CNN Pushes for Increased Amtrak Funding

     CNN’s “American Morning” pointed out that high gas prices were the reason ridership on Amtrak was up 14 percent and then pushed for more funding for the government-sponsored program through a recent Senate proposal.


     “The problem for Amtrak of course, though, is that they haven’t had a single new passenger car since 1990,” personal finance editor Gerri Willis said on the August 21 broadcast. “Their cars, even the locomotives are old and aging; they’re asking Congress for help. Dick Durbin has introduced legislation into the Senate to try and do something about that. Interestingly, he says that Thanksgiving is going to be a wake up call for Americans as we all try to go visit relatives for the holidays.”


     “What they need is new track, because every Sunday it’s like this all the way up,” co-host John Roberts said while bouncing up and down in his anchor chair, simulating a bumpy train ride.


     Co-host Kiran Chetry agreed. “They need more track too,” she said. “I mean not just the trains, because a lot of those routes, they need to be able to get more people moving.”


    The segment didn’t include any input from opponents of government funding of Amtrak.


     The cast also talked about the express train that Amtrak uses called Acela. Willis said the Acela was “really nice” compared to the “not so great” older trains, but pointed out Acela was, “not as new as you would think.”

     The “Train CARS Act,” which was announced July 29, encourages train car production by authorizing Amtrak to issue up to $2.8 billion in bonds over four years to finance the projects.

     Sen. Dick Durbin, D-Ill., promoted the bill August 21 at an Amtrak maintenance facility in Chicago. He called passenger rail ”the most cost-effective alternative in our part of the world,” according to the Chicago Sun-Times.

     Durbin said he hoped the bill would encourage rail car production to occur in Illinois.

     The senator’s August 20 press release dated says the act transfers one-quarter cent of the per-gallon motor fuels tax into a Rolling Stock Trust Fund for three years, generating approximately $400 million/year. 

     Sun-Times transportation reporter Mary Wisniewski pointed out that, “This could be a tough sell. Another fund paid for by the fuel tax is in trouble — the federal highway trust fund. The fund faces a multibillion dollar shortfall next year due to the decrease in driving, down from a surplus of more than $10 billion just three years ago.”

     Amtrak, which received $1.3 billion in federal subsidies in 2008, isn’t a consistent performer either.

     When Amtrak came out with glowing numbers in 2007, The Heritage Foundation’s Ronald D. Utt pointed out Septemeber 20 of that year that Amtrak's monthly rider numbers do not support their optimistic press announcements, “but instead reveal a still-troubled system losing market share and riders in its key service areas.”


     Utt said that although Amtrak's numbers increased in 2007, 2006 was not a good year for the train system and made for a faulty comparison. In fact, 2007’s numbers were barely higher than 2005’s.

     The Reason Foundation’s Michael W. Lynch found in 2002 that Amtrak cost $3.37 for every $1 it took from passengers. In the second half of 2005, Reason’s Adam Summers said, for every $1 Amtrak receives in revenue, it spends $1.61.


     “When a private company gets caught lying and cheating, it pays. At Enron, voluntary investors and employees take the hit when the company turned out to be a poorly managed product of slick PR and questionable, perhaps criminal, accounting,” said Lynch. “While Amtrak deserves to come crashing down, it never does. Taxpayers are forced to pay billions in bills to keep the employees in their jobs and the politicians happy.”