Here's a couple more negative Amtrak articles

[Amtrak901]

So why is there such an uproar when insurance companies cut out policies for hurricane insurance? I don't recall the last hurricane that hit Nebraska or Idaho!

Well said :lol:

 

[frj1983]

I've always been curious:

I do believe that all of the Freight Railroads and Amtrak pay fuel taxes. Are not these taxes lumped into the US General Revenue for deficit reduction and then the Railroads never see it again?? I wonder how much money it is a year, and I often wonder what could be done with those monies to help the railroad?

Like start a new Investment Fund that could be used for Freight and Passenger projects?

I don't know why I raised that point here (I suppose all the discussion about how things are paid for), but it does make me mad some times! :angry:

 

[PRR 60]

I've always been curious:
I do believe that all of the Freight Railroads and Amtrak pay fuel taxes. Are not these taxes lumped into the US General Revenue for deficit reduction and then the Railroads never see it again?? I wonder how much money it is a year, and I often wonder what could be done with those monies to help the railroad?

Like start a new Investment Fund that could be used for Freight and Passenger projects?

I don't know why I raised that point here (I suppose all the discussion about how things are paid for), but it does make me mad some times! :angry:

Amtrak and transit agencies are exempt from fuel tax. The freight railroads pay 4.3 cents a gallon in federal fuel tax.

 

[AlanB]

The highways are self-supporting at the federal level but almost always subsidized at the state level. http://www.bts.gov/programs/federal_subsid...transportation/

That couldn't be farther from the truth, sorry. The Federal Highway Administration has publicly stated in many documents that the user fees only cover about 80% of the total costs of the highways.

And just last year, the Highway Trust Fund got an $8 Billion dollar subsidy to keep it from going belly up.

http://www.washingtonpost.com/wp-dyn/conte...8090503525.html

 

[AlanB]

I've always been curious:
I do believe that all of the Freight Railroads and Amtrak pay fuel taxes. Are not these taxes lumped into the US General Revenue for deficit reduction and then the Railroads never see it again?? I wonder how much money it is a year, and I often wonder what could be done with those monies to help the railroad?

Like start a new Investment Fund that could be used for Freight and Passenger projects?

I don't know why I raised that point here (I suppose all the discussion about how things are paid for), but it does make me mad some times! :angry:

Amtrak and transit agencies are exempt from fuel tax. The freight railroads pay 4.3 cents a gallon in federal fuel tax.

Actually for many years the tax went into the tranportation fund. Then in 1993 Omnibus Budget Reconciliation Act of 1993 took all those monies and placed them into the general revenues in an effort to reduce the budget deficit. In 1997, that 4.3 cent tax from cars/trucks and airplanes was sent back to the appropriate trust funds, but the RR tax and the waterway's tax continued to enrich the general fund.

I believe, although I can't find proof, that bills in 2006 finally repealed the 4.3 cent tax on the RR's. The story that I linked to certainly indicates that such a move was a foot.

 

[AlanB]

Here's what you asked for: This is a study done by the State of Montana in 2003, about the economic impact of Amtrak in Northern Montana. It gives numbers. In conclusion the impact is several million dollars.

That's more like it.

Scanning through the document, the relevant number seems to be $1.6 million, and that might be a little high as it doesn't seem to account for money leaving the state as riders travel to other states. Now the question is, how does the cost to the various governments of providing this service to Montana compare to the $1.6 million in economic benefit brought to the state?

Amtrak direct spending (that is, the costs of running the trains) in Montana is listed as around $4 million, and that doesn't cover the costs of the system as a whole.

So, we spend more than $4 million to see $1.6 million in economic activity. I don't believe the economic argument makes a lick of sense.

With respect, you need to go back and actually read that document and not just scan it.

Amtrak is spending between $3.7 Million and $4.1 Million in Montana. That is money that is staying in Montana. This is money that is providing direct jobs for Montana residents who work directly for Amtrak, money that provides jobs for people who work for other companies like garbage haulers and fuel truck drivers.

Then there is $7.6 Million being spent by non-residents that arrive in Montana via the Empire Builder. If, the EB was eliminated, then it's estimated that Montana would loose at least $1.6 Million of that due to people who would not seek another alternative to get to Montana. But the reality is that since the EB is still running, $7.6 Million dollars is arriving into Montana because of the EB's presence.

And then there is the $7.6 Million dollars that is saved by Montana because people aren't using the road to get into/out of Montana.

Add that all up and Montana is getting an effective return of $18.9 to $19.3 Million dollars for the contribution that the residents make to Amtrak via their Federal Income Tax. Seeing as how Montana sent Amtrak about $4.1 Million last year, that's almost a 500% rate of return! Seems like a wise investment to me. Sure wish that someone would give me that interest rate for a few years.

I didn't even go into the secondary and tertiary economic benefits which could easily top $3 million more for Montana.

 

[saxman]

Here's what you asked for: This is a study done by the State of Montana in 2003, about the economic impact of Amtrak in Northern Montana. It gives numbers. In conclusion the impact is several million dollars.

That's more like it.

Scanning through the document, the relevant number seems to be $1.6 million, and that might be a little high as it doesn't seem to account for money leaving the state as riders travel to other states. Now the question is, how does the cost to the various governments of providing this service to Montana compare to the $1.6 million in economic benefit brought to the state?

Amtrak direct spending (that is, the costs of running the trains) in Montana is listed as around $4 million, and that doesn't cover the costs of the system as a whole.

So, we spend more than $4 million to see $1.6 million in economic activity. I don't believe the economic argument makes a lick of sense.

With respect, you need to go back and actually read that document and not just scan it.

Amtrak is spending between $3.7 Million and $4.1 Million in Montana. That is money that is staying in Montana. This is money that is providing direct jobs for Montana residents who work directly for Amtrak, money that provides jobs for people who work for other companies like garbage haulers and fuel truck drivers.

Then there is $7.6 Million being spent by non-residents that arrive in Montana via the Empire Builder. If, the EB was eliminated, then it's estimated that Montana would loose at least $1.6 Million of that due to people who would not seek another alternative to get to Montana. But the reality is that since the EB is still running, $7.6 Million dollars is arriving into Montana because of the EB's presence.

And then there is the $7.6 Million dollars that is saved by Montana because people aren't using the road to get into/out of Montana.

Add that all up and Montana is getting an effective return of $18.9 to $19.3 Million dollars for the contribution that the residents make to Amtrak via their Federal Income Tax. Seeing as how Montana sent Amtrak about $4.1 Million last year, that's almost a 500% rate of return! Seems like a wise investment to me. Sure wish that someone would give me that interest rate for a few years.

I didn't even go into the secondary and tertiary economic benefits which could easily top $3 million more for Montana.

Wow, Alan beat me to it, while I was going through that article and came up with the same numbers he did. But with the secondary and tertiary benefits the Empire Builder provides to Montana residents: $2.45 million in Montana resident income, 142 jobs, and $642,000 in additional tax revenue.

 

[jackal]

Add that all up and Montana is getting an effective return of $18.9 to $19.3 Million dollars for the contribution that the residents make to Amtrak via their Federal Income Tax. Seeing as how Montana sent Amtrak about $4.1 Million last year, that's almost a 500% rate of return! Seems like a wise investment to me. Sure wish that someone would give me that interest rate for a few years.

While your point is good, I'm not sure I'd ever call sending money to the federal government an investment! :blink:

 

[birdy]

The highways are self-supporting at the federal level but almost always subsidized at the state level. http://www.bts.gov/programs/federal_subsid...transportation/

That couldn't be farther from the truth, sorry. The Federal Highway Administration has publicly stated in many documents that the user fees only cover about 80% of the total costs of the highways.

And just last year, the Highway Trust Fund got an $8 Billion dollar subsidy to keep it from going belly up.

http://www.washingtonpost.com/wp-dyn/conte...8090503525.html

I'm aware of that fact, but isn't some of the gas excise tax money being diverted to public transit projects now? If so, do your figures take that into account? I'm not arguing, I'm just reluctant to go out on a limb, when the fact of local subsidy (generally) makes the point. No need to be Cato types from the other side, you know. We can afford to be careful with the facts.

 

[Green Maned Lion]

We can afford to be careful with the facts.

Not really, not in a world where people believe tv stations like FoxNews or MSNBC to be "unbiased" when they are, in fact, studies in biased reporting. Al Jazeera could learn a thing or two from them.

 

[AlanB]

The highways are self-supporting at the federal level but almost always subsidized at the state level. http://www.bts.gov/programs/federal_subsid...transportation/

That couldn't be farther from the truth, sorry. The Federal Highway Administration has publicly stated in many documents that the user fees only cover about 80% of the total costs of the highways.

And just last year, the Highway Trust Fund got an $8 Billion dollar subsidy to keep it from going belly up.

http://www.washingtonpost.com/wp-dyn/conte...8090503525.html

I'm aware of that fact, but isn't some of the gas excise tax money being diverted to public transit projects now? If so, do your figures take that into account? I'm not arguing, I'm just reluctant to go out on a limb, when the fact of local subsidy (generally) makes the point. No need to be Cato types from the other side, you know. We can afford to be careful with the facts.

Well I wouldn't use the word diverted, it's Federal law. But yes about 3.8 cents per gallon goes into the Mass Transit Account. And considering that for years 4.3 cents per gallon of diesel fuel went into the highways, it's probably only fair.

Now coincidentally last year it just so happens that the amount laid out by the MTA was right around $8 Billion, but that's not what caused the deficit on the highway side. Congress did that when they approved the current 5 year plan and out spent the monies being collected. The deficit this year was estimated at $9 Billion, however with the Stimulus monies appropriated, it's hard to say what will happen this year with the fund. It may or may not need a cash infusion.

The estimate for next year is also $9B, come 2011 & 2012 it's expected to be $12B, unless Congress raises the fuel tax and soon. The MTA's outlays will continue to be around $8B for the next several years, so even taking that money away won't solve the problem. It would reduce the problem, but it won't solve the problem.

Finally it's important to know that even though Congress passed the 5-year plan that outspent the fund, what Congress approved was $89 Billion dollars less than the DOT estimated it actually needs to keep the Interstate Highways in a state of good repair.

So the bottom line is that putting back the 3.8 cents that's currently going to the MTA into the HTF won't help. The users of our Interstate Highway System aren't paying enough for their use of the highways, just like every other smaller road.

 

[volkris]

It's not like I scanned the report for the lowest number I could find and ran with it. I considered the numbers you're referring to:

Amtrak is spending between $3.7 Million and $4.1 Million in Montana. That is money that is staying in Montana.

I file that under the other column: since Amtrak doesn't have a printing press of its own, that money is an expense, not a gain, coming out of the pockets of taxpayers. Since I don't support the notion of operating a service like Amtrak as a form of charity for Montana, I'm pretty unimpressed by the argument that Amtrak shifts tax dollars to that state.

Then there is $7.6 Million being spent by non-residents that arrive in Montana via the Empire Builder. If, the EB was eliminated, then it's estimated that Montana would loose at least $1.6 Million of that due to people who would not seek another alternative to get to Montana. But the reality is that since the EB is still running, $7.6 Million dollars is arriving into Montana because of the EB's presence.

Technically, yes, Amtrak provides the $7.6 million... but not in any meaningful way. What's the point in asking, effectively, how much currency is transported by rail? The real questions are along the lines of what would happen without Amtrak, without the investment it takes to keep Amtrak running. Unless you're talking about, for example, the costs of a service disruption, the $1.6 million number is far more useful.

And then there is the $7.6 Million dollars that is saved by Montana because people aren't using the road to get into/out of Montana.

That number can't really be used in that way as it assumes a static case: without the rail service, highway infrastructure planning, budgeting, and implementation would change and immediately void the number. And in the end, savings is not exactly the same as income.

So again, what do you have? $1.6 million dollars spent in the state by non residents (minus some unspecified amount spent out of state by residents) all enabled by a large, expensive, government-subsidized machine.

It's fine to support passenger rail because it's an efficient, effective transportation solution that fits well into the overall transportation infrastructure--I certainly do!--but I don't see the evidence that it's profitable or particularly economically positive.

 

[transit54]

It's fine to support passenger rail because it's an efficient, effective transportation solution that fits well into the overall transportation infrastructure--I certainly do!--but I don't see the evidence that it's profitable or particularly economically positive.

I don't really want to delve into the broader part of this discussion, but I think this particular point brings up something interesting. There is a particular price for a gallon of gasoline at which running passenger rail does become economically positive. I'm not sure what that number is, but it's probably at least twice what we're paying at the pump. One big reason why I adamantly support investments in rail and transit and smart growth and oppose prioritizing funding for roads and suburban sprawl is because I know that within my lifetime, we will reach a point where gas is 2-3x what it is now (at absolute minimum, and I think much more) and unless we invest in rail/transit/etc now, we're going to be facing an economic disaster. So I'd argue that if you take the net present value of the future economic benefits from having a robust rail and transit based infrastructure, that its an economically positive investment, even if at the present time its an accounting loss.

 

[AlanB]

It's not like I scanned the report for the lowest number I could find and ran with it. I considered the numbers you're referring to:

Well I'm sorry sir, but based upon your conclusions and your use of the word "scanned", it does indeed appear that's exactly what you did.

Amtrak is spending between $3.7 Million and $4.1 Million in Montana. That is money that is staying in Montana.

I file that under the other column: since Amtrak doesn't have a printing press of its own, that money is an expense, not a gain, coming out of the pockets of taxpayers. Since I don't support the notion of operating a service like Amtrak as a form of charity for Montana, I'm pretty unimpressed by the argument that Amtrak shifts tax dollars to that state.

This is one of the reasons that I do believe that you did just that, "scanned for the lowest number." Even if I were to agree that you have a partial case with this statement, and I don't, you have failed to consider that Amtrak does have a printing press of its own. Or at least a partial printing press. Only one third of Amtrak's budget is supplied by the general tax payer. The other two thirds of the budget is covered by fares, interest, real estate income, and other items that are not directly from the tax payer's unwilling pocket.

So if you're going to be fair, then you must allow for at least $2.4 Million to $2.7 in benefit to the State of Montana.

Then there is $7.6 Million being spent by non-residents that arrive in Montana via the Empire Builder. If, the EB was eliminated, then it's estimated that Montana would loose at least $1.6 Million of that due to people who would not seek another alternative to get to Montana. But the reality is that since the EB is still running, $7.6 Million dollars is arriving into Montana because of the EB's presence.

Technically, yes, Amtrak provides the $7.6 million... but not in any meaningful way. What's the point in asking, effectively, how much currency is transported by rail? The real questions are along the lines of what would happen without Amtrak, without the investment it takes to keep Amtrak running. Unless you're talking about, for example, the costs of a service disruption, the $1.6 million number is far more useful.

No, that's simply playing a fantasy/what if game. What happens if/when Amtrak isn't there is irrelevant. Amtrak is there right now and because of that, tourists are bringing those dollars into the state. Asking people what they might or might not do is really fantasy, as people often say one thing and then go do something different when asked. So trying to decide how many dollars might or might not remain if Amtrak goes away is a useless game. And it's one that shouldn't be played in the first place.

This is simply a copout excuse for people to argue against Amtrak. What might or might not happen if Amtrak isn't there is irrelevant to the fact that it is there and that $7.6 million can be attributed to the fact that Amtrak is there.

And then there is the $7.6 Million dollars that is saved by Montana because people aren't using the road to get into/out of Montana.

That number can't really be used in that way as it assumes a static case: without the rail service, highway infrastructure planning, budgeting, and implementation would change and immediately void the number. And in the end, savings is not exactly the same as income.

You can't void that number. It's there, it's reality. If the people displaced by a loss of Amtrak take to the roads, then that number represents an increase to the State of Montana's budget to facilitate building new roads, wider roads, and maintain and repairing the damages caused by the increase in vehicle miles. You can't dismiss those numbers, and you can't magically shift and plan around it. It represents an increased expense that Montana will have to deal with if Amtrak is no more.

That said, I do agree that savings in not the same as income. But since you're concerned about money coming out of the "taxpayer's pockets", isn't it better for those in Montana to give up $4 Million rather than $7.6 Million? That's a $3 Million dollar savings to their pockets, before we factor in the other items above.

And finally, once again, we haven't even dealt with the secondary and tertiary benefits.

 

[AlanB]

It's fine to support passenger rail because it's an efficient, effective transportation solution that fits well into the overall transportation infrastructure--I certainly do!--but I don't see the evidence that it's profitable or particularly economically positive.

I don't really want to delve into the broader part of this discussion, but I think this particular point brings up something interesting. There is a particular price for a gallon of gasoline at which running passenger rail does become economically positive. I'm not sure what that number is, but it's probably at least twice what we're paying at the pump. One big reason why I adamantly support investments in rail and transit and smart growth and oppose prioritizing funding for roads and suburban sprawl is because I know that within my lifetime, we will reach a point where gas is 2-3x what it is now (at absolute minimum, and I think much more) and unless we invest in rail/transit/etc now, we're going to be facing an economic disaster. So I'd argue that if you take the net present value of the future economic benefits from having a robust rail and transit based infrastructure, that its an economically positive investment, even if at the present time its an accounting loss.

I'm not sure what that magic number is either, but even if we don't reach that point anytime soon, the simple reality is that we're already not paying enough for our gas to actually pay for our roads and highways. The Federal Highway Administration estimates that we fall 20% short.

And this interesting study by UC Davis tries to quantify that number and comes to the conclusion that depending on just how you deal with certain factors, gas prices need to immediately rise between 20 cents per gallon to as much as 70 cents per gallon to actually stop subsidizing our highways.

Having seen what the $4.00 gas prices did last summer, and with gas prices currently hovering around $3.00 right now, a 70 cent increase would without a doubt give a huge boost to rail transit. It might not make it quite profitable, but it would get closer. And with those prices, this is one area where I would agree with URPA, that assuming that Amtrak could find the cars, ridership on the LD's would increase to a point where they most likely would come close to breaking even. They might never cover capital expenses, but covering operating I believe would be possible.

After all, the longest (consist) LD that Amtrak does operate does indeed do just that, cover its operating expenses.

 

[volkris]

So I'd argue that if you take the net present value of the future economic benefits from having a robust rail and transit based infrastructure, that its an economically positive investment, even if at the present time its an accounting loss.

Maybe, but I don't think that's the claim the author was trying to argue againt. He seemed to be referring to arguments in favor of HSR as a relatively short term economically positive and even profitable venture, that it would start paying off within a decade or so, not fifteen to twenty years down the road because other technologies became more expensive.

Rail can be a very smart, rational, and fiscally responsible part of a cohesive, long-term strategy for transportation infrastructure, and I didn't get the impression that the articles were arguing against that.

No, that's simply playing a fantasy/what if game. What happens if/when Amtrak isn't there is irrelevant.

What? Of course it is! It is THE question.

Do you stay awake at night wondering whether Amtrak is an operational service? Whether it exists? No. That would be a dumb question to ask since we all know--subject to limits of epistemology--that it does. As we say in science, that question is trivial.

The real questions involve funding for Amtrak, continued government sponsorship of the corporation, regulation of the corporation, and various other what if games.

Asking people what they might or might not do is really fantasy, as people often say one thing and then go do something different when asked.

Well then we should throw out this report entirely since it is fundamentally based on projections, assumptions, and educated guesses.... fantasy.

So I'm back to asking for hard numbers, and as soon as you find an omnipotent being with nothing better to do than write a report on Amtrak's effects on Montana, please get back to us.

This is simply a copout excuse for people to argue against Amtrak. What might or might not happen if Amtrak isn't there is irrelevant to the fact that it is there and that $7.6 million can be attributed to the fact that Amtrak is there.

And that is simply a copout excuse for people to argue in favor of Amtrak as their personal priority. It's a massaged number that's meaningless without clarifying, as the report did, that most of the money would come in without Amtrak and is therefore hardly due to Amtrak's operation.

You can't void that number. It's there, it's reality. If the people displaced by a loss of Amtrak take to the roads, then that number represents an increase to the State of Montana's budget to facilitate building new roads

That's a fantasy/what if game. You can't reject such speculation one second and appeal to it the next.

The highway savings number doesn't even tell the whole story as far as it goes. So some money was (in the fantasy) saved. But that only considers flat budgeting issues and not economic development that may have been brought had the highways been expanded. We see that Amtrak brings in $1.6 million to the state, but the report offers no speculation as to what would have been brought in had roads been built instead. For all we know economic development from building roads would have far exceeded the savings and $1.6 million combined.

 

[AlanB]

No, that's simply playing a fantasy/what if game. What happens if/when Amtrak isn't there is irrelevant.

What? Of course it is! It is THE question.

No, please go back and read the title of the report. Here, I'll help you out.

Analysis of the Economic Benefits of the Amtrak Empire Builder to Montana

This study was commissioned to figure out what the benefits of the EB to Montana were. A secondary purpose was to speculate on what might happen if the EB went away.

This study proves the economic benefits to Montana that are a direct result of the Empire Builder's passage through the State of Montana. The fact that much of the tourist dollar might still come to Montana without the train, doesn't mean that the train isn't currently providing Montana with that benefit.

Asking people what they might or might not do is really fantasy, as people often say one thing and then go do something different when asked.

Well then we should throw out this report entirely since it is fundamentally based on projections, assumptions, and educated guesses.... fantasy.

No, most of this report is based upon hard numbers and/or regularly accepted formulas that cities and states have used for years. Every city/state has a model that says if X people come to town, they'll leave X dollars in said town via hotels, gas, food, souvenirs, and other items. These formulas have been coddled and revised over many years to the point where they are quite accurate.

The only part of this that is pure speculation is the survey of people to see if they would have still come to Montana if the EB wasn't an option. How many polls have we seen over the years that so and so is leading, only to find out that so and so looses or at the very least another poll a day later shows the opposite? What people say to a pollster isn't always what they actually end up doing.

Can we assume that some people would still come to Montana? Sure. I'm positive that some would. But no poll is going to accurately determine just how many actually would do so were the EB eliminated. In part because those being asked were people who had already been to Montana, and therefore may have been impressed enough to come back. If they hadn't already been there, then they might well have gone someplace else rather than facing the long drive to Glacier or some other place.

So I'm back to asking for hard numbers, and as soon as you find an omnipotent being with nothing better to do than write a report on Amtrak's effects on Montana, please get back to us.

You got hard numbers, but apparently you didn't like them so you've dismissed them.

This is simply a copout excuse for people to argue against Amtrak. What might or might not happen if Amtrak isn't there is irrelevant to the fact that it is there and that $7.6 million can be attributed to the fact that Amtrak is there.

And that is simply a copout excuse for people to argue in favor of Amtrak as their personal priority. It's a massaged number that's meaningless without clarifying, as the report did, that most of the money would come in without Amtrak and is therefore hardly due to Amtrak's operation.

And once again, this reports purpose was to quantify what the current economic benefit is to Montana because the EB runs. Whether or not some of that money might still pour into Montana without the EB running doesn't change the fact that the money at present does pour into Montana because of the EB.

Whether you spend Montana's tax money on Amtrak, larger and more airfields, or more and bigger highways, you're going to have to spend that money to get those tourist dollars into Montana.

And as I mentioned above, that's not a massaged number. Every State/City has tried and true formulas to prove out that number. I've seen how the model works in the city of Timmins, Ontario. The only thing being massaged with that number is what might happen if the EB goes away. That's the only part that is at least partially speculation.

The highway savings number doesn't even tell the whole story as far as it goes. So some money was (in the fantasy) saved. But that only considers flat budgeting issues and not economic development that may have been brought had the highways been expanded. We see that Amtrak brings in $1.6 million to the state, but the report offers no speculation as to what would have been brought in had roads been built instead. For all we know economic development from building roads would have far exceeded the savings and $1.6 million combined.

Without the EB, you'll loose some of the economic development that occurred around the stations, so it will balance out any additional development along the expanded highways.

Finally, in closing I note that you didn't argue my point about the money that Amtrak spends in Montana. So if for a moment we say that you are right, and I'm not saying that, if we take the $1.6 that you're willing to allow for tourist dollars and add that to the low number for Amtrak spending of $2.4 Million that I recalculated to reflect that Amtrak funds 66% of its operations without taxpayer help, and we have $4 Million in economic benefit for Montana before we add in even a portion of the secondary and tertiary numbers much less the entire amount.

Additionally, the $4 Million being sent to DC by Montana taxpayers that I noted is based upon 2008 numbers, simply because that was easier to do. However, I've now gone back and reworked the population numbers using the average rate of growth for the 8 years since the 2000 census. Based upon that the population of Montana in 2003 was 926,549. That year, US taxpayers contributed $1.043 Billion dollars to Amtrak, so we find that Montanan's sent Amtrak about $3.33 Million dollars in 2003 and got back $4M+ in economic benefits. And therefore we then find out that Montana benefited as a state for their Amtrak contribution and got back every dime that Montanan's sent to DC in 2003 to help keep Amtrak in business and then some.