By M. E. Singer
Denial of economic reality persists in the formulation of the infrastructure program, with our hopes riding on a confused, diverted Congress. Why does it continue to so blatantly appear that our transportation policy is being formulated by non-transparent think tanks and their acolytes now in powerful positions to dutifully carry out these dictated, one dimensional policies? As we should have learned by now, not every program benefiting the general public can be better run in the private sector, as exemplified by the demise of the pay toilet.
How is it that this current federal government can propose to simply turning over the extensive investment by the taxpayer into the air traffic control system since 1956, gratis, to the private firm to assume that role? At least when Amtrak was formed, the private railroads were required to transfer to the new federal corporation their rolling stock, locomotives, depots, maintenance/repair shops, commissaries, etc. Amtrak was also required to honor all union agreements.
Also, I take umbrage at the statement by Secretary of Transportation Chao, who said in “Trump’s Transportation Budget Runs Into Resistance From Both Parties, (The Hill, 15 Jun): The administration has taken a closer look at programs that may not be meeting their intended purposes, have outgrown their usefulness or could be replaced with a new initiative that will better address future transportation needs.” How can anybody in this administration rest their laurels on such an assumption, when the reality is they do not rely on intercity or commuter trains, or even airlines serving rural areas via the Essential Air Service program, to conduct their business, or, maintain personal contacts?
How does dismembering Amtrak serve within the context of re-building our infrastructure? Any competent business school faculty would point out that when a national transportation service like Amtrak is deliberately starved from a consistent level of appropriations to be able to act like a business to properly plan, budget, acquire and rehabilitate equipment, as well as to expand or reduce routes, only on the surface would it deliberately appear not to be “useful,” or, certainly “replaceable.” Persistently denied any opportunity to invest in equipment, beyond the political cartel powers of the Northeast Corridor, has only crippled Amtrak’s capacity to offer more frequent schedules, and seasonal services, which are the essence of becoming a viable option for travelers.
Properly scheduled and expanded long distance rail services would serve to link multiple regions, and to augment the state-supported services paid by all non- Northeast Corridor states. Eliminating the excessive regional political clout that dominates Amtrak’s board of directors, and throughout its relationship with Congress, would enable Amtrak to think and act like a business re routes, instead of being overly concerned with which of so many political tributaries needs to be appeased.
Apparently, the Essential Air Service program (EAS) suffers from the same political interference to cause its cost to increase annually since it was temporarily established in 1978. How far do we have to search for common sense on the Potomac to realize the extent of sheer waste subsidizing airlines for Decatur, IL when it is but 37 miles from Springfield; or to Hagerstown, WVA when the hub at Washington Dulles is 50 miles away?
Before we turn any more railway depots or rural airports into spaghetti restaurants, those seeing privatization or elimination as the ultimate, purest panacea should learn the realities of how business should be conducted beyond their view of the Potomac:
1) Given the excessive deferred maintenance just for the Northeast Corridor, estimated at $52 Billion; years of disinvestment in equipment; corridor/long distance services operating at the margins, the feds have failed to align Amtrak with the interests of any potential private acquisition, other than perhaps a Russian oligarch seeking to launder funds here. Their is a reason the private rail operators in Europe have stayed clear of America.
2) The continuous deprivation of Amtrak by the feds has not been conducive to working with the Class 1 private freight railroads or other investors seeking a real P3 opportunity. Yet, just the opposite happens when a government is fully involved and supportive, as evidenced by California and its Joint Powers Authorities managing its regional intra-state passenger rail programs; working well with the Class 1 railroads owning the infrastructure.
3) A successful infrastructure program should initially have an appreciation of history, and learn from past federal government mistakes. Federal policy has decimated our industrial base and depleted a well trained American workforce by promoting “lowest bid” mentality in railcar construction. This has only encouraged foreign firms to become Beta sites at our expense, unsuccessfully re-engineering our former firms patents. The most recent failure is Nippon Sharyo to complete a federal contract that expires September, 2017, to build bi-level intercity passenger cars for the Midwest and California corridors.
4) A real infrastructure program to re-build America would be for the feds to invest directly and secure private investments to overcome the government’s past betrayal of our former rail car builders, e.g., Budd, Pullman, American Car Foundry, and St. Louis Car. The guts of a national, and just not simply a bi-coastal, infrastructure program would be to build and rehabilitate the rail passenger car fleets and locomotives necessary for Amtrak and our commuter lines to resurrect our once vast, vibrant private passenger rail network inter-connecting to all of our regions. Such inter-regional connectivity is still required to provide the mobility necessary as the catalyst for economic development and growth.
5) EAS must be updated to reasonably raise the bar by only serving airports in the continental US that must be more than 100 miles from another airport; to lower the per passenger subsidy to $100, as people will either use it, or lose it. In lieu of EAS subsidy, to what extent can the airport utilize its fees and tax revenues to pay for such service, instead of spending to market for the benefit of the airline?
6) The ‘free ride’ for those wedded to the road must end in fairness to paying their share (‘user fees’) for a true infrastructure program. This includes for auto, bus, and truck:
a) Vehicle Mileage Tax (VMT).
b) Tolling interstates; bridges; tunnels.
c) Increasing fuel taxes, inked to the CPI.
7) Although Amtrak and commuter lines currently pay user fees to the freight railroads who own the infrastructure to provide time slots for track access and dispatching, the feds need to apply this concept as well within its infrastructure program to the barge companies using the inland waterways maintained by the Army Corps of Engineers. As well, it is high time for the airlines to pay market-based user fees for the FAA’s air traffic control system, and for take-off and landing slots; to break their hub dominance that only strangulates competition.
Without embracing these business concepts to serve all regions and establish a balanced approach to user fees and subsidies, the only response to the currently maligned approach to infrastructure will be: “fehgetabouti!”