Alex Kummant -- His Views on Funding & Profitability

Discussion in 'Rail Advocacy Forum' started by Rover, Mar 7, 2017.

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  1. Mar 7, 2017 #1

    Rover

    Rover

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    This is from a Reuters 2008 Q&A with Amtrak President Alex Kummant

    http://www.reuters.com/article/us-usa-gasoline-trains-qa-idUSSIB27628520080612
     
  2. Mar 8, 2017 #2

    Anderson

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    Anderson

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    I'm probably most galled about the support for cruise ships. Whereas you can make very solid cases for a transportation function for highways, trains, and airports, with cruise ships? Not so much. Granted, at least some of that is going to be costs which are related to maritime safety in general and which are just getting assigned to cruise ships in some proportion...but it still does strike me as a comparative waste (especially given that airline pax at least in theory pay for a good chunk of their security/safety bill). Don't get me wrong, I don't want to see a mass casualty incident because the Coast Guard couldn't manage a rescue...but I also see very little value in an effective taxpayer subsidy for Caribbean vacations even compared to badly planned highway construction.

    You can perhaps make a case for service between the US and Alaska/Hawaii (and possibly Puerto Rico/USVI as well), if only because it's possible to envision someone literally becoming trapped in paradise [1], but I also don't exactly see anyone really offering functional transportation between the Hawaiian Islands and Los Angeles or San Francisco (e.g. a ship starting in Honolulu, making relatively short stops in Maui and the Big Island, and then making direct for the mainland). Yeah, some of that is down to the Jones Act (a bill which, at this point, probably needs to be strongly amended if not dumped entirely) and some silly complications such as "forced stops" in Vancouver and Mexico or some other island country in the Pacific en route.

    IMHO accelerated depreciation is a sticky point: You're moving the timing of the related tax expense around on the calendar, but you're not actually changing the amount being expensed, just when the expensing happens. Moreover, if you take a $100,000 plane and depreciate $75,000 on it (so you have a residual value of $25,000) and then sell it for $50,000? You'll be liable for a capital gains tax bill of $25,000.

    [1] This actually happened to my grandmother's younger brother the last time he was in Hawaii: He had a heart attack and he and my great-aunt were stuck in the islands for several months until he was healthy enough to fly home, and the time stuck there was an extreme expense which did a number on their finances for the rest of their lives. It is quite possible to envision someone never reaching a point that they could safely fly home.
     
  3. Mar 8, 2017 #3

    Just-Thinking-51

    Just-Thinking-51

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    I would like to know we're Mr. Kummant came up with the figure. General the Coast Guard is always ready. So it's a fixed cost. There required to do certain task ever month. If the rescue swimmer jumps in on a rescue, or jumps in on a training flight. They are required to do it (twice*) a month.

    If your ship meets the Jones Act then you don't need to stop anywhere, and could go straight from US port to US port. Only if your flying a convenience flag, with a foreign crew, do you need to stop at a foreign port, before return to a US port.

    The one and only US Flag Large Cruise ship was built here, but outfitted overseas and is allow to operate under a waiver from the Jones Act. The crew is US (75% or more.) and yes they have great difficulty keeping it crewed.

    Medical evacuation flight. Transport out on a freighter. Sorry but there little reason to stay. It costly both ways but getting out can be done. You might have to staff a mini hospital with MD and Nurse, but you can transport out on a regularly scheduled freighter.

    *Twice a month is what I have heard, and is a example, and should not be taken as a fact.
     
    Last edited by a moderator: Mar 9, 2017
  4. Mar 8, 2017 #4

    MikefromCrete

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    What's relevant about comments made nine years ago by a guy who was Amtrak's president for about 30 seconds?
     
  5. Mar 8, 2017 #5

    Ryan

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    Which of the facts do you think have changed over the last nine years?
     
  6. Mar 16, 2017 #6

    Rover

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    A better question 9 years down the road, would be "What's irrelevant about the comments made?"
     
    Last edited by a moderator: Mar 16, 2017
  7. Mar 17, 2017 #7

    Ryan

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    Based on Mike's excellent response, I guess he's having a little bit of trouble backing up his bluster.
     

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