedule time between San Antonio and New Orleans.
I would plan on being off the advertised arrival time in New Orleans by 45 to 60 minutes.
oltmannd wrote: If the RAILROADS had been allowed to treat passenger trains as a business in the 1960's, I'm not sure there would be any intercity passenger trains left!
Had Congress not agreed to save intercity passenger trains through the formation of Amtrak, they would have been laid to rest by the early 70s, with the possible exception of the Northeast Corridor trains. And the billions of dollars that the government has spent on Amtrak's intercity passenger trains could have been spent on higher priorities.
Americans had demonstrated since the 1950s that they preferred airplanes for long distance travel, automobiles for intermediate and short distance intercity travel, as well as for family vacations irrespective of the distance, and commuter rail or buses in major urban areas.
If the intercity passenger train, especially the long distance train, had been allowed to expire, only a few die hard rail buffs and a tiny percentage of the population that is unable or unwilling to fly, take the bus, or drive would have been inconvenienced.
Subsequently, as we have seen in California, Illinois, and Pennsylvania, as well as my automobile loving Texas, rail was chosen to overcome corridor transport congestion in a few markets. Amtrak was not required to bring this about. Other corridors are likely to see rail as a good solution to deal with congestion, although it is not always the best choice.
The passenger train might be able to stand on it's own in high density, relatively short corridors, if governments stopped subsidizing all forms of transport including passenger rail. A thorough discussion of transport subsidies is beyond the scope of this forum. However, here is an example of how one element in the mix could level the playing field.
The tax on gasoline, which is a user fee, does not reflect its true cost, or the cost of the facilities required by motor vehicles, e.g. local and county roadways, traffic enforcement, etc. If motorists were required to pay these costs at the pump, as opposed to paying them indirectly, the cost of operating a motor vehicle would go up significantly.
The cost of maintaining a naval presence in the Middle East to keep the oil sea lanes open or the costs associated with the air pollution created by vehicles is not imbedded in the price of gasoline. Likewise, the cost of building local and county roads, which are paid for with property taxes and bond proceeds, or the cost of traffic law enforcement, is not attached to the price of gasoline.
If the aforementioned costs were rolled into the pump price of gasoline, it would probably be well north of $5.00 a gallon. It would cause most Americans to opt for more fuel efficient vehicles and greater use of public transport including short haul trains
Higher fuel costs might create an environment where it would be possible for train operators to recover their costs and earn a return for their shareholders.
People who drive alone or with a partner might opt for the train over a relatively short distance if the price points were reasonably close and the train offered a better value package. However, it is doubtful that any operator could haul a family of four as cheaply as putting them in the family buggy.
Amtrak's mid-week fare from Los Angles to San Diego is $29. Assuming that a private train operator had a cost structure similar to Amtrak's, it would need to increase the fare by 121 per cent to recover the attributed costs before interest and depreciation. In addition, it would have to add a component to cover interest and depreciation as well as a return for the shareholders. Readily available information does not show how much of Amtrak's interest and depreciation is driven by the Surfline.
Assuming the facilities were owned by the state and the operator is charged a fee for using them, the interest and depreciation pass through would probably be less than Amtrak's system rates, which are weighted toward the capital intensive Northeast Corridor. So let's add another nine per cent for interest and depreciation for the Surfliner and 7.5 per cent for the return on equity. This means the operator would have to charge $39.88 for a LAX to San Diego coach ticket.
The fully allocated cost to drive my 2004 Toyota Corolla, as an example, from LAX to San Diego would be approximately $56.25 if gasoline was $5.00 a gallon. This assumes that all costs are variable, which they are over the long run. Given the other elements that make up the value model, comfort, safety, etc., I would probably take the train if catching it was convenient, i.e. access to the station, parking, security, etc.
The cost for other motorists would vary greatly, depending on the price of their car, whether it was financed, how long the owner keeps it, how fast he or she drives, maintenance costs, insurance costs, etc.
If the government created a level playing field for all common carriers, as well as private transport, market driven passenger trains might be possible in some areas. If not they should be junked.
Unfortunately, a rational national transport policy is not likely to emerge in this country. It would hit too many emotional hot buttons. So we will go on subsidizing most forms of transport and continue to have a sub-optimized system of moving people and goods.
Samantha wrote: And the billions of dollars that the government has spent on Amtrak's intercity passenger trains could have been spent on higher priorities.
And a lot of lower priorities as well. In the broad scheme of government spending, Amtrak makes more sense than a lot of so-called "priorities". It's not like Amtrak's subsidy would be put to anything more useful and available to the general public.
motard98 wrote:If the government is looking to cut out some subsidies why don't they start with the Tabacco farmers and use money on Amtrak?
or cotton or corn for ethanol or lakes for boating or.....
Michael Sol makes a good point.
Well, this topic has certainly generated more interest that I could have imagined.
As is the case with most issues, there are many legitimate views regarding whether the government should be in the railroad business and, if so, to what extent.
In my view government should not be in any commercial enterprise, especially one that is not used by most of the people in the body politic. Competitive markets are the best place to allocate scarce resources, whether it is tobacco or cars or passengers trains. Free markets, however, have winners and losers. Not every activity makes the cut. But they are the best way to determine what people are willing to pay for in an arms length transaction.
No one knows what the government would have spent the money on if it had opted not to save the intercity passenger train. All we know at this point is that Amtrak has received substantial taxpayer funds since 1971 and could not have continued without them.
Samantha wrote:Higher fuel costs might create an environment where it would be possible for train operators to recover their costs and earn a return for their shareholders.
But why do you assume that principle would only apply to short distance trains and not long distance trains? If fuel costs were raised to cover the true costs of its production as you suggest, jet fuel would also be much higher, and air fares would not longer be as cheap as they are today. That could make long distance train travel much more attractive.
If the government created a level playing field for all common carriers, as well as private transport, market driven passenger trains might be possible in some areas.
I'm inclined to agree with you there. The key here is a level playing field. Existing subsidies for Amtrak are an attempt to do just that given the diffferences in how railroads are run compared to everything else.
Now, you have stated that you don't think the government should be involved in any commercial enterprise. I understand that view, even if I don't necessarily agree with it. As an ideal, it has many merits, but I think it is too narrow a view to apply it indiscriminately in the real world.
IF all things were equal, if railroads had a publicly owned infrastructure and anyone with a train could use any tracks, and if those tracks were adequately maintained by the government to allow for the smooth flow of both passenger and freight traffic, then I would agree with you. Private enterprise could operate passenger trains, and the market would sort out the winners and losers.
But that is not possible under current conditions. Private enterprise owns most of the railroad tracks, while the government owns most of the airports and roads. I know you know that, but this means that on infrastructure development, private enterprise is competing against the government. Thus there is no incentive to maintain the infrastructure to passenger service standards, much less accommodate any potential passenger growth, without government involvement.
So if you can find an equitable arrangement, given real world conditions, whereby market forces can be allowed to provide the best possible rail service (without inserting your or my preconceived notions about which types of trains are workable and which are not), I'm willing to listen.
But unilaterally singling out certain trains for elimination just to suit an ideology, without leveling the playing field first, strikes me as simply unfair.
Mr. Toy wrote: Samantha wrote: Higher fuel costs might create an environment where it would be possible for train operators to recover their costs and earn a return for their shareholders. But why do you assume that principle would only apply to short distance trains and not long distance trains? If fuel costs were raised to cover the true costs of its production as you suggest, jet fuel would also be much higher, and air fares would not longer be as cheap as they are today. That could make long distance train travel much more attractive.
Samantha wrote: Higher fuel costs might create an environment where it would be possible for train operators to recover their costs and earn a return for their shareholders.
Because trains lost the overnight business traveller way back when to bumpy, slow, DC3s - when frequent, new, luxourious and (fairly) fast trains pretty much ran everywhere. I kinda doubt that a small difference in ticket price due to fuel cost differential would be enough to get the LD trains over the hump. They have a mighty high mountain to climb.
Samantha wrote: Well, this topic has certainly generated more interest that I could have imagined. As is the case with most issues, there are many legitimate views regarding whether the government should be in the railroad business and, if so, to what extent.In my view government should not be in any commercial enterprise, especially one that is not used by most of the people in the body politic. Competitive markets are the best place to allocate scarce resources, whether it is tobacco or cars or passengers trains. Free markets, however, have winners and losers. Not every activity makes the cut. But they are the best way to determine what people are willing to pay for in an arms length transaction.No one knows what the government would have spent the money on if it had opted not to save the intercity passenger train. All we know at this point is that Amtrak has received substantial taxpayer funds since 1971 and could not have continued without them.
I always get a bit queasy about the term "free markets" because I don't think that any really exist. "Free market forces" exist, but every market is disorted in some manner somehow by some human entity. And, any time you try to draw a box around one entity in a market and try to exert free market forces on it, or regulate it, or subsidize it, without regard to the market "outside the box" you can suboptimize the whole market.
So, do we try for perfect and give up if we can't get it? Or, do we just try for "Better"? Or, should we be satisfied with "Good enough"? Or does "Might make right"?
Mr. Toy wrote: There are many other reasons why people choose LD trains. Some are Amish or Mennonites who don't fly.
There are many other reasons why people choose LD trains. Some are Amish or Mennonites who don't fly.
The Upper Great Plains, both the Canadian and American sides of the border, was apparently a favored destination for Hutterite and Mennonite colonies, and even small sprinklings of Amish, and they are familiar sights on the Empire Builder. They are almost invariably in the "Lounge" car taking advantage of the dome feature to observe the country as it passes by. The ladies, in their dresses and bonnets, sit off by themselves usually talking quietly together and knitting. The men will sit in their black outfits and hats and engage in conversation about the farms they are seeing pass buy. They are speaking an antique form of German anytime I have overheard them, but its just close enough to Dutch that I can usually catch the gist of what they are talking about. They have a great interest in what they are seeing, and the trip for them is obviously a grand tour of farming practices and how the rest of the world does things.
Interesting how obscure and archaic religious sects from Europe, continuing to speak German, become on the Empire Builder a genuine part of "Americana".
Free societies, including free markets, are not perfect. They have generated their fair share of abuse. But they are better than state controlled societies and markets. Witness the transitions in Russia, India, and China, which have embraced freer market economies even as they shun all or many of the features of democracy.
I spent most of my working life with a large electric utility. When I signed-on it was a regulated monopoly, which meant it had no industry competition. It looked like what I imagine Amtrak's inner workings to be. The waste was awful. But by the time I retired the electric utility market had become competitive. My employer became leaner, meaner, and more effective. Most of the stakeholders benefited from competition, although some of the employees lost their make work jobs and some never made the transition to a competitive environment.
Free markets, albeit imperfect, will force out the inefficient and incompetent. My support of them is not ideological. It is driven by a sharp pencil as well as a recognition that if the user doesn't tote the note, someone else will have to pick it up.
Samantha wrote: Free societies, including free markets, are not perfect. They have generated their fair share of abuse. But they are better than state controlled societies and markets. Witness the transitions in Russia, India, and China, which have embraced freer market economies even as they shun all or many of the features of democracy. I spent most of my working life with a large electric utility. When I signed-on it was a regulated monopoly, which meant it had no industry competition. It looked like what I imagine Amtrak's inner workings to be. The waste was awful. But by the time I retired the electric utility market had become competitive. My employer became leaner, meaner, and more effective. Most of the stakeholders benefited from competition, although some of the employees lost their make work jobs and some never made the transition to a competitive environment.Free markets, albeit imperfect, will force out the inefficient and incompetent. My support of them is not ideological. It is driven by a sharp pencil as well as a recognition that if the user doesn't tote the note, someone else will have to pick it up.
Which is EXACTLY why I think the application of free market forces, or even psuedo-free market forces externally and/or internally to Amtrak could make things a whole lot better.
I just read a "Daily Drucker" that profitablity is a great measure to make sure you're not hanging onto "yesterday" - a sign of organizational inertia of which gov't is most prone. When the only restraint is economics, i.e. "can I get enough money to keep doing what I've been doing", yesterday can hang around forever and you'll never move on to the next thing.
A good example would be that Amtrak didn't try very hard to reform their dining car service until the GAO questioned why they had them at all.
Should the LD trains be part of the overall network of intercity trains? I think the political reality makes the answer "yes." They are definitely from "yesterday", but that doesn't mean they have to BE yesterday. They are combination restaurants, hotels, sightseeing tours and basic transportation rolled into one. So, FOR EXAMPLE (nitpickers and naysayers, pick away!) why not contract out to the best of the best for each function. Have Hilton take over the sleepers. Have Longhorn/Red Lobster/Olive Garden/Capitol Grill run the food service. Hire a world class airline to train and manage everybody else. Get more NPS rangers and docents on the trains where appropriate. Put these services out for bid. Amtrak pays the contractor a flat fee and the contractor is then motivated by profit to run the business. Give Amtrak the incentive to mind the store by paying their employees a bonus based on passenger-miles per subsidy dollar.
BTW, your description of change in the utility industry mirrors what happened in frt RRing over roughly the same time period - for the same reasons!
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