Slate's Bizbox
assessment: Taking stock of people and ideas in the news.

AmtrakThe little engine that couldn't.

By Chris Suellentrop
Posted Wednesday, June 26, 2002, at 4:53 PM ET
Illustration by Charlie Powell

"No one wants to see Amtrak die," Transportation Secretary Norman Mineta said Tuesday, echoing the consensus about a government-owned corporation that lost more than $1 billion last year. While not literally true, Mineta's statement reflects the political reality that Amtrak will no doubt survive this week's death threats, as it has survived so many before. And that's unfortunate. We need to let Amtrak die, so that others might live.

Amtrak's beginnings were inauspicious—it was formed because railroad companies wanted to get out of the passenger rail business so they could focus on their more lucrative business, carrying freight. It's not surprising, then, that the government has had trouble making a profit from a business that the private sector was glad to be rid of. Many predicted an early death: According to Monday's Washington Post, President Nixon's aides thought Amtrak would disappear within two years of its May 1, 1971, creation.

But over the years, Amtrak has proved itself masterful at one thing (and no, it's not train travel): self-preservation. A potent combination of Beltway pork, an organized lobby of train buffs, and a nation's nostalgic fondness for railroads have kept Amtrak alive despite 31 years of mismanagement, cost overruns, and poor service. The political and popular support for Amtrak becomes even more astonishing when you realize that almost nobody uses it. Amtrak carries about 64,000 passengers a day. That compares to 1.8 million passengers daily for domestic airlines and 984,000 passengers daily for intercity buses. That's right, more than 15 times as many Americans use intercity buses than use Amtrak. And those are just the mass-transit options for intercity travel. More people drive between cities than take a plane.

Amtrak should be dismantled for practical reasons, not ideological ones about the size and purpose of government. Our intercity passenger rail system works exactly the opposite way that our other systems of intercity transportation work, notes Anthony Perl, author of the book New Departures: Rethinking Rail Passenger Policy in the Twenty-First Century. With air travel and road travel, the government provides the infrastructure, and the private sector moves the passengers. The government runs the airports, and the private sector flies the planes. The government builds the highways, and the private sector handles the cars, trucks, and buses. But with passenger rail, we've got it backward. The government (Amtrak) runs the trains, and the private sector (the freight railroads) owns the rails, except in the Northeast Corridor between Washington and Boston. That creates a double whammy—the private companies don't have the deep pockets or the interest in maintaining the infrastructure needed for a viable passenger rail system, and the government doesn't have the market incentives to be entrepreneurial or customer-focused. The result is a lot of decrepit tracks and routes that respond to political, rather than consumer, demands.

Further compounding Amtrak's problems are its labor agreements, which help to make traveling by train so expensive. "The average Amtrak salary is about 20 percent higher than the average airline salary," says Ronald D. Utt, a senior research fellow at the Heritage Foundation. "No one views airline employees as underpaid people." Amtrak critic Wendell Cox notes that Amtrak workers can receive severance packages of up to five years, with medical and dental benefits—"ultimately guaranteed by taxpaying workers who typically have little or no coverage themselves." The cost-cutting program already undertaken by Amtrak President David Gunn indicates the depth of the problem. Gunn plans to reduce the number of vice presidents from 80 to 25, which means that Amtrak was employing 55 superfluous VPs.

It should be uncontroversial to suggest that having the government run a monopoly on intercity passenger rail service is a bad idea. Breaking Amtrak up into several competing units that operate like our deregulated airlines would cut costs and improve service. True, unprofitable routes would be eliminated, but so what if you can't ride the train anymore from Orlando to Los Angeles? Not all routes would be canceled permanently; some of them could be reinstated once the system was back on its feet. Besides, train buffs interested in transcontinental rail journeys can opt for high-priced, privately run "land cruise" trips that do for train travel what luxury liners have done for ocean travel—they've made the journey an end in itself. And who knows, removing Amtrak's monopoly on taking train passengers from point to point might allow these land cruises to add on some less expensive "steerage" cars, if there's enough demand.

The monopoly that the government granted Amtrak (or rather, granted itself) has made "passenger rail" in the United States synonymous with a single company—Amtrak. But it doesn't have to be that way. Focusing on saving Amtrak (or destroying it for ideological reasons) misses the point: creating a viable passenger rail system. And the first step in doing that is killing Amtrak.

Print This ArticlePRINTDiscuss this in The FrayDISCUSSEmail to a FriendE-MAIL
Share on FacebookPost to MySpace!Share with MixxDigg ThisShare with RedditShare with del.icio.usShare with FurlShare with Ma.gnolia.comShare with SphereShare with Stumble Upon
Chris Suellentrop, a former Slate staffer, writes "The Opinionator" for the New York Times.
Illustration by Charlie Powell.
If you liked this Assessment column, check out Backstabbers, Crazed Geniuses, and Animals We Hate, a collection of our all-time funniest, meanest, sweetest, and weirdest profiles.
Join the Fray: our reader discussion forum
What did you think of this article?
POST A MESSAGE | READ MESSAGES

Notes From the Fray Editor:

Who knew Amtrak was so funny? Good one-liners come from both sides of the bench in the debate over Amtrak. InARush notes that Amtrak's per-customer loss "puts Pets.com to shame" here, while AI proposes that "Martha by Rail" take over the unprofitable Great Plains routes here. Beyond that, the Fray has been focused on the great battle between public and private ownership, with the best posts performing quick and deadly dialectical jujitsu.

Notes From the Fray:

Chris Suellentrop calls Amtrak "a government-owned corporation that lost more than $1 billion last year."

Does that make the Department of Defense the goverment body that lost more than $288 billion last year?

-- Josh Pollack

(To reply, click here)


You're correct that you can't simply look at the loss and write off Amtrak. But you can't ignore the fact that Amtrak isn't a free service to taxpayers. The loss comes on top of the rail fees which are charged to customers.

-- SQR

(To reply, click here.)


Breaking up Amtrak and reinvesting the money in urban areas, where there's a demand for a rail and a benefit in reduced traffic and air pollution, would be the best solution. National train routes aren't coming back. A long ride along country tracks is charming, but most Americans prefer the airline's speed to the railway's aesthetics. Neither private companies nor Amtrak could change their minds. The next group of rail romantics won't, either.

-- BML

(To reply, click here.)


Transportation Sec. Norman Mineta will never move to break up Amtrak on his own, and the White House will never press him to do it if it thinks such a move would hurt vulnerable Republican candidates this year or -- far worse -- pose some risk however slight of costing President Bush votes in 2004. There are lots of good arguments for scrapping all or most of Amtrak, but no one who matters is listening to them.

-- Zathras

(To reply, click here.)


The airlines are still essentially a government agency that is bleeding the taxpayers. They may be called "private", they may sell stock, and they may get to keep their profits (when they come along). However, when it comes time to sink or swim, they are a government agency propped up by tax dollars. If United ends up with 1.8 billion in loan guarantees (on top of the Sept. 11 pork), it would take a large amount of willful ignorance to say that the airlines are a model for private success.

-- Mangar

(To reply, click here.)

(7/27)

Washington Post
The Washington Post
OPINIONS
The Great Debate
Marcus | Forget Biden. I'd like to see McCain face off against Palin.
Toles: Another McCain SurpriseStumped: Where's Palin's Baby?