Free Markets, Free People

They’ll Be Workin’ On The Railroad

Well here we go – the government apparently plans on getting further into a business in which it has no track record of success. Yes friends, if “Amtrak” doesn’t remind you of why this isn’t a good idea, how about doubling down on it?

You remember Amtrak:

In FY 2007, Amtrak earned approximately $2.15 billion in total revenue and incurred about $3.18 billion in expenses. Amtrak relies on an annual federal appropriation, which in FY 2007 totaled $1.294 billion, including $521 million in operating funds, $495 million in capital and $277 million for debt service. While Amtrak relies on federal appropriations to support its operating and capital needs, the federal government’s investment in Amtrak was less than 2 percent of the entire federal transportation budget for FY 2007.

Only 2%? Well, we’ll take care of that:

The president’s plan identifies 10 potential high-speed intercity corridors for federal funding, including California, the Pacific Northwest, the Midwest, the Southeast, the Gulf Coast, Pennsylvania, Florida, New York and New England.

It also highlights potential improvements in the heavily traveled Northeast Corridor running from Washington to Boston, Massachusetts.

Of course Amtrak runs service in all of those places.

The president cited the success of high-speed rail in European countries such as France and Spain as a positive example for the United States.

And, of course, Spain and France are physically so much like the US it is frighting:

US –  9,161,923 sq km

Spain – 499,542 sq km

France – 545,630 sq km

For comparison:

Texas – 691,030 sq km

Travel by train has been a part of the culture of both France and Spain for literally centuries. Not so in the US. This is not an “if you build it they will come” moment.

“My high-speed rail proposal will lead to innovations that change the way we travel in America. We must start developing clean, energy-efficient transportation that will define our regions for centuries to come,” Obama said at an event near the White House.

You can read the plan here. It can pretty much can be summed up by Obama’s statement. Not a single bit of analysis about whether there is a demand, whether or not it will be profitable, and, frankly whether it’s economically viable at all.  It’s all about social concerns, not how much it costs.

This is government betting your money that it can change your habits. It isn’t a business plan that’s been produced, it’s a social engineering plan.

Is this the role you’ve imagined for government? As most who understand economics would tell you, if there is a market and it is a profitable market, some entrepreneur or entrepreneurs will enter that market. But you can be assured that won’t enter a market unless there is a profit to be made – which should tell you all you need to know about this boondoggle.

And whether or not you ever board a single one of these trains in your lifetime, you will pay for it.


Tweet about this on TwitterShare on FacebookShare on Google+Share on TumblrShare on StumbleUponShare on RedditPin on PinterestEmail this to someone

33 Responses to They’ll Be Workin’ On The Railroad

  • Passenger rail for the most part isn’t practical.  But, I’ve always had some sympathy for commercial rail.  They can’t compete with trucking.  And since trucks decimate roads which I’m constantly taxed to repair, I consider trucking to be operating under a substantial subsidy as well. 

  • We should be clear…Obama is not talking about “High Speed” rail like France and Spain use (i.e. dedicated lines where trains can travel hundreds of miles per hour).  He is talking about “Higher (than we currently have) Speed” rail.  These lines will just be an expansion of the existing AmTrak passenger service with a modest increase in speed. has a good podcast that discusses some of the details of the fallacies of high speed rail (the good stuff is about 35 minutes in) 
    Transportation Reauthorization: Looking Beyond the Recession

    • Yup … high speed. Again, making it pay would be nice, but the track record is that passenger rail service run by the government doesn’t pay for itself. I see nothing in the fact that this will get you there faster than Amtrak that means it will be any different than Amtrak in terms of turning a profit and paying for itself.

    • Awesome.  You mean I get to sit and wait for two hours for some jack-hole in Omaha to signel the switching station to do it’s thing because the freight car passed ages ago at even higher speed?  Awesome!!!

      I do like to take the train from central IL to chicago (or to Kansas).  I like being able to sit and read and not have to fight traffic…

      But I have to travel one town over to do so, and thus it’s not all that convenient since I currently – still – can’t legally drive.  Connect more cities to the rail line, and I really think ridership would go up…  Since THAT won’t happen, I would just like Amtrak to die, please…

  • Gotta love it:

    The government is B-R-O-K-E, yet TAO feels that it has enough money to bring back the Super Chief.  Will he give up Air Force One and Marine One in order to go back to the halcyon days when presidents had their own rail cars (Union Pacific One)?  Somehow, I doubt it.

    Europe can and does make heavy use of rail travel because, as pointed out, European countries are small enough such that trips within most countries don’t take very long.  Anybody in America want to spend several days of their vacation merely GETTING THERE?

    Further, European cities are, for the most part, compact and already have existing, extensive mass-trans systems.  I used these quite a bit when I was on my honeymoon in Italy: it’s generally quite convenient to get around Italian cities without a car (though a good bit more walking than most Americans are accustomed to is necessary; I note also that Italians tend to be thinner than my fellow Americans!).  The people who insist that we spend billions to build train systems never quite seem able to explain how we’re supposed to get to and from the train station.  Should cities and counties follow the federal government’s lead and rack up huge debts to build subway and streetcar lines that many people won’t use, too?

  • Anyone here ever price out a train ticket?  I looked into it last year as there is a train that travels from gainesville GA to Washington DC.  I thought it would be a nice family trip, but the train was going to cost substantially more than flying, and was going to take all night.

    I used the trains and subways in Boston.  You could do a lot there with no car.  Now in Atlanta, MARTA sucks.  This is a local level issue, not something for the imperial federal gov’t to mess around with.

  • Japan’s local trains are as fast as our express trains, and the speed limits on the roads are much lower.  The country happens to be long, so high speed rail makes sense.  Here, something like the Shinkansen might make sense connecting Washington, Baltimore, Philadelphia, NY, Boston city centers.  I don’t see the population density or ridership anywhere else that could remotely make a high speed rail system viable. 

    Given the environmental regulations now in place, I can confidently predict it won’t happen in my lifetime. 

    • We kind of have such a rail setup right now in the BosWash corridor.  The Acela is currently a good alternative for the Boston-NYC business traveller who doesn’t care for air shuttles between Logan and LaGuardia.  However, it is still speed limited through most of Connecticut.  Improving the right-of-way for Shinkansen or TGV speeds would involve appropriating about a hundred square miles of high-value property to expand the railbeds adequately.  Not gonna happen any time soon. 

  • Is this refitting existing railways or building all new rails. All new rails would probably means getting all new land for it.  In which case, good luck getting that past the environmental groups.

  • I love trains, but they aren’t as fun as they used to be. They will never, however, replace automobiles, airplanes, or even busses until the cost of these alternatives skyrockets. Trains are just too slow for long distance travel and too inconvenient for short distances and, as me again says, too expensive for either. Not to mention that the only thing worse than a train station is a bus station.

  • Given the federal government’s experience running banks and automobile manufacturers, this move makes perfect sense.  It is another company that Obama can take over, run into the ground and create an entirely new population of dependent workers.

    Team Obama’s arrogant belief in its own abilities to run commercial enterprises will be the chief reason for failure.

  • 1374 Days, 02 Hours, 11 Minutes, 23 Seconds.

    Can’t come soon enough.

  • I know this is supposed to be a work friendly site, but I wish you’d allow swear words sometimes.  Because right now – and I predict many more opportunities for the next four years – the only appropriate thing left to say is “Obama is a dumb f@ck.”

  • High Speed Rail is awesome. I don’t know if it will make any money, but I much prefer them to planes. I would pay a little  MORE to take a train instead of a plane.

    Also, I am not sure population density really matters so much – after all, Americans are willing to drive their cars to the airport…why not to the train station? Perhaps a drive on train, like a car ferry? Just make sure to have parking lots, rental cars, and oh, maybe consider the rail stations to be connnected with major airport hubs…this works well in Europe.

    Still not convinced it will work, but I’d rather have HSR than ACORN getting money.

    • Currently most train stations and bus stations are located in city centers, and not the good part either. Unlike most airports, train and bus stations are a pain in the posterior to get to (relatively speaking) and do not have the ‘convenient’ parking facilities airports do, particularly long-term parking. Then there is the crime & grime problem associated with the areas. On the other hand, if you like history, antiques, and old things in general  train stations can be interesting.

  • …if the money has to be wasted, that is. I don’t doubt that HSR will lose money in the USA.

  • Distance aside – the problem you face is we (Americans) have grown up being able to set our own schedules, using our own vehicles, coming and going as we please, and not based on the train schedule.  People are not going to look at public transit seriously if it takes them 2 hours to go ten miles (the local bus system with route changes, etc) and it’s hardly better using light rail that, again, takes 35 minutes to cover 10 miles (because of stops, and because the nice operator driver lady decided to wait for those idiots running through the gate right now who shouldn’t have to wait for the next train). 

    While I would dearly love to see all of us ‘slow down’ a bit in life it’s just not going to happen until they force it on us.  It won’t happen voluntarily

    The biggest constraint for the paradigm shift Americans have to go through to use this system is TIME and ‘freedom’.

    • “Distance aside – the problem you face is we (Americans) have grown up being able to set our own schedules, using our own vehicles, coming and going as we please, and not based on the train schedule”

      They are not talking about commuter rail, but high speed long distance rail. Since Americans have to work around plane schedules, too, this is not a problem. 

      High speed rail shouldn’t require population density anymore than airports, unless airports can operate with fewer passengers per airport (this could easily be true – I have not investigated it.) HSR does poorly versus long haul flights, but does well against medium distance…say Las Vegas to Los Angeles in 1.5 hours vs. 6 by car. Its never going to replace planes altogether.

      • “HSR does poorly versus long haul flights, but does well against medium distance…say Las Vegas to Los Angeles in 1.5 hours vs. 6 by car.”

        …and now that the tulipmania has ended in LV, by the time a HSR is completed it will only be oh, 20 years obsolete…

  • Did you dig up an old John McCain speech for this idiotic post?

  • “Spain – 499,542 sq km
    France – 545,630 sq km
    For comparison:
    Texas – 691,030 sq km”
    And it’s not just the land area that makes it less feasible.  Texas’ population is 24M (density 31/km²) versus Spain’s 40M (density 80/km²) and France’s 64M (density 117/km²).
    There is a reason that, up until now, we’ve lots of ‘small” places in the US that have subways, but in only very few locations of intercity rail.  It’s called density, which underlies the low infrastructure and maintenance unit cost, high destination volumes, and the ability to schedule many trip times on routes without losing hordes of money, which just about all public transportation systems do.
    Contrary to Obama’s silly assertions, there is no greater mobility, higher flexibility, less inconvenience or more productivity involved in stressing high speed rail as policy.  That’s just snakeoil salesmanship.

    • You’re right, but the comparison was only made to help people understand the comparison and be able to relate to something in the US. We’re essentially talking about comparing something in a place smaller than Texas and the claim that it’s an apples to apples comparison (US and Spain or the US and France).

  • There are two major flaws with this plan that I can see right now, and both have to do with the existing system.  If the plan is for a Japanese-style “bullet” train, we’d need to put down an entirely new set of rails, as the requirements for turns and elevation changes are different for high-speed rail systems.  If the plan is for merely “higher-speed” trains that can run on the existing tracks, the whole thing will get bogged down by the existing freight usage.

    Of course, then there’s the whole security issue.  The claim is that we won’t need to “take our shoes off” to board the train, but why bother going through any security with the intent of blowing up the train when there are so many unguarded miles of rails that can be damaged with the same effect?

  • There was a time I commuted down to Anaheim via Amtrak.  Not a bad ride, good for avoiding traffic and the coffee in the cafe car was decent.  I could see a high speed train from Los Angeles to Las Vegas getting substantial use.

    I’m just not sure why we should pay for it.  It seems to me that government interference has kept Amtrak from adapting to a changing world, and thus the ability to turn a profit.  And it looks like we were (or maybe still are) on the precipice of doing the same thing to our domestic automotive industry.

    Subsidies stunt growth and adaptivity.

  • Looker, the freedom issue is a big part of this. They know the stuff isn’t profitable. They know people don’t like to use them, and they know trains and train stations are places where you stand a better-than-in-your-car chance of being mugged, accosted or otherwise harmed. And they know that in American cities, you will likely have to drive to train stations just to be able to save the mileage. 

    Would there be incremental environmental benefits? Maybe. Obama ASSUMES there will be. He wouldn’t know because they don’t exist, and because he himself has never created anything. (But then, Progressivism focuses on spending wealth and ideas, not creating them, isn’t it?)

    All of those drawbacks are insignificant next to the sweet, sweet desire to control other people’s lives. That’s cherry.
    Progressivism is about feelings. And few things feel so very, very good as the power – even if vicarious – of pushing other people around.

  • High speed rail has been the boondoggle rip off of choice for local governments for years now.  It figures that the Obama administration wants a piece of that sweet action.

  • If Dallas Light Rail is an sample of how they collect fairs on modern rail systems…..
    I had occasion to use the red-line north of Dallas the other day (we were lurking at the Trinity Hall
    pub by SMU)

    We bought our tickets – no one ever checked them…at ANY stop….either way.

    They didn’t check anyone else’s ticket either.

    There were no facilities for checking them.

    There were no people for checking them.

    But they probably had a sign posted that told you what would happen if someone DID show up to check your ticket, though I admit, I didn’t see it.

  • Passenger trains lose money even when full. There is a commuter train from Wash. DC to West Va. which is always packed and yet requires an annual subsidy. It has been a real boon to the real estate business & economy in the Eastern Panhandle of W. Va. I don’t know whether it can survive without Sen. Byrd’s patronage. I think NYC has a similar situation.