From the New York Times:
Thanks, Murray. At first, I thought it was an account of a trip you had taken.
It is good that Amtrak can make a good impression on a first-time traveler. I could wish that this particular traveler were familiar with the long-time terms, such as berth, but even Amtrak apparently does not know them (just as VIA mentions single, double, and triple passenger cabins and not roomettes or duplex roomettes, bedrooms or compartments and drawing rooms; course, VIA’s designations are descriptive of the accomodations).
I still remember a first-time traveler on the Sunset several years ago who was adamant that she would never travel by train again because the train was delayed by a motorist who put his vehicle on the track right in front of the train; she refused to listen to reason, and seemed to blame Amtrak for the delay. We were on the Eagle, and woke up expecting to be many miles west of San Antonio–but were still in San Antonio because of the delay.
This is a good article. But it does not tell the whole story.
The same trip on January 15th would cost $420. The cost of the rail transport would be $127 and the room charge would be $293. Back out $40 for the fair market value of the meals, and the cost of the room would be $253. This is for an accommodation that is slightly larger than a broom closet. A comparable room at the Sheraton in Baltimore, as an example, would cost approximately $160. This includes all taxes. It would be more in New York or Washington, but Baltimore is probably a good comparative market for the east coast as a whole.
Also overlooked is the fact that the fare, including the room charge, did not cover Amtrak’s cost of carrying the passenger over the distance of the journey waxed about. The subsidy would be $277.88, based on FY10 numbers. Due to accounting changes, Amtrak is yet to report the numbers for FY11, which ended on September 30, 2011. And this is before interest, depreciation, and miscellaneous charges, although these would be minimal for the portion of the trip south of Washington.
If the cost of the taxpayer subsidy were added to the ticket price, it would be approximately $698. Add on another 10 per cent for depreciation, interest, etc., and the ticket price, sans subsidies, would be $767. Not many Americans could or would pay the total tab if they were billed the true costs of traveling by Amtrak, especially in sleeper class. But most people don’t have a clue about how much the long distance trains cost or the subsidy they receive every time they ride one of them.
What a delightful NYT article. I, too, am a confirmed railroad passenger, trains now being the only humane way to travel, short or LD (especially LD !). For me, the “journey” is even more important than the “destination.” So … Not only do I willingly spend the money in behalf of, and to modestly support, Amtrak, but I also promote to friends its unique pleasurable experiences, service, amenities, availability, and even simplicity (compared to air travel). We all ought to do the same, 'cause there ain’t any other US rail LD passenger service around. Use it or lose it !
And most motorists don’t realize the hidden subsidies that they enjoy, especially long distance on specific interstate highways.
And you don’t appear to understand federal highway financing in the United States, i.e. that of the 18.4 or 24.4 cents motorists pay in federal fuel taxes (gasoline or diesel), two cents goes to the Mass Transit Administration and four cents goes to the Treasury Department for deficit reduction. The subsidy is just the opposite of what many people think. In FY10, the amount of money transferred to the MTA and TD would nearly equal the amount of the transfer (so-called highway subsidy) from the general fund back to the Highway Trust Fund. You assert that motorists receive hidden subsidies, but you don’t provide any amounts.
No matter how you slice and dice the numbers, the so-called federal rail passenger subsidy in the United States, either per passenger or per passenger mile, is nearly 20 times the federal subsidy for air, motor vehicle, etc.
One of your arguments, i.e. that highways don’t pay real estate taxes, is unique. It makes little sense since government(s) own most of the nation’s roadways. Having said that, one could argue that roadways take land off the property tax rolls, to the extent that it could be used for tax generating purposes, and shifts the tax burden to residential, commercial, industrial and agricultural users.
Determining the value of the land taken off the tax rolls for highway purposes would be a nightmare. In some locations, such as major metropolitan areas, one might be able to come up with a number, predicated on the assumption the land could be converted to tax generating purposes, which is not a given, and would require some unique estimates. In many parts of the country, however, the land would little or no tax value, i.e. it is too remote or unfit for any other purpose.
To the extent t
I think what you are saying is that there is heavy cross subsidy within the highway system, that the person jammed in commuting traffic burning gas idling on one stretch of urban interstate is subsidizing a vacation traveller bopping along at 80-per on a lightly used stretch in Wyoming. And that if a person travelling those sparsely used rural highways had to pay a toll, maybe they could consider a long-distance train, perhaps an AutoTrain type service as an alternative?
Well, maybe. It seems that especially sleeping cars, or the long distance train model of the full-featured train with sleeper, diner, lounge, and baggage car service is a particularly expensive way to provide a transportation service.
If the coach seats were subsidized on LD trains in the style of Essential Air Service but if the passengers in First Class were charged a high enough fare to pay their own way, that might be an arrangement people would be happy with. But the argument has been made that the First Class passengers, even though they are paying a lot of their trip, are benefiting from their proportional share of a high rate of subsidy.
Why are the long distance trains so expensive to operate? It is something that I call the Bus on Steel Wheels argument. Owing to the enabling legislation for Amtrak, the fees paid for the trackage rights are a minor part of the balance sheet of those trains. We can argue whether this is a “taking” from the freight railroads or this is justified by the freight railroads having benefited from land grants and other concessions in the past, but let’s just set this argument aside from now. Why are trains and especially long-distance trains so expensive to operate on an everything-above-the-wheel-rail-contact-patc
“Why are the long-distance trains so expensive to operate?”
I think we know the answer to this one: Because it takes so many resources and so much time to collect the fare you can reasonably charge and still expect to sell a ticket.
I can accept that the labor efficiencies and fast turnaround of equipment of the jet airplane blew the economics of the passenger train off the tracks. What I can’t accept is that a country of the wealth of the United States can’t afford the pittance it takes to subsidize operation of a skeletal remnant of a form of passenger transport that was uniquely important to development of our country.
It’s not in the same category as every other small expenditure – “a billion here and a billion there” – that in aggregate has us wallowing in debt. It’s way more important than that; it’s about our national soul. Make Amtrak part of the National Park Service, if you like. As long as people ride it, as they use the national parks – and they do ride it – that’s good enough for me.
Dakota,
If your arguement is correct, not that I think it is, then should the NPS not be running stage coaches between Independence MO and Sacramento plus steamboats on the Mississippi, Ohio, Missouri, Sacramento, and Columbia Rivers? How about the misquito fleet on Puget Sound? Dont forget the Commodore’s boats going everywhere out of New York City!
I guess that would not be in the filthy lucre category, like any other government exenditure, but in sainted public service of the NPS.
Mac
I ahve discussed the hidden subsidies for highway transportation at great length on this website already and do not need to repeat. They are enormous, beleive me.
In my opinion, this is a big sticking point for advancing the cause of passenger trains. The roads are being subsidized so we don’t want to hear any talk about train subsidies. We have been saying that repeatedly since 1971, and apart from the NEC and the California trains, it has barely allowed us to hang on to the trains we have.
Does the rate of subsidy, the bang-for-the-buck, the amount of service received for a given level of subsidy matter to anyone? Or do trains have such inherent goodness that whatever subsidy money it takes it shall be?
Even things funded by the government, while not subject to the harsh discipline of the marketplace of many privately funded ventures, even government spending is subject to cost-benefit tradeoffs at some point. Take the F-22 Raptor fighter jet. Please! Even the proponents of high levels of Defense spending are grudgingly accepting that the high price tag has moved that project into the Boondoggle category.
As to highway transportation receiving enormous hidden subsidy, no, I do not believe it. Why? Simple. Amtrak is subsidized at about 20 cents/passenger mile. For the approximately 4-5 trillion passenger miles in autos per year, that works out to about a trillion dollars per year in subsidy, hidden or otherwise, to automobile transportation. I simply do not see where one comes up with a trillion dollars in hidden subsidy to cars, unless one puts the entire defense budget into the auto ledger because of the war-for-oil justification. If Amtrak is the standard for “enormous subsidy”, I do not see where equally enormous subsidy is going into cars.
The NPS does this already! It’s what the Steamtown excursions are about - at least on the rail side of things. It’s about preserving and experiencing history. It’s not about transportation.
I think it’s perfectly okay to run trains everywhere with nobody on them as long as a majority of the public a) wants it, and b) know what it’s costing them.
I think we might have condition “a”, but no way do we have condition “b”. Most people don’t know or don’t care to know or both.
The best quote I saw about Amtrak’s LD trains was by Jim McClellan. It’s was in a talk he gave to the “Sandhouse Gang” a couple of years ago. It was the LD train are irrelevant. They will remain in the future, but will remain irrelevant.
It is a great question when you examine the high expenses of Amtrak (I think we would find that maintenance is very high) aside from direct operating expenses. Labor (Salaries, wages, and benefits) represented $1.79 bil.of Amtrak’s total expenses of $3.72 bil. in FY 2010, 48%. Fuel was $299.7 mil. By comparison, on the UP, labor was $4.31 bil. out of a total of $11.98 bil., 36%. Fuel was $2.49 bil. So while on Amtrak, the ration of labor to fuel was almost 6:1, on the UP it was only 1.7:1.
As usual, any discussion of passenger trains evolves into a discussion of subsidies, and as much as I like trains, I’ll agree that it’s hard to justify the high level of subsidy for passenger trains, but Paul Milenkovic hit on an idea that makes sense. Subsidise the coach seat so that basic transportation is available at a reasonable rate, but let the luxury services pay most of their own way. Sleeping accommodations take up considerably more space per passenger along with the extra services of attendants, etc.
As I wrote this it occurred to me that I really don’t know the level of subsidy the sleeping accommodations receive relative to basic coach. Is there a breakdown of costs and subsidies of the different services?
There is a GAO report from a few years ago with some of this information in it. I’ll see if I can find it.
I have a report that you referred me to several years ago. It is DOT report Number CR-2005-068, dated July 22, 2005, issued by the Inspector General, U.S. Department of Transportation. The reference is JA-50. This may be the report that you have in mind.
The greatest part of the subsidy for intercity highway transportation is land use.
You are just making an off the wall claim with no supporting data.
You could start with this bit from the ARTBA (a highway lobby): “There are currently 8,443,338 lane miles of road in the lower 48 states. The average width of a highway lane is 11 feet. This means roads cover 17,590 square miles of land. If shoulders, driveways and parking lots were added, the total would still be less than one percent of the nation’s land area.” One could get a very rough estimate the amount of tax not collected on this land by using some average tax per sq. ft. paid by the railroads on their track.
Getting a realistic appraisal value of the land for the nation’s streets, county roads, state highways, and federal highways probably is out of the question. I have never heard of anyone even trying it.
As I pointed out in a previous post, to the extent that roadways have been taken off the tax rolls, the taxes of the in-service property have been adjusted to reflect the so-called loss of the land for revenue purposes, which means that most motorists, because they pay property taxes directly or indirectly, pay the higher rates.
As I pointed out, which Mr. Klepper has conveniently overlooked, the same notion would apply to railroads, airports, waterways, etc. The freight railroads pay property taxes, except they don’t. The taxes are paid by the people who buy the goods and services shipped on the railroads. Moreover, whether the taxes paid by the railroads reflect the alternate value of the property is questionable. Moreover, Amtrak does not pay any taxes. It does not even reimburse its hoist carriers for any pass through taxes because the federal le