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 21^st 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. Read the rest of this entry »