Where are the train/rail companies?

Great Debates
1

I have just finished watching a show on one of the cable news stations about all the trouble with air travel these days and am just wondering why doesn’t an enterprising business person, organization or rail company jump in? I would think that this would be the perfect time for rail to make a comback in the U.S. Amtrak seems to be heading in the right direction, but what about private and current rail companies? I feel that a smart company could jump in and revolutionize rail travel in this country.

In Texas a few years ago some people were proposing the “Texas Star” which was supposed to go from the Dallas/Ft. Worth-San Antonio(I believe)-Houston. However the Jerk of the Board of Southwest Airlines (Herb Kelleher) protested that the government should not be in the travel business. (though he ignored the fact that the same government enabled him to get his company off the ground). He must be afraid of healthy competition, how un-American.

To me it is crazy to have to either fly or drive somewhere that is around 3 hundred or so miles away, (I also believe that it is crazy to have to rely only on cars within cities as well). Give us more options and it will be better all the way around for everyone concerned. The U.S. needs to stop being so rail(phobic)and admit we messed up when we dismantled our great rail system and hurry up and re-build it before it is to late.

2

The reason for Amtrak’s existence is that passenger rail is simply not profitable any more. All companies that used to operate passenger rail lines now operate freight-only lines. They’re subsidized by the government for allowing Amtrak to use their rail.

3

The biggest problem is that we have indeed dismantled our rail system (for the sake of discussion, I am including such things as intraurban trolleys in “the rail system”). The rights-of-way which have been abandoned could not be reassembled at any feasible cost.

More importantly, however, people will largely reject such a system because of its necessary regimentation. A rail system must obviously run on schedules, to and from certain places, etc. This will not allow a person the freedom of hopping in her car and driving whether she damned well pleases. Unless and until the attitude abandoned the best part of a century ago – that some places are basically inaccessible because the train just bloody well doesn’t go there – can be resurrected and inculcated into the population at large, a passenger rail system will at best be a heavily-subsidized boondoggle.

The “trouble” with air travel, incidentally, is that it is now cheap enough that every prole and college student is trying to fly the friendly skies, as opposed to the Good Old Days™ when hoi polloi were kept to the smelly Greyhound buses. At the same time, it is the political kiss of death to support a new airport, or even a serious expansion of an existing one, anywhere that such would be useful.

4

The reason commuter rail is not profitable is that the government subsidizes auto and plane travel at the expense of rail. Unless anything has changed the taxpayer foots most of the bill for roads and airports, so we do not see the actual cost through gas prices and the like. However rail companies have to pay to lay their own track and essentially have both hands tied behind their backs.

If the average person truly had to pay their part for the upkeep of our current transportation systems, I think rail (if given an equal footing) could be very competitive.

5

When the Federal government appropriates money for Amtrak, people call it a subsidy. But very few people call the hundreds of millions spent on the highway and airway (in the form of airport construction funding and the air traffic control system) systems a subsidy. And once you call something a subsidy, you’ve just given it that much more of an uphill battle because some people oppose subsidies on principle and others oppose any subsidies that don’t directly benefit them.

For example, Senator John McCain, as chair of the Senate Commerce Committe, has complained time and again about the chronic congestion of the air and road networks. But he also vehemently opposes federal funding of the operation of Amtrak, considering any money spend from the Federal treasury on Amtrak to be a wasteful subsidy. He sees the problem quite clearly, but his ideology blinds him to one of the solutions.

Amtrak is subject to a rule that it has to be operationally self-sufficient by 2003. That means it will theoretically still receive capital funding, but not a penny of money to cover its operating expenses. What the Amtrak opponents don’t consider is that NO passenger rail operation on Earth makes a profit or even covers all its operating expenses. Yes, not even the much-praised Japanese and French high-speed networks. The French, Japanese, etc. governments just consider passenger rail to be another big-line budget item like highways, canals, airports, welfare, and the military and fund it appropriately, without big philosophical debates EVERY SINGLE BUDGET about whether the government should be in the passenger rail business. The government is ALREADY in the transportation business; funding two travel modes without seriously funding the third puts that third mode at a (non-market-generated) disadvantage.

There is good news, though.

  1. We all know about high-speed rail in the Northeast states, which already has 70% of the non-automobile travel between New York City and Washington and which is set to capture a similar share of the market as far north as Boston when the new Acela trains are all in operation.

  2. There are busy rail corridors in other parts of the country. The Cascade trains connect Vancouver, Seattle, Portland, and Eugene. California has busy corridors along the Santa Barbara-LA-San Diego coast; between San Jose, Oakland, and Sacramento; and between Oakland and the San Joaquin Valley. These corridors receive heavy state funding to make up for the lack of federal money. They are very successful – yes, even in car-mad California – and prove that for markets of 300 miles or so, if you have frequent service (at least five round-trips a day on the San Joaquin line, up to hourly on the Pacific Surfliner route) so that people know they can catch a train when they need it, people WILL ride. There’s enough ridership that the states involved plan to add more trains and have made the budget appropriations to carry out those plans.

  3. The Midwestern states are in the process of putting together a high-speed (110mph) network with Chicago as the hub. The system will initially reach Milwaukee and Madison; St. Louis; and Detroit. Later extensions will reach the Twin Cities; Kansas City, MO; Des Moines and Omaha; Indianapolis and Cincinnati; and Cleveland. Track and grade crossing work is being done for the initial system, and the bidding process has begun for the new trainsets that the system will need.

Yes, these systems aren’t as flashy as the Shinkansens or the TGV. They use existing freight lines, and diesel engines with the exceptions of the Northeast/Acela routes. But they also can be placed in service without buying land for and laying expensive new rail lines like the Japanese and French high-speed systems. That’s an important consideration versus land-hungry highways and airports. And trains that can consistently travel at speeds around 100mph or more have a real chance of competing not only with the automobile, which is increasingly limited by traffic to less than the 55 or 65 mph speed limit, but with the airplane on trips less than 500 miles on a city center-to-city center basis when you consider the trip to and from the airports.

6

John, thanks for the insightful post. Got a question for you, though. My understanding of Amtrak’s difficulty in attracting a viable passenger load outside of a few dense corridors is that it has a lot to do with the condition of the tracks they have to pay to use. Most of these are freight lines that get just enough maintenance from their owners to keep those heavy coal or iron-ore cars from jumping the rails. The light passenger trains consequently have uncompetitively low speeds over these lines, along with very uncomfortable rides; furthermore they are often forced to run at rare and inconvenient times to avoid interfering with the lines’ main users.

If passenger rail is on the wrong side of that vicious cycle wherever population densities don’t permit dedicated high-speed tracks, then the problem is never going to be cured. They won’t attract enough passengers to pay for line upgrades and more convenient schedules, which would attract more passengers, etc.

Am I missing some key concept here? BTW, you’re absolutely right about Congress “investing” in aviation infrastructure but “subsidizing” rail - maybe the fact that most of them fly home instead of riding makes them more attuned to aviation problems.

7

A related thread, where I posted some info I don’t think I need to post again here in this one.

Disappearing railroads

8

If “commuter rail” was changed to “medium and long-distance rail” you would be exactly correct. The government began “investing” in aviation and highways in the 1920s and increasingly through the 1940s and 1950s to the point where rail support effectively disappeared and passenger rail has had to be put on the public dole.

The situation is quite different regarding the commuter/interurban lines. It is possible that without the investment in highways (particularly urban freeways), the commuter rail would have survived in more locations than NYC, Boston, Philadelphia, and the Bay area. (It is also possible that suburbia would have developed differently, yet still developed once the automoblie was introduced.) However, the interurbans in most of the country were kept alive for nearly 20 years by local subsidies after they had been effectively killed by the automobile, even before the government began investing in motor highways. The freedom of choosing where and when one wants to arrive at a destination is extremely strong. Several Cleveland area interurbans began to lose money at almost the exact time that the car became an affordable vehicle to the growing middle class. (Remember that macadam (asphalt) highways were developed for horsedrawn transportation in the 1860s and that concrete was developed in 1889, before any motorized vehicle was put on the roads.
Wayne County, Michigan tested concrete (along with other surfaces) in 1909 by building a mechanical “horse hoof” and iron-shod wagon wheel. Based on those results, concrete was used to pave one mile of Woodward Avenue in 1910, followed by 63 more miles of roads the next year. Arkansas followed with a 23 mile long road and the race to pave America had begun. The coincidental development of the car certainly did not slow down the paving, but the paving was not (initially) intended as a subsidy for the car, but an improvement for the horse-drawn traffic.

9

An issue that is also overlooked is the severe regulations placed on trains.

There are still many freight trains running through Cleveland, and I’m sure it isn’t the only place. Boston here, as has been mentioned, has a large commuter base (3 million rides a day, if the local news can be believed).

Trains took a dump when speed regulations hampered them even further. Instead of being a good option, it became an equal option, and then lost out to convenience.

Trains are also pretty inefficient. I mean, there still needs to be trucks to take cargo from the train station to the final destination.

I dunno. I think the government messes up most of what it touches. Trains are no different than traffic circles and stupid highway interchanges. :slight_smile:

10

There is a new rail line supposedly going in (or at least going forward in study) from Lansing to Detroit. Basically, a commuter line but, wow, it’d be great.

11

Florida has voted in a new high-speed maglev rail system to be developed and run between its 5 major cities (including Tampa, Miami, Orlando…). Won’t be done in time for Super Bowl XXXV between the Dolphins and the Bucs, but hey, it’s a start.

12

In the UK the railways were ‘privatised’ from being a public-owned system by Ms Thatcher and her idiot government.

This was in spite of the fact that it had been nearly 100 years since the railway industry as a whole had made a profit, owners used to cross-subsidise lines but eventually the buck had to stop somewhere and even with tax write offs they couldn’t make it pay.

WW1 helped for a time and the inter war build-up but again this ran out of steam, so to speak.

The British Railways were nationalised as it was considered a strategic industry and yet even with a huge amount of modernisation for the time and with large numbers of passengers it still could not be made to pay.

Advent of the car and the railways were severely affected.
Thousands of millions of £ were poured in, in subsidy.

Maggie Thatcher and her mates dreamed up a scheme to sell it all into private hands, but what was not given much emphasis was that the train operators would still recieve the subsidy that their franchised routes got before sell-off, in fact to make it sweeter they actually got bigger subsidies.

This was held up as a model for railway sell-offs around the world and set the tone for many of the worlds transport ministers, including the US.

It is a complete disaster, utterly crap beyond belief.The integrated railway system in the UK was broken up into hundreds of differant franchises from maintenance, rolling stock, track control, right down to who operates the cafes.

The track was left to deteriorate and now our whole network has disintegrated.

We are now in the process of virtually rebuilding it and it is going to take several years to attain a reasonably safe network.

We had a series of train crashes over the past eight or nine years with many fatalities but the latest incidents have been due simply to track breakages rather than human error.

You might wonder what happened to all the sweeteners paid out to track and train franchises - well they all were paid out in share dividends and directors made fortunes out of share options, leaving comparively little for rolling stock and none at all for Automatic Train Protection System s(ATPS)

Joe Public who voted for Maggie in the first place is heartily sick of the horrendous delays, ironically the worst affected areas happen to be in the places that used to turn out for Maggie.

I reckon you could go up to the average British train user now and quite easily persuade them of the case for re-nationalisation.

It looks to me that you folks in the US are still living with a government mentality that proved so disastrous for us as regards railways.

13

Oh, I see, the “free” government subsidies had nothing to do with it. Perhaps what you are missing in your own retoric is that these railways would have collapsed on their own, with the owners bankrupt, without government subsidies. And no one would have gotten rich.

14

Aynrandlover

I did not miss out on the fact that the railways would have gone bust long ago without subsidy, of that there is no question, but the share flotation simply would not have happened without those subsidies, and that money which was paid out to directors and shareholders could have been better used.

Our railways have not made a profit as a whole network for what will now be just over 100 years.

When Ms Thatcher came to power it was on the back of strife and inefficiencies in public services. This seemed fair enough at the time.

Her ideology was that the state should have as little to do with industry and the markets as possible and in some areas this cannot be argued against.

There were those who pointed out that in some industries this was not possible, the main ones being health services and the railways.

In the event the British psyche would not allow healthcare to be privatised but the railways were.

The point about having the railways sold off was that her philosophy deemed it inevitable that private hands would do better.The fear was that the share flotation would fail because the withdrawal of subsidies would mean that investers would not put their money in.

To attract those investors there had to be some form of underwriting by her government(these might be described as operating subsidies), and a failed flotation was not an option - being at odds with the ‘private ownership is good’ ideals.

We were promised that there would be fewer government subsidies because private owners would invest in newer equipment but the reality was exactly the reverse.The services have all but completely collapsed in certain areas, there is still rolling stock over 40 years age being used to carry goods and passengers and on top of it all the subsidies that the then government put in place(to sweeten privatisation and having a lifetime of 15 years) were actually higher than the sudsidies paid into British Rail when it was in public ownership.

So what we have is a fragmented railway industry, costing more to the taxpayer to run, providing a service that runs slower than it did pre-WWII, with a worse safety record than twenty years previous, which has announced that it is increasing ticket prices by up to 7% this year, and the original directors of the companies who bought into it having made millions are justifying this rise by saying that more investment is needed.

Maybe they should put their own hands into their pockets instead of slyly slipping their fingers into the public purse.

Now if those same director had delivered on the original assurances then I would have no objection to them making healthy profits and paying themselves handsomely.

Seems to me we could have kept a unified railway system under state control, like most if not all other European nations, and carried out modernisation, which other European nations have done, without all the problems we now have.

Is it relevant to US railways ? Maybe so if the US governemt has a simialr postion to public subsidy on railways as ours had.

15

A major concern of The US Railroads Vs the Bristish (and most European RR) is Freight vs Passengers. Both countries have an extensive highways system but the type of freight shipped and the distance needed covered in Britain is significantly different than in the US. However if you compare the regional passenger services of the US, the Northeast corridor or West Coast Corridor, with British passenger rail service in general we would be on the same scale. That is why a British ‘national’ rail system was able to survive as long as it did, and even in their dying days (after their merger) the Pennsylvania Railroads and New York Central were able to have a respectable amount of passenger service in the Northeast corridor. Rail service on that level (commuter/regional) will always be there to serve those that don’t want to deal with the traffic hassel and the expense of a short and costly flight. An open Highway or Motorway will always be more alluring than either however.

Maybe Ms. Thatcher drank too much of the NEW Formula Coca-Cola. It’s an Icarus Paradox, Where your ultimate invention (savior product) is ultimately linked to your downfall. Kind of like ‘New Coke’, by the time the late 1980’s rolled around Coca Cola was so far removed from the drink making business and had become Marketers of a product. They shot themselves in the foot trying to better themselves, fortunately a great deal of brand loyalty saved them, that and that they could easily reverse their error. Something unfortunately British Gov’t can’t do.

American Railroads survive on Freight now, and are have been, up until very recently, doing better than they have throughout almost all of their history. British Railroads survived on providing Quality passenger service and now people are just plain afraid of it.

16

The fact is that *some Amtrak routes do operate at a profit. The DC-Boston corridor does, as does the L.A.-San Diego line. The latter service, on some trains, continues up beyond Santa Barbara, but I’m not sure if the range of profitability continues up that far.

Cross-country rail, like from L.A. to Chicago, on the other hand, isn’t profitable and probably never will be. For such travel needs air travel is simply better.

WRT some remarks above about a cultural aversion to trains, especially for local mass transit, I think they are dead on.
In my city (L.A.), the voters prohibited further subway construction; above-ground rail rojects are bedeviled by NIMBYism, since homeowners virtually never want rail lines to go through their neighborhoods, and they certainly don’t want stations. Many of the appurtenances of local railroads are considered to be eyesores…things like overhead traction towers, elevated railbed abutments, and so on. But when you realize the sorts of things which for some reason are not considered eyesores, for instance another concrete highway, yet another strip mall, or a tract of utterly auto-dependent crackerbox houses, you know that the cultural aversion to rail is very real.