DOT Inspector General Says Deferral Strategy Fails Amtrak

If I recall correctly, the same official (or at least another official from the IG's office) recently admonished Amtrak to discontinue refurbishing its Superliner Fleet. As others have already noted, the admonishment is somewhat absurd because the funds Amtrak would save by taking the advice would consitute a needle in the haystack of NEC capital needs.

But I think we are witnessing something larger. As I have mentioned on other threads, I have reached the conclusion (with a great deal of dissapointment) that the end is near for Amtrak as we have known it.

Lets keep our eyes on the status of the labor protections offorded to Amtrak's employees. I expect to see changes in that area soon, and if that happens, the rest is history for intercity passenger railroading in most of the United States.

As others often note, I certainly hope I am wrong. But I really think the Neocons are about to win this one. When their expierement is over, the United States will find itself paying more public money for less passenger rail service than it enjoyed under Amtrak's days. Of course by the time we wake up an smell the coffee, it will be too late. The infrastructure will be gone.

Can the labor protections be changed at will, or are they protected by a contract? Might be easier said than done?

Glad to note that Matt Wald is back on the transportation beat

Thank you Bill Keller!!!!

Here is the "full monty" for which to access you will need both Adobe and patience.

Be back in a few days (system upgrade).

The actual report can be found here: http://www.oig.dot.gov/item_details.php?item=1434

It was written by Kenneth Mead, who is a government bean counter, nothing more. He has virtually no influence on policy. He has appeared on C-SPAN at numerous congressional hearings, and he always looks like a zombie with glazed eyes and messed up hair. Mead's job is to audit DOT related finances, including Amtrak's, but somehow he thinks he's a transportation planner, a businessman, and a citizen's advocate all rolled into one.

He hates long distance trains. Period. In this report he suggests that money put into Superliner repair could better be spent on bridges on the NEC. Yet at the same time, he complains that Amtrak is not doing enough to improve its bottom line. He fails to realize that Superliners in service bring in money, while bridges, essential as they are, do not. As I mentioned on another board, his idea is akin to telling a shopkeeper not to buy goods to sell, but rather use that money intended for inventory purchases to pay the rent on the store.

At other times he has suggested that long-distance routes should connect regional corridors, but not overlap them. So, for example, to travel from LA to Seattle one would have to take a Surfliner to San Luis Obisbo, a LD train from San Luis to San Jose, a Capitol train from San Jose to Sacramento, a LD train from Sacramento to Eugene, and finally a Cascades train to Seattle. Another time he state flatly that anyone who wanted to travel between regional rail corridors "should get on a plane."

He's dumb as toast in my book.

Mr. Toy is, of course, absolutely correct.

The problem, however, is that Congress generally lacks the savy to make indepedent decisions when it comes to Amtrak. Therefore, it can be expected to rely on these types of reports, and expressions set forth therein have a way of turning into congressional policy.

In addition, Mr. Mead's gratuitious advice about refurbishing bridges instead of superliner sleeping cars will likely resonate well with red-state polititions. Imagine, if you will, Zel Miller picking up on the theme. I can see it now, sleeping cars and spit balls. Next we will hear about Amtrak contributing to the corseness of society.

Another sad comment made by Mr. Mead was his assumption -- for purposes of encouring Congress to prioritize -- that corridor operations are more economically feasible than Amtrak's other services. As most of us know, Amtrak's off-NEC corridor services are the least economically feasible of all of Amtrak's services. While they might be more useful in the eyes of some, they cover less of their costs with fare box collections than any other Amtrak service.

Mr. Mead is an Idoit he dosen't know a thing about Amtrak he is so dumb I might as well be Inspector General he will realize what he did when Amtrak has an accident like Chase/Gunpow on the NEC.

<i>Mr. Mead is an Idoit he dosen't know a thing about Amtrak he is so dumb I might as well be Inspector General he will realize what he did when Amtrak has an accident like Chase/Gunpow on the NEC.</i>

And he's not responsible for the inability of crews to follow rules, which is what caused that wreck. If Amtrak has a major wreck because of an Amtrak crew screwup, it's their fault, not the DOT's. Nobody blames the DOT when an airline crew screws up and crashes, they blame the airline. Why is Amtrak any different?

Rhinecliff wrote:The problem, however, is that Congress generally lacks the savy to make indepedent decisions when it comes to Amtrak. Therefore, it can be expected to rely on these types of reports, and expressions set forth therein have a way of turning into congressional policy.

I will agree that some members of Congress will fall for that, but over the last few years that I've been watching Mead, I have yet to see his crazy ideas receive any serious consideration on Capitol Hill. Beyond his basic financial reports, nobody pays him much attention.

In addition, Mr. Mead's gratuitious advice about refurbishing bridges instead of superliner sleeping cars will likely resonate well with red-state polititions.

This is where it gets interesting. The so-called "red" perspective generally advocates businesslike practices. A business not only looks at managing costs, but also looks for ways to increase sales. Mead, and most of Amtrak's critics, are primarily concerned with cutting costs, and pretty much ignore opportunities to generate revenue. This unbusinesslike attitude has so permeated Washington, that Amtrak itself has often adopted that philosophy, rather than risk offending the hand that feeds it.

(As an aside, you know times have changed when the term "red" means "Republican" and not "communist.")

As most of us know, Amtrak's off-NEC corridor services are the least economically feasible of all of Amtrak's services. While they might be more useful in the eyes of some, they cover less of their costs with fare box collections than any other Amtrak service.

As a professional financial auditor, you'd think Kenneth Mead should be able to figure that out on his own. Dare I call him incompetent?

Nasadowsk wrote:<i>Mr. Mead is an Idoit he dosen't know a thing about Amtrak he is so dumb I might as well be Inspector General he will realize what he did when Amtrak has an accident like Chase/Gunpow on the NEC.</i>

And he's not responsible for the inability of crews to follow rules, which is what caused that wreck. If Amtrak has a major wreck because of an Amtrak crew screwup, it's their fault, not the DOT's. Nobody blames the DOT when an airline crew screws up and crashes, they blame the airline. Why is Amtrak any different?

Well if Productivity could improve they could save some money. Mead is a lobbysit type.

AmtrakFan

Well, I don't want to rain on anyone's parade here, but I know Ken Mead's deputy professionally, and he's a highly competent and knowledgeable individual.

Ken Mead is not a "lobbyist", and he's just calling it as he sees it. The NEC isn't going anywhere, and the government (which owns it) has inherited the responsibility for maintaining it. Hence Mead's admonition to fix the bridges.

The LD trains, on the other hand, run on private ROW, and -- as I have tiresomely pointed out here in the past -- costs are almost 100% variable. They stop running, and Amtrak immediately saves $100 million annually in payments to the freight railroads, plus all the wages of the crews, plus the maintenance and overhaul costs on cars and locos. There is no longer any legislated labor protection, just whatever the unions have been able to negotiate.

So in that context, Mead's conclusions are correct. As I have also pointed out, it's not "either or", that is, either LD or the NEC. The NEC stays with us no matter what. So if cuts are to be made, they will be elsewhere.

Given the limited capacity on the freight network, I'm coming around to the view that it may be best to just give up on the LD trains. As for the short-haul corridor services, well, if the states are willing to pay...

I’d like to consider the big picture here for a moment.

By constantly talking about what is expendable and what is not in the passenger rail system and other domestic programs, we are giving in to a mentality that says that we need to curtail this spending, while the real waste that no one wants to talk about is the bloated military budget.

Let me be specific: I’m not talking about the war, and I certainly support the troops, but it seems that all of the government programs that directly benefit the citizens of the nation (National parks, transportation, social programs, etc) annually all get put through the meat grinder by Congress, and bludgeoned in the media, while the defense budget – which is laden with corporate welfare – is hardly even questioned.

Why we are squabbling about a relatively small subsidy for Amtrak (A subsidy which, I might add, is spent right here in the US, providing a service to US citizens and benefiting US businesses, many of whom are small businesses) when literally billions of dollars are unquestioningly appropriated to weapons programs the military doesn’t want, redundant bases the military doesn’t want, and “classified” expenditures that have no public accounting is beyond me.

Of course, any attempt to discuss this in the popular media immediately labels the questioner as “unpatriotic” or “liberal” which are just catchwords that the public at large seems to have no concept of in a historical sense.

By keeping everyone bickering about things like Amtrak, education, welfare program, and a host of social issues that are important to a subset of the population, the powers that be are able to loot the treasury. That, to me, is the real scandal.

Thank you for saying that.

Well Said, Mr. Drumcorps!

NellieBly wrote:The LD trains, on the other hand, run on private ROW, and -- as I have tiresomely pointed out here in the past -- costs are almost 100% variable. They stop running, and Amtrak immediately saves $100 million annually in payments to the freight railroads, plus all the wages of the crews, plus the maintenance and overhaul costs on cars and locos. There is no longer any legislated labor protection, just whatever the unions have been able to negotiate.

So in that context, Mead's conclusions are correct.

No, Mead's conclusions are absolutely incorrect because they only show one side of the equation. If the Long distance trains stopped running, Amtrak would immediately sacrifice over $1.03 billion dollars in passenger revenue. That is Mead's problem. He looks at sources of revenue as costs to be eliminated. Today's lesson: no business can survive by not selling its primary product. The more product it can sell, the more money it can make.

Actually my above calculation is somewhat optimistic in terms of lost revenue, as the corridor trains would also lose business from lost transfers from LD trains. Both types of trains feed passengers to each other, so they are financially stronger as a unit than they would be in isolation. Ya gotta look at the whole picture.