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The Amtrak Funding Scandal

Trains - such a wonderful way of traveling! This article extends the concepts introduced in this earlier article.

Truly, the US government's neglect of Amtrak is a scandal!



Why does the government willingly give billions of dollars to the airlines, but begrudge every penny that Amtrak needs? How can a country five times smaller than us spend $15 billion to improve its already great railroad network when we are unwilling to spend one tenth of that on Amtrak?

Truly, the US government's neglect of Amtrak is a scandal!

Rail travel should be encouraged

Rail travel is inherently safer than air travel. Rail travel is more energy efficient than air travel. Rail travel is, in many cases (short routes under ~300 miles) quicker than air travel. Rail travel is less vulnerable to terrorist mass-destruction attack.

Most important of all (!) rail travel is vastly more comfortable and enjoyable than air or bus travel. Passengers can enjoy much more personal space, open areas to move around in, buffet/dining facilities, and not worry about getting stuck in a middle seat!

Rail travel is good, no matter what measuring stick you apply. Rail travel deserves to be encouraged. Rail travel deserves government support in at least equal measure to that given to air and road transportation.

Amtrak is - and can be- successful

In the Northeastern Boston-New York-Washington corridor, Amtrak carries more passengers between New York and Washington than both airline shuttles combined!

Amtrak needs to build on this success; it needs to invest in additional short distance major city-pair services where it can duplicate its success. San Diego-Los Angeles-San Francisco-Sacramento, for example. Vancouver-Seattle-Portland. Minneapolis-Chicago-Detroit. Dallas-Houston-San Antonio.

Amtrak is currently vastly under-developed. Each day, only 64,000 passengers take Amtrak services. On the same day, 15 times more people (984,000) use intercity buses, and a massive 1.8 million are forced to endure airplane flights. Amtrak needs to grow and grow and grow so as to reach critical mass and to be able to survive and trade more efficiently.


Much of Amtrak is inefficient and inappropriate. New investment in Amtrak needs to be carefully and directly allocated only to the 'sweet spot' of short haul train service. Long-haul (ie 12+ hour journeys) trains have no part of an effective, efficient, mass-transit service in the US today.

Why do airlines get cash but not Amtrak?

Immediately after 9/11, the airlines rushed to ask for up to $15 billion in cash gifts and loan guarantees from the Federal Government. The airlines - perhaps the most successful lobbying group in all history - encountered a generally positive response, and within eleven days, had secured commitments for a first tranche of $5 billion in grants, with no strings attached. Even airlines that made a profit got cash, and in the case of Southwest Airlines, they showed an accounting charge of $58 million arising from the terrorist attacks, but received a $169 million gift from the government.

A cynical observer of the political process might also note that a strengthened Amtrak would be a potential major competitor to the airlines - Amtrak's success might mean less profit for the airlines. Is it any wonder that our politicians, so amenable to anything that can help the airlines, are proving strangely resistant to helping Amtrak?

Whatever the reason might be, the generous funding to the airlines at a time when Amtrak is being denied any money at all is truly a scandal.

A Lesson from Britain

Anyone that has ever enjoyed an intercity train on the British rail network knows that British trains are close to excellent. Fast comfortable trains, traveling at up to 140 mph take you wherever you want to go in a very short time, and with many trains per day, you have a convenient choice of times and trains such that you don't even need to reserve seats.

The British rail system must seem like an impossible dream to Amtrak's management. But, as good as it is, the British government is committed to making it better. Describing a rail system that is vastly superior to the US system as 'dilapidated', British Transport Secretary Alistair Darling this week confirmed the government's investment of $14.5 billion in improvements, and added another $30 billion as a contingency facility as a provision for 'any horrible eventuality'! A small country with a population of 60 million people can afford to invest $14.5 billion extra into its already good rail system. But the US - with an affluent population nearly five times larger - is currently unwilling to even loan $200 million!

The unwillingness of the US government to fund Amtrak even to a level that is four hundred times lower than in Britain (per capita) is truly a scandal.

A Government Loan will just make things Worse

Let's face facts. Amtrak, like every other public transportation and railroad system in the world, is and always will be chronically unprofitable.

It now appears that an emergency financial package - a $100 million loan now, and another $100 million later, perhaps as a loan, perhaps as a grant, was agreed on Wednesday. But what does this mean? A $200 million loan makes things worse, not better!

  • It allows Amtrak to continue to lose more money for a few more months and increases its total indebtedness

  • It increases Amtrak's costs - Amtrak has to pay interest on the loan - by perhaps another $10 million a year!

Lending Amtrak money does not help Amtrak; it harms it. Amtrak needs a loan like an alcoholic needs a bottle of booze - the more money it borrows, the harder it is to ever become profitable.

What Amtrak Needs and Must Receive

Amtrak needs cash. Not loans that increase its operating costs each year, but cash (equity or otherwise). The government is able to give billions to the airlines. Why can it not be similarly generous to Amtrak?

Most of Amtrak's current problems relate to lack of capital. Amtrak has been forced to run itself into the ground over the last several decades. It has over fifty carriages that have been damaged which it can not even afford to repair. It has a laughably small number of carriages and locomotives, and can not operate enough trains to become convenient enough as to provide a viable service to potential passengers.

Amtrak needs a massive investment of capital to enable it to get closer to a 'critical mass' that can become, if not profitable, at least less of a current chronic loss maker. Amtrak needs this capital so that it truly can provide beneficial services to a much larger percentage of the population than currently benefits from Amtrak.

What is Congress Doing?

Congress is going on holiday, that is what Congress is doing! In other words, Congress is doing nothing.

However, the Senate Transportation Committee did pass a bill on to the Senate Floor that would greatly increase Amtrak's annual funding. It isn't enough, but it is a lot better than nothing. This should be supported.

What Should You Be Doing

Write some letters or make some phone calls. In terms of persuasive power, letters and phone calls are much more persuasive than emails.

Make your letter or phone call simple and short, and phrase your ideas positively; trying not to be critical of anyone or anything in the past. Talk about the positive aspects of rail (as discussed at the top of this article) and if there is a regional issue as to how improved short-distance rail would be helpful to your area, be sure to mention that to your own representatives, too.

Write or phone to your congressman, your two senators, to the President, and also to these people :

Sen Hollings (D-SC), Chairman, and Sen McCain (R-AZ), Ranking Member, of the Commerce, Science and Transportation Committee

Sen Murray (D-WA), Chairman, and Sen Shelby (R-AL), Ranking Member, of the Appropriations Subcommittee on Transportation

Sen Daschle (D-SD), Senate Majority Leader, to get him to schedule hearings on the Bill passed out of the Commerce, Science and Transportation Committee

Rep Young (R-AK), Chairman and Rep Oberstar (D-MN), Ranking Member, of the Committee on Transportation and Infrastructure

Rep Quinn (R-NY), Chairman and Rep Clement (D-TN), Ranking Member, of the Subcommittee on Railroads.

For all their undoubted faults, our politicians are still sensitive to the opinions of the people that elect them! Help them to understand the issues that are important to you, and make these same issues important to them, too.

And hopefully, we will all get to enjoy the type of train service we need and deserve.

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Originally published 28 June 2002, last update 20 Jul 2020

You may freely reproduce or distribute this article for noncommercial purposes as long as you give credit to me as original writer.

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