Looming Transportation disaster? Suppose Subsidies are a good thing.

[Paul Milenkovic]

But the taxpayers, often non users of air services, are paying the other 15% or so.  So, if Amtrak is supposed to be a self supporting (read: for profit) system, totally self supporting, why shouldn't airlines, bus companies, and truckers have the same stipulation?  I know it is really a rhetorical question, and I am somewhat mocking those who complain about Amtrak because they don't use it.  But, why hasn't the idea that airports be privately owned ever been brought up in this country.

No one denies that all transportation modes get some kind of subsidy, often indirect.

The problem for train advocacy is that the rate of direct subsidy for trains is at least 10 times that of cars and planes on a per passenger mile basis.  What this means is that if by some political miracle trains are funded at the same level as those other modes, trains will continue to be a minority contributor to transporting people.

The Vision Report proposed funding trains at roughly the level of the FAA budget.  Their projection is that this infusion of money could bring trains about to 1/10th what airplanes are carrying.

That "all the other modes are getting subsidy" or "look at how much money the Department of Defense spends" or even "look at what NASA is getting" is not going to persuade people to spend more public money on trains.  Is the argument "look at all of those other government boondogles, why can't the government waste more money on Amtrak"?

From the standpoint of the advocacy community, we have to come to terms with the high rate of subsidy required for trains or come up with innovative proposals to make trains more cost competitive.  That something is subsidized tempers the need to run it in a cost-effective matter, but it does not eliminate all considerations of cost.  Amtrak may not have the profit motive, but it has to make its case every year as to why the subsidy money gives the taxpayer value.

[henry6]

Approximately 85 per cent of the cost of America's airways, including the airports, are paid for by landing fees, vendor rentals, etc. and are reflected in ticket prices.  Fees are direct user charges.    

But the taxpayers, often non users of air services, are paying the other 15% or so.  So, if Amtrak is supposed to be a self supporting (read: for profit) system, totally self supporting, why shouldn't airlines, bus companies, and truckers have the same stipulation?  I know it is really a rhetorical question, and I am somewhat mocking those who complain about Amtrak because they don't use it.  But, why hasn't the idea that airports be privately owned ever been brought up in this country.

And I see one of the major differences in your opinions and solutions is geography.  How many times would New York or New Jersey fit inside the state of Texas?  Put NJ into Texas as many times as you can.  Then step outside, if there is room, and take a deep breath.  The geography, climate, population density, transportation needs, all are so different in the East than they are in the West.  So we will differ.

[Anonymous]

The U.S. could fund NARP's and the Passenger Rail Working Group's vision for a passenger rail network in the U.S.  It could build high speed rail between every significant metropolitan area in the country.  But given its other priorities, along with the aforesaid financial constraints, it could only do so with a hefty increase in taxes.  And most Americans will not support going there. 

 I follow you up to this paragraph.  I agree that high speed rail is not the panacea for rail travel and is highly overated by most porponents who vary in defining it.  But, "with a hefty increase in taxes" is applicable to the entire transportation system's future at this moment no matter what the mode. 

And I have not heard a word from anyone here about privitizing airports like in Europe.  Are publicly owned and operated airports in our country sacred cows?  (Oh, I know there are some small private airports, and some public airports, where the fixed base operator is designated or charged with or acts as management by agreement. But I am talking about a Kennedy or a O'Hare or LAX.)

Improvements in many transport modes may or may not require a signficant tax increase.  It depends on how we want to pay for them.   

More highways are being built as toll roads, at least in Texas, and planners are considering turning so-called free access highways into toll roads to pay for improvements.  Even the expansion of I-35 north of Dallas, according to the planners, will include toll lanes.  Tolls are direct user fees designed to pay for the roadway.

Approximately 85 per cent of the cost of America's airways, including the airports, are paid for by landing fees, vendor rentals, etc. and are reflected in ticket prices.  Fees are direct user charges.    

[henry6]

The U.S. could fund NARP's and the Passenger Rail Working Group's vision for a passenger rail network in the U.S.  It could build high speed rail between every significant metropolitan area in the country.  But given its other priorities, along with the aforesaid financial constraints, it could only do so with a hefty increase in taxes.  And most Americans will not support going there. 

 I follow you up to this paragraph.  I agree that high speed rail is not the panacea for rail travel and is highly overated by most porponents who vary in defining it.  But, "with a hefty increase in taxes" is applicable to the entire transportation system's future at this moment no matter what the mode. 

And I have not heard a word from anyone here about privitizing airports like in Europe.  Are publicly owned and operated airports in our country sacred cows?  (Oh, I know there are some small private airports, and some public airports, where the fixed base operator is designated or charged with or acts as management by agreement. But I am talking about a Kennedy or a O'Hare or LAX.)

[Anonymous]

The United States arguably has the best highway and airway system in the world.  It needs to expand, upgrade, and maintain them properly.  This is what Americans have consistently demonstrated that they want.

Passenger rail may be appropriate in relatively short corridors where the cost to build addition highway and airway capacity is prohibitive.  There are numerous city pairs in the U.S. where the distance is 200 to 300 miles.  In Texas most of the largest cities, with the exception of El Paso, are approximately 250 miles apart.      

The DOT has identified the areas of the country where it believes transportation congestion is a major problem or will be in the next couple of decades.  DOT's conclusions are based on sound research.

The most practical passenger rail option, where it is justified, is to upgrade existing facilities, as was the case with the NEC, for rapid rail.  The U.S. does not need 200 mph trains.  The NEC, by the way, hoists approximately 1,700 mixed trains operations a day. 

I suspect few people along the NEC would describe the Acela as useless.  It is a major player on the NEC, which is one of three corridors that cover its operating expenses from ticket revenues.  It does so in part by snagging approximately half the commercial passengers traveling between New York and Washington. 

The U.S. can afford to upgrade its highways and airways because that is what the people are willing to pay for.  And they are willing to pay for them because it is what they want and use. Most people in my part of the country have never been on a railway train. 

How much the U.S. and state governments spend on highways, airways, railways, pipelines, rivers, harbors, etc. is knowable.  But one has to dig it out, as I have done and written about. 

Transportation planners in the U.S. have reasonable estimates how much it costs to implement a transport alternative or up grade an existing one, e.g. $625 million (2007) to shave 15 minutes off the New York to Washington running time for the Acela; $7 billion to upgrade the NEC to TGV standards (2007); $3 billion to make commuter rail between Austin and San Antonio feasible (2008).

Highlighting U.S. financial straits is hardly bemoaning.  It is a fact.  And knowledgeable people, including the former Comptroller of the Currency and Head of the GAO, are very worried about it.  It is going to have a major impact on what Americans can afford.  Economists and budget wonks have a good idea what needs to be done to fix the problem.  The challenge is getting the people to agree.    

The U.S. could fund NARP's and the Passenger Rail Working Group's vision for a passenger rail network in the U.S.  It could build high speed rail between every significant metropolitan area in the country.  But given its other priorities, along with the aforesaid financial constraints, it could only do so with a hefty increase in taxes.  And most Americans will not support going there. 

[Dreyfusshudson]

2). I understand that in England Heathrow Airport and many others are operatead by private companies.  So, if we could introduce that into our air transportation system while rationalizing  and planning, there might be some money to put into rail, too.

I've seen that remark a couple of times in these forums. What does "operated by private companies" mean? Do the private companies have full responsibility for the financial and operational success or failure of these airports? Or are they under contract with some public agency, therefore one assumes if that agency deems them to be succesful then the agency will renew the contract? Are there guarantees that someone, the private enterprise or the public, will be made whole in the event of failure?

 

I saw a news report...on BBC North America via PBS...the other night about a possible strike averted at England's Airports operated by such and such a company and Heathrow was singled out.  It stated that this company "operated" these airports in Engalnd and others in the rest of Europe.  I am intrigued by the concept and wonder why it has not been approached here in the Colonies!   I do know that many airports have a fixed base operator and managers which are not public entities or necessarily employees here.

You might find the attached link interesting.

http://www.economist.com/world/britain/displaystory.cfm?story_id=11089928

 

[gardendance]

this is a company which owns and operates the airports with no government subsidy mentioned.

But no subsidy mentioned does not necessarily mean no government subsidy, only that there's no mention one way or the other about if they're getting a subsidy. Similar to private automobile driving on the so called freeway. Or my wife saying "Why do we have to pay to visit the Franklin Institute? All the museums in Washington are free", yet she still complains about April 15th tax day, when she finally sees the bill for those museums.

I'm just saying that all I've seen in the posts is "operated", your post now is the first I've seen which says "owns". So department of beating the dead horse department, how did they get to own it? I admit I'm ignorant of the facts, but I'm assuming it was once government owned, did the government get a fair price when they sold it? If not there are those who would deem the bargain basement purchase price to be a subsidy.

[gardendance]

Subsidies may be a good thing if they are reasonable and fairly administered just to level out the playing surface.

I think the argument is that subsidies tend to tilt an existing level playing surface. I consider myself a railfan, which I think means I should be a member of the rail advocacy group, but I do realize that could be more an intersection, rather than a union of 2 sets. For the most part I expect that railfans and rail advocates feel that historically the subisidies, real, direct or imagined, have leaned towards the enemy: private automobiles and airplanes, and that rail subsidies so far have only partially gone towards redressing those past and present wrongs.

My laisez faire sentiment, all other things being equal, would be that we should eliminate subsidies if the intent is to level the playing field. That's in line with my efficiency theory, I'd like to hang onto my money rather than send it to a beaurocrat who will decide more wisely than me how it's to be spent, and of course be compensated fairly, out of my money, for his wise decisions.

Yes a subsidy might be a good thing, but my opinion is that it's to elevate the recipient, and there are those who feel the only way to elevate one segment is to subjugate another, as I usually feel as raifan and rail advocate, subsidies have tended to elevate auto and air at the expense of rail.

 

   What the country really needs in an integrated transportation system. Regardless of what amouint of oil we have used up; it is in the short term a limited resource.

Can't agree with you more. The proper tool for the proper job. But the subsidy failure happens when it encourages us to use the improper tool. Again my feeling is that so far subsidies have tended to encourage us to use automobiles. But I also feel that for the most part the government has been giving the people what it wanted. Makes me kind of yearn to trust that wise beurocrat to handle my money, as well as yearn for the ability not to have to pay him for the service. 

Nobody shed a tear for the whalers when petrochemicals replaced whale oil , nor when gas companies were replaced by electrical generating companies.  Diversity allows you to change when change is necessary . Whats really sad is when you put all your eggs in one basket and it falls .  Playing catch up gets to be extremely expensive.  Besides we have been subsidising  giant corporations for decades ;they have been getting "social welfare" since Eisenhower left.

Again foamer railfan that I am, I shed tears once in while for the Lehigh Valley Transit, because now I cannot take advantage of hourly, or whatever the several times a day frequency it was, trips from 69th St to Allentown, and when I was stuck in traffic for 5 hours coming back from Cape May to Philly, 100 miles, ecologically sound 4 people in a sedan,  I irritated my car mates with the number of times I said "I want my PRSL (Pennsylvania Reading Seashore Lines) train back".

Save the whales, collect the whole set.

[henry6]

but then absent any more info we can't tell if the private operator is any less on the public dole than a government opertor.

Philadelphia 1960's Pennsylvania RR and Reading RR, private companies at the time, both got subsidies for their commuter rail lines. Philadelphia Suburban Transportation Co president Merrit Taylor, bus and light rail operator, which had some lines which competed with the railroads, had been quoted in a few books I read that if he got even a fraction of the railroad subsidies he could carry passengers for free and still make a profit.

I think I see what your are getting at.  But the PRR and the RDG were railraod companies who took the subsidy payments from government whereby this is a company which owns and operates the airports with no government subsidy mentioned.

[oltmannd]

I do not believe that any speed in excess of 80mph is remotely compatible with the interests of the railroads who own the current rights of way. Even as we converse, freight railroads are reducing the speeds of their trains to save on fuel costs. 80mph is worse than useless: 100mph failed in the 1940s, what chance 80mph in the 21^st century? Could you take current rights of way, and make them ok for 120mph, by adding dedicated passenger tracks?

Well, there already is some 110 mph passenger operation on frt RR owned track.  From Poughkeepsie to Styvesant on the Hudson River is owned by CSX but NY State pays for class 5 and 6 track along the route.  Frt traffic is very light, however...

NS's policy is 90 mph max on same track.  Faster than that, has to be separate track.  They are open to the idea, but bring your checkbook!

Something less than full HSR has a chance in the US now as more of the country becomes more more NEC-like, a place were moderately fast speed produces useful results. 

[Jhanecker2]

Subsidies may be a good thing if they are reasonable and fairly administered just to level out the playing surface.   What the country really needs in an integrated transportation system . Regardless of what amouint of oil we have used up; it is in the short term a limited resource.  Given that global warming is true , it behooves us to come up with less toxic and susstainable methods of powering our industries and transporation systems . Economics rules all aspects of our existance .  Nobody shed a tear for the whalers when petrochemicals replaced whale oil , nor when gas companies were replaced by electrical generating companies.  Diversity allows you to change when change is necessary . Whats really sad is when you put all your eggs in one basket and it falls .  Playing catch up gets to be extremely expensive.  Besides we have been subsidising  giant corporations for decades ;they have been getting "social welfare" since Eisenhower left.

[Dreyfusshudson]

Samantha,

 

Your first four paragraphs accurately summarise what I wrote, so I'm ok with that.

 

Where we diverge is your view in the fifth paragraph that ‘The place for passenger rail .... is rapid rail in relatively high density corridors, on an upgraded existing rail infrastructure.'

 

You seem to be saying that, yes, there is an increased role for rail transport this century, but that the only thing we can afford to do is upgrade existing railways. It all depends what you mean by this, but I fear that you are advocating something that I believe would be the biggest waste of money ever.

 

I do not believe that any speed in excess of 80mph is remotely compatible with the interests of the railroads who own the current rights of way. Even as we converse, freight railroads are reducing the speeds of their trains to save on fuel costs. 80mph is worse than useless: 100mph failed in the 1940s, what chance 80mph in the 21^st century? Could you take current rights of way, and make them ok for 120mph, by adding dedicated passenger tracks? Well, maybe, but I would say it would be enormously expensive to do that. I think any railroad operating at 120mph+ should be grade separated, and far enough from 15000ton coal trains on adjacent tracks that there was little chance of hitting them if they fell over. The FRA is extraordinarily conservative, as I understand, on safety, and my guess is they would pretty much insist on this. There is then a fundamental and indisputable point of geography. 120mph is ok for journeys of up to 200 miles- the trip times are competitive with both road and air. Given that the enormous costs of even upgrading to 120mph- 1960s technology- could only be supported on the basis of the traffic volumes between the major metropolitan areas, the problem is that, outside the North east Corridor, there are very few major metropolitan areas within 200 miles of each other. These trains would be just as useless as the ones that failed in the 1950s.

 

There are however plenty of major urban areas within 200-400 miles of each other, which could be usefully connected by 200mph+ trains (which will be the state of the art by the time anyone got round to building). With 250mph, even 500 miles comes into the equation for business travel. So, my view is that, given US geography, the only thing worth investing mega $B in is high speed rail. Would it cost that much more than upgrading existing right of way to 120mph?- I doubt it. So, my view is that the very worst thing that could happen is that the US invests $100Bs in low speed intercity rail, as the 2050 passenger rail report advocates (This is a very scary document if you are a US taxpayer). If this is what you're advocating, then I think you're wrong.

 

Having said that, I simply do not know if high speed rail is worth doing. I agree with your statement ‘that the place for passenger rail is high density corridors, on an upgraded existing rail infrastructure, where the cost of building more highways (the choice of most people) and expanding airways (the choice of most business people) is cost prohibitive. Exactly right. What I don't believe either you or I know is how many of these corridors exist, or where they are, though we can make intelligent guesses. My point is not to argue that high speed rail is a solution, or indeed, essential, only to argue that a proper analysis should be done. Otherwise, the debate remains at the level of children (railfans) looking in shop windows (Government- no one else can pay the price) and saying ‘I really would like one of those trains, Santa Claus. Each to his own preference. I'm not in favour of a rail lobby demanding a rail solution, only a rational assessment of the alternatives (I'm a bit of a dreamer).

 

You then go on to bemoan the parlous state of US finances, to bolster the case that ‘we cannot afford it'. There seems to be a non sequitur here; on the one hand you argue that massive investment in infrastructure is needed (even though by your own logic it cannot be afforded), but then say high-speed rail cannot be afforded (though low speed rail can). How can you know if the analysis has not be done? How do you know what the true costs and benefits of the alternative investments are? How do you know what the price of the political barriers might be? I imagine even now that if a foreign railroad tried to buy a small railroad for a few hundred million $ that went through some of the most wealthy suburbs in the land, there would be quite a stir. What resistance to $225B per annum of toll roads? I'm quite happy to back down if there is data to hand, but I haven't seen any.

 

There are a lot smarter people than I all over the world wondering what to do about the level of US indebtedness, and how long they should go on funding it. I have no idea of the answers, but have hunch that, whilst I admire your high mindedness in saying that it would be irresponsible to pass it on to children and grandchildren, that's what will happen, including the children and grandchildren of the immigrants who have not yet arrived (Don't tell them). I have another hunch. There is a strand in another thread that somehow, the US operates in a different, more virtuous political environment to Europe (which is in fact very far from homogeneous).  I think this is nonsense: it's about people responding to the realities they face. The US can do what it has done, and take the political stances it has because of the very privileged piece of real estate it has recently taken over, and the willingness of the rest of the world to invest in its deficit, in the belief that the dynamism of its people, economy and its natural resources are the safest bet for long term reward. There has been no need to spend more than 2.5% of GDP on infrastructure in a vast underpopulated land. It doesn't cost much to concrete over prairie or desert (Thesis, by the way, not fact), it does cost to concrete over Manhattan. The question is, how long can this continue, before the realities that beset the rest of the world, where people often live in something much closer to Manhattan than prairie or irrigated desert, (from which they want to escape to Dallas or Phoenix), start to bite. Again, I do not know, but by implication, your argument is that the US is already living in the past, because it even now does not spend what it needs to on infrastructure. I think that as this begins to pan out, some kind of political convergence is inevitable, timescale unknown, unpalatable as this may be. So, it's nothing to do with political virtue: to quote a past President ‘It's the economy, stupid'.

 

[gardendance]

but then absent any more info we can't tell if the private operator is any less on the public dole than a government opertor.

Philadelphia 1960's Pennsylvania RR and Reading RR, private companies at the time, both got subsidies for their commuter rail lines. Philadelphia Suburban Transportation Co president Merrit Taylor, bus and light rail operator, which had some lines which competed with the railroads, had been quoted in a few books I read that if he got even a fraction of the railroad subsidies he could carry passengers for free and still make a profit.

[henry6]

2). I understand that in England Heathrow Airport and many others are operatead by private companies.  So, if we could introduce that into our air transportation system while rationalizing  and planning, there might be some money to put into rail, too.

I've seen that remark a couple of times in these forums. What does "operated by private companies" mean? Do the private companies have full responsibility for the financial and operational success or failure of these airports? Or are they under contract with some public agency, therefore one assumes if that agency deems them to be succesful then the agency will renew the contract? Are there guarantees that someone, the private enterprise or the public, will be made whole in the event of failure?

 

I saw a news report...on BBC North America via PBS...the other night about a possible strike averted at England's Airports operated by such and such a company and Heathrow was singled out.  It stated that this company "operated" these airports in Engalnd and others in the rest of Europe.  I am intrigued by the concept and wonder why it has not been approached here in the Colonies!   I do know that many airports have a fixed base operator and managers which are not public entities or necessarily employees here.

[gardendance]

2). I understand that in England Heathrow Airport and many others are operatead by private companies.  So, if we could introduce that into our air transportation system while rationalizing  and planning, there might be some money to put into rail, too.

I've seen that remark a couple of times in these forums. What does "operated by private companies" mean? Do the private companies have full responsibility for the financial and operational success or failure of these airports? Or are they under contract with some public agency, therefore one assumes if that agency deems them to be succesful then the agency will renew the contract? Are there guarantees that someone, the private enterprise or the public, will be made whole in the event of failure?

[henry6]

America faces numerous infrastructure challenges.  Many of its highways, airports, airways, rail lines, pipelines, electrical grids, telecommunication facilities, etc. need to be upgraded or replaced.  In addition, given the projected growth in the population, new infrastructure will be needed.

Following the end of WW II Americans focused on two national passenger transport systems, i.e. systems that cover the nation as opposed to serving a regional market.  They settled on highway and air transport while shunning passenger rail in most markets. 

The shift to highway and air travel was a function of superior technology.  It was not, as some have suggested, a political conspiracy to wreck the country's railway passenger business.  The car is more flexible, comfortable, convenient and, in many instances, economical than taking a train.  The airplane, especially the jet, beats the train hands down for long distance travel.  It can cover as much distance in a hour or two than a train can all day long.   

Had Amtrak not been formed as a political solution to the shrinking passenger train market, intercity trains would have disappeared, with the exception of commuter rail and perhaps the NEC.  The NEC, because of its population density and lifestyles, i.e. people were used to taking the train, might have been able to stand on its own if it had been managed properly.

Now, as the country's population grows larger and larger, there is a place for passenger rail.  But it is not in a reincarnation of a 1950s style intercity passenger rail system.  It is rapid rail in relatively high density corridors, on an upgraded existing rail infrastructure, where the cost of building more highways (the choice of most people) and expanding airways (the choice of most business people) is cost prohibitive. 

Building a passenger rail system to connect America's 100 or so largest metropolitan areas, as advocated by some, including NARP, begs two important questions.  Would people use it in sufficient numbers to cover at least the operating costs?   And can America afford a third national passenger transport system?

The U.S. national debt is approximately $9.5 trillion.  And it is growing at the rate of more than $600 billion a year.  This is the federal operations spend deficit, which is masked in part by Social Security surpluses.  This averages out to nearly $100,000 per household, with an annual interest burden of more than $4,000 per household.  But approximately one third of the households in the U.S. that file a federal income tax return pay no federal income taxes.  So the burden for the households that pay income taxes is considerably more than $100,000.  But it does not stop there.  It does not include state and local government debt, consumer debt, mortgage debt, credit card debt, etc.  When these amounts are factored into the matrix, the average debt per American household is estimated to be more than $175,000.  However, this is only the tip of the iceberg.

The former Comptroller of the Currency, David Walker, estimates that the average burden for American household is more than $400,000 when the unfunded liabilities (Social Security, Medicare, and Medicaid) are taken into consideration.  He is so concerned about it that he left the current administration to become an advocate for recognizing the problem and taking steps to fix it.  How heavy is the burden? 

The median household income in 2007 was $48,200 per household.  Thus, the potential federal finance burden is nearly 10 times the country's median household income.  And that is not sustainable. 

Unfortunately, I have not seen from those advocating a massive investment in passenger rail in the U.S. a serious plan to finance it.  They talk about getting more federal monies, as if this will not further acerbate the country's financial problems.  Advocating more spending without a plan to pay for it lays the burden off on our children and grandchildren.  And that is irresponsible.

America needs to improve and expand its highways and airways where it is cost effective.  It should build rapid rail where the cost of improving the airways and highways is cost prohibitive and there is a commercial need for it.  But it cannot afford a third national passenger system, unless it wants a tax structure like most of the European countries.  And polls show that most Americans want to go there. 

Comments on above bold type remarks:

 There are those who would argaue that air and highway building was a political conspiracy on one hand but a private entprise monoploy and conspiracy on the other.  Big business was big and getting bigger and all was wonderful on the economic front: two cars in every garage by 1960! . It was, at the time you mention, right after WWII, and it was a simple fact that passenger trains were part of the free enterprise, private sector and, unless a true rapid transit commuter operation such as New York City's, it was figured that it would always stay that way.

The car did afford American's their precious freedom of being able to go where they wanted or needed to go, in a style they could afford.   And they were told their gasoline tax paid for the highways they drove on.  Local taxes took care of municipal streets.  But you never saw the tax at nine tenths of a cent per gallon of gas at the pump or the line item on your property tax bill.

At that time, too, railroads were fairly prosperous, fat from the War effort, and did spend money on new equipment and improved schedules.  They also had to work at improving thier roadbeds and infrastructure.  For which they were taxed to support highways and airports which took traffic away from thier private venture.  And railroads, faced with a dwindling passenger market, began getting rid of high overhead passenger trains but were required to continue commuter services...so you are partly right on that.  Except nobody stepped forward to pay for the commuter service or to put the passenger train into the public sector because both were owned and operated by private enterprise and thus a forbidden tresspass.

Building a usable and marketable national passenger rails system is what shoud have been considered at sometime but never was and still isn't.  Amtrak is a patch job of lip services because of a lack of committment.  As for financing the system,  it should be partially paid for by less contributions to air, highway, and water.  Proportionately Amtrak receives less than 10% of the total transportation budget, so you can't even begin to talk about real finances until the whole system is rationalized and planned, really planned, as a transportation system to serve business and people. And this will utilize the cost effectiveness of each mode of transportation to make it work for all.  In the East in general, but also in many industrialized and urbanized areas, air pollution, traffic congestion with no room for new highways or lanes, make highway construction not a viable or economic option anymore. 

Two quick sidenotes: 1).I n NJ in the late 40's and early '50's rail lines were taxed at least twice what other industry was taxed.  And when the NJ Turnpike Extension was built across rail yards, those yards had an increase in taxes because of the improvements made by the bridges. Other states were not as bad, but bad enough.

2). I understand that in England Heathrow Airport and many others are operatead by private companies.  So, if we could introduce that into our air transportation system while rationalizing  and planning, there might be some money to put into rail, too.

[Anonymous]

America faces numerous infrastructure challenges.  Many of its highways, airports, airways, rail lines, pipelines, electrical grids, telecommunication facilities, etc. need to be upgraded or replaced.  In addition, given the projected growth in the population, new infrastructure will be needed.

Following the end of WW II Americans focused on two national passenger transport systems, i.e. systems that cover the nation as opposed to serving a regional market.  They settled on highway and air transport while shunning passenger rail in most markets. 

The shift to highway and air travel was a function of superior technology.  It was not, as some have suggested, a political conspiracy to wreck the country's railway passenger business.  The car is more flexible, comfortable, convenient and, in many instances, economical than taking a train.  The airplane, especially the jet, beats the train hands down for long distance travel.  It can cover as much distance in a hour or two than a train can all day long.   

Had Amtrak not been formed as a political solution to the shrinking passenger train market, intercity trains would have disappeared, with the exception of commuter rail and perhaps the NEC.  The NEC, because of its population density and lifestyles, i.e. people were used to taking the train, might have been able to stand on its own if it had been managed properly.

Now, as the country's population grows larger and larger, there is a place for passenger rail.  But it is not in a reincarnation of a 1950s style intercity passenger rail system.  It is rapid rail in relatively high density corridors, on an upgraded existing rail infrastructure, where the cost of building more highways (the choice of most people) and expanding airways (the choice of most business people) is cost prohibitive. 

Building a passenger rail system to connect America's 100 or so largest metropolitan areas, as advocated by some, including NARP, begs two important questions.  Would people use it in sufficient numbers to cover at least the operating costs?   And can America afford a third national passenger transport system?

The U.S. national debt is approximately $9.5 trillion.  And it is growing at the rate of more than $600 billion a year.  This is the federal operations spend deficit, which is masked in part by Social Security surpluses.  This averages out to nearly $100,000 per household, with an annual interest burden of more than $4,000 per household.  But approximately one third of the households in the U.S. that file a federal income tax return pay no federal income taxes.  So the burden for the households that pay income taxes is considerably more than $100,000.  But it does not stop there.  It does not include state and local government debt, consumer debt, mortgage debt, credit card debt, etc.  When these amounts are factored into the matrix, the average debt per American household is estimated to be more than $175,000.  However, this is only the tip of the iceberg.

The former Comptroller of the Currency, David Walker, estimates that the average burden for American household is more than $400,000 when the unfunded liabilities (Social Security, Medicare, and Medicaid) are taken into consideration.  He is so concerned about it that he left the current administration to become an advocate for recognizing the problem and taking steps to fix it.  How heavy is the burden? 

The median household income in 2007 was $48,200 per household.  Thus, the potential federal finance burden is nearly 10 times the country's median household income.  And that is not sustainable. 

Unfortunately, I have not seen from those advocating a massive investment in passenger rail in the U.S. a serious plan to finance it.  They talk about getting more federal monies, as if this will not further acerbate the country's financial problems.  Advocating more spending without a plan to pay for it lays the burden off on our children and grandchildren.  And that is irresponsible.

America needs to improve and expand its highways and airways where it is cost effective.  It should build rapid rail where the cost of improving the airways and highways is cost prohibitive and there is a commercial need for it.  But it cannot afford a third national passenger system, unless it wants a tax structure like most of the European countries.  And polls show that most Americans want to go there. 

[Dreyfusshudson]

Just back from holiday- thanks for many intelligent and informed comments on my original query. I read an interesting article whilst away that said the American Society of Civil Engineers estimated that spending of about $320B per year was needed for the next five years just to bring US infrastructure into good repair. http://www.economist.com/world/unitedstates/displaystory.cfm?story_id=11636517

This would not address the future needs, e.g. an anticipated 70% increase in freight by 2020, and a 50% increase in population by 2050. The US invests 2.4% of GDP on infrastructure, Europe 5%, and the article argues that the US transport budget is often used nonsensically, e.g. buying a stadium in Montana and museum in Las Vegas. A Texas Institute says flight delays cost $15B/year, road congestion $78B. A national commission on transport policy recommended this year that the US spend $225B/year for the next 50 years. The Brookings Institute says investment should be focussed on the top 100 Metro areas. There is a bipartisan Senate plan to raise the finance, a House commission to guide infrastructure investment, and Messrs Rendell, Schwarzenegger and Bloomfeld are trying to make infrastructure a national priority. I'm just reporting what I read, but it does seem to me there is something big out there that needs to be addressed at some level by someone sometime reasonably soon. On this, at least, Phillips is right. The who pays and how questions are of course crucial, but is doing nothing an option? The article says that when major infrastructure investment has been needed, the US has always produced politicians of sufficient stature to address the question, and says it believes history will repeat itself, as do I.

 

No one has actually come out and said what they believe the nature of transport infrastructure development over, say, the next 50 years should be. I believe that any advocacy of major investment in passenger rail has to be part that.  The nearest to a prescription is a view that Federal investment should conform to some kind of subsidy/passenger mile criterion. In this light, the current Amtrak subsidy is folly of the highest order. Increasing its subsidy even ten fold would not lead to any economies of scale, and with current types of operation Amtrak would still make no meaningful contribution to intercity passenger travel, outside one or two areas. So, there is no case for subsidising Passenger Rail. I like the clarity of this logic, but wonder if a point is being missed somewhere.

 

It is true that presently, US passenger rail investments look absurd in cold economic terms. Amtrak recently published plans for a new Chicago-Rock Island service, a distance of 159 miles. The trip time of 3'20" gives an average speed of 48 mph. As I understand it, this may well happen. It is estimated that two trains each way per day would carry 111800 passengers per annum, say 75 passengers per train. This would cost the state $5.9M per year. The investment required in infrastructure is $22.4M, plus coach refurbishment and training costs of $5.25M. The proposal relies on the CB&Q and its intermediate stations already being in good shape, and spare capacity at Union Station; it also requires no new equipment- as cheap a proposal as you are likely to get. If the average trip length is about 120 miles, then we can infer that the subsidy/passenger mile on an operating loss basis is about 44 cents, if we add in capital costs, spread over 10 years we get 65cents/passenger mile. Each passenger will cost taxpayers about $78, and pay about $25. I assume the numbers are similar or worse for other State initiatives in the recent past.

 

What is going on here? Surely you can drive to Chicago in 2½ hours, for an out of pocket gas cost of no more than $25? Why would anyone, let alone 111800 people choose to travel by train? You reduce the number of daily car trips on Chicago roads by 200 at most. Are Illinois politicians (and, by implication, voters) completely mad, along with other State legislatures around the country? And the 75 passengers per train count really gets me. I can't think of a perfect European analogy to ‘significant metropolitan area about 150 miles from regional capital, little intermediate business, few onward possibilities', but the best equivalents I can come up with say the train service frequency would be hourly. With 200-400 seats, a 50% occupancy factor says there would be over 2000 journeys in each direction per day, albeit with transit times of around two hours (I can't imagine BNSF being happy about that)- a premium product that costs more than $25. This is prime rail travel territory. So I struggle with 150 vs 2000- do folk in the Quad Cities and Chicago not get along with each other, that is, is the travel market smaller than in Europe? And how many would take the train if transit time were markedly superior to driving?

 

It is true that European travel is subsidised. In the UK, the figure is about £6B/annum for 30B passenger miles-say 40 cents/passenger mile, though it is alleged (Government accounting) that high speed inter city is profitable, the rest (Commuter services, predominantly London, and cross country services linking Outer Porkbarrel with Lesser Cowfield- our Amtrak)- lose the money. With European levels of ridership, a significant number of cars are taken off the roads of large cities. Because of the way we have developed our infrastructures, rail is an essential part of the mix. There would be chaos without it- though there are course some who argue not. The overwhelming present view of the media, transport gurus and the politicians who pay their salaries in the UK however is that roads are evil, cars detestable, so rail is here to stay.

 

It should be clear that having postulated that contributors have missed a point, I can't really define what that point is, other than to say that US voters and politicians seem to disagree with the passenger subsidy/mile argument, as in Europe where no one really questions the value of passenger rail any more. So does Matt Rose: in an interview in the latest Trains magazine. He says: ‘we need to look beyond the actual costs to the societal benefits of passenger trains'. He advocates separate rights of way, and endorses the view that the US needs a real transportation policy. Looking at how he's running BNSF, he seems a pretty head screwed on kind of guy.

 

A transportation policy spending the $225B/year mentioned above buys a lot of concrete. The subsidy/passenger mile argument says that the implicit US transportation policy since WW2- look after yourself and fly or drive - is the one that will work for the next 50 years too- people have been very happy with it, both in a practical and ideological sense. That means a lot of new freeways and runways. The private sector could build both, for profit if the freeways are in fact toll roads. Problem solved. Question is, are there circumstances where this would not work- where is it not possible to concrete over?  Can you bulldoze property in large tracts of existing cities to speed traffic flow? (they do in Shanghai), or do you simply let existing metro areas expand? Can all of them expand? And where does the escalating price of fuel come in? What will voters and politicians permit? Is it in these questions where passenger rail begins to make sense? The concept of a politician spending my money on vague ‘societal benefits' scares me, but I think if you begin to reduce this to more practical concerns, there may be a legitimate case to be made.

 

In another forum, someone wrote that the US had the best passenger rail system in the world in 1940- well, maybe, but there's absolutely no sense in trying to recreate it, it died for very good reason. Amtrak is largely irrelevant because it seeks to preserve this, using 1940s technology on infrastructure that was better suited in the 1930s. Something like $225B, 2% of the proposed infrastructure spend would build you a High Speed Rail network, with 21^st century game changing technology, linking all large metro areas up to 400 miles apart, and provide a better alternative to flying or driving in many cases for large number of people- a fundamental, major and irreplaceable contributor to the transport mix. (Amtrak seems to get it right between Washington and New York). A well-used system should break even at an operations level with sensible pricing. So, if expanding current Amtrak operations, outside some Corridors makes little sense, and if the Feds are going to spend countless $B on freeways it seems to me that High Speed Rail, (plus commuter rail) should at least be put in the mix. Surely this is worth a full evaluation? Has anyone done the sums? It might just lead to a better transportation system. If the answer is ‘It will never provide a worthwhile alternative in the US for reasons x,y and z', then US passenger railfans ought to shut up and be left with our memories.

 

Perhaps we should not be too despondent. Over the last 35 years, I have said to my wife every so often, ‘We have to go back to the US for a holiday because President X will close Amtrak next year, and we must travel on #3-14 for the last time'. I no longer do. I sense that #3-14 will see us out. Maybe, as long as they exist, we can hope, along with Mr Micawber that something will turn up.   

 

 

[oltmannd]

But what I am saying is that if the economy of a single train track verses a 6 lane highway in a given hour is used to its fullest, then wouldn't the cost of the train's riders be less than the 6 lane highway? 

That depends.

First, that's an awfully big "if".

Second, what's "used to its fullest" for each case.  Single vehicles with one passenger each for highway or 50 passenger busses on 2 second headways at 70 mph.  Is it 6 car passenger trains, 2 per hours ala the NEC or something more rapid transit like?

Third, are the costs just operating costs or do they include capital costs?  How about social costs like the value of the automobile driver's time or the health costs of air polution?

Fourth, has Amtrak shown any inclination for economies of scale?  Did they reduce the forces for maintaining the Amfleet Metroliner service cars when they started running the Acela and quit the Metroliner schedules?  Did they reduce forces needed for maintaining Heritage cars when they dropped them? 

[henry6]

But what I am saying is that if the economy of a single train track verses a 6 lane highway in a given hour is used to its fullest, then wouldn't the cost of the train's riders be less than the 6 lane highway? 

 

 

[Paul Milenkovic]

So wouldn't giving Amtrak more money to build a more effecient and productive system attract more riders and therefore bring down the per passenger cost?

Great question.  In other words, is there some economy of scale, that if you scaled up Amtrak instead of trying to trim it, you would reduce the subsidy per passenger-mile?

The people who wrote the Vision Report implicitly believe the answer is no.  Instead of spending about a billion/year to get .1 percent of passenger miles on Amtrak trains, they want to spend 10 billion/year for a 40-year stretch to get 1 percent of passenger miles on trains.  In their Appendices, they base these spending numbers based on the European experience, where they spend a comparable amount to the US Federal Highway budget on trains to get about 4 percent of passenger miles.

[Paul Milenkovic]

And don't forget, Interstate Highways and Airports and government owned parking lots do not pay real estate taxes, but freight railroads do, and I understand Amtrak does make contributions to local communities along the NE Corridor. There are other hidden subsidies for highway transportation as well, specifically law enforcement and insurance-health costs.

Amtrak: about 1.2 billion in subsidies to move 5 billion passenger miles -- about 24 cents per passenger mile.

Roads and highways: about 40 billion in Federal highway budget in support of 4 trillion passenger miles.  About 1 cent per passenger mile.  And that is arguable as direct subsidy as the money is raised on a tax payed by highway users in the way that Amtrak is unable to raise the 24 cents/mile in costs by any kind of tax specific to railroad users.  It is also said that there is a substantial shortfall in the Highway Trust Fund and that as much as 10 billion/year in general revenues will need to be used -- OK, let's say that the Federal highway subsidy is then one quarter cent per passenger mile.

But of course, that 40 billion doesn't include the state and local spending, the property tax loss, and so on.  What does that make the government subsidy of highways, with generous allowance for all factors -- 3 cents/passenger mile?

Then the argument is made that new Interstate Highways or lane additions are so costly and there is so much cross-subsidy going on in the highway system that the effective rate of subsidy on those roads is perhaps an Amtrak-sized 24 cents/passenger mile.  These costly roads are a hard sell.  So we have a data point that when roads cost as much as Amtrak, some are getting built, but it is difficult to get such project approved.

OK, it is said that for the cost of new Interstate construction, we could construct high-speed rail.  The Interstate Highway is simply one leg of a trip that starts in your driveway, continues on local roads, travels for a part on the Interstate, and then ends up in some parking lot.  A high-speed rail trip most likely would be intermodal in this country, starting in your driveway, taking local roads or perhaps short stretches of Interstate to get to the HSR station, parking, assuming that there is enough parking at an affordable price, taking a leg of the trip on HSR, and then arranging some transport at the other end -- commuter or light rail, rental car, taxi.

We could promote the use of HSR for one segment of an intermodal trip by making it more costly and less convenient to use the Interstate by collecting tolls as they do in Illinois and other places.  One could have institutions like the Illinois Tollway Authority, where it seems that a lot of the collected tolls pay labor costs of the Tollway Authority, essentially a kind of Highway Amtrak.

Or one could use the cross-subsidy model.  If motorists are perfectly happy with the road taxes collected on idling their car motor in their driveway going towards the Interstate Highways, which are only one segment of a multi-segment journey, perhaps the motoring public would be perfectly happy with their gas tax money going to HSR, which would constitute a segment of an intermodal trip.

We already subsidize commuter rail out of gas-tax money.  There is general and broad-based political support for this.  There are some folks who think that the motoring public is getting the short end of this arrangement, but in the train advocacy community we are able to quickly dismiss those arguments without a reasoned examination of any of the statistical evidence by mentioning their names, pointing out that they work for "right-wing think tanks" and that their reasoning is tainted by "concrete lobby" funding of those organizations.

We don't support Amtrak with gas-tax money.  Many in the train advocacy community think this is a travesty, although to the extent that the right-wing think tank people are wrong and trains are effective in counteracting the ills of car and highway, the most effective place to spend the cross-subsidy is on commuter trains and light rail, which is what we are doing right now.

Forty years ago at the beginnings of NARP and the days of the passenger train discontinuances, we had an argument that passenger trains were in decline because their competitors were enjoying government subsidies, and we asked for government subsidy for Amtrak to level the playing field.  Today, Amtrak is subsidized at either a somewhat higher rate or perhaps a vastly higher rate than those other modes, and we are still complaining that trains are not competing on a level playing field. 

[daveklepper]

And don't forget, Interstate Highways and Airports and government owned parking lots do not pay real estate taxes, but freight railroads do, and I understand Amtrak does make contributions to local communities along the NE Corridor.   There are other hidden subsidies for highway transportation as well, specifically law enforcement and insurance-health costs.

[henry6]

So wouldn't giving Amtrak more money to build a more effecient and productive system attract more riders and therefore bring down the per passenger cost?

[Anonymous]

I would not describe myself as a Libertarian, although I can see how one might come to that conclusion.  I support free markets, but ones that are regulated by independent government agencies (federal, state, and local). 

Free enterprise should have first crack at providing a commercial activity, i.e. commercial transport.  Government(s) should create a framework to encourage it, but should not provide the service, except under special circumstances where social welfare demands it.  If free market players cannot make it because the users will not or cannot cover the cost of the service, those players should be allowed to go under.  Thus, when it became clear in the 1960s that private enterprise could not continue to run passenger trains, the government should not have created Amtrak to operate intercity passenger trains that few people wanted and only a small percentage used.   

Using its regulatory powers government should ensure a level playing field in the market place.  It should ensure that transactions are fair, open and honest; protect the welfare and health of employees; and ensure that consumers are treated fairly.  But only under special circumstances should it be involved in a commercial activity.

Ideally, the true cost of all forms of transport would be passed to the user at the purchase point, e.g. pump, ticket counter, freight invoice, etc.  Unfortunately, this has not happened and is not likely to happen.  Transport in the U.S. is hooked on subsidies.  It is unlikely that they will go away.    

Government should subsidize public transport where failure to do so would work a serious hardship on a significant segment of the population. 

The first that comes to mind is public transit, i.e. buses, light rail, commuter rail, etc.  A significant percentage of Americans, especially those in large cities, could not get around without public transit.  And many of them could cover the cost of the service. 

The second is rapid rail in highly congested corridors where expansion of the airways or the highways would be cost prohibitive.  Passenger trains from New York to Washington or Chicago to Milwaukee or LA to San Diego make sense.  Long distance trains do not.  And as Paul M points out, given the limited resources available to optimize passenger rail under the aforementioned conditions, the dollars should be concentrated where they can have a meaningful impact as opposed to fritted away on low value alternatives.

If government support is required for a commercial activity, e.g. commuter and corridor rail, the operation of the trains and support activities should be outsourced to private contractors.  They are likely to run the system more effectively than government.  The threat of losing the contract tends to keep contract operators sharp. 

I have been a rail buff since I was 10 years old.  I have ridden over every mile of the Amtrak System with the exception of Chicago to New Orleans, plus many other miles that no longer have passenger trains.  I have ridden trains in Australia, Canada, New Zealand, and Great Britain.  I love them.  But I am also a retired CPA who is worried about the debt (current and pending) being laid on this country.  And I have grave misgivings when people argue for more trains or more transit or high speed rail without saying how they would pay for it.  Because someone must pay!  There is no free lunch. 

[Paul Milenkovic]

As far as airlines are concerned, if the figures you stated, Samantha, are so great how come the airline insdustry is rife with cutbacks, layoffs, bankruptcies, and mergers?

Samantha can respond on her own account, and I don't adhere to Samantha's strict-Libertarian no-subsidies line.  But the more comments I see like the above, the more I am persuaded that on balance Samantha has the correct general outlook.

The airlines may be rife with cutbacks, layoffs, bankruptcies, and mergers, but these are allowed to occur to reduce the level of airline service to reflect the willingness or lack thereof of the traveling public to pay for the cost of such a thing.  I don't hear of an NAAP counterpart to a NARP starting up a lobbying campaign to save this or the other flight departure.  I don't see a community of airline passenger advocates holding meetings wondering what to do about the impending cutbacks, and the only people seeing this as an impending End of Air Travel are those in the passenger rail advocacy community engaged in a kind of wishful thinking that people will finally see things their way and throw all of the subsidy bounty going into airports and air travel back to trains.

We don't live in Galt's Gulch of a Libertarian commune, and yes the government is intertwined with all aspects of commerce, from the direct subsidy to the indirect tax break.  So the argument is made that all transportation modes are subsidized, forget that, all commerce is in some way subsidized.  Samantha, a member of the passenger rail advocacy community in good standing as far as I am concerned, is advocating laissez-faire.  It seems a lot others in the community are drawing the opposite conclusion and advocating laissez les bons temps roulez (that is a New Orleans-French expression that loosely translates, Let's have a good time freely spending other people's money).

The amount of Amtrak subsidy is small, but the rate of subsidy per passenger mile is large compared to much of anything else, and whatever turmoil is happening in an airline industry that is accounting for 100 times as much travel as Amtrak, 10 times as much travel as we would get spending 400 billion dollars over 40 years as proposed by the Vision Report, doesn't change much. 

There is much work needed to put our own house in order with respect to Amtrak -- gosh awful timekeeping of many trains, a marginal fuel efficiency advantage when trains should be beating the pants of other modes in a time of high energy prices but are not, expensive maintenance operations that it pays to keep bad-ordered equipment parked rather than repaired and earning revenue, and so on.  With Lautenberg-Lott, there may be what is admittedly a small amount of money to address these concerns, to improve Amtrak to make the case for more money down the road, that is, if the money is spent wisely.

The one question I want to ask of holders of the "all commerce is subsidized so why not Amtrak?" viewpoint: many in the advocacy community spend a lot of words ridiculing Amtrak reform, NEC privatization, "glide-paths to profitability" and so on.  Is it a matter of doctrine that all attempts to apply any kind of financial performance metric on Amtrak come from the Dark Side?  Is it the passenger rail advocacy position that Amtrak should be funded with whatever level of subsidy it takes to provide the train services deemed necessary?  Is there any measure of financial performance of an Amtrak train that the advocacy community would say, "OK, this is not working, let's try something else with the limited financial resources at hand?"

[henry6]

As far as airlines are concerned, if the figures you stated, Samantha, are so great how come the airline insdustry is rife with cutbacks, layoffs, bankruptcies, and mergers?  On the other hand since those figures are so good, then my tax dollars supporting airports, air traffic controllers, research and developement for the military (from whence come commercial aircraft designs), etc., should be paid back somewhere along the line and there should be no need for cutbacks, layoffs, bankruptcies, and mergers.

When it comes to business subsidies there are very few mom and pop operations of any kind any more.  Retail complexes are built with tax breaks, easements, and "other concessions"; then the mom and pop operations rents from them.  Large manufacturing facilities are given many of the same breaks for taxes, utility aid, etc. as communities bid or compete to attact them.  In the past, communites and state legislatures, would guarentee bonds and offer other incentives and help to businesses, even allowing monopolistic practices (from 1776 in this country).  Don't be fooled by the "free enterprise" mantra...it never really existed except as a propaganda weapon to keep us from "socialization".  Business and governement always has been, and always will be, and should always be, a partnership of community and business development for the  benefit of all.

[Anonymous]

There has always been subsidies for railroads (and all other American businesses).  Charters, subscriptions, bond authrizations, grants, government contracts, US MAIL, patents, land grants, donations, and on and on.  And anybody in the business of moving people does not make money from doing so, especially if not subsidized with traffic control, rights of way, terminal, policing: it is whatever "extra" an operator can charge for that may make money.  This is true of buses and airlines as well as railroads.  But the subsidies to highway and air transportation is measured in hundreds of billions of dollars annually while rail rarely makes it to a billion here or there.  And further, this country has never had a Federal transportation policy beyond fiscal supports: no planning, no coordination, no comprehensiveness.  Many have pushed for such a policy for years but it has fallen on deaf ears and otherwise open pocketbooks.  Now push is shoving and congestion, environment, and energy are converging as major issues which have to be addressed in the transportation arena in order for us to  both move freely and move goods and resources economically and safely.   No one form or method of transnportation is a whole answer, so discussion and private and public sectors pocketbooks have to remain as wide open as necessary and prudent to meet the future.

Most American businesses have not been subsidized.  Most of them are small to medium sized entities, sometimes referred to mom and pop shops.  They have created most of the jobs in the United States.

Most forms of commercial transportation have been subsidized, at least in some form, since the beginning of the country.  But at the end of the day, at least in recent times, the seat mile subsidy for passenger rail has dwarfed that for air or buses or any other form of commercial transport many times over.  It is not even close.

For the FY ended 30 September 2007, U.S. airlines earned $7.4 billion with net income of $4.6 billion.  Hauling people as opposed to goods does not generate the best returns, to be sure, but to say that there is no money in transporting people is not true.

 

[henry6]

There has always been subsidies for railroads (and all other American businesses).  Charters, subscriptions, bond authrizations, grants, government contracts, US MAIL, patents, land grants, donations, and on and on.  And anybody in the business of moving people does not make money from doing so, especially if not subsidized with traffic control, rights of way, terminal, policing: it is whatever "extra" an operator can charge for that may make money.  This is true of buses and airlines as well as railroads.  But the subsidies to highway and air transportation is measured in hundreds of billions of dollars annually while rail rarely makes it to a billion here or there.  And further, this country has never had a Federal transportation policy beyond fiscal supports: no planning, no coordination, no comprehensiveness.  Many have pushed for such a policy for years but it has fallen on deaf ears and otherwise open pocketbooks.  Now push is shoving and congestion, environment, and energy are converging as major issues which have to be addressed in the transportation arena in order for us to  both move freely and move goods and resources economically and safely.   No one form or method of transnportation is a whole answer, so discussion and private and public sectors pocketbooks have to remain as wide open as necessary and prudent to meet the future.