V.Payne oltmannd John WR1. Of course there are individual factors. Time is money. Once coast to cost air travel became available a business man could not afford to take the train. And of course with the massive subsidies of free highway systems driving was very popular. And it still is. In my state, for example, there is no sales tax on gasoline; there is an excise tax but that is substantially lower than the sales tax would be. Meanwhile, railroads were taxed and part of their taxes went to pay for these free roads. Competing with that was a little daunting. Yes, it was. But, the lions share of the money to build and maintain the interstate highways came from ....wait for it.... vehicle fuel tax paid into the highway trust fund - not property taxes paid to local gov't by RRs. There are indirect subsidies and ancillary costs not born by the trust fund, but the $$ to build them came from fuel tax - and it was a rather popular tax when it went in. Currently (2010 FHWA numbers) fuel taxes (state and federal) and tolls pay for 27% of all road government financial costs, disregarding the sales tax redirection by my calculation. But even this low average percentage is much higher than the number for limited access roadways. I keep a spreadsheet of FHWA numbers. The Federal fuel tax leveraged the user's indivdual fuel tax paid for use of the Interstates by a factor of 8-10 over six decades, with the balance coming from fuel taxes redirected off existing urban roads paid for by property taxes. Both longer distance trucking and passenger uses of roads are significantly underpriced, and due to this marketplace expectation rural limited access toll roads have financial difficulty recovering their costs, even with the accidents costs dumped on the government. Everyone realized this in the railroads but the times were what they were.
oltmannd John WR1. Of course there are individual factors. Time is money. Once coast to cost air travel became available a business man could not afford to take the train. And of course with the massive subsidies of free highway systems driving was very popular. And it still is. In my state, for example, there is no sales tax on gasoline; there is an excise tax but that is substantially lower than the sales tax would be. Meanwhile, railroads were taxed and part of their taxes went to pay for these free roads. Competing with that was a little daunting. Yes, it was. But, the lions share of the money to build and maintain the interstate highways came from ....wait for it.... vehicle fuel tax paid into the highway trust fund - not property taxes paid to local gov't by RRs. There are indirect subsidies and ancillary costs not born by the trust fund, but the $$ to build them came from fuel tax - and it was a rather popular tax when it went in.
John WR1. Of course there are individual factors. Time is money. Once coast to cost air travel became available a business man could not afford to take the train. And of course with the massive subsidies of free highway systems driving was very popular. And it still is. In my state, for example, there is no sales tax on gasoline; there is an excise tax but that is substantially lower than the sales tax would be. Meanwhile, railroads were taxed and part of their taxes went to pay for these free roads. Competing with that was a little daunting.
Yes, it was. But, the lions share of the money to build and maintain the interstate highways came from
....wait for it....
vehicle fuel tax paid into the highway trust fund - not property taxes paid to local gov't by RRs. There are indirect subsidies and ancillary costs not born by the trust fund, but the $$ to build them came from fuel tax - and it was a rather popular tax when it went in.
Currently (2010 FHWA numbers) fuel taxes (state and federal) and tolls pay for 27% of all road government financial costs, disregarding the sales tax redirection by my calculation. But even this low average percentage is much higher than the number for limited access roadways. I keep a spreadsheet of FHWA numbers. The Federal fuel tax leveraged the user's indivdual fuel tax paid for use of the Interstates by a factor of 8-10 over six decades, with the balance coming from fuel taxes redirected off existing urban roads paid for by property taxes.
Both longer distance trucking and passenger uses of roads are significantly underpriced, and due to this marketplace expectation rural limited access toll roads have financial difficulty recovering their costs, even with the accidents costs dumped on the government. Everyone realized this in the railroads but the times were what they were.
I'm having trouble following what you are saying. Are you saying the Federal fuel and excise taxes have never covered a significant portion of the Interstate/Federal highway network construction?
Or, are you saying that there is cross subsidization from local roads to federal roads by miles driven vs. fuel tax paid?
Or both?
-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/)
John WROne thing is certain. No one, absolutely no one in Government, was concerned about was the railroads. For well over a hundred years they had been private companies taking care of them selves and providing the Government with substantial benefits in the bargain. And then, with no concern for how much it inconvenienced the Federal Government, the Penn Central went bankrupt.
Pretty much.
The railroads tried shouting from the treetops in the early 1950s about all the various ills regulation was causing....and got absolutely nowhere. Just read some of the preamble in the PRR and NYC annual reports from that era. By the mid 1950s, they'd pretty much thrown in the towel in that regard...and greatly reduced the capital budget of their railroads.
Disgruntled commuters started the states to take notice and provide some $$ for improvements and to keep the service going, but PC going belly up was sure a wake up call to DC.
oltmanndDisgruntled commuters started the states to take notice and provide some $$ for improvements and to keep the service going, but PC going belly up was sure a wake up call to DC.
Somebody here -- I forget just who it was, my Alzheimer's disease is setting in -- but somebody here pointed out that the Penn Central was carrying the lion's share of all the passengers in the country. You may remember just who it was. And a lot of these passengers were commuters. And then there were the New Haven commuters. It was an old, old story. Commuter roads had to hire full time employees to do a half day's work in the morning or evening rush hour. And their trains laid idle all of that time. And yes, they stopped buying new equipment. The Delaware Lackawanna and Western ran its red Edison EMU's it brought in the 1930's and strung up 3,000 volt dc power lines to operate.
And yes, everyone though the railroads were only crying "Wolf. Wolf." All to get more government money. And everyone ignored them. Until it was too late for the Penn Central, which had been the biggest and most profitable companies in the country.
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