Responding to Ronald Utt, Part I

On January 7, ABC`s “World News Sunday” concluded with a report by correspondent Bill Redeker in which he lamented that first class travel on this nation’s railways might “become a thing of the past,” thanks to repeatedly proposed federal budget cuts.  In response, The Business and Media Institute distributed an article authored by Ken Shepard which complained “Redeker left Amtrak’s critics at the station, ignoring its massive costs to taxpayers who aren’t even riding the trains.” Ken Shepard then quoted extensively from Heritage Foundation transportation policy expert Ronald Utt.

I submitted the following rebuttal to Shepard’s article to The Business and Media Institute. The first part will appear today, the conclusion tomorrow.

Once again Ron Utt is utterly incorrect in his criticisms of US intercity rail passenger service. According to figures published by Amtrak in March 2006 on page 12 of its FY 2007 budget request, Amtrak’s annual federal costs are as follows:

According to Amtrak President Kummant, the federal cost for long distance train amounts to about the cost of one cup of coffee per US taxpayer per year—hardly an overwhelming burden.

Contrary to another of Mr. Utt’s assertions, there are zero private, for-profit, unsubsidized daily intercity rail passenger services in the US or Canada. Any such privately operated service operates less than daily and is targeted directly at relatively well-off vacationers, not at average citizens traveling for a variety of non-vacation purposes.

U.S. freight railroads desperately sought to shed passenger service operations because they could not operate such service at a profit, particularly following the advent of federally subsidized commercial airline service and the federally subsidized interstate highway system. In truth, Amtrak, commercial air service and the federally subsidized highway network each recover about 40 percent of their total costs from users via a combination of fares and user fees. The 60 percent balance is provided primarily by federal (and in the case of highways and airports), state and local government non-user fee funds.

Tomorrow, I’ll talk about Mr. Utt’s most ridiculous statement: per passenger subsidies.

—Howard Harding
NARP Board Member, Akron, Ohio