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Trump Proposes 50% Cut to Amtrak Funding (2018-02-12)


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#41 VentureForth

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Posted 14 February 2018 - 08:23 AM

With all of Amtrak's operating efficiencies they've recently incorporated by decimating the long distance services, if you can control the cost of manpower, replace pensions with 401(k), greatly increase advertising revenues onboard and in stations, increase opportunities for vendors by charging rent at stations (where applicable - I know most are owned by the city they are in), it's entirely possible for Amtrak to operate with half the budget AND improve the infrastructure in the NEC - but ONLY if they NEC subsidizes LD. The occasional infrastructure grant from the Feds for the NEC would be helpful, for sure.

I've always harped about the profitability of the Japanese railroads - particularly since privatization in the 80's. But I will also say that there is no doubt that the Bullet Trains subsidize what rural routes are left. Yes, since privatization, many under used rural routes were eliminated which was a travesty, but a financial necessity which was easily replaced with other forms of transit.

I hate the mentality of splitting the NEC from the rest of the network. I don't know how much Amtrak California makes (loses), but the issue is that if there is going to be an Amtrak - a NATIONAL rail system - it should be funded and operated as such: ONE entity.

As for Florida, I'm proud of what Brightline is doing. If they succeed, they will prove that in densely populated corridors, there is a profit to be made. I can see Brightline expanding to TPA, JAX and TAL - all without Government bureaucratic high-fives to each other. I'm honestly surprised that its the REPUBLICANS who are griping about Brightline. Brightline embodies the principles of greater personal responsibility with reduced government oversight to maximize productivity with responsibility.

14,223 Amtrak Miles. Many more to go.
Completed Routes: Capitol Limited, Palmetto
Also Ridden: Carolinian, Crescent, Pacific Surfliner, Piedmont, Southwest Chief, Silver Meteor, Silver Star, Texas Eagle


#42 jebr

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Posted 14 February 2018 - 10:40 AM

Yes, since privatization, many under used rural routes were eliminated which was a travesty, but a financial necessity which was easily replaced with other forms of transit.

 

Here's the rub about this (and why I'd be extremely hesitant to duplicate this mindset in the US): There's a decent number of LD train route stops where the train is the only form of non-private-automobile transportation outside of the local area. There's no intercity bus service along US-2 in North Dakota or Montana, for example, and many of the small towns don't even have essential air service, much less a competitive airport. I'm not sure there's really enough political will to fully subsidize buses to serve those corridors, and especially on the US-2 corridor it may not even be a better option (trains are much more reliable in the snow than buses.)

 

I'd also like to see hard numbers in how much Amtrak could make by pushing advertising more heavily - I recall hearing once that advertising is generally no more than a couple percentage points of most transit agency's budgets, and at some point too-intrusive advertising cheapens the brand and makes the product less desirable. Replacing pensions with 401(k)s is simply cutting costs by moving retirement costs to the employee, which some may be fine with but seems like a false savings to me. I don't think that Amtrak is going to be able to cut their subsidy by a substantial amount and pay for increased maintenance just by a few cuts and improvements to advertising revenue.



#43 jis

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Posted 14 February 2018 - 10:46 AM

Since Amtrak is a Railroad, it by law has to participate in the Railroad Retirement Plan for most of its employees and there is no getting away from it. Moreover, it has to pay more than just for its current and past employees due to some historical reasons.



#44 VentureForth

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Posted 14 February 2018 - 11:54 AM

Replacing pensions with 401(k)s is simply cutting costs by moving retirement costs to the employee, which some may be fine with but seems like a false savings to me. I don't think that Amtrak is going to be able to cut their subsidy by a substantial amount and pay for increased maintenance just by a few cuts and improvements to advertising revenue.


I don't intend for those ideas to be a save-all, but hey, I'll take the couple of points. Doesn't mean they shouldn't be doing it. As for those communities that would lose service, yes, it would be an issue. But there are literally thousands of communities across that country today that used to be served by rail that don't have busses or EAS anymore. People adapt.
 

Since Amtrak is a Railroad, it by law has to participate in the Railroad Retirement Plan for most of its employees and there is no getting away from it. Moreover, it has to pay more than just for its current and past employees due to some historical reasons.


Yet another legacy law that somehow can't get overturned or revised. The advantage of the 401(k) vs a pension is that it puts the management of one's retirement on the responsibility of the employee. The employer's cost would vary, depending on it's desire (or ability) to match a percentage of it. Sure, pensions are favored because you don't have to think about it. But I've also heard horror stories about them vaporizing when companies fail, even if they are supposed to be fail-safe. In the Stock Market, you'll have your ups and downs, but the 10 year trend is always up. Annuities have similar problems.

Again, I'm not saying that my ideas would save Amtrak, but I'm tired of them nicking the service before looking for alternate sources of income.

Edited by VentureForth, 14 February 2018 - 12:02 PM.

14,223 Amtrak Miles. Many more to go.
Completed Routes: Capitol Limited, Palmetto
Also Ridden: Carolinian, Crescent, Pacific Surfliner, Piedmont, Southwest Chief, Silver Meteor, Silver Star, Texas Eagle


#45 Skyline

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Posted 14 February 2018 - 11:57 AM

 

Yes, since privatization, many under used rural routes were eliminated which was a travesty, but a financial necessity which was easily replaced with other forms of transit.

 

 

 

. . . I'd also like to see hard numbers in how much Amtrak could make by pushing advertising more heavily - I recall hearing once that advertising is generally no more than a couple percentage points of most transit agency's budgets, and at some point too-intrusive advertising cheapens the brand and makes the product less desirable. Replacing pensions with 401(k)s is simply cutting costs by moving retirement costs to the employee, which some may be fine with but seems like a false savings to me. I don't think that Amtrak is going to be able to cut their subsidy by a substantial amount and pay for increased maintenance just by a few cuts and improvements to advertising revenue.

 

Much of the year, our best LD routes are well patronized NOW. Without a lot more modern, reliable rolling stock what would advertising for these trains accomplish? For starters, we need the kind of "infrastructure" capital spending to produce the size, frequency, and routing of passenger trains that robust advertising budgets are meant to fill! And without Federal and State mandates for passenger trains to be given priority over freight traffic where feasible, all those newcomers to train travel that advertising produces may be one-and-done.



#46 Lonestar648

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Posted 14 February 2018 - 11:59 AM

Congress doesn't want heat from the RR Unions I imagine. Path of least resistance, SOP for Congress/Washington.

#47 dlagrua

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Posted 14 February 2018 - 02:18 PM

Its always up to congress to decide the budget. The Whitehouse only recommends. As for the LD routes, Amtrak needs to do a full accounting on costs vs revenue. During the spring, fall and summer months the CHI going West routes CZ, EB, SWC are heavily traveled. The potential should be there for a profitable business. The write off for the equipment should have been completed years ago, so maintenance, employees salaries/benefits, payment for track usage and fuel should be the only costs.

Privatization of passenger rail could probably do better as they would not be saddled with the costs of the pensions to retirees of the railroad lines that Amtrak took service from. Privatization has been suggested in the past but unless its done by the railroads that own the freight service, it is unlikely that it could ever be successful. I guess everyone is waiting to see how Brightline will do. .



#48 MikefromCrete

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Posted 14 February 2018 - 05:26 PM

 

Replacing pensions with 401(k)s is simply cutting costs by moving retirement costs to the employee, which some may be fine with but seems like a false savings to me. I don't think that Amtrak is going to be able to cut their subsidy by a substantial amount and pay for increased maintenance just by a few cuts and improvements to advertising revenue.


I don't intend for those ideas to be a save-all, but hey, I'll take the couple of points. Doesn't mean they shouldn't be doing it. As for those communities that would lose service, yes, it would be an issue. But there are literally thousands of communities across that country today that used to be served by rail that don't have busses or EAS anymore. People adapt.
 

Since Amtrak is a Railroad, it by law has to participate in the Railroad Retirement Plan for most of its employees and there is no getting away from it. Moreover, it has to pay more than just for its current and past employees due to some historical reasons.


Yet another legacy law that somehow can't get overturned or revised. The advantage of the 401(k) vs a pension is that it puts the management of one's retirement on the responsibility of the employee. The employer's cost would vary, depending on it's desire (or ability) to match a percentage of it. Sure, pensions are favored because you don't have to think about it. But I've also heard horror stories about them vaporizing when companies fail, even if they are supposed to be fail-safe. In the Stock Market, you'll have your ups and downs, but the 10 year trend is always up. Annuities have similar problems.

Again, I'm not saying that my ideas would save Amtrak, but I'm tired of them nicking the service before looking for alternate sources of income.

 

401K's are simply corporate rip-offs.  Thanks, Republicans.



#49 Lonestar648

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Posted 14 February 2018 - 06:03 PM

Actually, I am very glad we were moved to 401K retirement accounts instead of pensions.  What I have available for my retirement per month, figuring living until my late 80's is over twice what the pension was/is paying employees.  At the two companies I worked for in my over 40 years, we received our matching, 50% of 6% contributed, even during the bad times.  Best match was four years straight at 4:1 for every dollar contributed.  I will agree that some companies do zero match, but that seems to be more the exception based on feedback from family and friends across the country.  Now, the pension plans are susceptible to company bankruptcy.  In two cases, the Court reduced pension payouts to 20 cents per dollar the pension would be or was paying.  Many friends who worked for United had to return to work because of this or sell everything they owned or both.



#50 Bob Dylan

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Posted 14 February 2018 - 09:56 PM

Corporate screwing of pensioners is one of the obscenities of this era!

And the fact that out Courts and Governments let it happen, and continue to happen, is one of the Shames of our Society.😣

Next up, do the same to those in the Social Security and Medicare/Medicare programs in the name of "Entitlement Reform". See Paul Ryan's plan!😥
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#51 Anderson

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Posted 14 February 2018 - 10:41 PM

I'm not sure that "put[ting] the management of one's retirement on the responsibility of the employee" is an advantage in general, and I will admit that I'm not a fan of them versus IRAs.  In general, I find that a 401(k) manages to take all of the disadvantages of an IRA and a pension plan and roll them into one package.  For example, you can only invest in funds that your plan includes...which means that if your employer manages to end up with a bunch of high fee funds, those are all you can pick from and you can't pick (for example) a Vanguard analogue with lower fees.  I'd actually be curious as to whether it wouldn't make more sense for some folks to leave the company match "on the table" in the face of substantially higher fees (e.g. given the choice between an S&P index fund in a 401(k) with total fees sitting in the .8-1.0% range and investing your IRA via an S&P fund with fees in the 0.05-0.10% range, how much of a match do you need for this to make sense?).


Amtrak mileage to date: Somewhere between 120,000 and 150,000 miles...I /really/ need to run all of my trips through a calculator sometime.

...and no, I am not /that/ Anderson...;-)


#52 jebr

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Posted 14 February 2018 - 11:26 PM

Unless you're staying at an employer for decades, even a 401(k) where the only available funds have a cost of 1% would have a hard time leaving a 50-100% match on the table; while I didn't do any hard math even 1% a year would take a number of years to eat up a 50% match (I'd guess 25 years minimum, even with compounding?) That's also assuming you only put in in year 1 and never use the match after that.

 

If the match is very low (10-25% of what you put in) the equation might differ, but usually I've seen it be a reasonable percentage. That being said, anything you aren't matched for should go in an IRA for maximum flexibility. 

 

Luckily, my employer offers both a 401(k) with an index fund with fees in the 0.035% range and an ESOP which has generally performed very well since they started it a number of years back (it's roughly 60/40 split with just over 60% owned by the founding family and 40% owned by the employees.)

 

That being said, I'm realizing that we're going way off on a tangent here. If we want more discussion on retirement plans, I (or someone else) can open up a thread in the lounge and I'll move the relevant discussion over there.



#53 VentureForth

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Posted 15 February 2018 - 11:29 AM

If your 401(k) really sucks, you can always pick your own by funding an IRA.

14,223 Amtrak Miles. Many more to go.
Completed Routes: Capitol Limited, Palmetto
Also Ridden: Carolinian, Crescent, Pacific Surfliner, Piedmont, Southwest Chief, Silver Meteor, Silver Star, Texas Eagle


#54 VentureForth

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Posted 15 February 2018 - 11:31 AM

Privatization of passenger rail could probably do better as they would not be saddled with the costs of the pensions to retirees of the railroad lines that Amtrak took service from.


Though I agree with you in principle, most of the legacy railroad employees are probably no longer collecting. It's been 45 years. Not saying they are all gone - far from it - but the numbers are falling.

14,223 Amtrak Miles. Many more to go.
Completed Routes: Capitol Limited, Palmetto
Also Ridden: Carolinian, Crescent, Pacific Surfliner, Piedmont, Southwest Chief, Silver Meteor, Silver Star, Texas Eagle


#55 Carolina Special

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Posted 15 February 2018 - 05:21 PM

So to help fund the FAST Act, the IRS is now going to enforce the provisions that say that having $51,000 in back taxes due means your passport can be revoked, trapping you inside the country.

No criminal investigation is required, just the government saying you owe the dough.

No problem though, I’m sure California and New York will be setting up sanctuary cities immediately.


Sent from my iPhone using Amtrak Forum

#56 VentureForth

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Posted 16 February 2018 - 08:44 AM

I'd be alright with those owing back taxes to be kept from leaving New York and California. :D

14,223 Amtrak Miles. Many more to go.
Completed Routes: Capitol Limited, Palmetto
Also Ridden: Carolinian, Crescent, Pacific Surfliner, Piedmont, Southwest Chief, Silver Meteor, Silver Star, Texas Eagle


#57 tommylicious

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Posted 16 February 2018 - 10:57 AM

Et tu, Brute?  Then fall Amtrak.



#58 jis

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Posted 16 February 2018 - 11:53 AM

... And Brutus is an honorable man, like are they all, all honorable men :D

 

- Mark Antony as narrated by William Shakespeare


Edited by jis, 16 February 2018 - 11:54 AM.


#59 JoeBas

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Posted 16 February 2018 - 02:15 PM

... And Brutus is an honorable man, like are they all, all honorable men :D

 

- Mark Antony as narrated by William Shakespeare

 

And some very fine people, on both sides. 

 

- Someone more recent. ;) 



#60 neroden

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Posted 17 February 2018 - 07:44 PM

Since Amtrak is a Railroad, it by law has to participate in the Railroad Retirement Plan for most of its employees and there is no getting away from it. Moreover, it has to pay more than just for its current and past employees due to some historical reasons.

Well, thankfully I believe the overpayments are slowly going away: if I remember correctly, they're related to people who were employed prior to the formation of Amtrak, and there aren't very many of those left alive any more.  So they're paying closer and closer to just for their actual employees now.  Someone can correct me if I'm wrong about that.


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