Out of Control Policy Blog

Privatize Amtrak

Some sensible advice in the Wall Street Journal this morning:

    Since the ill-fated day in 1971 when Uncle Sam took over control of rail passenger service as a "temporary" experiment, Uncle Sam has spent almost as much money bailing out Amtrak as it cost to put a man on the moon. All of this money for a train service that doesn't reduce traffic congestion, doesn't cut pollution levels, doesn't save energy, and isn't integral to inter-city travel, because so few people ride the trains.

    We're not against trains; they can be a great way to see America. But Amtrak has poorly served customers and taxpayers alike and is arguably the nation's worst-run commercial enterprise. It loses $1 billion a year ($45 per rider) and that doesn't include some $10 billion in deferred maintenance costs. Every route run by Amtrak loses money, and some are horrendously unprofitable. The long-distance route from Los Angeles to Florida loses $400 for every passenger who comes aboard. It would cost taxpayers less if Congress purchased free discount airline tickets for every traveler.

    [...]

    The good news is that there's no law of economics that train service has to lose money -- although it's a pretty sure bet that a train run by the government will. A Congress serious about fiscal restraint would privatize Amtrak, lift its indefensible monopoly status as the sole provider of rail passenger service in America, and let the market determine where and how train service can operate in the black.

The full article is here. Other recent Amtrak-related posts are here, here, here, and here. And be sure to check out Iain Murray's recent CEI study on the British experience with rail privatization.

Leonard Gilroy is Director of Government Reform


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