posted
Former Pennsylvania Governor and passenger rail supporter Edward Rendell has co-authored an Opinion piece that appeared in Yesterday's Wall Street Journal:
The Journal's website is available by paid subscription; but sometimes material is open to free access. Here is pertinent brief passage:
But there is a way to fund high-speed rail in a place where leaders in both parties support it—the Northeast Corridor from Boston through New York and Philadelphia to Washington, D.C. How? By creating a partnership among the federal government, state governments and the private sector.........The first step is for the federal government, which ultimately controls Amtrak, to break off the Northeast Corridor into a separate company. It could then package the railroad for transfer out of federal control. The new railroad should be a public-private partnership. Fifty-one percent of this new company would be owned by a multistate compact among the nine states along the corridor and the District of Columbia. The remaining 49% would be owned by a private consortium that would likely include an investment bank/private-equity group, a railroad operating company, railroad unions and equipment vendors.
.The federal government's financial obligation to the corridor would be to allocate funds up front, perhaps on a five-year payout, to compensate the new owner for the fact that it is obtaining an asset in rundown condition. Federal legislation could limit the size of this up-front payment by requiring the states to pick a private-sector partner based in part on which one proposes the lowest federal subsidy. Whatever the payment is, it will represent a long-term savings as compared to the open-ended commitment of hundreds of millions of dollars per year now going to Amtrak service along the corridor.
I have my doubts about this proposal; first, there certainly appears to be a track record that once government gets involved in a program, it is loathe to get out. That is why there is skepticism (I personally think unfounded) that "bailed out' auto companies in which the government obtained an equity ownership will simply become "Government Motors'. Therefore why would the private sector want to become a minority holder in an enterprise controlled by the government?
If the private sector desires to invest in rail passenger service, then why not start with a comparative "baby step' - the one I would have in mind is what I have noted in the past - namely 40 additional Coaches to be added to the existing 20 Acela sets, with 'the government' making the necessary additions to the three "car barns' along the Corridor.
Further, some, particularly Long Distance train advocates, will argue "this will be the death of Amtrak as we know it'. Such would likely result in the other viable Corridor services such as California to be spun off to regional agencies. Where then would the Long Distance trains end up, as I highly doubt if a Federal agency operating only LD trains could make much of a case for continued funding.
Suffice to say, the Reader Comments that I have reviewed support the Journal's anti-passenger rail positions.
Posts: 9976 | From: Clarendon Hills, IL USA (BNSF Chicago Sub MP 18.71) | Registered: Apr 2002
| IP: Logged |
posted
Gilbert, When I saw this article in the Journal this morning I thought of you immediately, so I came to this website, waiting for your comments. I didn't get to read them until this evening. My comments on your comments?: restrained, polite, diplomatic.
To follow in your vein, I would suggest that Ed Rendell's argument misses a lot which only complicates the issues, too bad.
Tom
Posts: 518 | From: Maynard, MA, USA | Registered: Sep 2000
| IP: Logged |
posted
I'm calling this a bad idea. First, the federal government is going to give million$/billion$ to some private consortium to compensate for conveying a plant in rundown condition?!? That's likely a deal killer right there. But then we're going to create a nine states + DC governmental agency to control operations and ownership of the corridor. Plus we'll add in some more investment bankers, some union leaders and maybe just a few people that actually know something about running a railroad...
Somehow, I don't think we'll be happy with the results.
Posts: 831 | From: Seattle | Registered: Jan 2011
| IP: Logged |
Printer-friendly view of this topic
