It is well known in financial circles that money can be created by a mere banking redeposit process, and is a basic, fundamental premise of American economics. It is a concept known all too well by now Federal Treasury Secretary (and ex-CEO of CSX Railroad) John Snow, as well as Federal Reserve Chairman Alan Greenspan.
IF Amtrak became a special federally chartered BANK in charge of billions and billions of dollars in assets and a multiplicity of redeposit funds expanding the economy, profits earned from loans could be applied to the money losing national intercity passenger train network. And taxpayers perhaps could eventually become totally out of the picture and unaffected.
However, its true that corporations do sell stock to raise capital… something Amtrak cannot do… Then again, who would buy stock in a company that doesn’t turn a profit?
Amtrak’s is a nationwide passenger railroad government service… To start over with a private passenger railroad company, it would have to start small and grow slowly at the same time turning a profit… For this to happen, this small company would have to have government subsidies similar to the railroads of the nineteenth century…large land grants…or something similar…
And if one new small company started this and got the federal and state subsidies the railroads received in the nineteenth century, this new railroad would of course be state of the art HSR…
The question that remains is, Wouldn’t it be cheaper for the government to build HSR nationwide? And a second question remains, Would private enterprise operate a HSR nationwide better?
These are the two questions that envelope Amtrak today!
“No”? Why? And, could ANYTHING else ‘pacify’ almost everyone?
donclark:
Isn’t there a distinct difference between a corporation’s owners (stockholders) and WHAT A CORPORATION DOES to generate revenue and profits?
kevarc:
Your reply is an emphatic no also. Why? Do you have anything constructive to offer? Or, will the same old thing prevail? (i.e., the ones with the most political clout will win.)
Snow is an idiot. He darned near ruined CSX. He has no business being a position of power.
To Charter a bank would take an Act of Congress to creat. Chances of that ever happening are slim to none.
From what I can gather, Greenspan is NOT a fan of amtrak and so I see no help coming from that quarter.
Where would the money come from? As a charter bank it needs deposits and after seeing amtraks track record with money, no fund or retiremen fund manager in their right mind would put money there. The lawsuits for failing thier fiduciary duties would be unreal. NOt only that, but a bank MUST pay interest on their deposits and the return at this time is not going to encourage deposits.
Face it, without gov subsidies, amtrak is DOA. No one in their right mind is going to finance anything without a fed guarantee and what would the difference in a direct subsidy and that? Nothing.
ergo -it is best to either let amtrak die or let the states that want it pay for it.
Most of the airlines flying into a lot of small cities and into all of the larger cities, i.e., the major carriers, are losing money. The only airlines that is turning a profit, these two or three keep coming up: Southwest, AirTrans, and JetBlue…have cherry picked routes serving underserved cities… It happens that most of AirTrans routes serve Atlanta and either Orlando or Fort Lauderdale, Florida, wherever the other cities are… I would not consider any of the above a nationwide airline…not even Southwest…
AirTrans, for example, is a new airline… I’m not sure whether its twenty years of age… AirTrans would not have grown as much recently if it had to buy and build new airports, terminals, and parking garages serving them… It has grown by taking over other airlines gates at the airports it serves…
ANY NEW PRIVATE PASSSENGER RAILROAD COMPANY WOULD HAVE TO EITHER BUILD NEW RIGHT OF WAY OR TAKE OVER (BUY) AN EXISTING RIGHT OF WAY!
For example, I would like to travel by HSR to Houston from Dallas… Since the only right of way is owned by Union Pacific, and since Union Pacific does not desire to lose any of its slots along this right of way, any new company would have to build new tracks to Houston…
You know what this means… Unlike the nineteenth century when the railroads were granted right of way along property which was owned by no one(yes, the governments)… today that is not the case…
No private entity that I know of could possibly fund the HSR line between two of the top 10 largest cities in America without some sort of government subsidy either at the state of national level… The right of imminient domain would be nice for any private entity to use to keep the price of real estate from skyrocketing beyond a fair price for the land involved…
The cheapest direct route as far as real estate is concerned is owned by the state of Texas, its right of way alongside I-45… only
What’s the difference between saving energy and saving money? If HSR would save money vs. jets, then Southwest airlines would think about building HSR between Houston and Dallas.
I know I know, private airlines get unfair subsidies for their infrastructure, so why not trains. But I have to think that airports are still cheaper to build (and they’re already built) than 100’s of miles of new HSR tracks.
I don’t think HSR will get a serious look until all other existing forms of transit are saturated.
Thanks Gabe. Guess somebody didn’t like my long form answer. Sometimes the truth hurts, I guess. Like trying to turn a donkey into a canary. With a lot of genetic engineering and a few generations time you can get close, but it’ll never really work…
Good analogy. Like turning a donkey into a canary, attempting to do that with Amtrak would only result in the person making the attempt making an “***” out of themselves.[;)]
#2 NO. Most banks are state chartered, but insured by the Feds (FDIC). Only the real big guys have a true federal charter. Check out where most of your credit card money goes (my old hometown - Delaware). A lot of banks have charters in many states and are actually many different banks under one holding company (Bank One).
#4 Yes. Banks need a form of deposits to then reissue as loans with higher interest. Deposits can be of many design (Cash, Credit Transactions, Fees, Loan Interest, Insurance)
I recently flew from DFW to Las Vegas… on AirTrans… Yes, I got there fast and on an airliner that has cheap fares… But notice, from DFW there are three places to fly to with AirTrans: Las Vegas, Atlanta, and Fort Lauderdale… In fact, the flight to Fort Lauderdale was an extension of this flight…
However, there were snafus… When the aircraft got to Las Vegas, we had to wait a half hour for another aircraft to leave the terminal before we could pull in… And it happened again at DFW, except this time it was a 45 minute wait… MAYBE THERE IS PLENTY OF SPACE IN THE AIR, BUT SPACE IS GETTING SHORT ON THE GROUND!
The pilot blamed bad weather up north which caused all of the delays… Bad weather! Is this the transportation system of the future? Is it getting worst? When will we wake up and realize that the major urban airports are already at capacity? Build another terminal, build another runway… Come on, are you so deceived that the 20 new gates will only create breathing space for a year or two… and then we’re back were we were… Its the same with adding lanes to urban freeways… They fill in practically no time…
Two or three train coaches can replace any airliner… A train can pull as many as needed… just add more locomotives to pull more and more cars… on real estate that takes up about two lanes of traffic… for double track main lines…
Take a look at some city pictures taken from satellites. My favorite is a view of Dallas… In it notice how wide freeways and their frontage roads, notice how little space DART’s double track light rail takes… A little bridge over RL Thornton freeway downtown shows the reality… barely a two lane bridge over a 12 lane freeway…
Then take a look at DFW airport… Footprint…means government owned land… the size of Arlington, Texas practically… Railroads closed to major terminals and stations can be tunneled underground lea
Donclark is on the right path. HSR would fill a time niche between highway and airline. Current standard 79 mph max rail operations do not beat highway travel door to door, freight or passenger. The only thing he’s missing, and the most important variable for success with HSR is that it MUST be focussed on freight, first and foremost, then and only then can you add a passenger element. Freight makes money, ergo would attract the necessary private investment capital (although you would still need a significant government financial invovement, not necessarily using tax dollars but utilizing instead tax exemptions and credits). HSR freight would take market share from truckers mostly and also some airfreight, and these time sensitive freight components have higher profit margins.
Once you’ve establish HSR freight lines, it would be no problem to introduce passenger operations, even running as “mixed” consists. A HSR passenger operation over the medium distance corridors would make the most sense, since such could directly compete with medium haul airlines, but even long distance HSR passenger operations could probaby attract enough travelers to approach private sector profitability.
Amtrak, when it ran express, had trouble keeping the cars on the rails at 79 mph…
Second, there are good reasons that neither the Japanese nor Europeans run a significant amount of HSR freight. Freight is heavier and much more dense than passengers. Trains must have heavier construction, track structures must be of both heavier construction and correctly engineered for freight including little or no super elevation that is often used on passenger lines especially HSR lines. Lets not forget that merely mixing freight and passenger trains on the same tracks is likely to create dispatching headaches similar to those felt now. For example, suppose freight spe
The transportation problem in this country is more than just the railroads. While stopped at a truck stop, a conversation with a trucker revealed he was running bi-weekly trips from Mich to Calif hauling truck chassis. Where is the sense in this when we all must realize how much more efficient RR is.
When Fred Pena was Sec’y, he promised to integrate the network, in order to minimize duplication, but got nowhere. We desprately need a better system to move both goods and people, and neither air, truck or RR is the only answer.
Now before you all get in an uproar about more gov’t control, take a look at what “competition” has done for airlines, and telephone, after de-regulation.
Sure we could use trucks, but why not develop a way to cooperate: hauling trucks on trains (not just trailers)? The truckers could either stay in their homes on wheels, or perhaps a passenger coach could be included in the consist.
The arguement was made for door-to-door service, but actually even trucks are seldom door-to-door. In most cases goods are transferred from truck to truck at more than one distribution center.
We need to take advantage of the benefits of all modes of transportation in order to solve the problem of time, cost and energy without thinking any one mode is the ultimate answer to the question of life, universe and everything.
Does anyone have any ideas about how to implement this cooperation, or how about a better idea to minimize the traffic on the highways, and the almost constant delays at the airports? HSR in certain locations are great: I would love one between Denver and the ski slopes (probably from DIA). Flying long distances is sometimes the best solution, but overnight trains would be fine, too.
Well, that is enough for now.
Thanks for listening.
Amtrak, when it ran express, had trouble keeping the cars on the rails at 79 mph…
Second, there are good reasons that neither the Japanese nor Europeans run a significant amount of HSR freight. Freight is heavier and much more dense than passengers. Trains must have heavier construction, track structures must be of both heavier construction and correctly engineered for freight including little or no super elevation that is often used on passenger lines especially HSR lines. Lets not forget that merely mixing freight and passenger trains on the same tracks is likely to create dispatching he
As I’ve suggested in other threads . . put together some form of Rail Trust Fund. Compensate the landlord RR’s in the form of additional track, capacity, or maintenance funds, in addition to the “rent” that the service operator would pay. One source of funding would be a ticket tax in the form of a disembarkation fee, paid to the State in which the passenger disembarked.
HSR for freigth and passengers are more expensive to build and to maintain than HSR that serve only passenger and some mail and parcel-trains. The question is whether the market niche is big enough to justify the higher costs. These costs would have to be covered by the freight trains alone, because any other solution would be a cross-subsidy which does not make sense economically. the problem is very simple. You can build a supply-chain based on almost any trip-time, supposed the trains arrive reliably. Why should a customer pay higher rates if the does not need the faster delivery? Parcels, mail and perishables are the only exception to this rule.
Furthermore, you need a fleet of decidated HSR-freight-cars, streamlined and equipped with electronicalle-controlled disc-brakes. So you have to transload the cargo at the end and at the beginning of the HS-run, or you have to buy an enormous fleet of these cars. In Europa, the fastet freight trains run at 100 mph, some perishable-trains from southern France to the North and limestone trains in Britan. But these are exceptions, and they run on the convetional lines, not the HSR.
The Germans tried to establish a HR-freigt-service. It failed on the commercial side, not from a technical or safety point of vue. Starting years ago, the French still run HSR-Mail trains on their HS-network, with yellow TGV-trainsets. I think, UPS is studying to introduce a similar service for parcels basing on PDG-airport as hub.
Entire Trucks - not only trailers or containers - on railcars is an idea practized in Europe for years. It is called the moving highway. It survives only because it is heavily subsidized by government. It is much cheaper not to haul the tractor and to hire a new tractor and driver for delivery of the trailer or container.