Tuesday, June 15, 2010

This Week in Amtrak

Railway tracks. (NOTE: Uploader says, in uploa...Image via Wikipedia

Volume 7, Number 17
June 14th, 2010

A weekly digest of events, opinions, and forecasts from

United Rail Passenger Alliance, Inc.

America's foremost passenger rail policy institute

Jacksonville, Florida USA

Telephone 904-636-7739, Electronic Mail info@unitedrail.org . http://www.unitedrail.org


Positive news for commuter operations, and ponderings on the future of high speed and intercity operations. But let us begin with two brief preludes; first, a short poem, called a "Grook" by its author, Danish poet and philosopher Piet Hein.

Thoughts on a Station Platform

It ought to be plain
how little you gain
by getting excited
and vexed.
You'll always be late
for the previous train,
and always in time
for the next.

A second lead-in: a note on why we are all here. Marcus Garnet, of Transport Action Atlantic in Canada, writes in a Progressive Railroading internet journal ,

What is commonly overlooked, is that time spent on a full-service
long-distance train is also available for other purposes, including
overnight sleep, meals, work, meetings, socializing or simply the
enjoyment of scenery. Overnight train travel serves a transportation
function, but also offers a total experience, especially for those
who are able to afford a bedroom. These passengers do not just
travel on the train, they live on the train. Whether for tourists or
traveling Canadians, this is a vital market distinction from other
land transport modes.

Mr. Garnet sums up many of our feelings and motivations for being passenger train advocates. Yes, trains are a vital part of our national infrastructure, but we want trains because of what they do for us personally, what they do for our friends and families and neighbors, what they do for our economy and our ecology. Trains are special and we need many more of them.

One last item, from the Inbox: Reader Ole Amundsen wrote in regard to the referenced article on VIA Rail Ocean Train Service:

The comments around this exceptional piece of work seem to be
getting at the heart-wood of the rail passenger conundrum in this
country. My positions come from being 70 years of age, nurtured by
an old school conservative view of individual responsibility,
educated in business and economics, and experienced in national

When Amtrak was started, I was only interested in getting the
/Montrealer/ re-instated so I could avoid driving from my new home
in Vermont to family in Connecticut. It is easy to look back and say
Amtrak should have been done differently: it has performed the task
of "place holder" for passenger rail but that is about it. Those
were dark days for railroads, but we are now in a very different
world: then I paid 16 cents a gallon for fuel oil to heat my drafty
Vermont farm house! Today, we have 75 million boomers aging out;
they control about 75% of the nations wealth, they love to travel,
they are fit but getting more prone to medical situations, they have
"done it all" and want to continue to have adventures, they enjoy
creature comforts and are enjoying being grandparents. This is not a
market block to be ignored, it is not solely a market for "luxury
train travel;" it is a major component of the traveling public which
does not opt for speed alone, but which prefers reasonable mode
frequency, reasonable adherence to published schedules, reasonable
and clean accommodations, reasonable food, accessible and
accommodating equipment and a minimum of hassle...

My friend, the late Paul Weyrich, had all the conservative
credentials a person could have; and he was a strong voice for
passenger rail and trolley ("light rail") as well as integration of
inter- and intra-urban service. This problem, this opportunity, must
be addressed without falling back on old reasons not to, and [there
must be a way we can] come together with fresh ideas on how to
really run the railroad.

Now, on to the news.

The /San Mateo County Times/ reported on 27 May that

Caltrain officials have convinced federal safety authorities to
allow quick European-style electric trains to zip from San Francisco
to San Jose... common in Europe, the smaller electric trains... [had
been considered] unsafe. But after three years of tests and
research, Caltrain will become the first railroad in the nation to
use the technology after being granted a waiver... [this] will
essentially be a pilot operation for the trains, called electric
multiple units. If successful, commuter railroads and planned
high-speed rail networks throughout the nation would have access to
cheaper, greener and faster trains...

Even with several restrictions, the advent of modern equipment used successfully and safely for years elsewhere around the globe is a huge step forward for the implementation of regional rail lines around and between American cities.

For those who saw the Ayn Rand quote last week as being "the politics of the past," we turn to Paul Merrion 's article in Chicago Business this June 10th , regarding high-speed rail (emphasis mine):

In a move that reportedly "stunned" the rail industry, the Federal
Railroad Administration last month proposed stiff terms for the
grant agreements that railroads must sign with states to get funding
to upgrade their rail systems... Among other things, *the FRA said
railroads must be required to pay, without limit, for any further
improvements or fixes needed to meet on-time performance goals* set
out in the grant agreements, or else pay back the federal
grants.Even Boston-based non-profit, National Corridors Initiative
Inc., a high-speed rail advocacy group, questioned whether that is
feasible."While the objective of these guidelines --- to protect the
taxpayer against the (mis)use of their money when federally assisted
railroad projects are built --- is a valid one, the prescriptive,
punitive nature of the proposed FRA regulations are and will be
non-starters for any normal businessperson who has to carefully
assess projects for risks to his company, or face the wrath of his
stockholders," the group said in a statement on its Web site...

The FRA holds over the railroads, not just the billions in high-speed rail grants effectively controlled by Amtrak, but also the impending imposition of Positive Train Control (PTC), a worthwhile safety and capacity improvement but one that will cost billions and take years. It is still not certain how much of PTC the railroads are expected to shell out of their own pockets. Is the Obama administration seriously going to require the railroads to pay /any/ price so Amtrak can operate its government-funded high speed trains?

In parallel developments, concerning the Gulf oil spill, "Obama said he had no interest in undermining the value of BP" (Reuters story , 12 June 2010), but meanwhile "U.S. House of Representatives Speaker Nancy Pelosi said on Friday BP should be subjected to unlimited liability costs and should pay all damage claims" (Reuters story , 11 June 2010). How can one impose unlimited liability without undermining industry? What person or corporation in their right mind would continue operating under those conditions?

(Caution: Ayn Rand reference follows; the timid may avert their gaze.)

In /Atlas Shrugged/, Rand populates her dystopia with officials who do not understand how the world works. Rand's bureaucrats have only ever ridden, as a Mr. Guthrie would put it, "their fathers' magic carpet made of steel," never seeing the engineering brain-power and the technical muscle-power behind a railway, imagining that trains function by magic, that oil pumps itself, that commerce and industry exist in a mythical land of everlasting continuation unaffected by taxes, regulation, and legislation. Rand posits a government whose popular and well-intentioned enactments "for the public good" strangle commerce and industry, slowly as a gentle flurry at first, finally escalating to a murderous avalanche.

Arthur Laffer explained in the /Wall Street Journal/
one June 6th why this neverland of perpetual sameness does not exist:

People can change the volume, the location and the composition of
their income, and they can do so in response to changes in
government policies... It has always amazed me how tax cuts don't
work until they take effect. Mr. Obama's experience with deferred
tax rate increases will be the reverse. The economy will collapse in

Dire predictions of impending doom aside, will the Obama administration, having already started down the dystopian road (One of the characters in Rand's 1957 book asks, When they nationalized health care, did anyone ask what the /doctors/ wanted?), truly enact scorched-earth policies in one economy sector after another? If so, look for oil and rail executives to be among the first to relocate to Galt's Gulch.

Back in the high speed arena,

Amtrak announced it is reorganizing and establishing a new
department to pursue opportunities to develop new intercity
high-speed rail service in select corridors around the country...

"Amtrak is the unparalleled leader in high-speed rail operations in
America today and we intend to be major player in the development
and operation of new corridors," said President and CEO Joseph

-- Amtrak press release, 22 March 2010

Aside from the omission of a word (does Amtrak intend to be /*a*/ major player, or /*the (only*/) major player?), does it not sound as if Amtrak might be jockeying for a near-monopoly in high speed rail? Will we see a resuscitation of the dead corpse of its former monopoly over all intercity trains, moved to HSR? Prior to the passage of S.738, the Amtrak Reform and Accountability Act of 1997, U.S. Code: US Code, Title 49, section 24701(b) read (emphasis mine):
"Except as provided in section 24306 of this title, a person may provide intercity rail passenger transportation over a route over which Amtrak provides scheduled intercity rail passenger transportation under a contract under section 401(a) of the Act *only with the consent of Amtrak*."

The "monopoly clause" indeed prevented state agencies as well as private companies from even talking to railroads about running passenger trains.
Would Amtrak have approved trains like New Mexico's RailRunner?
Doubtful. Certainly not in the short time it took from its announcement to the first cue for the "Meep-meep!" of the RailRunner departure door chimes.

That provision having been rescinded, will the liability issue now be how private operators are forced out of business?

Perhaps echoing liability concerns voiced frequently by North
America's Class I freight railroads, Amtrak President and CEO Joseph
Boardman has cited similar concerns "emerging as a significant
obstacle to the improvement of existing passenger rail service and
the development of new, including high speed and intercity corridor,
passenger rail service in the United States."

Boardman, in a five-page letter to four congressional leaders dated
Feb. 26, says in part, "The core of the problem is the unwillingness
or inability of a growing number of entities, including states and
other public bodies, to enter into the kind of agreements for risk
allocation ... and/or to purchase insurance at all or at sufficient
levels ..."

"Moreover, the attitude from a number of private parties and state
entities alike seems to be that Amtrak, in significant part because
of its federal funding, should assume the greater share or risk of
liability." That, Boardman warned, could curtail or terminate
state-supported services Amtrak currently provides...

-- Railway Age, 2 March 2010

Airlines are feeling a similar pinch. According to Susan Stellin in the /New York Times/ , this 7 June, reporting from the first meeting of the Future of Aviation Advisory Committee, air travel will look much different within half a decade.
Small cities will continue to lose air service, or at best will have ever-fewer flights at ever-higher prices, while some large cities with aggregated volume will see volumes above today's and low prices from further rate wars.

...Glenn Tilton, United's chairman, stated it more bluntly: "There
are clearly going to be winning cities and losing cities," he said,
addressing the fact that the industry cannot sustain service to
destinations that don't have the passengers to fill planes...

High speed trains have the same problem as airplanes: They just do not serve enough places. California's governor Schwarzenegger has proposed running a "high speed lite" train before he leaves office. Here is what Noel Braymer of RailPAC has to say in a letter to the /Los Angeles Times/:

According to the letter signed by the Governor, it looks like there
are plans to run rail service between Los Angeles and San Diego by
November in about 2 hours. It looks like the new train would only
have 3 stops at Los Angeles, Anaheim and San Diego. Just dropping
the six other intermediate stops would save 30 to 36 minutes on the
current schedule of 2 hours 40 minutes.

Generally express trains are not successful. By skipping stops such
trains also loses the business from those stations. Amtrak has tried
several express trains and they have all failed. A local example of
this was the /San Diegan Metroliner/ which ran for about a year
starting in September of 1984. It rarely carried more than a busload
of passengers. It lost the traffic the other trains carried from the
skipped stations. There was only one train a day leaving Los Angeles
for San Diego in the morning and returning in the afternoon. Saving
10 minutes wasn't worth the extra money for passengers if the return
train ran at an inconvenient time. Another problem with the
Metroliner was most cities with train stations lost a train to run
this new train. Many of these cities had gone to great trouble to
build new or rebuilt their stations and had not been consulted about
this decision. These cities were not happy...

Precisely this same scenario is playing with the English Javelin trains, the California HSR project, the Florida HSR, and soon coming to a minor city near you whose airport terminal will lose scheduled flights.

Looking back to Mr. Garnet's thoughts about the vital market distinction of rail, clearly the nation's towns and smaller cities, the ones left without air service, and nowadays without even bus service or anything at all, are the market for regular passenger trains. Even fifty or a hundred years of mangled government transportation policy cannot hide the basic utility and need of trains over cars and airplanes. The difficulty will be to create something that works more like a free market, replacing today's lack of choice or hope for too many towns and people.

The way forward involves tort reform, reasonable liability caps, and getting government back to /governing/, not operating, passenger trains. The same prescription holds for the freight railroads, the oil industry, even our highway and airway systems. This involves the dreaded "C" word -- Change -- and nobody much likes change; not lawyers, not unions, not management, not stockholders, and certainly not government.

We had better get started quickly.

William Lindley

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