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
Monday, November 12, 2012
Wednesday, September 26, 2012
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.
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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
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.
.png)
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
Sunday, July 08, 2012
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
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
Sunday, May 06, 2012
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
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
Sunday, April 15, 2012
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
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
Wednesday, March 28, 2012
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
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
Saturday, January 21, 2012
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
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
Thursday, December 15, 2011
The Devil Is In The Details
One of the biggest problems with any kind of changes (whether upgrades, downgrades, or innovations) in our Passenger Rail system - we're talking North America here - is the complexity of our system. I'm not talking about the rail network, nor am I talking about engineering. I'm talking about all of the ways that we go about financing and managing passenger rail.
For most of you who are interested in this subject, it's not necessary to go through a comprehensive list. Let me just list a few.
1. Private enterprise and private enterprise with public funding. Example: ARR
2. Public funding, public oversight, private operators. Narrow gauge in the west, NM Railrunner
3. Public funding, public oversight, public operators. Chicago Metra
4. Public funding, state ownership, private operator. California
The list goes on.
The point that I'm getting around to making is that entrenched complexity is hard to overcome. There is an inertia to it.
Now, life must go on, and it would be a disaster to shut down, say, a commuter railroad, even for a week, to reorganize it. So how do we get from where we are to where we need to be?
One idea is a reset button. It's not as far fetched as you think, and it's been proposed for more than just passenger rail. A reset button law could solve a mortgage crisis, for instance. A reset button law could erase the political establishment that some blame for the decline of America. A reset button law could erase years of bad law and the results of unnecessary litigation that imposes costs on everything we do.
The trouble is, first we have to decide on what the default state of things should be. Now, in government in The United State of America, we have The Constitution. That's the default state, and everything else in government is window dressing.
Back to Passenger Rail. Default state could be defined as X number of routes serving Y number of population centers with a total population of Z, a defined train frequency, and defined services. What does it take to have that, and would any private enterprise be willing to run it? On a specific date, press the reset button and Amtrak goes away. There's more to it than that, of course, but you get the idea.
This is not a new idea. In the Judeo-Christian Bible, Deuteronomy prescribes the seven-year cycle of forgiveness and even the "default state" in which the debtor is to begin the next cycle.
Just thinking, but the devil is in the details.
©2011 - C. A. Turek - mistertrains@gmail.com
For most of you who are interested in this subject, it's not necessary to go through a comprehensive list. Let me just list a few.
1. Private enterprise and private enterprise with public funding. Example: ARR
2. Public funding, public oversight, private operators. Narrow gauge in the west, NM Railrunner
3. Public funding, public oversight, public operators. Chicago Metra
4. Public funding, state ownership, private operator. California
The list goes on.
The point that I'm getting around to making is that entrenched complexity is hard to overcome. There is an inertia to it.
Now, life must go on, and it would be a disaster to shut down, say, a commuter railroad, even for a week, to reorganize it. So how do we get from where we are to where we need to be?
One idea is a reset button. It's not as far fetched as you think, and it's been proposed for more than just passenger rail. A reset button law could solve a mortgage crisis, for instance. A reset button law could erase the political establishment that some blame for the decline of America. A reset button law could erase years of bad law and the results of unnecessary litigation that imposes costs on everything we do.
The trouble is, first we have to decide on what the default state of things should be. Now, in government in The United State of America, we have The Constitution. That's the default state, and everything else in government is window dressing.
Back to Passenger Rail. Default state could be defined as X number of routes serving Y number of population centers with a total population of Z, a defined train frequency, and defined services. What does it take to have that, and would any private enterprise be willing to run it? On a specific date, press the reset button and Amtrak goes away. There's more to it than that, of course, but you get the idea.
This is not a new idea. In the Judeo-Christian Bible, Deuteronomy prescribes the seven-year cycle of forgiveness and even the "default state" in which the debtor is to begin the next cycle.
Just thinking, but the devil is in the details.
©2011 - C. A. Turek - mistertrains@gmail.com
Friday, November 25, 2011
Serious Business - Proposition 5
The longer we wait, the longer it will take to get things right. Am I talking about Passenger Rail? You bet!
As I write this, Amtrak is probably going to finish the year with its first reduction in ridership in a long time. That is in part due to the weather. No joke, it's not the fault of a politician or bureaucrat. It's also in part because Amtrak, like other railroads, has to take time out to upgrade and maintain. Upgrades will help in the long run, but not in the short. The reason is that there simply are no alternate routes for Amtrak trains. Some have to be shut down, others converted to bus routes until the trackwork or storm cleanup is done.
The United States no longer has enough alternate rail routes to just re-route a passenger train without having serious impact on freight deliveries. Those spare routes that are out there are just too unsafe to run an Amtrak train. For the first time in history, freight rail is challenging the laws that established Amtrak and Amtrak's right to use their private rail systems. I don't know if they will succeed, because many politicians with demagogue it and point to the fat-cat railroads as just bad public-private partners.
I dislike this description of how government wants to involve private enterprise in something it can't get right on its own. I have used the term, but it's like the term privatize. It's a bad way to characterize a situation where the credit goes to the government and anything bad is the fault of the private part of the equation. When you come down to it, all industry is a public-private partnership. But the public part of the partnership should only have three jobs: 1. Provide protection of individual property rights though a stable system of government and national defense where business can be assured that it's ownership of property will not be challenged or usurped by the government or challenged by an enemy. 2. Provide a stable economy and monetary system where commerce can proceed without fear that the government will, by caprice, devalue investments made by private parties who expect a reasonable return on their investments. 3. Where an industry is deemed a necessity to maintaining the other two situations, provide the monetary means to assure that the private side will not have to take all the risk to keep the government stable.
So we need more passenger route miles, and we need them right away, or Amtrak will just erode more. If these route miles come from private investment, then, as in 3. above, the government should be willing to step in and provide some capital. However, as I have said before, it shouldn't be off the table to just dissolve Amtrak and structure something else - something better. Amtrak, after all, has pissed off enough commuter agencies that is is losing their contracts to private enterprise. That is good, because the competitors for those operating contracts are private enterprise.
Where is the money for that federal funding going to come from? From all of us. But there are other ways than through taxes. Deregulation of industry could raise almost as much tax money as would significant increases in taxes on high income entities. Deregulation of freight rail has turned it into an industrial powerhouse.
Again, I ask the question. Do we have the political will?
©2011 - C. A. Turek - mistertrains@gmail.com
As I write this, Amtrak is probably going to finish the year with its first reduction in ridership in a long time. That is in part due to the weather. No joke, it's not the fault of a politician or bureaucrat. It's also in part because Amtrak, like other railroads, has to take time out to upgrade and maintain. Upgrades will help in the long run, but not in the short. The reason is that there simply are no alternate routes for Amtrak trains. Some have to be shut down, others converted to bus routes until the trackwork or storm cleanup is done.
The United States no longer has enough alternate rail routes to just re-route a passenger train without having serious impact on freight deliveries. Those spare routes that are out there are just too unsafe to run an Amtrak train. For the first time in history, freight rail is challenging the laws that established Amtrak and Amtrak's right to use their private rail systems. I don't know if they will succeed, because many politicians with demagogue it and point to the fat-cat railroads as just bad public-private partners.
I dislike this description of how government wants to involve private enterprise in something it can't get right on its own. I have used the term, but it's like the term privatize. It's a bad way to characterize a situation where the credit goes to the government and anything bad is the fault of the private part of the equation. When you come down to it, all industry is a public-private partnership. But the public part of the partnership should only have three jobs: 1. Provide protection of individual property rights though a stable system of government and national defense where business can be assured that it's ownership of property will not be challenged or usurped by the government or challenged by an enemy. 2. Provide a stable economy and monetary system where commerce can proceed without fear that the government will, by caprice, devalue investments made by private parties who expect a reasonable return on their investments. 3. Where an industry is deemed a necessity to maintaining the other two situations, provide the monetary means to assure that the private side will not have to take all the risk to keep the government stable.
So we need more passenger route miles, and we need them right away, or Amtrak will just erode more. If these route miles come from private investment, then, as in 3. above, the government should be willing to step in and provide some capital. However, as I have said before, it shouldn't be off the table to just dissolve Amtrak and structure something else - something better. Amtrak, after all, has pissed off enough commuter agencies that is is losing their contracts to private enterprise. That is good, because the competitors for those operating contracts are private enterprise.
Where is the money for that federal funding going to come from? From all of us. But there are other ways than through taxes. Deregulation of industry could raise almost as much tax money as would significant increases in taxes on high income entities. Deregulation of freight rail has turned it into an industrial powerhouse.
Again, I ask the question. Do we have the political will?
©2011 - C. A. Turek - mistertrains@gmail.com
Sunday, October 23, 2011
Serious Business - Proposition 4
This is the fourth in a series of blog posts about how America might go about getting private enterprise back in the Passenger Rail business.
Proposition 4 is that bankers and venture capitalists are going to have to be willing to take more risk with less guarantee that government will back them up.
Hold on, you say? This is supposed to be a blog about Passenger Rail and not about the sorry state of the banking system. Well, the two overlap.
Proposition 4 probably applies to a lot of businesses, particularly heavy industries and heavily capitalized ones. Railroading is both. America has gotten itself bunged up in an economic situation that has no way out without risk. And this risk is going to have to be on the part of private enterprise and government both. As a country, we have to be willing to believe that government bailouts of businesses -particularly financial ones - simply postpones the inevitable, and that the term "too big to fail" should not be a part of our vocabulary.
Now, from my point of view, government regulation and public policy drove the financial industry to ruin when institutions were forced to lend money to home buyers who had no hope of paying it back. This house of cards had to fall. No, I don't care who's to blame, but I do care who's to blame for our current situation. Now we have a situation where the lending institutions are gun shy, and the government has just slapped on more regulations. This is probably good for the single-family home market. It will keep home prices reasonable for years. But it's not good for the business community, and not for heavy industry. Heavy industry runs on capital. If the capital is not out there, heavy industry does nothing but stagnate.
I think Passenger Rail could return to the private sector if lending institutions were willing to forgo the promise of government bailout along with the regulations that come with it. I think that, as time goes on, institutions with money to lend will see the upturn in demand for Passenger Rail, the astute management of the rail industry in general, and with God's grace the lifting of onerous regulation, and then see in Passenger Rail an opportunity to make a lot of money. This will do a lot for the country and a lot to lift Passenger Rail out of the doldrums of Amtrak.
The only question is: Do we have the political will to accomplish this?
By next time, I'll decide if there is a Proposition 5.
© 2011 - C. A. Turek - mistertrains@gmail.com
Proposition 4 is that bankers and venture capitalists are going to have to be willing to take more risk with less guarantee that government will back them up.
Hold on, you say? This is supposed to be a blog about Passenger Rail and not about the sorry state of the banking system. Well, the two overlap.
Proposition 4 probably applies to a lot of businesses, particularly heavy industries and heavily capitalized ones. Railroading is both. America has gotten itself bunged up in an economic situation that has no way out without risk. And this risk is going to have to be on the part of private enterprise and government both. As a country, we have to be willing to believe that government bailouts of businesses -particularly financial ones - simply postpones the inevitable, and that the term "too big to fail" should not be a part of our vocabulary.
Now, from my point of view, government regulation and public policy drove the financial industry to ruin when institutions were forced to lend money to home buyers who had no hope of paying it back. This house of cards had to fall. No, I don't care who's to blame, but I do care who's to blame for our current situation. Now we have a situation where the lending institutions are gun shy, and the government has just slapped on more regulations. This is probably good for the single-family home market. It will keep home prices reasonable for years. But it's not good for the business community, and not for heavy industry. Heavy industry runs on capital. If the capital is not out there, heavy industry does nothing but stagnate.
I think Passenger Rail could return to the private sector if lending institutions were willing to forgo the promise of government bailout along with the regulations that come with it. I think that, as time goes on, institutions with money to lend will see the upturn in demand for Passenger Rail, the astute management of the rail industry in general, and with God's grace the lifting of onerous regulation, and then see in Passenger Rail an opportunity to make a lot of money. This will do a lot for the country and a lot to lift Passenger Rail out of the doldrums of Amtrak.
The only question is: Do we have the political will to accomplish this?
By next time, I'll decide if there is a Proposition 5.
© 2011 - C. A. Turek - mistertrains@gmail.com
Sunday, October 09, 2011
Serious Business - Proposition 3
So far, I have suggested two propositions regarding a new direction for intercity Passenger Rail in America.
The first was that the freight railroads could absorb some of the losses it may take to get passenger service re-integrated with the rail system in general. I think this is true, but only under certain conditions.
The second was that freight railroads do not have handling passengers in their business plans, which, I think, is false for the reasons stated. (Go back and read!)
Proposition 3 is that freight rail will want some serious concessions from government in order to re-assume the burden of moving passengers in any form greater than their lackadaisical handling of Amtrak. I think this is true, but I don't think these concessions will have to be as costly as one might think.
Go back to the airport/airway model again. Making railroads copy this model wholesale is just not a good idea. The railroad business has too much capital tied up in land, track, and other infrastructure. This wouldn't be a concession to a profitable private enterprise, but a wholesale nationalization. But I think freight railroads, the profitable ones that have experience in leveraging real estate to their advantage, would listen if government was ready to provide the land and pave the way for new kinds of passenger terminals.
Didn't railroads used to lose money on terminal operations before? Why would they want to go back there? These questions do not jive with historical perspective. Railroads lost money on passenger services for many reasons, the chief among them being loss of revenue to cheaper and faster modes of transportation. But hear me out.
I don't have a crystal ball, but I don't see anyone saying that air travel is going to get cheaper or easier. I don't see anyone saying that highway congestion is going to go away, or that trucks are going to stop using the Interstates altogether. I don't see any competition on the horizon for moderately fast, comfortable and efficient Passenger Rail. Terminal services, from large stations to small, could be where the already well established sales departments of freight railroads could shine. I'm not talking about service from the 1930s to the 1960s, but the kind of amenities that could be provided today. Luxury hotels, amusement, shopping, short-term layover facilities, casinos, tours, and things that haven't been created yet, all integrated to a much greater degree than possible before our digitally connected era.
I think there are freight rail companies that would be willing to get things like this going for passenger rail, and make them profitable, given just the minor subsidy of real estate to build on, and the minor guarantee from government that the tax structure and regulations for this form of transport would remain predictable and stable for the better part of a half century. Railroads aren't the staid old corporations run by grandfatherly old men that many people think of when they think of railroads. In the new era, the average railroad executive is going to be just as connected as the rest of us. And maybe just as creative.
Next time, Proposition 4.
©2011 - C. A. Turek - mistertrains@gmail.com
The first was that the freight railroads could absorb some of the losses it may take to get passenger service re-integrated with the rail system in general. I think this is true, but only under certain conditions.
The second was that freight railroads do not have handling passengers in their business plans, which, I think, is false for the reasons stated. (Go back and read!)
Proposition 3 is that freight rail will want some serious concessions from government in order to re-assume the burden of moving passengers in any form greater than their lackadaisical handling of Amtrak. I think this is true, but I don't think these concessions will have to be as costly as one might think.
Go back to the airport/airway model again. Making railroads copy this model wholesale is just not a good idea. The railroad business has too much capital tied up in land, track, and other infrastructure. This wouldn't be a concession to a profitable private enterprise, but a wholesale nationalization. But I think freight railroads, the profitable ones that have experience in leveraging real estate to their advantage, would listen if government was ready to provide the land and pave the way for new kinds of passenger terminals.
Didn't railroads used to lose money on terminal operations before? Why would they want to go back there? These questions do not jive with historical perspective. Railroads lost money on passenger services for many reasons, the chief among them being loss of revenue to cheaper and faster modes of transportation. But hear me out.
I don't have a crystal ball, but I don't see anyone saying that air travel is going to get cheaper or easier. I don't see anyone saying that highway congestion is going to go away, or that trucks are going to stop using the Interstates altogether. I don't see any competition on the horizon for moderately fast, comfortable and efficient Passenger Rail. Terminal services, from large stations to small, could be where the already well established sales departments of freight railroads could shine. I'm not talking about service from the 1930s to the 1960s, but the kind of amenities that could be provided today. Luxury hotels, amusement, shopping, short-term layover facilities, casinos, tours, and things that haven't been created yet, all integrated to a much greater degree than possible before our digitally connected era.
I think there are freight rail companies that would be willing to get things like this going for passenger rail, and make them profitable, given just the minor subsidy of real estate to build on, and the minor guarantee from government that the tax structure and regulations for this form of transport would remain predictable and stable for the better part of a half century. Railroads aren't the staid old corporations run by grandfatherly old men that many people think of when they think of railroads. In the new era, the average railroad executive is going to be just as connected as the rest of us. And maybe just as creative.
Next time, Proposition 4.
©2011 - C. A. Turek - mistertrains@gmail.com
Sunday, September 25, 2011
Some Serious Business - Proposition 2
Proposition 2: The business plans for the freight railroads do not include Passenger Rail.
If we are talking about the major players, I think this is a fallacy. Sure there are some railroads, probably mostly short lines, where you could say there will never be a scheduled passenger train. And you'd be right.
If I were running a major railroad, however, I would want to have a business plan in place that includes contingencies for carrying passengers. Even for carrying a lot of them. Given the current world political and economic climate, I can imagine many scenarios where Passenger Rail could become very strategically important, both economically and militarily.
So I cannot believe that the people running the major, Class One railroads, are not smarter than I am.
So the next question becomes this: Would operation of passenger services by modern freight railroads make Passenger Rail better, or worse?
Does anyone see where I'm going with this?
Next time: Proposition 3.
©2011 - C. A. Turek - mistertrains@gmail.com
If we are talking about the major players, I think this is a fallacy. Sure there are some railroads, probably mostly short lines, where you could say there will never be a scheduled passenger train. And you'd be right.
If I were running a major railroad, however, I would want to have a business plan in place that includes contingencies for carrying passengers. Even for carrying a lot of them. Given the current world political and economic climate, I can imagine many scenarios where Passenger Rail could become very strategically important, both economically and militarily.
So I cannot believe that the people running the major, Class One railroads, are not smarter than I am.
So the next question becomes this: Would operation of passenger services by modern freight railroads make Passenger Rail better, or worse?
Does anyone see where I'm going with this?
Next time: Proposition 3.
©2011 - C. A. Turek - mistertrains@gmail.com
Saturday, September 17, 2011
Some Serious Business
Starting with this post, I want to try to shed some of the politics and get back to the roots of this blog. I started it because I like trains, and I like passenger trains even more. While I find freight trains and their infrastructure fascinating, and while passenger trains never would have existed as they did in the United States during the golden age - between about 1939 and 1959 - without freight rail, I still find nothing more pleasing than the thought of riding, dining, and sleeping aboard a passenger train.
So, I've been thinking. What could we actually do in America to get back to those thrilling trains of yesteryear, with just enough of the modern and innovative thrown in to make everybody happy.
The first thing I thought about was not so-called high-speed rail. The first thing I thought about is a reverse Amtrak. What does that look like, you ask? Well, it may take several blogs to lay it out for you.
The thought arises from the fact that railroad deregulation via the Staggers Act did not take place until after Amtrak was formed. But we've never deregulated Amtrak. The freight railroads have thrived under deregulation, and, unless the heavy-handed progressives get their way in congress, will thrive even more in an economic recovery. Much of freight rail did not even lose money during the recession and is not losing it now - even if whether or not the recession has ended can be debated. Could the same have happened for passenger rail in an era of deregulation?
Proposition One: The profitable freight railroads could probably absorb short-term losses on passenger rail, still make a profit,and possibly turn passenger rail around for the better. All of the innovations that make freight rail profitable today did not come about because of government regulation, but because of the profit incentive and competition for routes. (Government please listen: Your only function should be to make sure there is a level playing field for private enterprise, and then get out of the way.)
Next time: Proposition Two.
©2011 - C. A. Turek - mistertrains@gmail.com
So, I've been thinking. What could we actually do in America to get back to those thrilling trains of yesteryear, with just enough of the modern and innovative thrown in to make everybody happy.
The first thing I thought about was not so-called high-speed rail. The first thing I thought about is a reverse Amtrak. What does that look like, you ask? Well, it may take several blogs to lay it out for you.
The thought arises from the fact that railroad deregulation via the Staggers Act did not take place until after Amtrak was formed. But we've never deregulated Amtrak. The freight railroads have thrived under deregulation, and, unless the heavy-handed progressives get their way in congress, will thrive even more in an economic recovery. Much of freight rail did not even lose money during the recession and is not losing it now - even if whether or not the recession has ended can be debated. Could the same have happened for passenger rail in an era of deregulation?
Proposition One: The profitable freight railroads could probably absorb short-term losses on passenger rail, still make a profit,and possibly turn passenger rail around for the better. All of the innovations that make freight rail profitable today did not come about because of government regulation, but because of the profit incentive and competition for routes. (Government please listen: Your only function should be to make sure there is a level playing field for private enterprise, and then get out of the way.)
Next time: Proposition Two.
©2011 - C. A. Turek - mistertrains@gmail.com
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 - mistertrains@gmail.com
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 - mistertrains@gmail.com
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 - mistertrains@gmail.com
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 - mistertrains@gmail.com
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 - mistertrains@gmail.com
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 - mistertrains@gmail.com
Sunday, June 19, 2011
The Chickens Come Home to Roost
None of us with any knowledge of the business of Passenger Rail think that it is a walk in the park. Start a passenger train, let alone a full schedule of trains, from scratch requires capital, hard work, luck and a loyal customer base. Preferably that base is a broad one, drawn from a variety of demographics. If you are running a train, you should also hope that both ends of your line originate traffic.
Readers of this blog will recall my skepticism and incredulity when then New Mexico Gov. Bill Richardson went out of his way to fund rail passenger service for the Mid-Region Council of Governments, AKA MRCOG. This service, one of Gov. Bill's "legacies", from Belen, NM, through Albuquerque, to Santa Fe, is now known as New Mexico Rail Runner Express. Look on my second page to see some photos.
I wrote at the time that the route was too costly and that the whole project would eventually cost the taxpayers of New Mexico many millions of dollars in subsidies. Albuquerque just isn't the kind of metro area that you find in places like Seattle or Dallas. If done at all, the service could have used existing tracks instead of new ones, used DMUs instead of full-fledged communter rail equipment, and grown with demand rather than taking a "build it and they will come" approach. Even now, with heavy rail tracks built all the way into Santa Fe, the equipment could be owned and operate by another entity under subsidy. And New Mexico will now have the dubious distinction of trying to make BNSF Railway run the Lamy to Raton portion of the original Santa Fe Raton Pass line in order to keep just one long distance train, Amtrak's Southwest Chief, running.
In the future, if you hear someone ask, "Who killed the Chief?" the answer will be either New Mexico or Railrunner Express.
The Albuquerque Journal of Sunday, June 19, 2011, reports that the service averages "about" 4,500 passenger boardings on weekdays. That's not a lot. It's why the beginning of the whine has started, as the Rio Metro Regional Transit District board decided to cut weekends from the schedule. Passenger boardings on weekend days of only 1,000 make this seem logical, but the politicians on the board see it as a way to speak to current Gov. Susana Martinez. "Whine! We need more taxpayer money. Whine! The businesses who depend on weekend recreational travelers will lose money. Whine!"
Frankly, as a taxpaying NMer, I don't see why I should have to subsidize riders to the tune of an (estimated) $40 to $80 a boarding just so they don't lose the profit from that latte. I don't think we should let them eat cake, but let them adjust their business practices to take advantage of the business that remains. Or learn a lesson, which is: Don't depend on the taxpayer to keep you in business.
But the better lesson is this. When you're local politician starts to talk about his or her legacy, hide your wallet and your kid's wallet and your grandkid's wallet. The state will be picking their pocket for the legacy forever.
©2011 - C. A. Turek - mistertrains@gmail.com
Also posted on A Bit Off New Mexico.
Readers of this blog will recall my skepticism and incredulity when then New Mexico Gov. Bill Richardson went out of his way to fund rail passenger service for the Mid-Region Council of Governments, AKA MRCOG. This service, one of Gov. Bill's "legacies", from Belen, NM, through Albuquerque, to Santa Fe, is now known as New Mexico Rail Runner Express. Look on my second page to see some photos.
I wrote at the time that the route was too costly and that the whole project would eventually cost the taxpayers of New Mexico many millions of dollars in subsidies. Albuquerque just isn't the kind of metro area that you find in places like Seattle or Dallas. If done at all, the service could have used existing tracks instead of new ones, used DMUs instead of full-fledged communter rail equipment, and grown with demand rather than taking a "build it and they will come" approach. Even now, with heavy rail tracks built all the way into Santa Fe, the equipment could be owned and operate by another entity under subsidy. And New Mexico will now have the dubious distinction of trying to make BNSF Railway run the Lamy to Raton portion of the original Santa Fe Raton Pass line in order to keep just one long distance train, Amtrak's Southwest Chief, running.
In the future, if you hear someone ask, "Who killed the Chief?" the answer will be either New Mexico or Railrunner Express.
The Albuquerque Journal of Sunday, June 19, 2011, reports that the service averages "about" 4,500 passenger boardings on weekdays. That's not a lot. It's why the beginning of the whine has started, as the Rio Metro Regional Transit District board decided to cut weekends from the schedule. Passenger boardings on weekend days of only 1,000 make this seem logical, but the politicians on the board see it as a way to speak to current Gov. Susana Martinez. "Whine! We need more taxpayer money. Whine! The businesses who depend on weekend recreational travelers will lose money. Whine!"
Frankly, as a taxpaying NMer, I don't see why I should have to subsidize riders to the tune of an (estimated) $40 to $80 a boarding just so they don't lose the profit from that latte. I don't think we should let them eat cake, but let them adjust their business practices to take advantage of the business that remains. Or learn a lesson, which is: Don't depend on the taxpayer to keep you in business.
But the better lesson is this. When you're local politician starts to talk about his or her legacy, hide your wallet and your kid's wallet and your grandkid's wallet. The state will be picking their pocket for the legacy forever.
©2011 - C. A. Turek - mistertrains@gmail.com
Also posted on A Bit Off New Mexico.
Sunday, June 05, 2011
Political Extremes
For a good while, I have been just flabergasted - check my spelling here - at the political extremes that have been reached in playing with the Passenger Rail football. This is one reason I haven't had much to say of late. At the one extreme is the high speed rail initiative begun by the Obama administration and perpetuated by those government agencies that recognize they have a whole pot o' money to get power over if they somehow hitch their train to the high-speed bandwagon.
At the other political extreme are conservatives who can't recognize a good deal when they see one. And, as most of you know, I am a political conservative, but, by God's grace, not as stupid as some, I hope. And in the middle stands Amtrak, which has proven time and again that it can play at both games, but would be better off if the game didn't change every year or two. I think this constant game change is one reason that Amtrak didn't pick up the ball and run faster with it, taking upwards of two years to decide what kinds of new engines and cars to order, and now it looks like it is too late.
I now agree with most pundits: America has no high speed rail at this point in time, and is unlikely to have any true high speed rail at any time in the reasonable future. So the administration's push for high speed rail is really a political subsidy for "higher" speed rail, which translates into the following: If you have a political entity (such as a transit district) that runs passenger trains or is going to run passenger trains sometime in the future, even if you are only in the "study" phase, you can get high speed rail money as long as your trains will run faster in the future that they do now. For the study-phase districts, that could be 1 mph.
A good long vacation - the first in several years - has given me a bit of new energy, and I will be trying to post on this site more often than recently. The vacation gave me a chance to start my next novel. Will it have trains in it? You betcha!
© 2011 - C. A. Turek - mistertrains@gmail.com
At the other political extreme are conservatives who can't recognize a good deal when they see one. And, as most of you know, I am a political conservative, but, by God's grace, not as stupid as some, I hope. And in the middle stands Amtrak, which has proven time and again that it can play at both games, but would be better off if the game didn't change every year or two. I think this constant game change is one reason that Amtrak didn't pick up the ball and run faster with it, taking upwards of two years to decide what kinds of new engines and cars to order, and now it looks like it is too late.
I now agree with most pundits: America has no high speed rail at this point in time, and is unlikely to have any true high speed rail at any time in the reasonable future. So the administration's push for high speed rail is really a political subsidy for "higher" speed rail, which translates into the following: If you have a political entity (such as a transit district) that runs passenger trains or is going to run passenger trains sometime in the future, even if you are only in the "study" phase, you can get high speed rail money as long as your trains will run faster in the future that they do now. For the study-phase districts, that could be 1 mph.
While we push ourselves to opposite poles of the political globe, we fail to realize that there is a real place in America for Passenger Rail, if not for high speed rail in particular. Americans have been speaking about this to Amtrak with their pocketbooks for several years now. So have millions of commuters who use Passenger Rail to get to work every day. Yes, this involves a subsidy, but the conservatives among us should see that as an opportunity to start up a business and move the whole shootin' match onto the private, for-profit stage. That is no less likely a scenario than having a true high speed line (125 mph or more average speed) running between two major cities by 2021.
© 2011 - C. A. Turek - mistertrains@gmail.com
Saturday, March 05, 2011
'Nother Way
The ongoing, highly politicized "Battle For Wisconsin" has got me thinking about other ways to fund Passenger Rail.
The train of thought - now leaving from Track 5 - goes as follows: The whole Wisconsin thing involves public sector unions. Any unionized Amtrak employee is effectively in the public sector. Why can't ours be a totally privatized but subsidized passenger rail system. Unions welcome, but no longer public sector unions. Private enterprise can't give away the store without losing out on the profit.
Why can't our government - we, as taxpaying citizens, recognizing that Passenger Rail is part of a balanced national security and national transportation policy - decide how much it wants to spend on passenger rail. Let's say for the next 10 years to make it a stable system. And then why can't we put it up for bid. The company that wants to show some gonads and take a shot at making a profit above and beyond covering the tax money gets to bid its own X number of dollars for the privelege. Define adequate progress for 3 years right there in the bid documents. The hard part would be defining progress realistically - not by having Congress say it has to turn a bottom line every year or else.
The prize: Getting to make a profit. As big a profit as you want if you manage it all correctly.
The penalty: If no adequate progress in 3 years the whole thing goes up for bids, including the subsidy and the investment of the original proprietor. The whole subsidy goes back to the taxpayers out of the proceeds and everything starts over except for the infrastructure already in place.
I don't know if the USA has enough political will to try to accomplish something like this. But I do know that, given the capital, I'd be one of the bidders.
©2011 - C. A. Turek - mistertrains@gmail.com
The train of thought - now leaving from Track 5 - goes as follows: The whole Wisconsin thing involves public sector unions. Any unionized Amtrak employee is effectively in the public sector. Why can't ours be a totally privatized but subsidized passenger rail system. Unions welcome, but no longer public sector unions. Private enterprise can't give away the store without losing out on the profit.
Why can't our government - we, as taxpaying citizens, recognizing that Passenger Rail is part of a balanced national security and national transportation policy - decide how much it wants to spend on passenger rail. Let's say for the next 10 years to make it a stable system. And then why can't we put it up for bid. The company that wants to show some gonads and take a shot at making a profit above and beyond covering the tax money gets to bid its own X number of dollars for the privelege. Define adequate progress for 3 years right there in the bid documents. The hard part would be defining progress realistically - not by having Congress say it has to turn a bottom line every year or else.
The prize: Getting to make a profit. As big a profit as you want if you manage it all correctly.
The penalty: If no adequate progress in 3 years the whole thing goes up for bids, including the subsidy and the investment of the original proprietor. The whole subsidy goes back to the taxpayers out of the proceeds and everything starts over except for the infrastructure already in place.
I don't know if the USA has enough political will to try to accomplish something like this. But I do know that, given the capital, I'd be one of the bidders.
©2011 - C. A. Turek - mistertrains@gmail.com
Monday, February 21, 2011
No Rail Projects - But Don't Touch Those Unions!
As we have been talking of late about the rare chance to fund HSR and other new Passenger Rail projects, and of the need to hold our collective taxpayer bladder and keep from pissing it away, I thought a comment or two about Wisconsin, the power of the people, and the power of labor unions would be in order.
First, I applaud Wisconsin Gov. Walker for taking a stand on spending money the state doesn't have on rail projects. They've waited this long and they can wait a little longer. A compromise wherein the state perhaps spends some money on planning - including a detailed study of costs and maybe even a 20-year projection as to ridership - wouldn't be out of the question.
Notice how Gov. Walker has enough political power to do this. Passenger Rail protesters haven't packed the state capitol or called the governor a fascist. The people of Wisconsin elected Gov. Walker and the Republicans in the statehouse to do a job, and they are trying their damndest to do it. EVEN THOUGH railroads are typically unionized, I didn't see organized labor on the capitol steps either.
But let the same Republican take a step that looks like union busting, and all hell breaks loose.
So a lesson, if you will. Make that A LESSON!!!
Political power that comes from the ballot box is how this country was set up. But political power that comes from money and influence is always there. As The People, we can do one of three things with that, none of which will make everyone happy all of the time.
First, we can let it take over, as Gov. Walker is determined not to do in Wisconsin, but as it has done in the federal Executive Branch. This is either bad, or - at best - so-so for everyone. Bad for the general populace, the vast majority of whom are not union members, and so-so for union members. Why so-so? Anyone who has ever been a union member will tell you that the rank and file many times gets treated just as badly by the union leadership as it does by management.
Second, we can fight it. This is a so-so result for all. Collective bargaining and the labor movement have done a lot of good things in this country, and they can do a lot more in the right settings. I am thinking that public-sector labor is not one of those settings. When a public-sector laborer - I'm not talking first responders - gets paid more than a private-sector laborer in the same job, things "jest ain't right."
Third, and this may be anathema to some conservatives, we can live with it. Just like we didn't vote for Mr. Obama to take advantage of a crisis and change the face of America, we didn't vote for conservatives to do the same. If Gov. Walker needs to flex some muscle to get the Dems back to the bargaining table, so be it. But please don't ram through conservative changes that are just as radical as the changes that Mr. Obama has tried to make to the American political landscape.
What does this mean for Passenger Rail? I didn't agree with the last Bush any more than I agree with the Last Obama. You can't completely cut off a mode of transportation from government support any more than you can cut off a proven method of keeping wages and working conditions fair for some workers. And yet, you can't just throw away money on either. Let's hope Gov. Walker has the intelligence to see that where both labor strife and rail funding are concerned.
Can I have an Amen?
© 2011 - C. A. Turek - mistertrains@gmail.com
First, I applaud Wisconsin Gov. Walker for taking a stand on spending money the state doesn't have on rail projects. They've waited this long and they can wait a little longer. A compromise wherein the state perhaps spends some money on planning - including a detailed study of costs and maybe even a 20-year projection as to ridership - wouldn't be out of the question.
Notice how Gov. Walker has enough political power to do this. Passenger Rail protesters haven't packed the state capitol or called the governor a fascist. The people of Wisconsin elected Gov. Walker and the Republicans in the statehouse to do a job, and they are trying their damndest to do it. EVEN THOUGH railroads are typically unionized, I didn't see organized labor on the capitol steps either.
But let the same Republican take a step that looks like union busting, and all hell breaks loose.
So a lesson, if you will. Make that A LESSON!!!
Political power that comes from the ballot box is how this country was set up. But political power that comes from money and influence is always there. As The People, we can do one of three things with that, none of which will make everyone happy all of the time.
First, we can let it take over, as Gov. Walker is determined not to do in Wisconsin, but as it has done in the federal Executive Branch. This is either bad, or - at best - so-so for everyone. Bad for the general populace, the vast majority of whom are not union members, and so-so for union members. Why so-so? Anyone who has ever been a union member will tell you that the rank and file many times gets treated just as badly by the union leadership as it does by management.
Second, we can fight it. This is a so-so result for all. Collective bargaining and the labor movement have done a lot of good things in this country, and they can do a lot more in the right settings. I am thinking that public-sector labor is not one of those settings. When a public-sector laborer - I'm not talking first responders - gets paid more than a private-sector laborer in the same job, things "jest ain't right."
Third, and this may be anathema to some conservatives, we can live with it. Just like we didn't vote for Mr. Obama to take advantage of a crisis and change the face of America, we didn't vote for conservatives to do the same. If Gov. Walker needs to flex some muscle to get the Dems back to the bargaining table, so be it. But please don't ram through conservative changes that are just as radical as the changes that Mr. Obama has tried to make to the American political landscape.
What does this mean for Passenger Rail? I didn't agree with the last Bush any more than I agree with the Last Obama. You can't completely cut off a mode of transportation from government support any more than you can cut off a proven method of keeping wages and working conditions fair for some workers. And yet, you can't just throw away money on either. Let's hope Gov. Walker has the intelligence to see that where both labor strife and rail funding are concerned.
Can I have an Amen?
© 2011 - C. A. Turek - mistertrains@gmail.com
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