Version XI - This Was The Week That Was
July 20, 2001
Week Eleven of Amtrak’s summer is going along about the same. Amtrak was the subject of much media attention this week, much of it which was unflattering.
- First, last Friday’s memo. Amtrak President and CEO George Warrington distributed a company wide memo last Friday, urging employees to plan ahead for next year, make do with less, and be ready for some changes in the company.
Following this on Tuesday was a story by Washington Post Reporter Don Phillips going in great detail and many of Amtrak’s plans for the future, many of which would have a negative impact on passengers and passenger rail advocates, as well as employees.
Then, immediately following the Washington Post story, Mr. Warrington issued a second employee memo saying much of what was said in the first memo and in the Washington Post story was just speculation, and no hard decisions had been made.
Is this a case of Clinton-type testing of the waters to see a reaction? Leak information out, gauge a reaction, and then make a final decision what to do based on the reaction? It’s possible. But, it’s also possible that, when contained in the story were hints of 10 to 15% cuts in union personnel, that a firestorm was started by organized labor and Amtrak had to pull in its horns quickly?
- As part of that media coverage of Amtrak this week, your humble correspondent noticed a paragraph in an Associated Press story quoting Tom Till, head of the Amtrak Reform Council staff, saying that Amtrak had hired 900 new management employees in the last three to four years. Your humble correspondent took this information and put it into a strongly worded opinion piece that was posted publicly on the All-Aboard list.
Amtrak guardian and perennial watchdog Ross Capon, always ready to come to the defense of Amtrak, forwarded the same missive to Amtrak Corporate Communications spin meister William Schulz, who diligently responded to what he perceived as wrong information, and set out to set the record straight.
Mr. Schulz said, “Ross Capon forwarded your e-mail to me. Larry Arnold had quoted Tom Till that management employees had grown 900 in 3-4 years. Tom was wrong. After a couple of days of checking, I’ve learned that Amtrak had 2,838 management employees in Jan. ‘97 and 2,887 management employees as of Jan ‘01. The net gain was 49, not 900. I hope this clears this up. Thanks.”
Whew! Our thanks to Mr. Schulz for clearing that up in a quick and accurate manner. Good, solid information directly from Amtrak is always welcome by all.
Now, if we could just depend on this type of good information when it comes to Acela …
- This week also saw yet more Acela trains delayed due to pantograph problems. What’s the story here? What is it no one is telling the public? After 60,000 miles of mandated testing by the FRA, this equipment still can’t perform up to workaday standards? Is the design fatally flawed? Many inquiring minds are wondering. Amtrak still isn’t talking much about the problem.
- Of the several things covered in the Washington Post article of Tuesday, one that stands out is Amtrak’s proposed hiring of McKinsey & Co. to come into Amtrak, help restructure the company, and save the soul of Acela and Amtrak.
On the surface, this appears as yet another attempt to keep alive the current senior management regime and board of directors. It is also an overt admission that Amtrak’s current business plan is a failure, and that Acela profits will not save the company. As many said several years ago, Amtrak was betting the whole farm on one racehorse.
The racehorse is lame. Will the farm be gone, soon?
There is a luminous heritage along the lines of what Amtrak is doing. Many prestigious companies have brought in consultants to help fix problems, including Pan Am, Braniff, Eastern Air Lines, and others. The common thread you may notice here is that all of these companies, in their original incarnations, are gone.
The cost of McKinsey & Co. is another point of debate among many. Amtrak has just pawned its most visible station, New York Penn, for $300 million so it can make 90 days worth of payroll and a few other expenses. It will take 17 years and $600 million to pay this mortgage back, so Amtrak could limp through the Summer of ‘01.
Simultaneously, Amtrak has brought in McKinsey & Co., and it is estimated McKinsey & Co. could garner as much as $10 million as a consulting fee from this contract. Remember all of those Sunday School lessons about good stewardship, and all of those college business class lessons about accountability to your shareholders and owners?
We wish someone at Amtrak would remember them, too.
Amtrak can’t afford to have more than one coach attendant in the height of the summer season for four coaches, and can’t afford to fully stock restrooms with toilet paper and paper towels on every run, but it can afford to pay outside consultants to fix what current management has broken?
Perhaps, instead of bringing in consultants to fix the company under current management, the best thing to do would be to get new management?
- Now, the most unpleasant subject. A report came from the Providence (Rhode Island) Journal this week about a stalled Amfleet Acela Regional train at Cranston, Rhode Island last Sunday night. The locomotive failed for an unknown reason, and the consist stopped dead in the right of way.
Weary and wary travelers refused to stay on the train because of rising temperatures here in the summertime, and started punching out emergency escape windows and opening trap doors to jump down to the right of way.
Disembarked passengers were actually strolling up and down the NEC right of way, and crossing other live tracks to get to local businesses along the tracks.
Keeping this in mind, here’s the most unpleasant question: The cause of this breakdown was most likely due to either deliberate decisions to subject this locomotive to deferred maintenance, or the locomotive was unroadworthy and never should have been sent out of the roundhouse in the first place. Because of this, with passengers disembarking from the train and wandering around on live tracks, when is this going to result in the death of a passenger?
What unsuspecting NEC engineer is going to be racing down the tracks and not know he or she is about to plow into a group of disgruntled passengers trying to escape from a stalled train?
When is the law of averages going to catch up with Amtrak’s unforgivable decisions to often allow poor equipment maintenance which could result in innocent deaths?
Railroad advocates love to debate about every topic regarding passenger rail, from the color of seat cushions to how large track side signals should be. Now is the time to forget such silliness and concentrate on making changes at Amtrak before a human life is lost.
What cost are we willing to pay to keep Amtrak just as it is right now?
And, that’s another week of Amtrak. Here’s to happier times ahead.
Bruce Richardson
Jacksonville, Florida