Tuesday, May 3, 2005

TRAINS COST taxpayers too much. Every 10,000 miles that a train passenger traveled in 2002 cost federal taxpayers $200 in subsidies, compared with $6 for passenger jets and $4 for long-distance buses. Amtrak, the main operator of passenger trains across the country, has proposed ideas to fix this madness, and so has the Bush administration. Now Congress has to act.

The first test of any reform is whether it will force closure of the most uneconomic routes. Intercity connections that take three hours or less, such as the Washington-New York corridor, are just about competitive with airlines; connections of up to five hours require relatively modest subsidies that are perhaps tolerable given the trade-off: reduced congestion and pollution on highways. This defensible category of rail service accounts for 80 percent of the trips taken by Amtrak customers. But the other 20 percent of Amtrak's business, comprising routes that take more than five hours, cannot hope to compete with airlines. As more and more passengers have abandoned long-distance rail, the per-passenger federal subsidy has jumped from $158 per trip to $214 since 2000. These routes should be dropped.

The second test of reform is whether it will produce better management. The recent suspension of the high-speed Acela service on the Boston-Washington corridor is just the latest in a string of setbacks; before the cracked brakes that led to that suspension, there was the embarrassing discovery that the Acela was built too wide to pass an oncoming Acela at high speed without a crash. Somehow Amtrak manages to lose $100 million a year on its food service. Maintenance on the Washington-Boston corridor has been so neglected that it would cost around $2 billion to deal with the backlog. In 2004 the service from Los Angeles to Orlando, which is subsidized to the tune of $466 per passenger, ran an average of six hours behind schedule.

Amtrak's board has proposed reforms that might ameliorate these problems, but the administration's stance is better. Amtrak wants a new financial reporting system that might render the absurd subsidies for long-distance routes more transparent, creating some pressure to do away with them. But Congress is capable of supporting absurd yet transparent subsidies (think farming), and members from states with uneconomic rail routes will fight to keep federal payments. The administration proposal to devolve management and most financial responsibility to state authorities is more likely to force needed closures.

Equally, Amtrak proposes legal reform that would increase its bargaining power with its entrenched labor unions, making it possible, for example, to deploy conductors in a more rational fashion. But the surest route to better management is the one supported by the administration: allow competition. This does not mean privatizing the rails, which are a natural monopoly. But train operators should compete to operate services on government-run tracks. State and local jurisdictions such as North Carolina and Boston have shown that this can work.

Reform is going to be difficult. Sen. Trent Lott (R-Miss.) recently asked an administration official to consider "the ridiculousness" of the Bush proposal; Sen. Kay Bailey Hutchison (R-Tex.) declared, "My motto for passenger rails is 'national or nothing.' " But there is no justification for spraying billions at a national rail network that attracts one-fourteenth as many passengers as intercity buses and one-seventeenth as many as the airlines; spending federal dollars on uneconomic lines is pure pork. Unfortunately, Congress gets to control Amtrak reform even though Congress is the chief reason reform is needed.