STATEMENT BY JAMES E. COSTON
MEMBER, AMTRAK REFORM COUNCIL
June 20, 2002
http://www.trainweb.com/advocate/2002/2002f20b.html

As a former Amtrak employee and as an advocate of a national passenger-rail service since 1969, I was disappointed and disturbed to learn this morning of the Bush administration's proposals for the future of Amtrak. The administration, which has had a year and a half to acquaint itself with the fundamentals of passenger-rail transportation, apparently failed to open the textbook and prepare for its passenger-train exam until Amtrak's funding crisis and Senator Murray's decision to call a hearing by the Commerce Committee's Appropriations Sub-committee made the task unavoidable.

After pulling an all-nighter, the administration flunked all of the questions on its Transportation 101 exam:

Q: What should be done to spare Amtrak the enormous costs of maintaining and upgrading the Northeast Corridor?

A: The administration has proposed taking ownership of the Corridor away from Amtrak and awarding it to a "partnership" consisting of the federal government and the states. No details of this partnership, which appears to be unprecedented in the history of U.S. transportation infrastructure, have been given. It is not clear how it would be funded, managed or governed. It is not clear whether under U.S. law it can be funded, managed or governed. It is unclear why this untried ownership format is needed. I earlier advocated taking the financial burden of funding the Corridor from Amtrak but retaining Amtrak as the owner/operator of the Corridor, with the commuter agencies and freight railroads as its customers. Ninety percent of the train movements on the Corridor are trains run by local transit agencies. Let the Federal Transit Administration use some of its budget to build up that property but let Amtrak remain the landlord.

Q: What should be done to make the trains more profitable and successful?

A: Forget about profits. Profit is a chimera in passenger transportation, because the economic value created by transportation is not recaptured within the transportation system. It is captured outside-in the businesses that grow and flourish because they are able to access a vital transportation infrastructure. In a futile cart-before-the-horse effort to make passenger trains show a profit rather than create profits for others, the administration proposes "franchising" trains to private companies. This is a totally unworkable and unrealistic proposal. The freight railroads are understandably paranoid about opening up their tracks to private passenger operators and will resist such an innovation. The unions fear privatization will reduce the number of union jobs. History shows that when the carriers and the unions make common cause they are virtually irresistible.

The fact that after 18 months the administration remained unaware of the third-rail nature of privatization illustrates dramatically how poorly they are prepared to deal with the Amtrak funding crisis and the future of passenger rail service in America. The administration also appears to be clinging to the notion that "profitability" is the sole measure of passenger-train success and the sole justification for supporting a passenger-train system. Wrong: All forms of common-carrier passenger transportation lose money - highways, private automobiles, airports, the air-traffic control system, urban mass-transit systems, and the airlines, which as an industry have been unprofitable since the dawn of commercial flight. Passenger trains made money only during a brief 19th-century honeymoon period when they had a monopoly on overland transportation and government had not yet built competing air and highway networks. The administration's insistence that Amtrak recapture this vanished era or go out of business substitutes nostalgia for sound public policy.

Q: How can the federal government get the states to assume more of Amtrak's costs?

A: Wrong question. The states should be assuming less of the passenger-train burden, not more. Almost all of Amtrak's trains are interstate in nature. Under the Constitution, interstate commerce is a federal responsibility. For 80 years the federal government has recognized its responsibility by funding most of the cost of the nation's major interstate transportation programs. The federal government pays 80 per cent of the cost of highway construction; the states pay 20 percent. The federal government pays 90 percent of the cost of airport construction; local communities pay 10 percent. The federal government pays 100 per cent of the cost of the FAA's air-traffic-control system and 100 percent of the costs of the Inland Waterway System.

What makes passenger trains uniquely ineligible for inclusion in this time-honored funding system? Nothing except nostalgia for those simpler days when government could let others fund and operate the passenger-train system. The Bush administration's effort to off-load passenger-train costs on the states represents an abdication of the federal government's constitutional responsibility to promote interstate commerce and denies rail travelers the equal protection of the laws which they enjoy when traveling over federally funded road, civil-aviation and waterway systems. Amtrak President Dave Gunn was right when he said this part of the administration's proposal is an "exercise in problem avoidance." It is a head-in-the-sand approach that tries to redefine the passenger-train problem out of existence by labeling it "Somebody Else's Problem."

Our Constitution obligates the federal government to promote interstate commerce. States are responsible only for the commerce conducted within their borders. Virtually all of the passenger-rail transportation corridors in the United States-existing, proposed and potential-cross state lines. Developing them is the obligation of the federal government. The continuing failure of the federal government to support, nurture and develop passenger-rail transportation has effectively withheld the many benefits of passenger-rail technology from the traveling public and has unnecessarily stifled national economic development, personal mobility and transportation security. To learn at this late date that the administration does not understand these fundamentals of transportation is deeply disappointing.

It is time for Congress and the administration to acknowledge their obligation to fund a modern interstate passenger rail system and to dispense once and for all with the nostalgic fiction that this vital and dynamic tool of modern mobility and national economic development can be delivered effectively by individual states or by private interests.

Secretary Mineta has called for a "market-driven passenger rail service without federal operating subsidies" and has said that "Prices and passengers -- not politics -- should drive service."

But every congressman who runs for re-election brags about how much highway and airport money he has brought back to his district. It's politics, not markets, that drives this nation's transportation-funding priorities. To pretend otherwise may be noble, but it is less than honest.

The critics portray Amtrak as being "too political." The real problem is that Amtrak is not political enough. Not enough politicians care about it, and not enough politicians vote for it. We need to change that.