Continued socialization will derail passenger service

Budgetary choices that ask voters to decide between equally unpalatable alternatives are often unnecessary. With a bit of imagination, budget cuts can be therapeutic rather than painful. A good example is Amtrak. Do we really have to choose between losing passenger rail service and subsidizing a cripple Amtrak?

The present budget fudges this question by phasing out the roughly $700 million Amtrak subsidy over three years and hoping for “privatization.” But it doesn’t provide a transition plan to achieve the goal. Legislation before Congress would reform the ancient labor and liability laws that burden Amtrak, but that only will clear the way to a healthy future, not get us there.

Until the 1950s the United States had the world’s leading passenger railroad system, and it was private. Our fleets of “streamliners” were the envy of Europe and Japan. What killed this system was not just the growing popularity of autos and airplanes, but also the government’s ruinous over-regulation, combined with federal subsidies for the infrastructure of rail’s competitors–autos, which got a massive new federal highway system, and planes, which got new airports. Finally, in the 1970s, it seemed that the only way to save any level of train service was to socialize it.

Amtrak was the ungainly result. Lately, its top management has been unusually open to change, welcoming, for example, the offer of the states of Washington and Oregon to help finance new service along the “Cascade Corridor” between Eugene, Ore., and Vancouver, B.C. But nationally, Amtrak service is indifferent and so is the public response. Increased cutbacks are anticipated and Amtrak seems slated to wither away over the next few years. And with it may go our chances of a balanced transportation system.

Two facts have to be faced. First, as Ray Chambers, a “transportation fellow” at Discovery Institute, points out in a recent paper, no system anywhere that relies on long distance trains is going to last very long. Even Canada’s esteemed transcontinental scenic southern route recently was terminated. Simply put, airplanes are better bargains for most long trips.

But trains have a potential edge in short-to-medium distance trips where convenient downtown stations and superior reliability in bad weather often give them an advantage on timeliness as well as expense. This points to a plan to rebuild passenger rail with a national system of 100-500 mile “corridors” between major cities.

Second, Congress and the President need to recognize that Amtrak is a senseless anomaly in the U.S. transportation scheme, a government carrier operated on a private infrastructure (the private freight railroads’ tracks). This is just the opposite of the situation with plans and autos and intercity buses, where the private sector provides the transportation service and government supports the infrastructure.

If swift intercity traffic is ever going to work well, we need to upgrade the nation’s tracks to passenger quality. The freights presently have inadequate incentives to do so, while the federal government is too busy bailing out Amtrak’s operating losses to worry about infrastructure.

Therefore, after the present burden of over-regulation is lifted, government should get out of the operation of Amtrak altogether. But, regarding infrastructure, Congress should let states opt to use existing transportation capital funds of all kinds to upgrade railroad tracks and crossings. Amtrak then could become a private company and compete with other private companies to operate on the new, corridor-based system.

In fact, as Ray Chambers indicates, the free market is sure to find ways to create opportunities where government sees only problems.

For example, new private railroads might be allowed to combine passenger service with high value package delivery or, for another example, to operate a new generation of fast “autotrains.”

Intermodal bus/air/train connections, and joint ticketing and package deals, would encourage mixed-mode trips and make life easier for American travelers. Private rail service almost surely would improve dining facilities, perhaps stressing regional fare. Entrepreneurial ingenuity also is the best hope of saving transcontinental train service.

It cannot happen overnight, but it can happen. Chambers has proposed a national “Rail Alliance for Passenger Service ” (“RAPS”) to design the new system and to approve private franchises during a transition period, while federal operating subsidies are ended.

Remember, 16 years ago private freight railroads were dying, too. Government then had enough sense to free the freights from its own heavy hand, and today the private system thrives, paying taxes instead of using them.