Volume II Version 11 – This Was The Week That Was – An Amtrak Saga

February 08, 2002

It has been a dizzying eight days. A week ago today, Amtrak senior management and its board of directors, acting in a manner similar to a terrorist organization, took all of America’s long distance trains hostage at gunpoint by threatening to discontinue them October 1st if their funding demands were not met by Congress and the Bush administration.

The explosion of moral outrage across the country was audible.

Then, yesterday, Thursday, February 7, 2002, the Amtrak Reform Council released its much anticipated and much maligned in advance final report to Congress, containing its recommendations for a New Amtrak.

The sparks have been flying, and some from some interesting places.

1. First, an enthusiastic and unabashed endorsement of the work of the ARC by the leadership of United Rail Passenger Alliance, the sponsor of this space.

   Andrew Selden, URPA vice president, spoke for the group, saying,

   “The Wall Street Journal reports this morning [Thursday, February 7th] that the final ARC report to congress to be delivered today will present a simple plan to reorganize Amtrak into three entities: a Federal agency to set policy direction and provide funding for intercity rail passenger operations; an entity to own and manage rail passenger infrastructure; and, a company designed to operate passenger trains as a business.

   “Funding would be allocated on an incentive basis to spur growth, reinforcing strength rather than enabling and sustaining failure, such as by providing funding as a percentage of passenger revenue.

   “Amtrak, its supporting organizations, and rail labor all strenuously oppose the ARC plan, which is very odd when one considers the actual contents of the plan: ‘The plan would count on the federal government to provide infrastructure funding in the same way it finances facilities for highway travel and aviation. The report also said that in the future, federal operating subsidies should be limited to long-distance national trains while states bear the cost of operating subsidies for corridor services, including new high-speed services.’

   “What’s not to love in that plan? The NEC gets its “capital” needs ($1 billion a year) through dedicated federal sources, and since it is already “profitable” on operations (Isn’t that what Amtrak always tells us?) there will be no need for state operating support at all there, and all the federal operating subsidies can go to those political anachronisms like the Coast Starlight, the Silver Meteor and the Southwest Chief.

   “This is the plan that Amtrak’s Board Chair described last Saturday as ‘wacko.’ Perhaps it is not the plan that is a tad disconnected. After a transition period, the plan says, the policy agency can direct the operating company to franchise designated routes and services to private companies, or others.

   “I, for one, would love to have the Empire Builder run by Virgin Rail, and to have the Surfliner service run by Carnival Cruise Line, rather than the transit lovers of Mass Ave. Let them stick to what they understand and appreciate, the Clockers and such, and Acela, a/k/a Wondertrain.

   “It is worth noting that the ARC plan mimics in very large measure the policies and vision of URPA, not at all because ARC slavishly adopted our plan as such, but because two years of intense analysis of Amtrak by objective, independent professionals reached largely the same conclusions we have about the results of the current structure and regime, and the pathway to a better outcome.”

2. Our labor friends have chimed in, too. The United Transportation Union, which has been providing high profile leadership on the need to end the reign of the current Amtrak senior management and replace it with more suitable candidates, had this to say,
   

   “America’s mayors are applauding the UTU’s proposal for a summit among railroad-knowledgeable opinion leaders and decision makers to recommend an effective means of preserving a national rail passenger network and expanding the rail-passenger workforce. UTU International President Byron A. Boyd, Jr., shared with hundreds of U.S. mayors his opinion article …

   “‘It is clear that Mr. Boyd’s suggestion is reasonable …,” wrote Mayor Randy Roach of Lake Charles, La. …

   “‘We will do all we can to help,’ said Topeka, Kansas., Mayor Harry ‘Butch’ Felker in a letter to Boyd. Davenport, Iowa, Mayor Charles W. Brooke offered his assistance, while Newport News, Va., Mayor Joe S. Frank told Boyd that the concept of a comprehensive multi-modal national transportation policy, ‘and your idea for a summit, are certainly compatible.’ …

   “Meanwhile, Burlington Northern Santa Fe President and CEO Matt Rose wrote Boyd, ‘Thank you for initiating a proposal that could lead to a meaningful solution for America and bring a level of efficiency to rail passenger service that all citizens can be proud of.’

   “Union Pacific Chairman Dick Davidson said of Boyd’s summit proposal, ‘As you noted …, rail management and rail labor were able to come together to develop Railroad Retirement reform. In an effort to achieve a similar outcome on passenger rail, Union Pacific would be very willing to participate in a working team effort to determine if there are common themes and ideas we can develop collectively.’

   “Boyd said that ‘preserving Amtrak jobs and protecting the employment, wages and working conditions of Amtrak employees is essential. The most effective way to succeed is to improve and expand our national rail passenger network and not auction the most favorable segments off to lowest-cost bidders that could cause other segments to be abandoned.’ The latter has been suggested by the congressionally created Amtrak Reform Council.

   “‘The UTU thinks there is a better, more effective plan — a plan that will keep our national rail passenger network intact and safe, allow rail passenger service to be improved and expanded, protect the wages and working conditions of existing Amtrak employees, grow the rail-passenger workforce and not interfere with efficient freight operations,’ Boyd said. …” [February 6, 2002]

   While the UTU may not agree with the ARC report, they are taking positive, helpful steps to participate in the debate on a high level. The AFL-CIO, which filed a lawsuit that was dismissed by a judge before it went anywhere, at this point seems to be out of step with the positive process of solving the “Amtrak problem” over the long term.

3. Make no mistake about it, much of this battle is over jobs – a reasonable level of jobs that will be preserved nationally along with the national system. The ARC scenario sets up the national system for growth, as does URPA’s similar Selden Plan. Saving the national system means saving present jobs, and positioning the system for new, well paying jobs. The status quo won’t do that; it will only cause what jobs there are now to linger for a while longer, and then be in danger once again.

   What is also important is the recognition of the bloated bureaucracy of Amtrak now, particularly the NEC, where, as noted before, Amtrak bragged there are 11,000 employees to run 147 terminal departures a day. This type of overfed, overdone federal management level jobs program is NOT what is called for. A streamlined, well-working company that has necessary jobs filled on all levels – not just in corporate staff management jobs that cause little measurable productivity – will be the healthiest choice for all concerned, including the taxpayers of the United States of America.

4. From Capitol Hill, came this statement from Chairman Don Young [R-Alaska] on the ARC report, “‘Amtrak Reform Council Report Recognizes Unfortunate Realities Of Amtrak’s Continued Management & Operating Problems’
   

   “Washington, D.C. – … The ARC is to be commended for its comprehensive examination of the passenger rail problems and its thorough recommendation of how we should improve this failed system. The Council and its recommendations have substantially advanced the debate over the failures of the existing system and what passenger rail in America could become with proper management.

   “The ARC is the first group to publicly say what we all have known for many years – the passenger rail system has been derailed for years because Amtrak is providing poor service at astronomical costs, and that we need to fix this system, not just throw more and more money at Amtrak.

   “I believe the ARC report outlines several notable goals. Among them are promoting intermodalism, establishing a regional decision-making process, funding rail infrastructure, and creating the potential for competition while recognizing the legitimate interests of Amtrak’s employees.

   “Legislation I have introduced – the “Rail Infrastructure and Development Expansion Act for the 21st Century” (RIDE-21) – would provide $71 billion in railroad infrastructure expansion and improvements and move us in the direction of achieving many of the ARC’s goals.

   “This report recognizes the unfortunate realities of Amtrak’s continued management and operating problems. Its costs are too high and it runs a system that is designed to win funding support in Congress rather than a system based on sound financial and economic decisions.”

   As previously reported, Chairman Young’s committee will hold oversight hearings, featuring all members of the ARC, on February 14th, with more hearings to follow, featuring other speakers and opinions.

5. Amtrak senior management also issued its own press release on Thursday, February 7, 2002.
   

   “WASHINGTON – The Amtrak Reform Council’s report today has reasserted what has been recognized for a long time: the current policy model for passenger rail does not work, cannot work, and must be fixed.

   “It makes plain what is already known: the increasing need for passenger rail service requires a substantial capital investment, greater efficiency and, where it exists, ongoing operating support for the public service of long-distance service.

   “But the report sidesteps the underlying policy and funding issues that must be determined. First, a federal commitment to define, develop and invest in the passenger rail system must be made. Fundamentally, only then can the nation determine the system’s scope and nature, level of necessary funding, and source of funding. No council or commission can make these decisions – the ARC hasn’t – and until these issues are resolved, the nation’s passenger rail system will continue to be torn by conflicting policy mandates and inadequate capital, whether operated by Amtrak or anyone else.

   “Amtrak’s impending reauthorization is the vehicle for Congress to determine the role, scope, funding level, and source of funding for our passenger rail network. It is time to provide the policy and funding that will give America the passenger rail system it needs and deserves.

   “It is also important to recognize that we have a policy problem, not an Amtrak performance problem. Under current management over the last five years, Amtrak’s total revenues have grown by 38% and nationwide ridership has risen by 19%, while federal operating support has been cut by more than 80%.

   The DOT Inspector General said it best in the Wall Street Journal on January 28: “For what it has been charged to do, it is amazing that Amtrak has gotten this far.” But the limits to this success are set by a flawed policy that must be fixed. -AMTRAK”

   The statement was notable for two points: First, there were no updated ransom demands made for the long distance routes they are holding hostage and threatening with extinction if Congress doesn’t meet the demands. Second, once again there was The Big Lie about high revenues and high ridership, but not a whisper about the record expenses the company spent to achieve those modest gains.

6. Which brings up Part II of The Big Lie: Amtrak, for so long, has had a continual drumbeat about the “money losing long distance trains,” or, the “bad long distance trains that are a drag on the rest of the company.”

   Those who are learned students of passenger rail know that these statement are patently false. Amtrak’s own numbers prove these statements false. If you still believe the Amtrak version, visit the URPA web site at http://www.unitedrail.org and see for yourself. Using Amtrak’s own numbers, charts and graphs demonstrate how the long distance routes are strong performers for Amtrak.

That’s it for another fascinating week. Again, for all of us who support the patriots of the ARC, and, as a result have been wholesale labeled “wackos” by Amtrak Acting Chairman Michael Dukakis, it’s great being in the wacky world of long due Amtrak reform.

Still proud to be a wacko,