The Amtrak Subsidy

Talk about bad timing. Just as Rep. Jerrold Nadler of New York was introducing a bill to spend $12 billion over six years subsidizing Amtrak and as the railroad's executives were asking Congress for an increased annual subsidy to $1.8 billion from $1.2 billion, the federal rail monopoly was canceling its Acela high-speed service between Boston and Washington, citing broken brakes. The Acela project itself has cost $2 billion.

We're sympathetic to the view that if Congress is going to subsidize interstate highways and air traffic control, rail should get its share, too. But the air system is at least set up so that different passenger carriers can compete using the same federal air traffic controllers. That competition means that when an innovative low-cost entrant such as Southwest or Jet Blue comes on the scene, the benefits get passed along to passengers. And their capital investment is private. Even the bus lines plying the highway compete, as travelers between Chinatowns in New York and Boston well know.

For New York travelers, Amtrak is often not a competitive alternative. A train from Penn Station in Manhattan to South Station in Boston this Saturday will take four hours and cost $66, while a Peter Pan or Greyhound bus takes four hours and 20 minutes and costs $28. Delta will get you from La Guardia to Logan in an hour for $103.70. If either time or money are your primary considerations, it's hard to see how the train comes out ahead.

Even the road-operating sector is seeing gains in privatization, as the New York Times reported on its front page yesterday, with private companies building and operating toll lanes alongside, or as an alternative to, traffic-clogged highways. If there must be an interstate rail subsidy, it seems to us the task for a free-market-oriented Congress is to devise a way to structure it so that it doesn't create a government-owned monopoly, but a competition that would allow the most efficient operators, with the best service, to make the greatest profit.

If there's a way to make the trip between New York and Boston quicker or cheaper by train than by bus or plane, it's private enterprise and competition that will make it happen. And if it's not possible under those circumstances, it's hard to see what the point is of offering continued billions in subsidies to a government monopoly with little more than broken brakes to show for itself.