Perhaps the plethora of mindless insults directed toward Mineta shows that the pro-Amtrak gang (including NARP) can’t come up with even one good argument in response to Mineta’s Alaska analogy. That more than anything is reason enough to continue the bid to rationalize the existence of government run passenger trains over privately owned rail lines.
The current Administration is trying to come up with solutions to many problems (not just AMTRAK) that have festered for years. Their most vocal opponets aren’t offering any worthwhile input. They just call the President, his staff and advisors, stupid or evil and impugn their honesty.
Here’s one. The operating profit on Amtrak’s NEC, where Amtrak owns and operates the railroad, is better than the operating profit of the Alaska Railroad. So why is the ARR a good analogy?
I guess now other reasons will have to be used to continue the bid to rationalize the existance of government run passenger trains over privately owned rail lines. From previous your previous posts we know you mean eliminate rather than “rationalize”.
So maybe everything but the NEC should be shut down. But just like the ARR, the NEC operation does not generate sufficient ca***o catch up with with the deferred maintenance and required capital investment. And so just like the ARR, Amtrak will continue to require a fairly hefty infusion of cash. In that circumstance, I doubt you will be very happy knowing that some of your tax money is going into the NEC. That is, of course, if you actually pay taxes.
The Bush administration is saying that Amtrak is broken and has to be reformed. Until they do reform, Federal funding will be cut off. They know full well that eliminating the funding for Amtrak will result in the end of intercity passenger rail service in the U.S.
It is quite appearant that the Bush administration wants to reduce federal expenditures for everything except money for “spreading democracy” and “homeland security”. At the same time complaints about the reduction of services are not welcome. If Amtrak goes down, the line will be, "We told THEM to reform, THEY didn’t, so it is THEIR fault. If it were anything else, the
So the NEC makes more “operating profit” than the ARR, but at the same time the NEC doesn’t make enough to cover its expenses (but the ARR from all reports does make enought to cover its expenses)? And what evidence can you produce that the ARR has any problems whatsoever with deferred maintenance?
Well, I’m definitely not a Democrat, so yes I do pay taxes, but more importantly I pay in more to the government (roughly 50% of my income counting all forms of taxation) than I get back from the government (roughly zilch). Amtrak and the NEC are but a small portion of the glorified welfare recipients who have absconded with my hard earned cash.
You obviously hav
The only passenger operations of any kind in the world today are:
Subsidized or
Use lots of volunteer help or
Strickly very high end cruise systems that only wealthy can afford
Subisdized can be by a government entity, both Amtrak and the AAR fall into this catagory, or by other businesses, either freight traffic on the railroad, or hotels and retail stores whose access depends on good rail service (very typical in Japan, where rail makes the real estate profitable, was true of Leonard’s Department Store in Dallas with its own subway line.)
If anyone knows of any exception to this, please post that example.
From the Anchorage Daily News:
Beth Bragg: Comparing our super railroad to Amtrak is unfair
BETH BRAGG
COMMENT
Published: July 8th, 2005
Last Modified: July 8th, 2005 at 06:37 AM
The railroad depot at the airport is a bit like those destination-nowhere
construction projects we Alaskans excel at conceiving and sometimes even
building – a bridge to nowhere, a road to nowhere, a tunnel to nowhere.
This is a depot for no one, or at least for only a few of us. A sleek
addition that opened two years ago, it was built by the people ($28
million in federal tax dollars) but not for the people, except those who
are cruise-ship passengers. The only way an Alaskan, or anyone else, can
ride the rails that link the airport in Anchorage with the docks in Seward
is to buy a rail/cruise travel package.
You had to appreciate the irony, then, of the depot providing the backdrop
this week for a speech by Transportation Secretary Norman Mineta, who used
the occasion to bash Amtrak as a "disservice to riders and to taxpayers
nationwide’’ that each year "gets in line for another subsidy.‘’
Strong criticism. Maybe even deserved criticism, given the huge losses –
$908 million last year – Amtrak suffers annually.
But the words would’ve packed more punch if they hadn’t been spoken at a
train depot built with federal dollars for the benefit of the cruise-ship
industry.
This depot is all about the cruise industry – so much so that the
airport-to-Seward train schedule is set by the cruise industry, according
to Tim Thompson, the Alaska Railroad’s public affairs officer. This year
the train is making three round-trips a week during a 16-week summer
season, for a total of 48 trips.
Once summer is over, it’s a depot with no trains. Eight months a year, the
bronze plaque of Bill Sheffield – the f
futuremodal quote: “So the NEC makes more “operating profit” than the ARR, but at the same time the NEC doesn’t make enough to cover its expenses (but the ARR from all reports does make enought to cover its expenses)? And what evidence can you produce that the ARR has any problems whatsoever with deferred maintenance?”
As you know, in 1983 the federal government sold the ARR to the State of Alaska for $23 million. Rather than running the railroad as a state agency, it was set up to run like a private business own by the state with the provision that all income and other generated cash was to be reinvested in the railroad. At the time of purchase, Alaska put in another $14 million for start up expenses. In 1997 all the states without any Amtrak service received federal grants to give those states funds somewhat equal to the tax receipts received by Amtrak states as a result of Amtrak operations. Alaska received $27 million and in turn granted that money to the ARR. And so, since 1983 the State of Alaska has provided no more than $41 million to the railroad.
On the other hand, the amount received from the federal government is quite a different story.
I quote from the Alaska Railroad Corporation Special Report to the State of Alaska, January 2005. “The backlog of ARRC capital needs is several hundred million dollars.” A table in the same report forecasts federal grants for 2005 through 2009 to be over $96 million at the same time, the ARR will reinvest $118.42 from internally generated funds. The State of Alaska will not provide any funds to the railroad.
A statement from the 2004 annual report. “The ARRC’s fiscal year 2005 capital budget approved spending another $70.4 million for capital projects… The ARRC intends to use federal grant funding to provide $54.6 million of the capital additions. The remaining capital projects will be funded out of current year earnings and cash flow.”
Also from annual reports: The ARR rported positi
Beth Bragg is not exactly correct about the operating profitability of the ARR, but the Corporation does report a profit from the rental reciepts for the real estate that went along with sale of the property to Alaska. Given that the ARR Corporation paid nothing for the property and the property is not encumbered with any debt, it is quite easy to show a nice profit on the real estate operation. And yes, those profits are reinvested in the railroad. That’s not bad.
Jay
There’s another aspect to the ARR story that is being ignored, and that is of it’s relationship to military installations (current and proposed) that utilize the ARR for service needs. In order to keep these facilities functioning, and to supply the future needs of an expanded military presence in Alaska, the U.S. military in Alaska is dependent on the ARR, so federal expenditures for ARR capital investments cannot be construed as a subsidy for passenger operations. Granted, the new “intermodal” station cannot be percieved as being anything but pork, but political pork is available for all the U.S. states to be used as they desire. Just because Alaska directs its pork to train stations while other states use their pork for studying the sex lives of some irrelevent species should not be used as “proof” that Alaska gets it passenger rail system Amtrak like subsidies.
Alaska, like all states that have a great deal of their land under federal ownership, is entitled to an equal degree of federal tax dollars to make up for the inherent recessionary pressures put on these states by federal land ownership. Most of these states would gladly give up these “make up” funds in return for transfering ownership of much of these lands to the state governments.
The bottom line is this: Mineta is absolutely correct to state that Alaska knows how to run a passenger rail service. The lessons learned from Alaska’s experience needs to be applied to the co-existence of the private Class I railroads and the federally run passenger rail service known as Amtrak, and whether a different type of relationship between the Class I’s and some kind of passenger rail service needs to be explored to better emulate the Alaskan experience. This Administration is willing to engage in that research, while NARP only wants to obstruct the process for change.
If the Alaska Railroad’s passenger operation is owned and operated by the railroad and uses the track and all other facilities owned by the railroad, how does that provide any kind of model for the co-existance of the private Class I railroads and the federally run Amtrak? Do you propose to return the passenger rail operations to the Class I’s to operate as part of there private businesses? If so, how do you propose to make that go? Private businesses just love to jump on ventures that will make money when pigs fly.
If the Administration is so willing to engage in the research to design the changes, why have they not done so? I don’t think a proposal to put the Amtrak deficit on the states, writing a letter to the states asking them to identify any entities willing to operate passenger service as a “private” business or proposing to end funding with the idea that the service would then have become self sustaining represents any amount of “research”.
As I noted before, Amtrak management and the Bush appointed Amtrak Board of Directors has proposed to Cogress very significant changes to Amtrak. Looks to me like they have done a tad bit more “research” on the subject than DOT. Mineta dumped on their proposals on the subject, has offered nothing more than the idea of putting the resposibility for an interstate commerce function on the individual states, and has proposed some really inane ideas such no stopping of trains in states that don’t support the system.
I find it hard to dismiss the idea that the Administration’s goal is no federal funding even if that causes the demise of intercity passenger service. The only thing is that the administration probably does not want is to take the political hit for causing the end of a service that rightly or wrongly is liked by 70% of the citizens. So the ground work is set for others to get the blame.
Jay
Gee, I never thought I would see the day when Ohio would be in worse shape than Georgia or North Carolina. Maybe you folks should come to see us and learn something from some not so corrupt states.
Yes, you’re correct. Political pork is granted to the rest of the states, and Amtrak service is part of the pork distributed… I have seen America from the train, the only states I have not been to via Amtrak is Alaska, Hawaii, Wyoming, and South Dakota… I don’t know of any state that wants its Amtrak service cut…not one state… In fact, many states including the large state of Texas wants to see Amtrak expand…
No, you don’t give renewed opportunity to entities that squandered the possibilities of the original concept. The Class I’s had an opportunity to counteroffer the creation of Amtrak by offering to continue to run their own trains with some sort of subsidy or tax incentive, but they all pretty much decided to get rid of passenger operations altogether knowing full well that a new “foreign” entity would be running their former passenger trains on their track for them, with the risk of losing complete proprietary control over their trackage. If the creation of Amtrak ends up being the foot in the door for the eventuality of open access, then the rialroads will look back on that date with a bit of rue.
The single most important caveat of both the Administrations proposal and the Gunn counterproposal is the ability to transfer Amtrak’s right of access to third parties. This means private, state, regional, or any combination of such. What I’ve said all along is that there are private entreprenuers who have tried or wio try out some form of rail passenger service over the nation’s rail grid, either as a partnership with a state or local transit authority or as a go it alone operation, and mostly geared toward the tourism market, without having to beg and plead with the Class I’s for access. Whether they wio engage in these ventures because they saw pig flying through the air by their window or