Privatization Issues

Privatized Rail Passenger Service

According to many transportation policy specialists, the private sector -- not Amtrak with all its political priorities and demands -- could and should be allowed to rescue rail passenger service in the U.S. If private companies were permitted to own and operate passenger trains they believe we could expect innovative solutions which would attract customers once again and remove the burden of Amtrak subsidies from the federal budget.

Here are some of the innovations private rail companies might explore:

  • A dramatic rebuilding of infrastructure and service concentrating initially on corridors between cities 100 to 500 miles apart.

  • Regional trains that might bring back riders with regional food, drink and entertainment.

  • Introduction of a new generation of fast auto-trains.

  • Coordinated bus, train and air connections with joint ticketing.

  • The last two should hasten later development of efficient, attractive and enjoyable transcontinental service.

A plan developed by Seattle's Discovery Institute recommends:

  • Cut costs immediately through more efficient labor arrangement and maximum contracting to private companies -- even if this means relying on Amtrak for a limited time.

  • Begin a vigorous transition program with the goal of phasing out Amtrak during an interim period of three years.

  • Establish a blue ribbon board charged with the responsibility of coordinating the transition and developing new and efficient rail corridors.

  • Develop a new complimentary relationship between passenger and freight carrying sectors of the rail industry, as well as a redefined and more productive relationship with labor.

Until the 1950s, the American train system was the best in the world. Privatized, it could be again.

Source: Ray B. chambers (Discovery Institute), "Put Passenger Service on Track," Wall Street Journal, November 15, 1995.


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