Why Are Taxpayers Funding Amtrak?
Amtrak, the government-owned, taxpayer-funded, union-operated transportation entity, is not doing well. Despite CEO Joseph Boardman’s optimism about record ridership last year, the passenger train continues to bleed money at an astonishing level. In 2010, Amtrak earned about $2.51 billion but incurred about $3.74 billion in expenses. Not the best business model. Since its inception, Amtrak has cost taxpayers about $50 billion.
How do they continue to lose money if ridership is at an all time high? Anthony Haswell, founder of the National Association of Railroad Passengers and the original inspiration for Amtrak, explains in a book written by Erick Erickson and Lewis K. Uhler, Red State Uprising: How to Take Back America that:
“Amtrak is a massive failure because it’s wedded to a failed paradigm. It runs trains that serve political purposes as opposed to being responsive to the marketplace. America needs passenger trains in selected areas, but it doesn‘t need Amtrak’s antiquated route system, poor service and unreasonable operating deficits.”
So why are taxpayers still funding this failing company? Politico reports that apparently to Boardman, we’re not:
“Asked about congressional efforts to wrest the Northeast Corridor from Amtrak’s control, Boardman didn’t seem too concerned. ‘We are already privately operated,’ he said. ‘Regardless of whether you call Amtrak ‘peanut butter’ or something else, it’s the same people.’ House Transportation & Infrastructure Chairman John Mica has backed off plans to include the privatization bill in the highway reauthorization, but he and others continue to build support for the idea.”
Well, if they’re privately operated, they don’t need taxpayer subsidies, right?
In 2011, Amtrak received $1.4 billion in taxpayer subsidies. Remember also that they received $1.3 billion in taxpayer funds thanks to the so-called “stimulus” in 2009. If they’re privately operated, why must they be government-funded? Taxpayers should not be on the hook for failing companies and should not be forced to waste over a billion dollars a year in order to keep such a failing company afloat. This is what the entire Solyndra debate was about.
Instead, Amtrak should be privatized. That would allow Amtrak the ability to allocate their own finances, make their own investments and be freed from under Congress’ thumb.