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Lessons from GM’s Bankruptcy on the Consequences of a Fly-Drive Transportation System
Thursday, June 04, 2009
For decades, NARP has argued that America’s “fly-drive” system, that is, a transportation system over-reliant on highways and aviation and neglecting trains, was bad policy. We focused heavily on the importance of giving citizens more choices, on environmental impact and—as the opportunity opened—on energy supply issues. We also argued that highways and aviation enjoyed significant public subsidies even as many politicians kept telling themselves and the public that such subsidies did not exist, mistakenly believing that user-funded trust funds completely supported those systems. The fly-drive mentality also contributed to the nation’s overall economic problems, to the extent that the housing bubble encouraged construction and purchase of exurban homes in pedestrian-unfriendly surroundings—actions that would not have taken place if people had known where the price of oil was headed. Finally, we said one of the biggest subsidies in transportation was from airline shareholders to passengers enjoying cheap, non-compensatory fares.
Now, the stories of General Motors and Chrysler have made clear fly-drive’s financial unsustainability. Government subsidies and loans to GM and Chrysler now total over $50 billion, including loans which GM and Chrysler may not repay, and the forms government aid has taken have been varied.
Even today, some still say NARP should apologize for the fact that Amtrak requires government funding. Would airlines be profitable if governments did not maintain airports and air-traffic-control systems? Would bus companies be profitable and driving be affordable if government did not maintain the roads? Would the making of the very vehicles that carry the bulk of American travelers have been profitable without repeated help from Uncle Sam? The transportation system upon which our economy is built requires public funding and is one of the best investments we make as a society. The impact of these investments would be maximized if we had a proper balance between the modes to achieve the most efficient outcomes.
The billions that the government is ready to spend to bail out bankrupt GM are only the latest in a series of large public subsidies to automakers. GM has already received $13.4 billion in taxpayer funds, with Chrysler getting another $4 billion, and both companies’ suppliers got a total of $5 billion. The government guarantees manufacturers’ warranties for GM & Chrysler cars, and the Recovery Act provided a tax credit of $49,500 to consumers who purchase new autos. Furthermore, the climate change bill recently passed by the House Energy & Commerce Committee includes a “cash for clunkers” program, which offers tax credits encouraging drivers to trade in existing cars for more fuel-efficient models. This latter program—which, though sold as promoting energy efficiency, does not take into account the energy costs associated with prematurely scrapping useful cars—has been described as a subsidy to manufacturers, their workers and car buyers.
Some incentives for the production and consumption of more fuel-efficient vehicles are necessary to address our energy problems as long as most Americans continue to live in communities planned in such a way as to make driving a virtual necessity. It is also important for the government to help struggling communities that are dependent on auto manufacturing to get back on their feet. But we need strong efforts to minimize the worsening consequences of increased congestion and urban sprawl. More attention should be paid to the goals set forth in S. 1036, the Federal Surface Transportation Policy and Planning Act of 2009—increased use of freight and passenger trains and mass transit and reduced, and reductions in national per capita motor vehicle miles traveled on an annual basis, in national motor vehicle-related fatalities (50 percent by 2030), in national surface transportation-generated carbon dioxide levels (40 percent by 2030) and in national surface transportation delays per capita.
We need a stronger focus on investing in the infrastructure that support those goals and would give Americans more travel choices. Many forward-thinking commentators have envisioned Midwestern factories retooled to produce wind turbines and solar panels. To that list we should add locomotives, railcars, light-rail vehicles, streetcars, subways, and other rail infrastructure. Surely federal investments to correct transportation priorities are at least as worthy as efforts to maintain specific automobile companies. The “priority-correction efforts” would support more quickly achieving President Obama’s vision of an enhanced role for trains in our mobility network. Such spending would yield dividends for years to come, perpetually benefiting people, our economy, and the environment.
—Ross B. Capon and Malcolm Kenton
Posted by NARP
Tags: auto industry, bankruptcy, chrysler, congress, detroit, energy, gm, highways, mobility, oil, transportation,Flag Stops: Signs of Change
Tuesday, June 09, 2009
Highway Trust Fund woes, models for industry nationalization, lessons from Europe, and more in this week’s roundup of rail-related reports and ruminations.
—Malcolm Kenton
Posted by NARP
Tags: auto industry, europe, green, highways, mobility, nationalization, rail, taxes, transit, transportation, urban development,Counting Our Blessings
Tuesday, June 23, 2009
Thoughts in light of yesterday’s Washington Metrorail disaster.
Our thoughts are with the families of those who lost their lives and those who were injured in yesterday’s horrific Metrorail crash in Washington, DC. We are also keeping in mind the Metro employees who received a shocking reminder of just how important their jobs are and the awesome responsibility that is in their hands. That yesterday marked only the second train accident causing passenger fatalities in Metrorail’s 32-year history should remind the traveling public how safe mass trasit is. The National Transportation Safety Board has begun its investigation into the exact cause of the tragedy and, as with all such incidents, what we learn from their findings will make Metro and other transit systems even safer in the future.
My experience getting home from NARP’s Washington office yesterday, while harrowing, made me count my blessings. My plan was to take the 5:35 PM MARC Brunswick Line commuter train from Union Station. After almost half an hour waiting at the station hearing only that the track ahead was blocked, I learned via my mobile phone of the accident and determined that my train was not going to depart. I informed my fellow passengers and proceeded to find other means of transport. It took me two and a half hours, two bus rides and a lift from a kind stranger, but I made it home. Had I decided to leave only 15 minutes earlier, though, it could have been a lot worse, and I was lucky to be alive and unharmed.
Yesterday, I saw firsthand just how much a large city relies on its transit network. With a key segment of Metrorail and commuter service out of commission, the number of people forced into buses, cars and taxis, created huge traffic jams. If Metro’s trains and buses did not exist, there is no way the city of Washington would be able to function as it does. The subway network has only been around for three decades, but it literally consitutes the arteries that keep the city’s lifeblood flowing. When one of those arteries gets clogged or fails, the entire body is thrown into disarray.
This should serve a reminder of how indespensible our work is at NARP and throughout the rail and transit industries. We must continue our work to make trains—intercity, commuter and metro—a reliable, convenient, comfortable, and above all, safe travel method available to all Americans.
—Malcolm Kenton
Posted by NARP
Tags: commuting, disaster, metro, mobility, railroad, safety, tragedy, transit,Flag Stops: New Ideas, New Challenges
Monday, July 19, 2010
A roundup of news and views on passenger train issues.
- The Housatonic Railroad has commissioned a Massachusetts research firm to study restoring passenger trains on its line between Danbury, CT and Pittsfield, MA—essentially extending northward the Danbury Branch of Metro-North’s New Haven Line from New York City. The railroad’s vice president of special projects, former Connecticut transportation commissioner Colin Pease, told the Danbury News-Times: “If the study’s finding strongly indicate a passenger market, [the Housatonic Railroad] is prepared to spend, along with other private investors, $100 to $150 million to improve the tracks and infrastructure along the line.” Housatonic has become the first private “freight” railroad to formally study getting into the passenger business since 1980.
- A national passenger train network as a key component of mobility, and it’s equally important to our national security. The impetus to invest in trains in order to cut the transportation sector’s oil consumption becomes more urgent as the US military warning of serious oil shortages within five years.
- Transportation Secretary Ray LaHood touts the outlay of stimulus funds for augmenting North Carolina’s passenger railcar and locomotive fleet as another step towards completing the Southeast High-Speed Rail Corridor. 34 jobs will be created immediately, while the transit-oriented development the corridor continues to attract will generate an estimated 19,000 jobs. The Secretary also comments further on how better automobile alternatives work to combat obesity.
- The CEO of JetBlue acknowledges that hundreds of his airline’s short-haul flights won’t be needed as high-speed train service increases—and he’s fine with trains being a complement to air travel.
- The American Prospect lays out the challenges before the new reform-minded leadership at the Departments of Transportaton and Housing and Urban Development—challenges worsened by public pressure for reduced deficits and against tax increases, which have led the White House to impose a 3-year freeze on discretionary spending. Luckily, former Reconnecting America President Shelly Poticha and other New Urbanists in the administration have a “can do” attitude and are breaking down decades-old barriers to interagency communication.
- A graphic designer has reimagined the national Amtrak network as a subway map. This conceptualization gives one a better perspective on how Amtrak works as a network—and shows where connectivity is sorely lacking: the Gulf Coast, Boston North to South, and between North Carolina and Memphis, to name a few spots. Importantly, the Florida-New Orleans route is left off of this map, although the “suspended” line remains on Amtrak’s official map and on the US DOT’s “existing services” map.
- Hoping life will imitate art: The author of a novel featuring a train across North Dakota and Montana (a NARP member) is using his book to promote restoring the North Coast Hiawatha in real life. A friend of his discusses on YouTube.
- LCL: Support for the fight to prevent the Princeton Dinky from being replaced by a dedicated busway grows. * * * A National Journal panel of transportation experts expounds upon the potential for high-speed rail to generate economic activity. * * * Planning for rail systems and transit-oriented development, long the exclusive domain of government, is generating interest from private funders. * * * The Quiet Car movement reaches New Jersey Transit.
—Malcolm Kenton
Posted by Malcolm Kenton
Tags: amtrak map, danbury, high-speed rail, housatonic railroad, jetblue, mobility, national security, network, north coast hiawatha, oil shortage, passenger train, pittsfield, ray lahood, shelly poticha,Trains: Enhancing Freedom of Mobility
Friday, August 13, 2010
Washington Examiner editorial page editor Mark Tapscott claims that we train and transit advocates want to use “government power to force the rest of us to accept less mobility and convenience.” On the contrary, expanding train and transit service gives people more mobility and convenience by not tethering them to one mode of transportation. Many prefer not to have to worry about where to park or having to go get gas when out on errands or taking a leisure trip across town or across the country. Taking public transportation also saves money, and may even save your life—over 42,500 people are killed in car accidents each year, 50 times more than die on railroads and 180 times more than die on transit annually. But those of us who would rather leave the driving up to someone else are left with less mobility and less convenience because public funding priorities are so overwhelmingly skewed towards highways.
Tapscott also compares the “freedom” the car offers to that afforded by smartphones. But what good is a smartphone when you have to spend all your travel time keeping your eyes on the road? When you use trains and transit, you have the freedom to spend your travel time however you choose, including by using your smartphone, without posing a safety hazard. Mobile devices can also increasingly help you get around without a car just as easily as they can give you driving directions.
Balancing out the U.S. transportation funding scale to provide frequent, dependable train (and bus) service would give people the freedom to choose not only when and where to travel, but also how to travel, and the freedom to choose a mode of travel that takes a lighter toll on the pocketbook and the planet. It’s advocates of the highway-happy status quo who want to limit your freedom of mobility.
—Malcolm Kenton
Posted by Malcolm Kenton
Tags: automobiles, cost savings, freedom, highways, mark tapscott, mobile devices, mobility, safety, smartphones, trains, transit, washington examiner,Sununu Would Curtail Americans’ Freedom of Mobility
Wednesday, September 07, 2011
NARP President Ross Capon penned the following in response to this Boston Globe op-ed by former U.S. Senator John Sununu (R-NH):
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To the editor of The Boston Globe:
You wouldn’t guess from John Sununu’s cherry-picked data (“Off the rails on Amtrak’s crazy train,” Sept. 5) that Northeast Corridor (NEC) capital investments consume $350 million annually—25% of Amtrak’s federal funding. This excludes heavy overhauls on NEC rolling stock and work on the $100+ billion plan for a new Boston-Washington high speed line.
Instead, Sununu implies that long-distance trains consume the bulk of Amtrak’s federal grants. He calls NEC trains “profitable,” but this is true only if one leaves out the just-noted infrastructure and rolling stock costs.
He sneers at leisure travel, which should offend the tourism industry. His statement about buying California Zephyr passengers airline tickets reflects ignorance that most passengers use intermediate stations, many with astronomical air fares or no air service. Also, many Americans cannot fly or drive.
The long-distance trains—the only Amtrak trains in 22 states—are valuable both in their own right and in facilitating start-ups of shorter-distance services. To end them would be to deny Americans the freedom to avoid the growing costs, congestion, and hassles of highway and air travel. It also would be a statement of federal disinterest in rural travel. America’s energy-efficient passenger railroad is too valuable to be torn apart.
Posted by Malcolm Kenton
Tags: amtrak, amtrak funding, boston globe, john sununu, long-distance trains, mobility, northeast corridor, tourism, travel costs,Transportation investment is inherently valuable; job creation is an important side benefit
Wednesday, December 07, 2011
Hat tip: Streetsblog Capitol Hill
Transportation Secretary Ray LaHood is understandably fond of emphasizing the number of jobs that projects funded by his Department, particularly those under the High-Speed and Intercity Passenger Rail program, have created or will create. He reiterated this case in testimony before the House Transportation and Infrastructure Committee yesterday.
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| London’s Paddington station. Photo by dipfan on Flickr |
Given the persistently high national unemployment rate, touting job creation is an important way to win the support of Americans and the officials they elect. And it’s certainly true that the construction and replacement of railroad infrastructure and the operation of passenger train systems generates good-paying jobs that cannot be outsourced.
But perhaps job creation should not be thought of as the number one reason to invest in transportation and infrastructure upgrades. Instead, the value to the economy and society inherent in the efficient, reliable movement of people and goods should be enough to justify a consistent, high level of investment in transportation. This is the conclusion reached by five former Secretaries of Transportation of both parties who participated in a panel last week at the University of Virginia.
President Ronald Reagan’s deputy transportation secretary James Burnley put it this way:
We need to convince the American people that we need to invest in transportation infrastructure because we need to invest in transportation infrastructure. If we sell that idea – not as a jobs program, but because it affects the ability of our economy to grow over time, our international competitiveness and all the other things that we believe it affects, then we’ve got a fighting shot at convincing the American people that the resources that we believe ought to be devoted to transportation should be devoted to it.
Posted by Malcolm Kenton
Tags: auto dependence, economics, job creation, mobility, transportation funding, transportation investment, us dot,©2010 National Association of Railroad Passengers | » NARP website
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