NCPA - National Center for Policy Analysis

Amtrak Off The Rails

April 30, 1997

Amtrak, which has a monopoly on U.S. intercity rail passenger service, has careened downhill at gathering speed since its first full year of operation in 1972. Critics say the taxpayer-supported system is a wreck which should be propelled off a cliff.

  • Amtrak's cumulative losses over its 26-year life now total $13 billion -- about twice as much per year as trains were losing under private ownership.
  • With only 219 daily trains compared to 547 that ran under private ownership, Amtrak has managed a neat trick: losing twice as much money with half as many trains.
  • Under private ownership, the railroads had been generating just under 6.2 billion revenue passenger miles of rail service a year.
  • When Amtrak took over, that figure dropped to 3 billion passenger miles -- not to match the earlier figure, at 6.3 billion, until 1991.

While intercity rail service in 1970 served 7.5 percent of the commercial travel market, it entered the 1990s with only 3.6 percent.

In January, Amtrak announced that its first-quarter losses had more than doubled, and it had to borrow money despite a $22.5 million emergency congressional appropriation in September.

Transportation analysts want to eliminate Amtrak as a service provider. Some suggest that government take on the responsibility of building rail track which could handle 150-mph business-class trains which would be privately owned and operated. Then, rail service would follow the same pattern as all other inter-city U.S. transportation: government provides the infrastructure, private enterprise provides the service.

Source: Christopher B. Cohen (attorney, Holleb & Coff), "Get Amtrak Back on Track," Wall Street Journal, April 30, 1997.

 

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