Beer, Bears, and a Canoe: Your Guide to Lower Travel Costs

12 comments

Posted on 10th June 2014 by Administrator in Economy |Politics |Social Issues

Beer, Bears, and a Canoe: Your Guide to Lower Travel Costs

By Ann Pringle

Leisure was last weekend’s theme, I spent it in a canoe—a cheap and energy-efficient way to see the Everglades, though not at all speedy. That was fine—I just wanted to see alligators in their natural habitat, enjoy a frosty beverage with good company, and return to the city with my limbs intact. My nature-sighting report: zero panthers, one alligator, and one black bear.

Now, had I needed to go from here to there in the swamp, an airboat or swamp buggy would have worked better, or so the locals said. However, when you’re not rushing, old-time means of transportation like canoes and trains add to the adventure. There’s no harm to indulging in that nostalgia—though when Congress forces you to pay $45 billion so “the public” can do the same, it’s a problem.

A $45 Billion Affair Sours

The US has a 44-year-old mistress, and her name is Amtrak. Since its inception in 1970, the National Railroad Passenger Corporation (Amtrak) has received about $45 billion in federal subsidies, according to the Congressional Budget Office.

Amtrak loses money year in and year out despite these fat subsidies (or likely because of them). The company’s operating loss for fiscal 2012 was the lowest since 1975: $361 million. Yes, that means Amtrak actually found a way to lose more than $361 million each year for almost 40 years running.

The Amtrak lobby is quick to point out that in total dollars, air and highway travel receive far more from the federal coffers. True enough. However, on average an American will ride just 20 miles on Amtrak each year. 20 miles!

Per passenger mile, Amtrak is far and wide the most heavily subsidized transportation system in the US. According to a 2012 Cato Institute study by senior fellow Randal O’Toole, from 1995 to 2007 Amtrak’s federal subsidies per passenger mile were 9 times greater than those to the airlines and 22 times greater than our highway system’s.

It’s no surprise these subsidies haven’t made train travel cheaper. Per passenger mile, inflation-adjusted airfares dropped 50% from 1960 to 2010. Meanwhile, Amtrak fares rose 70%. As O’Toole mentions, it’s pretty remarkable that during a period of rapid technological advancement and reduced costs for privately funded transportation, Amtrak has done such a shabby job of controlling costs.

One runaway cost is so absurd, it will baffle anyone who’s spent $6.25 on a ballpark hotdog and washed it down with a $5.75 Coke. From 2002 to 2012, Amtrak’s food service operation lost the company, ahem, I mean lost taxpayers $834 million.

Ted Alves, who resigned as Amtrak’s inspector general in February, testified to Congress last year that the $72 million in food-service losses in 2012 alone stemmed predominately from meals on long-distance routes. Free wine is part of the problem, as multiple long-distance routes include complimentary wine gatherings for sleeper-car passengers. Who knew you were buying so many people drinks?

In short, Amtrak can’t make a dime selling food and drinks to people who are literally stuck on a train with no other option. A privately owned and operated company could turn that problem around with a 10-minute lesson from any ballpark concession worker.

#AmtrakResidency

If you’re not irked yet, get ready. Last March Amtrak launched #AmtrakResidency, a writer residency program “designed to allow creative professionals who are passionate about train travel and writing to work on their craft in an inspiring environment.” Up to 24 writers are being selected for 2- to 5-day “residencies,” meaning free meals and long-distance travel, through March 2015.

Answer two probing questions in 2,000 words or less and you, too, could be a contender:

  • Why do you want a #AmtrakResidency?
  • How would this residency benefit your writing?

Too bad the rickety tracks make writing on Amtrak next to impossible.

There’s not much to redeem Amtrak. Its trains are less energy efficient than inter-city buses. It doesn’t provide an invaluable service to the poor, who generally take that cheaper, more energy-efficient bus if and when they can’t snatch up cheap airfare. And, though subsidy supporters call it an invaluable public service, I can’t pinpoint what that service might be. Free wine for leisure travelers, perhaps?

When Driving Miss Daisy Is Not an Option

Seniors could benefit a great deal from well-run private alternatives. According to the Insurance Institute for Highway and Safety (IIHS), as of 2012, 79% of the US population aged 70 and older still held valid driver’s licenses. That’s up from 73% in 1997, and as the baby boomer population ages, the total number of 70-plus drivers on the road will increase as well.

Unfortunately, they’re not all road-safe. Although overall crash rates tend to decrease with age, the rate of fatal crashes takes an upward spike when drivers pass age 70. While many seniors self-regulate by driving only during daylight and sticking to familiar routes, those who shouldn’t drive but do have limited alternatives.

Short of hiring a personal driver, what other comfortable options do seniors have for inter-city travel? Not every trip warrants a flight, and thanks to the TSA, air travel is now a world-class headache anyway. Plus, in all but a few major cities, the bus carries a certain social stigma I won’t dwell on here. Suffice it to say, middle-class seniors are unlikely to start riding the bus after 50-plus years behind the wheel.

On the other hand, Amtrak’s schedules are haphazard, its stations are bleak and difficult to move through, and its standards of service are spotty at best. It’s too bad, though, because Amtrak should be courting middle-class and well-to-do seniors first and foremost. They have time to travel slowly and discretionary income to spend on comfortable accommodations and polite service.

Furthermore, as long-distance driving becomes difficult or dangerous for the aging boomer population, private passenger trains could help fill the void.

Lessons from the Sunshine State

Among other errors in 2000—recall the hanging chad—Florida voters amended their state constitution to require construction of a statewide network of high-speed passenger trains. That’s right, an actual constitutional amendment demanding trains.

The plan unraveled in 2004 when voters repealed the amendment after learning how much it could cost them: $20-25 billion. However, the state’s train dream didn’t stop there. Construction on the Tampa-Orlando line, phase 1 of the state’s plan, seemed imminent until Governor Rick Scott rejected $2.4 billion in federal stimulus to build the line. Scott cited concern that his state couldn’t afford the project even with the federal funds.

As the brouhaha over a state-funded Tampa-Orlando line continues, All Aboard Florida is planning passenger rail service from Orlando to Miami, with stops in West Palm Beach and Fort Lauderdale. The private company plans to operate 16 northbound and 16 southbound passenger trains beginning in 2016.

It’s still uncertain whether All Aboard Florida, which is being developed by Florida East Coast Industries, LLC—a company with 122-year-old roots—will be successful. About 17% of Florida’s population is over age 65, and the state relies heavily on tourism, so it’s an ideal place to test how much travelers will ride trains when they have to pay the entire fare out of pocket.

What you just read was an excerpt from Miller’s Money Weekly, a free e-letter that provides retirees and people planning for retirement with guidance on saving, investing, and life. To get Money Weekly in your inbox every Thursday, click here.

12 Comments
  1. Zarathustra says:

    If time were of no concern, which way would you prefer to travel, on an airplane where there is no food other than an occasional bag of peanuts or pretzels, while strapped into a tiny chair, or on a train where there is decent food, comfy chairs, different places to visit and mingle with others, plenty of bathrooms and a place to lie down when tired?

    That’s what I thought.

    10th June 2014 at 12:28 pm

  2. Eddie says:

    As I recall, Amtrak was dreamed up because private rail was going out of business . Rather than re-privatize rail travel, it is far more likely that the next Amtrak will be AmFlight, as the government is forced to nationalize air travel for the same reasons that once applied to rail.

    The bottom line is that no corporation, no state government, no national government, has the financial resources anymore to build big infrastructure, and maintain it and still make a profit.

    10th June 2014 at 1:59 pm

  3. IndenturedServant says:

    After living in Europe for eight years and traveling all over the place by train, I could never understand why train travel was not more prevalent here. Nearly every single town in America has at least one set of tracks. My wife and I are considering taking a train trip to Alaska or across Canada just for fun. She had never been on a train until I took her to Spain on vacation and she loved it.

    It’s a fantastic way to travel and really see a place. On rare occasions when I find myself a passenger rather than the driver I’m always amazed at how much I see compared to when I’m driving.

    10th June 2014 at 4:11 pm

  4. AKanon says:

    I saw the title of this thread and thought it sounded like a relaxing weekend. Disappointing it is about Amtrack.

    IS-Tell us how that train trip to Alaska works out for ya. We do have a nice in-state railway, so far as it goes. I prefer canoes.

    10th June 2014 at 7:12 pm

  5. llpoh says:

    IS said ” could never understand why train travel was not more prevalent here”. Well, here is the reason why:

    750px-World_population_density_map.PNG

    It has to do with population density and where people live. The US is spread out far and wide, and it is huge. Europeans are crammed together like sardines and it is small. Relatively.

    Being a big country, Americans are spread out all over, and the suburbs stretch on and on and are low density areas. Europe is different.

    10th June 2014 at 8:07 pm

  6. Stucky says:

    Fact: There is no country in the world hat operates a rail system without federal subsidies.

    Question: WHO will PAY for the extra rails or improvements of current rail …. hundreds of billions …. not that money is ever a question with Obongo or Gellin’ Yellin.

    ===============================================

    Why Americans Don’t Like Train Travel

    “There are many reasons why Americans don’t ride the rails as often as their European cousins. Most obviously, America is bigger than most European countries. Outside the northeast corridor, the central Texas megalopolis, California and the eastern Midwest, density is sometimes too low to support intercity train travel. Underinvestment, and a preference for shiny new visions over boring upgrades, has not helped. Most American passenger trains travel on tracks that are owned by freight companies. That means most trains have to defer to freight services, leading to lengthy delays that scare off passengers who want to arrive on time. Domestic air travel in America is widely available, relatively cheap and popular. Airlines fear competition from high-speed rail and lobby against it. Travelling by cars is also popular. Petrol is cheaper than in Europe (mostly because of much lower taxes). Road travel is massively subsidised in the sense that the negative externalities of travelling by car, including the release of carbon dioxide and other greenhouse gases, are not fully offset, and most major highways—which cost tens of billions to maintain—are still free of tolls. And finally, Barack Obama’s embrace of high-speed rail has heightened a political battle over rail that doesn’t exist quite in the same way in other countries (although the fraught debate over high-speed rail in Britain comes close). Opposition to rail is now often seen as essentially conservative, and Republican governors oppose rail projects to boost their conservative image. ”

    http://www.economist.com/blogs/economist-explains/2013/08/economist-explains-18

    The above link also makes this amazing-to-me claim ———– “AMERICA has by far the LARGEST RAIL NETWORK IN THE WORLD with more than twice as much track as China. But it lags far behind other first-world countries in ridership. Instead of passengers, most of America’s massive rail network is used to carry freight. Why don’t Americans ride trains?”

    ============================================================

    .
    .
    Lastly, below is an interesting site that addresses RAIL MYTHS …. including smashing several comments in the above Economist snippet.

    http://highspeedrailworks.org/about-us/myths-facts/

    10th June 2014 at 8:21 pm

  7. Stucky says:

    India is the darkest purple (most dense).

    Huh! I guess that explains this …

    traveling+on+train+in+india+%252811%2529.jpg

    10th June 2014 at 8:23 pm

  8. llpoh says:

    Stucky says above: “Lastly, below is an interesting site that addresses RAIL MYTHS …. including smashing several comments in the above Economist snippet.”

    Seriously??????

    Seriously?????

    Most of there rebuttal is not fact based. They have a “save the environment” agenda.

    But I would love to see infrastructure of all kinds improved. That includes introducing high speed rail links in the NE, in CA, etc. Infrastructure inevitably tends to pay for itself. And the US has let its infrastructure decay, which is a sign of doom.

    10th June 2014 at 8:57 pm

  9. Stucky says:

    I said interesting …. not, accurate. LOL

    From their website, “About Us” ….

    “ELPC has actively studied and promoted high-speed rail for more than a decade, believing that a third transportation option is needed to meet the challenges of the future in a safe, convenient, environmentally responsible way.”

    They clearly have an ax to grind. Therefore, an unbiased opinion is not to be expected. It is “interesting” in that it provides for the reader all the pie-in-the-sky responses.

    10th June 2014 at 9:05 pm

  10. llpoh says:

    Well, alrighty then!

    I wasn’t really commenting on the “interesting” portion of the comment – more the part where you said “addresses rail myths”. That part seemed to say that they are able to refute the “rail myths”.

    But I get your point – it is frequently valuable to see other viewpoints.

    10th June 2014 at 9:26 pm

  11. Mike Moskos says:

    All Aboard will probably make the bulk of its money at its stations in Fort Lauderdale and Miami; the actual trains just have to break even. Miami is getting an enormous station: ground level retail, hotel, residential units, etc. http://www.allaboardflorida.com/files/miami1.jpg

    11th June 2014 at 2:00 am

  12. Stucky says:

    Llpoh

    Yeah, I coulda done a much better job wording it. (Wow, talk about a fucked up sentence!)

    11th June 2014 at 2:21 am

Leave a comment

You can add images to your comment by clicking here.