What About Amtrak?

I've been doing a lot of thinking lately about how the economy is going to change Amtrak.  Will it be for better or for worse, and what can we who love passenger trains do to make it better?  I don't think there's any question that Amtrak will change, as it has for as long as there has been an Amtrak.

In my humble opinion, the economy is not going to get radically better for the next year.  It may not get radically worse, but I see nothing on the horizon that spells boom times.  So two things are a sure bet for Amtrak:  1.  There will be less federal funding.  2.  There will be higher fares for everyone.

Let's take number 2 first, because it's a good thing, as old jailbird Martha Stewart used to say.  Higher fares without an increase in incremental costs; i.e., same old schedule, no increase in frequency, but Amtrak charges the traveler more to get from Point A to Point B; means Amtrak gets closer to being profitable.  However, it also means that Passenger Rail, in general, gets closer to being profitable.  Enter private enterprise.  Say what you will about the capitalist system.  As much as the current regime in Washington would like to regulate big business out of existence, trends in investment are coming back strong in favor of rail - both freight and passenger.  If the transportation-consuming public gets used to paying more to ride the rails, the same way it got used to paying over $3 per gallon of gas, then watch out for more investment in privately operated Passenger Rail.  As I said, "A good  thing!"

On to number 1.  In the humble opinion of this rail fanatic, Amtrak, at this point in it's federally-funded life, may not survive a drastic cut in federal funds.  Even in a gradually increasing economy, the states that would have to pick up the bulk of the shortfall in federal funding to keep many - if not all - services are cash-strapped and have other agendas.  Being politically conservative my self, I've never understood the incredible shortsightedness of politicians who ignore the enormous public benefits of comprehensive transportation policy that includes all modes.  Both ends and the middle of the political spectrum seem to be self-destructive in their zeal to show constituencies their so-called principled approach to government.  Hogwash!  Common sense and historical perspective tell us that Passenger Rail was never the real albatross around the neck of railroad private enterprise, but government intransigence was!

Would the demise of Amtrak be desirable?  In short:  A resounding NO!  There's not a railroad out there that is prepared to take over the route structure and offer the level of service - such as it is - that is today's Amtrak.  (A tip of the New Years hat to all of Amtrak's dedicated employees!)  Once it's gone, it's going to be that much harder to get something back, in any form.  Better for the politicians to recognize Amtrak's value as part of a comprehensive transportation policy that may include fares covering ever more of costs until such time as Amtrak becomes another Conrail.  It won't happen, you say?  Why not?  There was a time not so long ago that I wrote in this blog that Passenger Rail would never be profitable.  I don't see it that way any more.

Disclaimer:  I write this on 12/31/2012, and the Fiscal Cliff - who I sometimes imagine as some myopic accountant living in a 3-story walk-up in Queens - has yet to be addressed.  I don't think any deal that happens after I post this will change what I have written above.

Happy New Year!

+Amtrak
#PassengerRail

© 2012 - C. A. Turek - mistertrains@gmail.com

There's Always Somebody

At the risk of using a bit of awkward English in my title, I couldn't find better words to express a phenomenon that we see in America that happens every time a business or organization appears to be down for the count.

In the case of Passenger Rail, it's taken long enough.  Virtually from the inception of Amtrak, I have hoped for somebody who can see the proverbial light at the end of the tunnel, and who might just put Passenger Rail in America back on the right track.  (I'm just full of them - these railroad cliche metaphors.)  I'd even gotten to the point where, about when I started this blog, I was willing to state as a conclusive fact that nobody will ever make money running passenger trains.

I hope two ventures prove me wrong.  The first is that made by FEC (aka Florida East Coast Industries) to run passenger trains from south Florida to Orlando.  See All Aboard Florida.  These guys have scads of money to spend, and aren't going to do it without the hope of making more in the process.

The second is the reanimation of the rail route from Los Angeles to Las Vegas in the new and improved format of HSR.  XpressWest and Las Vegas Railway Express, Inc. have competing visions of what this service could or should be.  Given the enormous investment needed for a brand new HSR route for most of the way, I'd sat that LVRE's incremental, one-at-a-time train-on approach is the most likely to succeed.  XpressWest may require a huge capital infusion from government to get theirs off the drawing board.

But in either case, the American optimist is quite alive and well and looking at ways that, even in our down economy, Passenger Rail could make some money for some and provide a huge dose of transportation service and pleasure for many.

I am Mister Trains.

©2012 - C. A. Turek - mistertrains@gmail.com

Vacation is Good For The Soul

This post is a little about Passenger Rail and a lot about what you can learn by simply taking a vacation once in a while.  Okay, I'll admit that the vacation was rail oriented, but that doesn't matter.  Railroads are everywhere, and you will encounter them even if your vacation plans don't include any.  If you are a "traveler" or a "vacationer," that's okay, too.  If you keep your eyes open, you'll start to enjoy railroads.

Now to this vacation just completed:  The objective of the vacation was to travel from our home in Albuquerque, NM, to see UP 844 in Ogden, UT.  The special Union Pacific train has been traveling a lot this year, celebrating the 150th anniversary of UP and doing public relations with shippers and employees and just making friends.  And boy does UP know how to make friends.

First, UP is safety conscious above all else.  Their steam crew courteously keeps the unaware and the innocent from getting hurt.  They make friends while doing it.  They do not order people around, but they do make sure that everyone that gets near this big steam engine and its train is safe.  Second, UP is generous.  Sure, they want to sell souvenirs in the gift shop, but they gave away a helluva lot of stuff, and they did it willingly and freely.  Third, if you have never seen UP's train, to see what passenger railroading once was and could be again, you've got to get a look at it.  Granted, UP will not give public tours of the whole train, but the outside speaks of the opulence and grace within.  Fourth, for the tree-huggers among you, they run the steam locomotive on biodiesel.  UP is environmentally conscious.

Aside for those of you who have ever been tempted to protest a new rail line due to how ugly it might be:  A trip up Route 6 over Soldier Summit with the old Denver & Rio Grande (now UP) reminds one how beautiful a railroad snaking through the mountains can and will always be.  The highway paralleling the railroad is far uglier and takes up far more of the limited area between high canyon walls.

On the way up to Ogden, we decided to "surface road" it through Salt Lake City and the large metro area that appears to run from Provo all the way up to Ogden and beyond.  We got to see the latest in light rail systems in Utah Transportation Authority's TRAX system, which is expanding quickly.  And, right up the way from where UP parked the steam loco, FrontRunner, which reminds me of Albuquerque's RailRunner Express, made its northern terminal stop.

I hope I've given some of you reason to believe that rail, and Passenger Rail in particular, is on its way to new and better things.

©2012 - C. A. Turek - mistertrains@gmail.com

How Long Would It Take Today?

This is an instructive game to play, and the title of a tabular piece in the most recent (August 2012) issue of Trains Magazine written by Fred W. Frailey.

As a game, it can really bring home the impact of government regulation and intervention in all sorts of things.  In the case of Mr. Frailey's piece, its about building a transcontinental railroad, and is written on the 150th anniversary of the Union Pacific Railroad.  Mr. Frailey posits that, instead of the 7 years that it took (1862-1869) to build the Union Pacific, today it would take from August 1, 2012 until May 2069, about 57 years.

Tongue in cheek, he throws in all the possibilities:  Federal court intervention, ten years for an environmental study, EPA intervention, both Democrat and Republican intransigence, environmental activist intervention, endangered species, and forest fires.  In this scenario, it takes until 2057 just to break ground.  You know what, although this piece reeks of sarcasm, I think it is closer to the truth than not.

As a matter of fact, this kind of thing reminds me so much of what goes on in New Mexico, and in Albuquerque in particular, that I am doing this same post on my political barb blog, Turn Right At Albuquerque.

©2012 - C. A. Turek - mistertrains@gmail.com

Losing Interest - Gaining Riders

The view count for this blog is going down, and that's my fault.  It's not that I'm losing interest, per se, it's that I'm finding it harder and harder, in this economy, to write content that has no realistic chance to produce income.  Sure there's Google advertising, but that's not generating enough to buy a loaf of bread, even at the ridiculously low price of bread.

That's not what's happening to Passenger Rail.

In a Murphy's Law kind of way, the transportation industry has perversely decided - contrary to my old mantra of "You Can't Make a Profit on Passenger Rail" - that it may be possible to build and run privately operated passenger rail service.

Most recently, Trains Magazine is reporting that Florida East Coast Railway (FEC) is serious about running a privately operated rail passenger service from Orlando to Miami, Florida, and this at speeds of up to 110 mph and including running on 40 miles of proposed new track from Orlando to Cocoa.  FEC is a privately held company, but it is held by Fortress, an investment company with lots and lots of capital.

This tells me that Capital (big C) is not losing interest.  Maybe thinking, "If money can be made investing in freight rail, why not passenger?"

I'm going to make a serious effort to not lose interest and keep this blog going.  But what with two novels I'm working on, others I'm trying to sell, and the need to keep working at a full-time day job past retirement age, time is limited.  You can help:  Look for my novels on amazon.com, lulu.com, and barnesandnoble.com.  Or just link to https://sites.google.com/site/charlesaturek/.  Thanks.

©2012 - C. A. Turek - mistertrains@gmail.com 

Expecting Too Much

Continuing thoughts about what will and what will not work on the subject of privatizing Passenger Rail in the United States.

I think most of the rest of the list of what will not work comes down to expecting too much.

There are many special interest groups, and even those on the same side don't agree.  For example:  Some environmentalists like trains because they are the most energy efficient way to move people and goods - pound for pound.  Environmentalists - and I guarantee this - will also throw up unreasonable restrictions on building new HSR routes or adding trains to existing rail routes because it will in some way harm the environment.  If the costs of meeting these unreasonable restrictions get too high, no private enterprise is going to want any of it.

Random thought:  How did the original developers of railroads in North America get started and make money? They didn't - not always.  But what they did to was start with a forward-thinking idea and get backers interested in the project.  People put in their capital and they got what they got.  It was not always good, but we moved forward.

Now for differences between then and now:  To get backers today, you have to go to a bank, or an investment house, and you have the SEC looking over your shoulder.  To build, you have to jump through hoops with federal, state and local government.  If you want to build a widget factory, you can't just get the money and build it.  You have to get permits and environmental studies, and, God forbid the land you bought had anything spilled on it by a prior owner.  It'll be years before that mess is unraveled.  If you want to hire men to help you build widgets, you can't just hire them.  You have to make sure you have workers comp first, and insurance, and a benefits package in place, and you don't want to piss off any unions.  You'll have to account for fairness, too.  You will have to be fair to all groups and sub-groups of groups, and every color and creed under the rainbow, ad infinitum.  You also should have a good lawyer, because when you do piss somebody off, they won't just call you out on the streets of Dodge for a gunfight, they will sue your butt through more courts than Wimbledon.

Get the picture?  All this takes money.  So when you do raise the capital for your passenger railroad, you better raise ten times as much as you need for the trains and tracks, because you will have to grease the wheels of more than just your trains.

I'm starting to think I was right the first time.  Passenger Rail will never be profitable without government subsidy.  Unless we change things.

©2012 - C. A. Turek - mistertrains@gmail.com

Privatized Passenger Rail - Possible or Pipe Dream?

I've said lots in this blog about how Passenger Rail will never make a profit on its own.  It is always going to need a subsidy.  I have also pointed out that there are other modes of transportation business, and other businesses in general, that are subsidized by the government in various ways that are not as overt as, for example, Amtrak.

So I started thinking about this question:  Under what circumstances would privatized Passenger Rail work and not work?

The first thing you have to do is define "privatized."  For my thought experiment, "privatized" does not mean take what you have now and throw it into the hands of private enterprise and try to make it work.  "Privatized" does, however, allow for the possibility of private enterprise buying existing assets for the purpose of running passenger trains under new and/or different business plans.  Okay now, we've already started the list of what will and will not work.  So let's step back and start with the rest of what will not work.

What Will Not Work - Item 1:  If you didn't get my drift from the last paragraph, let me spell it out.  Do not take an existing Passenger Rail service - Amtrak or Chicago's Metra, for examples - throw it's system into the hands of private enterprise by some means - sale or lease contract, for other examples - and demand that service continue as is while the private operator struggles to run what was already a losing proposition while, at the same time, trying to make changes that will bring the system into profitability.

What Will Not Work - Item 2:  Do not expect freight railroads to jump in and start operating Passenger Rail of a robust nature using existing freight rail infrastructure.  The freight railroads are in the business of moving goods and commodities.  Sure, they'll take a look at a proposal that throws money their way, but their hearts will not be in it.  We who love Passenger Rail will rue the day we try this one.

What Will Not Work - Item 3:  Do not wait until private investors get all goo-goo-eyed over High Speed Rail. At least not in our venue (USA and/or North America).  The HSR project now underway on "The Continent" involves lots and lots of investor's money and that's just for trains and routes over infrastructure that already exists or has already been approved and passed environmental muster.  (Perhaps a key to what will work.)  With the stranglehold that greens have over is, don't expect to see anything get approved economically unless it is by fiat.  And the Fiatster In Chief does not like corporations and investors making a profit.

More next time.

©2012 - C. A. Turek - mistertrains@gmail.com

Hope?

I don't have much hope for Amtrak.

Before you all get in my face about not supporting Passenger Rail, let me add this:  I never had much hope for Amtrak.

So things haven't changed.  The fact that Amtrak has managed to struggle into its fifth decade proves that I am just a little bit wrong, and also a little bit right.  For any government-created entity to struggle that long while coping with the daily - and I do mean daily - political battles is a massively high-scoring achievement.  Then there are the idiots that run Amtrak.

No, I'm not talking about Amtrak's board, or its management!  I'm talking about Congress and We The People.  Come on folks!  Is this how you'd run a business if it was all your own to run?

There have been times when my hope for Amtrak flickers brighter than now.  And there have been times when I thought it was doomsday for sure.  The Reagan administration was one of the latter.  While I admire Reagan conservatism, I deplore the tendency of conservatives to look at every government subsidy as anathema.  Reagan scared me as far as Passenger Rail was concerned.  He had the guts and the wherewithal and the character to accomplish whatever he wanted.  Subsidizing Amtrak wasn't one of those "whatevers."

But I have never felt so hopeless as today, when it appears that the lip-service to HSR has all been paid out and the next Congress will most certainly cut Amtrak money again, and when there's (sometimes reasoned sometimes not) argument that Amtrak should be broken up and the profitable parts kept and sold to the highest bidder.  (Read "profitable" as not losing as much money as the other parts.)

Don't get me wrong, because I do realize I'm all over the map here.  It would have made a lot more sense to break up Amtrak during boom times rather than on the (very slow) recovery side - and I'm not convinced of that yet - of a major economic recession.

But it's not all gloom.  No matter how dark the days, Amtrak always seems to survive.  And as long as there are tracks, there will be other - I hope better - Passenger Rail projects out there.  If I had the money, (I don't - the recession has crapped on my finances) I would invest in Passenger Rail, but probably not in any part of Amtrak as it exists today.

So I guess I should have opened with:  I have hope, but not much for Amtrak.

©2012 - C. A. Turek - mistertrains@gmail.com