Don’t Add to Amtrak’s Boondoggles
(Bloomberg Opinion) -- For train enthusiasts, these are hopeful days. The infrastructure bill Congress passed in November allots $66 billion to rail, or about $4,000 for every passenger that Amtrak carried last year. Not coincidentally, the government-owned colossus recently unveiled a vast new expansion plan that would add 39 new routes and bring service to 160 new communities.
Encouraging as this may sound, it’s actually throwing good money after bad. Amtrak has been reliably bleeding cash since 1971. It requires some $2 billion in federal support each year. Even the relatively profitable Northeast Corridor line necessitates a government subsidy to cover capital costs, while most other routes are simply nonviable economically. In particular, long-distance trips account for 15% of Amtrak’s total ridership and 80% of its financial losses.
It’s hard to see how adding dozens of stops — to such modish locales as Rockland, Maine — will improve matters. All those new routes will need maintenance and repairs in perpetuity. Most will need more personnel (“an estimated 26,000 permanent jobs,” Amtrak says). All of them will likely require subsidies. The people of Rockland may welcome the train coming to town. Yet Congress could buy every local household an electric car for about $98 million, a comparative steal.
Expanding passenger rail doesn’t just burden the federal budget. It could also harm the broader economy. On most of its routes, Amtrak pays private freight carriers for access to their tracks. Because passenger trains are (by law) given preference on these routes, they’re likely to slow down the nation’s freight network and hence raise shipping costs. Because they may require improvements (such as longer sidings or safety upgrades), they can also entail huge upfront costs. Amtrak’s proposal to restart its Gulf Coast line could require as much as $1.3 billion, according to a report commissioned by the Florida Department of Transportation — for a service that might carry a few hundred passengers a day, on what one local politician called a “joyride for the affluent.”
You might still argue that passenger-rail expansion is necessary on environmental grounds. But this, too, fails a cost-benefit test. Displacing freight rail means more cargo will likely be carried by trucks, which produce perhaps 10 times more carbon per ton-mile. Moreover, Amtrak’s trains outside of the northeast are diesels, which emit about 167 grams of carbon dioxide per passenger-mile, not much better than planes (174 grams) — and that’s before any construction is factored in. Even on optimistic assumptions, a decades-long expansion of passenger rail is a grossly inefficient way to fight climate change.
In fact, the infrastructure bill almost seems designed to maximize inefficiency. It specifically prohibits Amtrak from reducing service on unprofitable rural routes. It requires human ticket agents at every station that serves more than 40 passengers a day. Outraged at Amtrak’s attempts to reduce chronic losses on its dining service — by offering prepackaged meals, for instance — lawmakers demanded that it create a “Food and Beverage Service Working Group” to solicit advice about menu items from nonprofit groups, state agencies, and (of course) organized labor. It’s hard to parody this sort of thing.
Amtrak may never be profitable, but it should try to cut its losses. Congress should prevent any expansion of long-haul boondoggles and focus on shoring up the Northeast Corridor — which has a maintenance backlog exceeding $38 billion — and other viable intercity services. In the longer term, it should fund research into next-generation technologies, such as hyperloops, that could offer a safer, faster, cheaper and carbon-free alternative to high-speed rail, and one far better suited to America’s dispersed population centers.
No one doubts the romantic appeal of coast-to-coast railroad service. But subsidizing it at taxpayer expense makes less sense by the year. Adding costly and wasteful passenger routes to this already groaning system is no way to run a railroad.
Editorials are written by the Bloomberg Opinion editorial board.
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