Once again the battle over funding Amtrak
is starting to percolate and the preservation of tens of thousands of
unionized jobs are once again on the line. Also at issue is the
environment, national security and energy efficiency. It is time for
Congress and the President to stop using Amtrak as a political
football and provide a stable, dedicated source of funding to the most
efficient rail passenger transportation system on the Planet Earth.
A brief history of this issue is in order. Prior to becoming
Amtrak, rail passenger service was operated by private, primarily
freight railroads. In the heaviest traffic area in the Northeast,
passenger service was mainly a part of the Penn Central Railroad. When
the Penn Central (and much of the rest of Northeast freight service)
went bankrupt, it was clear that one of the main reasons for its
bankruptcy was its passenger operations.
All rail passenger operations in the world are a major service to
their country – a mode of transportation which acts as a pressure
valve for gridlocked highways and airports and the environmental
pollution which results from such gridlock. Rail passenger operations
also provide an energy efficient alternative to highway and air
travel, assisting the U.S. in its stated goal to become less dependent
on foreign oil.
As a result of major technological changes in the transportation
field since the 1930s, the role of rail as part of the nation’s
transportation system was dramatically redefined and reduced. The
explosion in the capacity and use of the automobile and trucks, the
growth of the interstate highway system, the technological revolution
in the airline industry, and the U.S. and state governments providing
hundreds of billions of dollars for roads, airports and air traffic
control systems caused a massive downgrading in the role of rail as
part of our national transportation system. These changes led to
overwhelming financial problems for the rail industry in general and
rail passenger service in particular. Bankruptcies and near bankruptcy
were common: Rock Island, Milwaukee, the Northeast railroads, Southern
Pacific. New federal legislation during the period of the 1970s and
1980s attempted to rationalize this, as rail was still a critical
component of our national transportation system.
In the early 1970s, Federal legislation created Amtrak as the main
provider of intercity passenger service throughout the United States.
Almost simultaneously, Congress created Conrail as the means to
revitalize the railroad industry in the Northeast. In the early 1980s,
Congress stripped the various commuter operations from Conrail,
creating New Jersey Transit, SEPTA, Metro North, MARC and other
commuter operations. Amtrak and the commuters were stripped from the
freight railroads for primarily one reason – a recognition that rail
passenger service required public subsidies and would bankrupt private
rail freight operations if those operations were required to foot the
bill for rail passenger operations.
Since its creation, Amtrak has been a major success, utilizing
miserly federal subsidies to provide critical national rail passenger
service. Costing the federal government between $30 and $40 billion
since its creation, Amtrak obtains more percentage of its revenue from
the fare box than any intercity rail passenger service in the world.
This means that the U.S. government provides less subsidies for
intercity rail passenger service than any other government in the
industrialized world. The $30 to $40 billion the government has spent
since 1970 is a minuscule percentage of what it has provided for
roads, airports and the air traffic control system.
Everyone understood that privatization of intercity rail passenger
service had failed – a significant reason for the bankruptcy of some
railroads which were primarily freight operations. And everyone
understood that in order for the United States to continue to provide
intercity rail passenger service, there would necessarily be
government subsidies, primarily for capital costs but also for
operations.
Nevertheless, when Congress created Amtrak, it also gave Amtrak a
mandate to make a profit. Ever since Congress has used Amtrak funding
as a political football, never providing Amtrak the subsidies it
needed to really blossom and continually criticizing Amtrak for not
producing a profit. In one State of the Union address in the mid
1980s, President Reagan stated his intention – as one of the goals
of his Administration for that year – to eliminate Amtrak.
Despite all of this, there has been a bi-partisan consensus that
Amtrak must continue and it has been funded every year – though at
levels well below its needs. During the last major legislative battle
around Amtrak (1997), Congress provided $2 billion in funding and put
requirements that Amtrak become operationally self-sufficient by 2003.
It also created an oversight Committee called the Amtrak Reform
Council to determine if Amtrak would be able to reach operational self
sufficiency by 2003.
It was clear from the very beginning that the ARC was controlled by
a cabal of right wing, anti-Amtrak ideologues and people who had a
vested interest in seeing that Amtrak failed, so they and their
friends could personally benefit from Amtrak’s demise. At first they
were hell-bent on "privatizing" Amtrak – a tried and true
method of bankrupting Amtrak and ending intercity rail passenger
service. After suffering political defeats by the bi-partisan
Congressional supporters of Amtrak, the ARC became smarter and
attempted to sound more reasonable in order to attract support for its
goal – the destruction of Amtrak.
It was becoming clear to the bi-partisan supporters of Amtrak in
Congress that self-sufficiency was impossible for an intercity rail
passenger company to achieve, and this year several pieces of
legislation were introduced in both Houses which would have the effect
of increasing federal funding for Amtrak and continuing its existence.
Some of these pieces of legislation would also give Amtrak the primary
responsibility for developing and implementing high speed rail
operations throughout the United States and in critical, auto, truck
and air gridlocked rail corridors.
Then came September 11. Suddenly everyone realized the critical
importance of Amtrak in the national passenger transportation scheme.
Ridership grew. Everyone realized an alternate source of safe
intercity travel was necessary to the national interest. Legislation
was introduced in the Senate by Senator Hollings which would, in
addition to providing more funding to Amtrak, end the self sufficiency
requirements of the 1997 Bill.
In response to this, the ARC, by a 6 to 5 vote, issued a finding
which requires Amtrak to submit a liquidation plan to Congress within
90 days of November 9, 2001. Although Congress would ultimately decide
whether to act on this liquidation plan, the finding, which was
opposed by the Bush Administration (Secretary of Transportation Mineta
voted against it), has the immediate effect of downgrading Amtrak’s
credit rating and makes it nearly impossible for it to borrow at
reasonable rates – as creditors are aware that Amtrak may be
liquidated. The action could cause Amtrak to declare bankruptcy.
One of the reprehensible idiots on ARC actually stated that ARC
needed to act now and declare it impossible for Amtrak to meet its
self sufficiency requirement. This is without even seeing the economic
results from this quarter in which Amtrak’s ridership has increased
dramatically. Clearly the real reason he wants the ARC to act now is
to head off the Hollings Bill. He convinced a majority of the
anti-Amtrak Board to issue the ill-advised finding with the deciding
anti-Amtrak vote being cast by the Mayor of Milwaukee, Wisconsin –
Mayor Norquist. This unpatriotic, anti-Amtrak cabal on ARC would not
even allow the events of September 11 to influence their personal and
ideological goals to bring down Amtrak and are obviously willing to
inflict harm on the USA in order to achieve their personally lucrative
and/or ideological goals.
AFL-CIO President John J. Sweeney immediately issued a statement on
November 9 urging Congress and the White House to "sunset"
the ARC and put it out of business in favor of a responsible debate
about the future of Amtrak and our national rail passenger system.
And so once again we are in for a legislative battle of monumental
proportions in order to preserve Amtrak for the riding public, defend
the security and national interests of the United States and protect
our membership. We will keep you informed. |