Fifty years ago, last Saturday, May 1, Amtrak operated its first passenger trains, a fact that President Biden celebrated a early day. Biden wants people to think Amtrak is successful enough to merit $ 80 billion in additional funding. But the reality is, it’s just a big loser.
Rail fans remember May 1, 1971, as the day America lost more than half of its passenger trains. On April 30, ten trains left the Midwest for the West Coast: the empire builder, Western star, Limited north coast, and Mainstreeter (who all went to Seattle with sections in Portland), City of Portland, Portland Rose, City of San Francisco, Chief of San Francisco, City of Los Angeles, and Super chef. The next day, Amtrak killed them all except the empire builder (and he killed the leg in Portland), Super chef, and City of San Francisco (which has been reduced to three days a week). It is a loss that is difficult to forgive.
Business analysts recall that the idea of a national passenger railroad was sold to Congress as a profitable business, but it turned out to be a big loser. Rather than a normal government agency, Amtrak was founded as a for-profit corporation with shareholders and, potentially, investors. The railroads were supposed to give him seed money based on the amount of money they claimed to have lost over the previous three years. After spending that to start, Amtrak was supposed to make money.
In fact, after quickly burning its starting money, Amtrak went deeply in debt and needed $ 1.5-2 billion a year (in today’s money) in federal support to keep it going. Anthony Haswell, sometimes known as “Amtrak’s father,” admitted 30 years later that he was “personally embarrassed” by the railroad’s continued demand for grants.
Transportation analysts know that under Amtrak, passenger trains have lost travel market share in the United States despite billions in subsidies. In 1970, private railroads carried a 0.29 percent of passenger travel to the United States. By reducing that many passenger trains, Amtrak immediately fell to about 0.16%. By 1991, Amtrak’s ridership had returned to 1970s levels, but other modes of passenger transportation also increased, so Amtrak’s share was still 0.16%. After that, it fell to 0.10% in 2005, which is roughly where it stayed in 2019.
Coronavirus followers know Amtrak has lost more than 70 percent of her runners during the pandemic, and she may never get them all back. Thanks to even more federal grants, he continues to run the trains, but they are almost empty.
Amtrak is trying to market itself as a solution to global climate change. How can this be a solution when it carries less than 0.1% of passenger transport and 0.0% of freight? Nearly empty Amtrak diesel trains generate tons of greenhouse gases per hour without saving anywhere else. Even before the pandemic, intercity buses emitted less greenhouse gases per passenger-mile than Amtrak’s Diesel trains, and they receive none of the transportation funds offered by Biden.
Amtrak’s electric trains can generate less greenhouse gases than its Diesels, but like economist Charles Lave highlighted over 40 years ago, if you want to save energy, “the biggest components matter most”. This also applies to greenhouse gases, and it means making cars and airplanes more energy efficient will do much more to reduce greenhouse gas emissions than increase Amtrak’s share of travel. from 0.10% to 0.11%, which is probably more than Biden’s plan. .
Most of the $ 80 billion Biden would allocate to Amtrak will be spent on digging tunnels, building bridges, replacing ties and rails, and other rehabilitation work in the northeast corridor, which has at least $ 52 billion capital replacement needs. This will do little more than maintain the status quo, so it will not increase Amtrak’s ridership. But that would generate huge amounts of greenhouse gases.
Amtrak is proposing to use some of the Biden dollars to add some new routes, but since I shown previously these would attract few passengers as Amtrak would face intense competition from airlines and buses. Ultimately, the question is: why should a transportation agency that carries 0.1% of passenger travel and no freight get 26% of transportation dollars in Biden’s infrastructure plan?
Amtrak is therefore a loser on several occasions. He lost most of the country’s passenger trains; it lost market share on travel to the United States; he lost tens of billions of dollars; it lost most of its passengers during the pandemic; and it loses its credibility when it claims to save greenhouse gases. It’s time to recognize that Amtrak is a loser and stop subsidizing it.