NCPA - National Center for Policy Analysis


July 7, 2005

Since the ill-fated day in 1971 when Uncle Sam took over control of rail passenger service as a "temporary" experiment, the federal government has spent almost as much money bailing out Amtrak as it cost to put a man on the moon. All of this money for a train service that doesn't reduce traffic congestion, doesn't cut pollution levels, doesn't save energy, and isn't integral to intercity travel because so few people ride the trains, says the Wall Street Journal.

Trains can be a great way to see America, but Amtrak has poorly served customers and taxpayers alike and is arguably the nation's worst-run commercial enterprise, says the Journal:

  • It loses $1 billion a year ($45 per rider) and that doesn't include some $10 billion in deferred maintenance costs.
  • Every route run by Amtrak loses money, and some are horrendously unprofitable; the long-distance route from Los Angeles to Florida loses $400 for every passenger who comes aboard.
  • It would cost taxpayers less if Congress purchased free discount airline tickets for every traveler.

Meanwhile, the $3 billion high-speed Acela trains on the Northeast Corridor, which were promised to be the financial savior of the railroad, have also been losing money, and are now shut down for several months because of faulty braking systems on the locomotives.

The good news is that there's no law of economics that train service has to lose money -- although it's a pretty sure bet that a train run by the government will. A Congress serious about fiscal restraint would privatize Amtrak, lift its indefensible monopoly status as the sole provider of rail passenger service in America, and let the market determine where and how train service can operate in the black, says the Journal.

Source: Editorial, "The Little Engine That Shouldn't," Wall Street Journal, July 7, 2005.

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