Sunday, November 23, 2008

Something Big

Since the inception of Amtrak, the model for Passenger Rail in this country has been - with few exceptions - one of subsidize and recover. This means subsidize as much of the train operations budget as is politically possible, and recover as much as possible of the costs of train operations from the farebox. The few exceptions are excursion trains, since even commuter rail is handled in the "subsidize and recover" model.

Perhaps we are ready for a new model. A big idea.

Looking at some photographs of New York Central varnish from the 1930s and 1940s got me thinking: We could look at this the same way banks are required to look at deposit insurance. Banks take a percentage of every dollar and put it into the FDIC.

Think about this: Instead of taking money out of transportation taxes and out of other general taxes to fund Passenger Rail, why don't we just require every railroad to pay a percentage of their profits towards passenger service.

You may say that was how railroads got in trouble with passengers to begin with. And I would say you are right. But railroad of the time were trying to serve every community on most routes and were doing it with lots and lots of equipment and heavy schedules. I think that if the current Amtrak route structure were imposed on the host railroads, a percentage of freight revenues would be enough, in our day, to operate most, if not all of Amtrak, maybe even double the routes currently available. I believe that it would not cramp the style of the profitable railroads.

You may also say this is a bad time to start imposing an effective tax on profitable businesses, as the times are telling us that profitable businesses are going to be few. But what better time than when railroads are flush with cash? Should we wait until the whole economy is in shambles?

If it worked, this would be a way to ease railroads back into the habit of operating and funding passenger service, not just grudgingly allowing passenger trains to operate on tracks built in the public interest.

Yes, there are consequences. Shippers would effectively be paying for passenger rail in rates that might be higher. Congress would have to resist the temptation to allow (or worse, mandate) that all costs thus incurred be passed on to the shippers. And initally, reduced service would result on already crowded lines. Benefits would be forthcoming with patience. Business would benefit from increased availability of travel and lower cost. Removing automobiles from roadways would relieve environmental pressures on all businesses. Fuel savings would be great, and all businesses would benefit from a reduced dependence on foreign oil.

I'm sure I haven't thought of all the positives and negatives here. Anyone want to jump in and enlighten me if you think this is a bad idea? Otherwise, maybe we can write some letters to the new Congress and the new president. Maybe there are other new and better ideas out there. But the old model isn't working, hasn't for a long time. Let's start something big.

© 2008 - C. A. Turek -
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