Sam1Amtrak does not provide station boardings in its public reports, so it is difficult to say how many board at each station. In any case, the ratio of passengers handled by the station agents for Amtrak's long distance trains in Texas, as well as most other intermediate spots in the national system, is very low.
Wrong! Check this Amtrak page -- Has figures for both 2008 and 2009.
http://www.amtrak.com/servlet/ContentServer?c=Page&pagename=am%2FLayout&cid=1246041980432
blue streak 1 Sam1Amtrak does not provide station boardings in its public reports, so it is difficult to say how many board at each station. In any case, the ratio of passengers handled by the station agents for Amtrak's long distance trains in Texas, as well as most other intermediate spots in the national system, is very low. Wrong! Check this Amtrak page -- Has figures for both 2008 and 2009. http://www.amtrak.com/servlet/ContentServer?c=Page&pagename=am%2FLayout&cid=1246041980432
I was wrong. Thanks for the insight. I'll have to calculate the station agent to passenger ratio for the Texas stations, although it will be an estimate since I don't know the exact number of employees in the staffed stations.
schlimm HarveyK400Could the higher proportion of labor expenses for Amtrak (48%) also represent lower expenses and greater efficiences in other areas? It's clear that the much higher proportion of labor to revenue (72%) is due to overall deficit operations. When I cited those figures, i also wondered. But the study Don cited, which I quoted from, makes it clear that salary expenses are high for Amtrak. I believe wasteful operations on lightly used LD lines could/should be specifically subsidized in the same way as the FAA subsidizes the "essential service" routes in smaller cities in the West as a separate item. That way, the existing/upgraded and new corridor services can have a fair chance at covering operating expenses as they already do in the NEC. If you read those two studies, one thing that is embarrassing is the idea that in 40 years, the speed in the NEC, from Metroliners to Acela has only increased marginally. Having services in the NEC run at a much higher speed was the original goal.
HarveyK400Could the higher proportion of labor expenses for Amtrak (48%) also represent lower expenses and greater efficiences in other areas? It's clear that the much higher proportion of labor to revenue (72%) is due to overall deficit operations.
When I cited those figures, i also wondered. But the study Don cited, which I quoted from, makes it clear that salary expenses are high for Amtrak. I believe wasteful operations on lightly used LD lines could/should be specifically subsidized in the same way as the FAA subsidizes the "essential service" routes in smaller cities in the West as a separate item. That way, the existing/upgraded and new corridor services can have a fair chance at covering operating expenses as they already do in the NEC. If you read those two studies, one thing that is embarrassing is the idea that in 40 years, the speed in the NEC, from Metroliners to Acela has only increased marginally. Having services in the NEC run at a much higher speed was the original goal.
I think the goal should to stop subsidizing all forms of transportation and require the users to tote the note. That would mean, amongst other things, getting rid of the long distance trains and the essential air services program, which is a boondoggle every bit as bad as the subsidization of the long distance trains.
Subsidies mask the true cost of a service and result frequently in dysfunctional behavior, e.g. motorists buy gas guzzling vehicles or shun public transport because they don't see the true cost of driving at the pump.
Sam1 The GAO has a variety of in-house experts, including economists. It is, however, primarily an auditing organization known for the thoroughness and objectivity of its work. You assessment of the the GAO is wrong. I can only suspect that you have never had any dealings with the GAO executives. I see nothing in your writing that suggest that you have deal with the GAO or understand its methodologies. If you have a BBA in Finance, then you should know that the busines community and governments use somewhat different accounting rules and standards. Most businesses use GAAP, as do most governments, except government accounting is moderated by the Government Accounting Standards Board.
The GAO has a variety of in-house experts, including economists. It is, however, primarily an auditing organization known for the thoroughness and objectivity of its work. You assessment of the the GAO is wrong. I can only suspect that you have never had any dealings with the GAO executives. I see nothing in your writing that suggest that you have deal with the GAO or understand its methodologies.
If you have a BBA in Finance, then you should know that the busines community and governments use somewhat different accounting rules and standards. Most businesses use GAAP, as do most governments, except government accounting is moderated by the Government Accounting Standards Board.
OK so now they are "Executives" versus GS level employees. I am pretty sure I am correct in my assessment of the GAO though. I don't hear many CPA's quoting them or saying they want to emulate their best practices. In fact, I hear the reverse. I guess our life experiences are different in this respect.
Sam1 I think the goal should to stop subsidizing all forms of transportation and require the users to tote the note. That would mean, amongst other things, getting rid of the long distance trains and the essential air services program, which is a boondoggle every bit as bad as the subsidization of the long distance trains. Subsidies mask the true cost of a service and result frequently in dysfunctional behavior, e.g. motorists buy gas guzzling vehicles or shun public transport because they don't see the true cost of driving at the pump.
So do you therefore believe that airlines, trucks, cars, buses and waterway users should do the same? Or only Amtrak?
RIDEWITHMEHENRY is the name for our almost monthly day of riding trains and transit in either the NYCity or Philadelphia areas including all commuter lines, Amtrak, subways, light rail and trolleys, bus and ferries when warranted. No fees, just let us know you want to join the ride and pay your fares. Ask to be on our email list or find us on FB as RIDEWITHMEHENRY (all caps) to get descriptions of each outing.
Amtrak's "Empire Builder" makes twelve (12) station stops daily, each way, in Montana. 7 1/2 of those stations are unmanned, including the 'Flag Stop' at Essex. 4 1/2 of the stations are staffed. 3 1/2 receive checked baggage. The "1/2" station comes from East Glacier Park being manned in the summer only, and accepting checked baggage then. In the winter, the stop is in Browning (unmanned).
Boarding statistics are published in the local papers every year: #1 - Whitefish, #2 - Shelby, #3 - Havre, #4 - Wolf Point (no baggage). Shelby might be #1, if we had connecting bus &/or air service from Canada and from points south. Long gone. Guess we would need a ground taxi service if the "Essential Air Service" boondoggle planes crashed here.
Hays
henry6 Sam1 I think the goal should to stop subsidizing all forms of transportation and require the users to tote the note. That would mean, amongst other things, getting rid of the long distance trains and the essential air services program, which is a boondoggle every bit as bad as the subsidization of the long distance trains. Subsidies mask the true cost of a service and result frequently in dysfunctional behavior, e.g. motorists buy gas guzzling vehicles or shun public transport because they don't see the true cost of driving at the pump. So do you therefore believe that airlines, trucks, cars, buses and waterway users should do the same? Or only Amtrak?
Last time I checked the top sentence said ALL FORMS---including Amtrak. So yes, he is referring to ALL transportation.
Any argument carried far enough will end up in Semantics--Hartz's law of rhetoric Emerald. Leemer and Southern The route of the Sceptre Express Barry
I just started my blog site...more stuff to come...
http://modeltrainswithmusic.blogspot.ca/
Sam1I think the goal should {be} to stop subsidizing all forms of transportation and require the users to tote the note. That would mean, amongst other things, getting rid of the long distance trains and the essential air services program, which is a boondoggle every bit as bad as the subsidization of the long distance trains.
If such a reactionary measure were implemented, the US economy would likely grind to a halt. I hope this forum can discuss reasonable plans, not put forth such extreme, libertarian political positions as the above or the fantasy about using tracking devices on every vehicle/person to charge them for every mile they drive.
C&NW, CA&E, MILW, CGW and IC fan
schlimm Sam1I think the goal should {be} to stop subsidizing all forms of transportation and require the users to tote the note. That would mean, amongst other things, getting rid of the long distance trains and the essential air services program, which is a boondoggle every bit as bad as the subsidization of the long distance trains. If such a reactionary measure were implemented, the US economy would likely grind to a halt. I hope this forum can discuss reasonable plans, not put forth such extreme, libertarian political positions as the above or the fantasy about using tracking devices on every vehicle/person to charge them for every mile they drive.
There no empirical evidence to suggest that phasing out transport subsidies over time, say 10 years, would cause the economy to grind to a halt. Clearly, without subsidies people would change their behavior. But it could benefit society and, dare I say it, passenger and transit rail. Here is one example.
Motor fuel taxes, which are a user fee, do not wear the full cost of supporting the operational and infrastructure costs of the nation's roadways. Thus, motorists do not see at the pump the true cost of driving vs. other modes of transport. As a result, Americans tend to shun public transport and buy relatively large, gas guzzling vehicles that consume considerably more fuel per mile or kilometer than motorists in countries where driving is no so heavily subsidized, i.e. Australia, New Zealand, etc. If motorists were required to wear the full cost of driving, they would probably make greater use of public transit, passenger rail for intercity travel up to 250 to 300 miles, and buy vehicles that reduce the damage done to the environment.
In FY08 Amtrak's long distance trains accounted for 4/10s of one per cent of intercity travel in the U.S. And the essential air services program, outside of Alaska, had equally distressing numbers. In fact, according to the DOT, more than 75 per cent of the airports served by the essential air services program are within 1 to 1.5 hours driving time of a major airport with excellent airline service. It is hard to imagine that eliminating these services would bring the economy to a grinding halt. In Texas they would not even be missed by the overwhelming bulk of the population.
Reasonable is in the eyes of the beholder. Moreover, the University of Nebraska is performing a study to determine if it would be feasible to use GPS technology to track motor vehicle use and use the data as a base for generating the revenues to pay for the nation's roadways. As the Texas Transportation Commissioner, Ric Williams, told me several years ago, as gasoline and diesel are phased out, which is an environmental goal, we will have to come up with another method to fund the cost of the roadways.
CMStPnP Sam1 The GAO has a variety of in-house experts, including economists. It is, however, primarily an auditing organization known for the thoroughness and objectivity of its work. You assessment of the the GAO is wrong. I can only suspect that you have never had any dealings with the GAO executives. I see nothing in your writing that suggest that you have deal with the GAO or understand its methodologies. If you have a BBA in Finance, then you should know that the busines community and governments use somewhat different accounting rules and standards. Most businesses use GAAP, as do most governments, except government accounting is moderated by the Government Accounting Standards Board. OK so now they are "Executives" versus GS level employees. I am pretty sure I am correct in my assessment of the GAO though. I don't hear many CPA's quoting them or saying they want to emulate their best practices. In fact, I hear the reverse. I guess our life experiences are different in this respect.
CPAs would probably not look to the GAO for best practices as CPAs. But auditors, especially internal auditors, at least the ones that I know, hold the GAO in high regards. One of the best U.S. Comptroller, General, David M. Walker, who was the head of the GAO, spent many years in private accounting with a major firm.
The Amtrak Fact Sheet, Fiscal Year 2009, State of Texas, appears to support the notion that Amtrak's station based customer service agents (agents) service ratio is relatively low whilst their compensation level is relatively high. I only have time to analyze the Austin numbers, but they are insightful, I think. Of course, as mentioned, I don't have all the data from Amtrak, but I have enough from other databases to make a reasonable estimate.
At the end of FY09 Amtrak employed 207 Texas residents. Total wages for the employees living in Texas were $14, 447,102. It is unclear whether all of the Texans employed by Amtrak live in Texas, but let's assume that they do. It is equally unclear whether the wages include payroll burdens. If they do, the average compensation package per employee in 2009 was $69,793. If they do not include the burdens, then they would have to be added to get the cost of the total compensation package. My former employer (I am retired) was a large electric utility. Its average payroll burden was 30 to 35 per cent for customer service employees. The burden was in line with those for other large Texas employers. Amtrak is not a large Texas employer, but it is a significant national employer that probably sets its compensation policies to be in line with the regions where it operates. If we go with 30 per cent, then the average compensation package in Texas would be $90,731.
The Austin station has at least four full-time employees; it probably has six or more. I don't know for sure. It is open seven days a week from 7:00 a.m. to 8:00 p.m. Assuming that the normal workweek is eight hours, it probably has more than six employees, but let's assume five as a conservative number. Moreover, let's assume that these folks are paid 93 per cent of the national average for customer service employees. This percentage squares with some other comparisons that I have made between Texas average family and household income compared to the national data. This means that their annual compensation package would be $37,433 before loadings and $48,662 after loadings based on the average national customer service data that I provided. Thus, for five employees the compensation cost before loadings would be $187,165 and $243.315 after loadings.
In FY2009 Amtrak boarded and detrained 25,404 passengers in Austin for an average of nearly 70 passengers per day. The average customer service cost per passenger would have been $7.37 before loadings and $9.58 after loadings. But wait a minute! The bulk of the agent support services are performed for boarding passengers. Little service is required to detraining passengers; they received the bulk any required assistance when the boarded the train up or down the line.
If we assume that 75 per cent of the agent services in Austin are directed toward boarding passengers and further assume that the boarding and detraining numbers are relatively even, then the cost of the services directed toward these passengers would have been an average of $11.05 per passenger before loadings and $14.37 after loadings.
I don't have time to chase up the numbers for customer service agents at the airport and bus terminal in Austin, but I suspect that Amtrak's agent costs would not compare favorably with the airlines and bus companies. Instead, they would show that Amtrak's customer service cost ratio per passenger is high, especially in those markets served by only one train per day.
sam1: I believe you said the goal should be "to stop subsidizing all forms of transportation." That would include a lot more than LD trains and EAS. If they really paid their ways, it would mean trucking companies and airlines would find their expenses would increase to a level they could not stay in business. What they really cost in general revenue funds is well in excess of their "user fee contributions." However, I would not be in favor of that because of the concept of providing for the common good. The basic idea of a state is that we all contribute to services etc. that benefit the entire society, not just pay for what we as individual may use or want. If we lived in that sort of a place, many of us would not pay for schools, fire departments, police etc. because we may not use them. Some would refuse to pay taxes for the military. Others would refuse to be taxed for Social Security. The list goes on and on. Notions of living in a cafeteria-style state would be disastrous if it weren't so ludicrous.
On the other hand, I think your research on the Texas station situation is a very helpful contribution. Although I believe in subsidies for capital investment for passenger service, I also think we need to be mindful of finding ways to increase productivity and give incentives for that in a non-profit. Profit-making corporations have a built-in method to do that which has been used successfully for years. But there are sectors of the economy, like passenger rail, where the profit motive may not be the best method to ration scarce resources. Other methods to do so and reduce wasteful practices and increase efficiency need to be explored/discovered.
Although I have not brought the following for some time we need to consider it again.
The political system and the consequences of not having a full transportation policy may have been forgotten. I am not talking about the US politics but world wide politics.
1. We have Europe with its continuing increase of HSR miles and MSR miles. Paris to London, Frankford, Geneva in 2 hours. Other locations in 4 hours.
2. Eastern European cities slowly connecting their HSR to this network.
3. Southern Europe -- Spain, Italy, a couple hours more.
4. Grece -- Well their lack of any good ground transportation - except ferry boats however rail and auto terrible (cannot even take a EuRail pass but it works there). I will not assume that this lack has caused all the present economic upheval ( Only 2% of total EU economy) but the lack of rapid surface transportation does not help.
5. Northern Europe also has projects for tying into the network.
6. China --- we are all aware of how much HSR they are installing.
What has all this mean?
The US is in the untenable position of loosing all its hard won gains and advantages due to previously better rails (freight and passenger), roads, bridges, airways, and tele communications. This can only be prevented by filling in the rail leg. The rail leg is both freight and Passenger. The freight leg needs improving to allow freight movements to be competive with the western European water born freight mentioned on an earlier post in this thread.
On my travels in Europe there are several themes that my conversations with European travelers note.
1. They are anxious for more HSR service to be initiated to more destinations. Big talk of the SNCF Paris to Germany line. I believe it is now in service?
2. Business people really appreciate the amout of work they accomplish on their HSR travels.
3. The lack of Wi-Fi bothers them but they believe it will be coming within 5 - 10 YRS.
4 There is a feeling that most would not want to be based in the US because of the lack of good ground transportation. They also do not feel comfortable drivin in the US.
5. They despise airline trips but usually take an airplane if surface takes mre than 4 - 6 hours. Note this number had a lot of divergences but below 4:30 rail the choice of almost everyone. Of course most can get to airports by rail.
6. Amazingly enough many talked of using the overnight trains to get to an early morning appointment in another city.
7. A few mentioned that their HSR systems will enable the EU to tromp the US.
8. Didn't like Bush and thought he had no idea what transportation was all about.
9. One person mentioned our surface transportation not any better than the Balkans.
So if we do nothing to improve HSR passenger travel the US will drop behind these and other countries that close the time gap for business and personal travel. Lets not Balkanize our country. Its not good for business.
schlimm sam1: I believe you said the goal should be "to stop subsidizing all forms of transportation." That would include a lot more than LD trains and EAS. If they really paid their ways, it would mean trucking companies and airlines would find their expenses would increase to a level they could not stay in business. What they really cost in general revenue funds is well in excess of their "user fee contributions." However, I would not be in favor of that because of the concept of providing for the common good. The basic idea of a state is that we all contribute to services etc. that benefit the entire society, not just pay for what we as individual may use or want. If we lived in that sort of a place, many of us would not pay for schools, fire departments, police etc. because we may not use them. Some would refuse to pay taxes for the military. Others would refuse to be taxed for Social Security. The list goes on and on. Notions of living in a cafeteria-style state would be disastrous if it weren't so ludicrous. On the other hand, I think your research on the Texas station situation is a very helpful contribution. Although I believe in subsidies for capital investment for passenger service, I also think we need to be mindful of finding ways to increase productivity and give incentives for that in a non-profit. Profit-making corporations have a built-in method to do that which has been used successfully for years. But there are sectors of the economy, like passenger rail, where the profit motive may not be the best method to ration scarce resources. Other methods to do so and reduce wasteful practices and increase efficiency need to be explored/discovered.
The talking point was transport subsidies. Schools, fire departments, police, Social Security, defense, etc. have nothing to do with public and private transport.
If you take the time to plough through the budgets and financial statements of DOT, FAA, Homeland Security, as well as your state related organizations, you will find that general revenue funds, whilst differing from mode to mode, are a small per centage of the total revenue stream. Most of the transport in the U.S., with the execption of passenger rail, is covered by direct and indirect user fees.
Timely post. I imagine one of these days the power elite of the multinational corporations may wake up and decide "something needs to be done" because they need a economically viable US. Until then we will become less competitive on the world stage for many reasons, including, but not limited to those that blue streak just pointed out.
henry6Sam, here you ago again getting yourself in trouble. You come up with fast and fancy facts and figures and you guide me into a groove, then you scramble away tossing off comparisons by saying you assume. You lost your credibilty by doing that. As for the Texas payroll for Amtrak, it sounds about right for the number based on the need for engineers, conductors, and train service personell in addition to agencies' staffs. What you don't take into account is that there has to be some sembelance of "service". It probably makes sense that there be one, maybe two people, on duty for about one to two hours before the arrival and up to a half hour after the departure of a train. If this train is "off hours" like after 9 at night and before 7 in the morning, then it might mean that there be at least one person with a 8AM to 5PM office to "serve" the public, the convenience bringing customers who might not show up at all. The sticks and stones of running trains is only half the game of playing Amtrak!
The "fast and fancy figures" as you put it come from Amtrak's numbers, as well as those from the U.S. Census Bureau. Bluestreak put me onto the boarding figures, which I did not know were available on "Inside Amtrak", so I took the opportunity to workout what is a plausable scenario for Austin.
I have visited the Austin Amtrak Station on many occasions. In fact, I have take the Texas Eagle flrom it twice this year. It has two employees on duty seven days a week from 8:30 a.m. to 7:30 p.m., although I don't know the staffing complement. The shoulder hours are covered by one employee as far as I can determine. That is why I used a very conservative estimate. I think that the actual total complement is higher. If that is true, the numbers would look even worse.
I am not participating in these forums to win a popularity contest, and I certainly don't get upset my people who disagree with my perspectives. I respect the people who post a view on these forums with a logical argument supported with verifable facts. I have no time for perspectives that are illogical, not supported by facts, and take a swipe at others who are participating in the forums.
Sam1The talking point was transport subsidies. Schools, fire departments, police, Social Security, defense, etc. have nothing to do with public and private transport.
You are looking at my post in a too literal and concrete manner. Apparently have no interest in seeking practical solutions, as seen in your use of the term "talking point."
schlimm Sam1The talking point was transport subsidies. Schools, fire departments, police, Social Security, defense, etc. have nothing to do with public and private transport. You are looking at my post in a too literal and concrete manner. Apparently have no interest in seeking practical solutions, as seen in your use of the term "talking point."
chill, dudes, chill---
I remember our little mass transit system here did a little ol' ad campaign that actually showed how much cheaper public transit was as compared to driving our car here. It took out ALL the subsidies from ALL the transport modes and compared them. Boy, it got people's attention. London ON BTW pays the lowest subsidy rates for any city of its size yet we have a very well run system here----
I did think that maybe even taking a chunk out of the subsidies may also get planners rethinking some of the more deletrious aspects of our current single system zoning we do to our cities----kvetching all along why people use their cars when their local shopping for groceries has them driving 20 miles to and from the grocery store and there is no access to mass transit, or, even if there is, have to haul groceries on a crowded bus all the way back 20 miles to home---etc PP so on and so forth
I agree you guys shouldn't get overly worked up on what any specific poster posts Not likely an individual opinion is going to stop passenger rail in this country. I think we are going to progress down the path of passenger rail because it makes economic sense. The rail component of passenger carriage is largely absent in this country and if we want to stay competitive with other countries we need to work on expanding it. It is slowly happening. Light rail is expanding, Commuter rail is expanding, and now intercity is starting to expand. We'll see how far we get with intercity and High Speed Rail. Looks like also we are finally going to have true intermodalism in some parts of the country as well.
Sam1CPAs would probably not look to the GAO for best practices as CPAs. But auditors, especially internal auditors, at least the ones that I know, hold the GAO in high regards. One of the best U.S. Comptroller, General, David M. Walker, who was the head of the GAO, spent many years in private accounting with a major firm.
OK, we agree on this. I'd also add that a LOT of the CEO's today have no Accounting background. Instead they reach the CEO position via Sales / Marketing. While it was true once upon a time that Accounting was almost a defacto prerequisite for a good CEO, thats an old paradigm now.
Most projects today do not have an IRR projection done even. So thats why I am confused as to why your quoting all this auditing stuff as if it would mean anything to any future project. It's just not how projects are evaluated anymore, IMO.
CMStPnPOK, we agree on this. I'd also add that a LOT of the CEO's today have no Accounting background. Instead they reach the CEO position via Sales / Marketing. While it was true once upon a time that Accounting was almost a defacto prerequisite for a good CEO, thats an old paradigm now.Most projects today do not have an IRR projection done even. So thats why I am confused as to why your quoting all this auditing stuff as if it would mean anything to any future project. It's just not how projects are evaluated anymore, IMO.
To be sure, other values need to be evaluated, maybe monetized, for a rail service; but that will need to carry a far bigger, even impossible, load if the revenues don't come close to meeting expenses. Not everyone wants to accept the health, environment, insurance and other costs that go into the politics.
CMStPnP: You are right, no one here is going to stop passenger rail service. But we should get worked up. If we're not ready to defend and argue the positive points of rail passenger service here and now, then when the real challengers and detractors come along we won't be prepared. This is a test or an exercise to keep us tuned up and ready for when we get into the fray that matters. Here we see the opposition, their good arguments, their smoke and mirror arguments, and where they agree with "us". So we can prepare and practice.
henry6 CMStPnP: You are right, no one here is going to stop passenger rail service. But we should get worked up. If we're not ready to defend and argue the positive points of rail passenger service here and now, then when the real challengers and detractors come along we won't be prepared. This is a test or an exercise to keep us tuned up and ready for when we get into the fray that matters. Here we see the opposition, their good arguments, their smoke and mirror arguments, and where they agree with "us". So we can prepare and practice.
As long as the attack imagery is left at home. I don't like to see an all out idealogical battle wherein one must win and the other must lose. If we are talking about transportation systems as such.....,
.....it will also have to include.......the radical other......the car
CMStPnPThe rail component of passenger carriage is largely absent in this country and if we want to stay competitive with other countries we need to work on expanding it. It is slowly happening. Light rail is expanding, Commuter rail is expanding, and now intercity is starting to expand. We'll see how far we get with intercity and High Speed Rail. Looks like also we are finally going to have true intermodalism in some parts of the country as well
The improvements of Amtrak's operating figures for Jan are what I consider encouraging. It certainly appears that lack of equipment is a definite hold down in ridership. when the new cars start arriving maybe we can really find out the demand both short haul and long haul.
CMStPnPMost projects today do not have an IRR projection done even. So thats why I am confused as to why your quoting all this auditing stuff as if it would mean anything to any future project. It's just not how projects are evaluated anymore,
CMStPnP: Interesting comment! I've sorts thought all those auditing figures give you is a picture of past performance, which doesn't seem very useful when you're trying to go in a new direction. Could you help get me/us a little more up to speed on how to avoid mere retrospective snapshots? What are some of the current techniques used for future planning that carry some weight?.
schlimmCMStPnP: Interesting comment! I've sorts thought all those auditing figures give you is a picture of past performance, which doesn't seem very useful when you're trying to go in a new direction. Could you help get me/us a little more up to speed on how to avoid mere retrospective snapshots? What are some of the current techniques used for future planning that carry some weight?.
Well my experience in Corporate America today and in the last 10-12 years is projects have a financial component but the Finance end of the project is more one of where does the money come from (project funding) vs how much money will the project return. So for example, right now the firm I am working for is spending millions of dollars on new sales performance monitoring software. No software was in place before. The project was the initiative of the CEO. The firm brings in between $1-2 Billion in gross revenue. An IRR, audit, or detailed projected costs savings was never formally done and if it was I never saw it. Basically the CEO stating....."I want this software, I used it at past employers and it will be a huge benefit for the sales force". That was that.
Similarly when I worked for GM which was still a large manufacturer when I worked for them. They would also go by "gut feel" of the Executive in charge in most cases. Sure they do Market Research which in their case is quite extensive but rarely do they look at costs of the projects before startup. Usually it is "gut feel" of the Executive in charge. Back when I was working for them (1991-1994) they were too large to stop everything and do a financial analysis of each project. Just way too many projects and not enough Financial Employees to do that. In fact, they were so large they had a fulltime team from the IRS at HQ, they negotiated their taxes with the IRS. It wasn't necessarily an assessment as it is for smaller firms. It was too impractical because the company was too large. So GM had to go on trust and how an Executives past projects did.
I worked for the DoD once upon a time as well as a contractor (1994-1995). Likewise, their projects started with an "objective". Rarely was the objective looking at costs vs revenues. It was a increased productivity objective or infrastructure expansion typically. They would look at the Financial aspect as to where they would get the money from (what budget or request). Then they would write a request for proposal and look at the bids. That was that.
DoD does not use GAO, they use their own internal audit agency which I think is superior to GAO. Congress uses GAO to attack the Pentagons spending sometimes. IMO, thats wrong because the GAO Accountants are totally clueless as to the specific costs or features that are needed for Defense, in a lot of cases they are analyzing costs from the perspective as if a civilian alternative is just as good. DoD's internal auditing team I think is superior (Defense Audit Agency) because many of them are uniformed Officers or have that background and they understand the Defense specifics better.
Thus, the basis for my earlier comments that GAO doesn't know rail operations / costs and is probably just guessing themselves with their reports. I understand where Sam1 is comming from and I agree with some of the past posts. Government can be very wasteful with taxpayer money. GAO warns that waste might happen or that a project might not attain it's objectives but I think their opinion needs to be placed in perspective.
I cannot see how the GAO can analyze high speed rail in this country as to costs vs benefits when we don't currently have an existing HSR demo anywhere as a viable alternative to air, bus or auto. By the same token we really do not know if it will be successful either. So this spending of the stimulus funds is a gamble of sorts. I will agree with that but I cannot agree at this point in time that spending in the area of High Speed Rail is wasteful. Not enough evidence.
CMStPnPI cannot see how the GAO can analyze high speed rail in this country as to costs vs benefits when we don't currently have an existing HSR demo anywhere as a viable alternative to air, bus or auto. By the same token we really do not know if it will be successful either. So this spending of the stimulus funds is a gamble of sorts. I will agree with that but I cannot agree at this point in time that spending in the area of High Speed Rail is wasteful. Not enough evidence.
If the experience in the EU is anything to go on there may be pockets where it can be "wasteful" and other pockets where it may be successful. There is a little matter of recessionary pressures and odd doings in terms of accounting procedures that will have an influence at the present moment but I do think that there may be some building towards HSR.
Me? I'd rather try to get workable city pairs going---the one in FL may actually work for example---and incrementally work it up.
blownout cylinderCMStPnPI cannot see how the GAO can analyze high speed rail in this country as to costs vs benefits when we don't currently have an existing HSR demo anywhere as a viable alternative to air, bus or auto. Not enough evidence.try to get workable city pairs going---the one in FL may actually work for example---and incrementally work it up.
CMStPnPI cannot see how the GAO can analyze high speed rail in this country as to costs vs benefits when we don't currently have an existing HSR demo anywhere as a viable alternative to air, bus or auto. Not enough evidence.
try to get workable city pairs going---the one in FL may actually work for example---and incrementally work it up.
Again, some interesting perspectives. I wonder where we would be today if the NEC had really moved forward incrementally over its 40 year history to being a HSR instead of gaining about a 5 mph average speed. It would have been a real model to show us the benefits of HSR and its application in other corridors of city pairs. The FLA project may be the one that tests out or confirms the benefits. But let's be sure that incrementalism doesn't become an excuse for never really moving forward.
A great example --- The Northeast Corridor NEC
" we've increased our share of the AIR/RAIL market between New York and Washington from 50 persent to 61 persent; New York and Boston from 39 persent to 50 persent; "
Joseph Boardman in the February issue of "Amtrak Ink"
Don U. TCA 73-5735
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