Opinion from a Libertarian ViewPoint

Rebuttal to Mr. Brian Pitzer’s letter criticizing my advocating the succession of public funding for Amtrak

Posted by Martin C. Fox on June 16, 2013

See the letter here.

Three things immediately come to mind:

-The Constitution does not allow nor did the founding fathers intend for the government to be in business.

-All of my working life I have heard from contractors it costs the government twice as much to do a project as the private sector.

-Governments with printing presses don’t worry about profit and loss statements.

Crony capitalism did not start in the 21st century. Railroads have always benefited from the largess of the government, particularly during the Lincoln administration and later. Have you ever thought how all those rights-of-way were paid for and how the owners were “persuaded” to sell?

There were numerable reasons for rail’s decline in the twentieth century. The depression (the Fed’s first major accomplishment), government regulation, railroad labor unions (Amtrak currently has to deal with a dozen or so unions), the emergence of cars and air travel, ICC’s inept rate setting and heavy government subsidy of highways and airlines. Government is a major source of its own problems.

To address Mr. Pitzer:

I am glad gasoline taxes initially paid for Eisenhower’s highway project. This must be the only government project where only the intended user fully paid for what they were using. As Mr. Pitzer commented, that is no longer the case as costs have sky rocketed. Remember, government projects cost twice as much. The Highway Trust Fund may get $53B compared to $1.4B for Amtrak but I am guessing there are more than 38 times more automobile passenger miles travelled.

The figures I see tell me the average Amtrak ticket is subsidized by $45. These are Federal subsidies we are talking about. Many states also subsidize Amtrak, PA included. These figures aren’t addressed in this discussion.

Yes, airlines are in a mess also. Where else but in a government project would you have federal, state and county government give US Air a billion dollar airport in Pittsburgh and allow US Air to walk away leaving a $62M annual mortgage? A deal crooked as a dog’s hind leg.

Amtrak says its Northeast Corridor runs at a profit and covered 88% of its operating expenses. Technically, or on paper, yes, but how does one say that when by its own admission Amtrak maintenance of trains, tracks and stations is woefully lacking? It is easier to claim a profit if you don’t perform proper maintenance. Smoke and mirrors. Clothing factories in Bangladesh make money also but then the wind shifts one too many times and the building collapses. What is a company in that kind of shape really worth?

I was not complaining about investing in improvements. I am complaining about it not having been done with one of the innumerable previous bailouts and why wasn’t the cost initially included in the price of the ticket like any normal private sector business.

Finally my “puzzling” comment relating to the CATO assessment that fully paid airline tickets would be cheaper than operating outlying runs rendered the response “…is that compared to subsidized or true cost airfares?” Brian, good question. This is the industry that runs the Pittsburgh airport, so I am guessing no one can figure out true costs.

Some letter writers seem to think I am against Amtrak surviving. I am for an Amtrak that survives on its own merits. Like any private sector business. A good thing about train travel is that it is safer and more fuel-efficient than travel by automobile. The significant closing statement in my initial letter, which was edited out, said we would be better off if the government just gave the whole thing away to a company that knew what it was doing.

There is a more basic Progressive vs Libertarian debate involved. Theoretically one takes the train because it is cheaper than auto or air travel. The Libertarian says why should a train lover subsidize highway and air travelers? The same goes for highway and air travelers. When a train traveler has to take a taxi, bus or airplane the fare should include his legitimate share of the highway or airport costs. The Progressive says we have to cover the other guy’s costs to too. That is the wealth redistribution of which Mr. Obama is so fond. Redistribution is a kind way of saying there is a bunch of people with badges and guns taking your money and giving it to someone else.

Be seeing you


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