Saturday, July 30, 2011

What Happens When All The Yapping Stops?

Most of the traditional media has tried its level best to keep the country focused on the debt ceiling "crisis" - aka budget crisis, aka Republican hostage situation, aka etc. ad infinitum.  But what can we, who love trains and train travel, learn from all of this?

For one thing, we should start to learn not to place so much faith in our elected politicians in matters of establishing wise policy.  I saw a bumper sticker this afternoon that pretty much sums it up.  "GOVERNMENT DOES NOT SOLVE PROBLEMS, GOVERNMENT SUBSIDIZES THEM."  Just because government - I don't care if it is federal, state or local - puts money into a project or policy, that doesn't mean it is a wise policy.

Making good transportation policy is one of the most important things that government can do for the people of these United States.  I will say that a different way:  Making GOOD transportation policy is, etc., etc., etc.
If making war is one of the biggest "rackets" out there, then we've got to figure out a way to turn transportation, and that includes railroads, into a "racket."  Because we've sure learned to do a good job of making war in the process.  We have not, as a nation, learned much about good transportation policy.

Another thing to learn as it relates to transportation is that there will never be an unlimited well of money springing from the federal government.  Although many people would like this to be a falsehood, I don't see how it can happen.  As such, we should design our transportation projects to get the maximum ton-mile or passenger-mile per dollar.  And that means railroading.  Despite its anachronisms, railroading is still the cheapest way to move many tons and many passengers from point A to point B. 

A third thing, related to the second thing, is that we need to get over the idea of letting the government help us out by sucking money out of our pockets first and then paying for some service we need at a later date.  We've got to learn to know the real cost of getting from point A to point B and be ready to pay it.  If I knew the real cost to me and to taxpaying society - which has been shrinking, by the way - when I decide whether to fly, drive or take the train, even if the train loses in the comparison, it's the only way I'm going to make an informed decision.  Consequently, it's the only way that a truly free society can develop the modes of transport that will move it forward with a robust economy.

What should we do?  I don't think this so-called crisis gives us any pointers, other than to never let things get so bad that the only choices we have are all bad ones.  But maybe there are choices out there.  I will get to them in another blog.

© 2011 - C. A. Turek -

Sunday, July 17, 2011

Macro - Micro - Whatever

The worries I have expressed in previous blogs about the financial viability of New Mexico RailRunner Express can be boiled down to this:  Can a relatively low-density population state support conventional commuter rail / intercity rail when the terminal points are even lower-density population cities than exist elsewhere in the state?

Unfortunately, I think the answer is "no."  At least the answer is "no" in the present economy and for the foreseeable future.  Also unfortunately, I see this as a microcosm of the same situation with high-speed rail. 

I hear you saying that RailRunner doesn't even come close to high-speed rail.  Well, neither did many, if not most, of the projects that got funded under Mr. Obama's first round of funding.

Like RailRunner Express, the projects shouldn't be funded just because there is some interest and the money is there.  The transit board that is responsible for RailRunner is finding out that nobody knew where the fares were going to come from, who was going to ride, where they were going to start their trips, where they were going to end them, and how much they were willing to pay to avoid the hassle of driving the same trips.  (For high-speed rail, this should be read as the hassle of flying.)

Only one of RailRunner's two terminals is in a city of reasonable population density.  (Santa Fe to Belen, NM)To draw a comparison, but with contrastingly higher population densities, this would be like building a high-speed rail line from Springfield, IL, to St. Louis, MO, but making the south terminus at Rolla, MO.  The losses from the extension to Rolla would probably more than cancel any imaginable black ink to be had from the northern leg.

If we're going to fund high-speed rail, let's not just try to build something because the money is there.

© 2011 - C. A. Turek -

Sunday, July 10, 2011

The Real Stats - From The Horse's Mouth

If you are concerned that I've gone all barnyard with my last two titles, think again.  Animals have always been a good analogy for railroading of all kinds.  After all, it is an iron horse.

Anyway, I thought I'd pass along the real cost of operating my state's commuter railroad, Railrunner Express.  My source is an Op-Ed piece submitted by Larry Abraham and published by the Albuquerque Journal.  Mr. Abraham is the Vice-Chairman of the Rio Metro Regional Transit District board, and also happens to be the mayor of Los Ranchos de Albuquerque.  Mr. Abraham is concerned that NM taxpayers will be paying for the train for a long, long time and there will be new and still-hidden costs to keeping it in operation.

The most disturbing part of all this is that the capitalization of Railrunner appears to have been done in the darkness of political subterfuge.  It is easy for any of my readers to say that it is impossible that the public didn't know what was going on.  All I can tell you is that the details were kept so complicated and changed so often that eventually everybody just accepted Gov. Bill Richardson's mantra.  "Don't worry.  Be happy.  We're getting a train!"

So to the details - and I am paraphrasing Mr. Abraham.  The state spent a half billion on RailRunner.  NM issued highway revenue bonds to pay for it.  This mean that with principal and interest the state will have to pay $850 million over the next 16 years or $18 million a year with two balloon payments (in 2025 and 2027) of $230 million each.  On the revenue side, the train will take in about $60 million, and it is unclear whether that is all farebox or some creative accounting is adding federal grant money, etc.

More recently than the date of publication of Mr. Abraham's editorial, we have learned that the track needs $25 million in maintenance that is not budgeted, and there is an undetermined cost over the next decade to meet federal requirments for Positive Train Control.

If you want to make ugly comparisons, this money could have purchased every current rider a new car for every year until the bonds are paid off, or could have paid for a leased car and hired a chauffer for the trip.  That's efficiency in the use of tax dollers!

I don't think shutting down the train is an option.  We pay for it anyway, whether it is running or not.  What I do think needs to be done is for it to be stopped in the short term until we can develop a business plan where fares come far closer to covering fixed costs.  It's not so unreasonable, for example, to note that a round trip to Santa Fe from Albuquerque in you car is going to use about half a tank of gas.  That's going to be near $30 at today's gas prices.  So why not bring fares closer to this?  Will we lose riders?  Maybe some.  But as long as the attraction is "not driving" and the cost is somewhat less, the riders will be there.  We can lower the fares when the volume of riders goes up. 

Some wags have said we should do it the other way around.  Lower fares almost to nothing and watch the volume soar.  Then adjust the fares upward when people get used to using the train.  I don't think we can afford to spend the extra money in this economy when we are already spending more than enough for this little train.

I love trains.  I love passenger trains.  But bad examples of bad planning using somebody else's money aren't going to make people any more train-friendly than they already are. 

©2011 - C. A. Turek -