Why isn’t Amtrak on the table?

by Eric Shierman

After completing all of my Christmas shopping online this year, I used the saved time to finally get a chance to read a very well researched paper released a few weeks ago on the privatization of Amtrak written by Oregon’s own Randal O’Toole. Isn’t it great and indeed fitting that the world’s greatest transportation analyst resides in our own state?

This paper is very timely, because domestic discretionary spending needs to be cut deeply and with bipartisan enthusiasm if Democrats refuse to cut entitlement spending and Republicans refuse to cut defense. The most interesting dynamic in these budget negotiations is how little in taxes Obama is actually pushing for given the paltry cuts he is willing to accept. Letting the Bush tax cuts on the highest marginal bracket expire is politically popular, but it just doesn’t raise very much money, even by the methodologically optimistic calculation of the OMB that is prevented from using established economic science for dynamic scoring, a body of evidence that comes not from Republican hacks, but from the peer reviewed research of UC Berkeley’s David and Christina Romer.

We have a spending problem not a revenue problem. Republicans love to point out that the debt Obama has accumulated exceeds the sum of all the debt from every previous administration before him. This is true, but what gets left out of that narrative is that most of our spending has been the result of legislation George W. Bush very happily signed into law. When it comes to the deficit however, it was not Bush’s 2001 tax cut that blew a hole in our budgets; it was his runaway spending.

Revenue during the Bush years was rather stable. Like Obama, Bush inherited a recession, but by the end of his first term, federal tax receipts returned to the levels seen during the fat boom years of Clinton administration surpluses when taxes were slightly higher. Though signed into law in 2001, the lion share of Bush’s tax cuts did not go into effect until 2003. By 2005 the IRS was partying like it was 1999. A year later the Bush administration was taking in more revenue than his predecessor did but doing it with lower marginal rates, that is a fact.

bush spending

Wouldn’t it be nice if there were some low hanging budgetary fruit to cut spending? O’Toole argues persuasively that the red ink from public ownership of Amtrak should be easy pickings. Anyone who knows O’Toole’s work would understand that his paper is too packed with details for me to fully summarize it here. I strongly urge you read it in its entirety here.

Of course it will take a lot more pieces of fruit than just Amtrak to make up for the leadership of the two parties’ unwillingness to make real cuts in the areas where the big money is. The fact that Amtrak and the many other wasteful programs that make up our domestic discretionary spending have not been on the table serves as a symbol as to why we will always have a spending problem no matter how much revenue the US Treasury takes in.

Eric Shierman lives in southwest Portland and is the author of A Brief History of Political Cultural Change. He also writes for the Oregonian’s My Oregon blog. 

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Posted by at 05:00 | Posted in Federal Budget, Transportation | 48 Comments |Email This Post Email This Post |Print This Post Print This Post
  • Aaron Z.

    Amtrak uses up less than $2 billion per year and its farebox recovery rate is now up to around 80%. Basically what the federal government pays for is maintaining their rolling stock and tracks and a few minor capital projects (emphasis on “a few”). Considering the federal deficit is about $1.3 trillion, Amtrak accounts for something like half a percent of the deficit, so not much value there either. Also, who let Randall O’Toole back out of his cage?

    • Steve Buckstein

      Lots of line items in the federal budget “use up less than $2 billion per year” and “account for less than half a percent of the deficit.” “Not much value there” may apply to each individually, but together they add up to lots of value.

      Dismissing any one item because it’s a small part of the problem is a recipe for doing nothing except trying to raise taxes, which has proven to simply add to federal spending.

      • valley person

        Steve, non defense discretionary spending, which includes all those little items like managing national parks and forests, keeping soil on the land, researching disease control, and a lot of other useful but generally invisible services add up to…drum roll please….16% of the entire federal budget. So you could just eliminate everything the government does except send checks to old people and defend the nation and you would not have closed even half the deficit.

        Small ball, like selling Amtrack, is a basically useless way to tackle the federal budget or the deficit. If it keeps Randall out of trouble, then maybe it is worthwhile I suppose.

        • Steve Buckstein

          If they can’t tackle “small ball” items like Amtrak, why should we think they can tackle the big ones? Big Bird and Amtrak are good places to start…but not finish the return to fiscal sanity in D.C.

          • binhT

            Steve, it’s because they have a finite amount of time and resources. Wasting time on things like Amtrak (which covers 85% of its costs) while allowing TENS OF BILLIONS in runaway spending on highways (which barely cover 50% of their costs) is fiscal neglegence.

          • Damascusdean

            You shouldn’t. Small ball items are mostly popular and important services, and big ball items like Social Security and Medicare are also important and popular.

            In short, get used to big government and learn how to deal with it. Stop flinging yourselves at windmills.

      • binhT

        But how many cover 85% of their costs? You must also consider return on investment. Taking that into consideration, cars and roads are massive money-losers when held to the same requirements as Amtrak.

    • binhT

      Compare that to the TSA which costs 4 times as much as Amtrak. Amtrak has it’s own nationwide police department and doesn’t require the TSA.

    • Tyschev

      1/2 of a percent of the total budget seems like a very good number to cut. You have to start with something. Besides the fact that saving $2Billion dollars Anywhere is a good thing, the private market would be paying taxes on money made and then the loss split gets even better!

  • valley person

    Anyone who knows O’tooles work would understand that he is a crackpot.

    • 3H

      Perhaps that’s even world’s greatest crackpot?

      • valley person

        Not by a long shot. Ron Paul still lives.

  • Anyone who believes one word written by Randall O’Toole also believes that Satan is the “savior of mankind”!

  • Bob Clark

    You forget Amtrak is Joe Biden’s long held commuting means “dead track 1.” We are doing good just to stop the “high speed train spending hole.” I say just freeze nominal federal spending as current across the board indefinitely, get what permanent tax rates (for everybody making less than $1 million per year) you can, push deregulation where you can, wait for the economy to bring up federal tax revenues, and when the two get close to balance again then unfreeze nominal federal spending.
    We’ve had two spend thrift presidents in a row now. Before these two jokers there was Clinton. Say what you will about Slick Willy Clinton, he knew how to compromise and make political sausage; but Obama in contrast is limited in his own capabilities, seeing how every issue has to be tortuous and strung out. Don’t forget Clinton had the GOP to reckon with, just as Obama now; only Clinton had the cheerfulness to compromise and move on. (I wish I knew Hillary Clinton shared her husbands same dynamism and sausage making abilities. I kind of think she’s not as dynamic and cheerful.)

  • DavidAppell

    It is a flat-out lie that ‘the debt Obama has accumulated exceeds the sum of all the debt from every previous administration before him.’

    Debt information is here:
    https://www.treasurydirect.gov/NP/BPDLogin?application=np

    The day Obama took office, public debt was $6.3 T and total debt was $10.6 T.

    Today they are $11.5 T and $16.3 T, which represent increases of 83% and 54% respectively. So, in fact, total debt has gone up by about half.

    What can you say about a writer who either can’t do the simplest of fact checking, or simply writes lies?

    • I was not referring to the difference between total US debt when Obama was sworn in and what we owe now. I am referring to the sum of how much debt Obama has floated and the value of the debt from projected deficits under current law discounted to present value. Actually, I saw this calculation on Bloomberg TV last summer and so it was discounted to 2011 dollars at the time. I believe Barrons wrote an article about this too.

      I would think however that you would actually agree with point I was making, that the vast majority of this was the result of Bush’s policies that Obama inherited. This piece of mine was more a dig on Bush than Obama, perhaps you should read it again, or at least read that paragraph of mine again. Our problems however were not caused by Bush’s tax cuts, but by his spending.

      I am most certainly not blaming Obama for having to refinance nearly all of Bush’s Treasuries. My problem with Obama is that he has not taken this problem seriously; it’s like he channels Dick Cheney saying “Bush proved deficits don’t matter.” The fact that Obama has had to roll over most of Bush’s debt is a very interesting, esoteric, but also very frightening development that has its origin in a sudden decision on Halloween 2001 to discontinue auctioning 30 Year Treasuries and the surprising dominance of the 5 year TIPS in our debt structure. I almost included this above, but I will write about it separately down the road, perhaps next week.

      • valley person

        Eric,with due respect your argument is growing more incoherent with time. You post Amtrack funding as having anything to do with the deficit, and then you claim the Bush tax cuts had NOTHING to do with the deficit. I mean, you are a finance guy right? Can you possibly be THAT math challenged?

        No. I’m sure you aren’t. So you are trying to construct a political argument using phony economics.

        The Bush tax cuts, over a 10 year period, deprived the federal government of $2.8 Trillion. The cost of running Amtrack over a 10 year period is what, about $15 Billion?

        Please…get serious ok?

        • My argument was that if Republicans don’t want to cut defense and Democrats don’t want to cut entitlement spending, then non defense discretionary spending has to be cut very deeply. I presented Amtrak as very low hanging fruit that has very little impact on the deficit itself, but is one of several needless programs that together would have a material impact.

          Perhaps you also missed my mentioning that Obama does not even want to raise much in taxes either. Only letting the highest bracket revert to its previous rate of 39% will not raise anything close to 2.8 trillion. Remember that top rate was reduced by only 4.6% compared to the lower middle class (second bracket from the bottom) which was reduced by 13%. The ever overly optimistic CBO which always assumes we will enjoy GDP growth rates of more than 4% uninterrupted every year for the next ten years (including 2013!), has scored the expiration of the top bracket to add only $849 billion in new revenue over a glorious ten years, and again that is only if our economy booms more than the 1990s starting next year! Under this unlikely scenario, the added revenue is still just a fraction of what we will be spending over the next ten years on non defense discretionary programs regardless of how the economy grows.

          • valley person

            OK, your premise is wrong. Republicans have already voted to cut defense. Its in the sequester. And Democrats have already cut entitlements, or did you ignore that part where Romney and Ryan kept talking about restoring the Obama Medicare cuts?

            Amtrack is not “low hanging fruit” for the simple reason that it is a popular service and it is so tiny it doesn’t have enough gravity to hang low or otherwise.

            I agree with you on the point that Obama is only proposing a very modest increase in taxes, yet it is your side that is screaming bloody murder over this. He isn’t trying to raise $2.8 trillion. He is trying for around $1.6. So why all the hand wringing. Why not just say yes to that and then sit down and negotiate more cuts?

            Bringing the federal budget closer to balance will take time, tax increases, budget cuts, and some luck (decent growth for a decent umber of years). We could eliminate Amtrack or double funding for it and make no noticeable difference, but raising taxes at the upper end will make a difference.

          • valley person

            And….cutting “entitlements” basically means getting better control over health care expenditures. The only reasonable way to do this given our mixed private and public insurance system with mostly private providers is to implement the various features of Obamacare that are designed to constrain costs…you know…like death panels. At what point does your side of the aisle say uncle on Obamacare and then sit down with him and help implement cost controls on PUBLIC expenditures?

      • DavidAppell

        Eric, let me remind you what you wrote: “…the debt Obama has accumulated exceeds the sum of all the debt from every previous administration before him.”

        That’s a pretty straightforward claim. And it’s completely false. I expect you to continue to try to B.S. your way of out it, but it doesn’t wash.

  • DavidAppell

    Moreover, it was both Bush’s tax cuts and his wanton spending that blew a hole in the budget, but mostly it was his tax cuts:

    “Tax Cuts, Wars Account for Nearly Half of Public Debt by 2019,” Center on Budget and Policy Priorities
    https://p.twimg.com/A1-fmSHCMAAeTq4.jpg

    • I love this graph. I’m not sure you fully understand what it is showing otherwise you would see how even though it involves some considerable manipulation of the numbers by the Center on Budget and Policy Priorities, which to their credit they own up to on the bottom by labeling the source of their data “CBPP analysis based on Congressional Budget Office Estimates.” Remember, the CBO makes a range of estimates for different scenarios.

      I first saw this graph in 2010 on the Marginal Revolution blog which was making fun of it, because it somehow chose to ignore that the Social Security cash flow had suddenly gone cash negative, but by using some old CBO numbers, this progressive think tank was able to pretend Social Security would not go cash negative until 2017. The CBPP also arbitrarily used old CBO estimates of what our deficit would look like if we continued to occupy Iraq until 2019 even though the Obama administration was making good on his promise to put an end to it. The CBPP also arbitrarily chose the CBO’s highest future GDP growth assumptions to calculate the “debt without these factors” making non stimulus social spending like medicaid appear much lower than it is going to be, but since we are about to enter the year 2013, even the actual historical numbers for the past two years look very different that this graph depicts. The light blue area for example is the 2009 Stimulus Bill whose actual price tag has turned out to be higher than its original $800 billion because of the sloppy way its open ended commitments were scored by our friends at the CBO.

      The most egregious methodological mistake however was how the CBPP exaggerated the cost of the tax cuts for the same reasons I mention below. It fails to factor in the trade-off of GDP growth we would not have had with higher tax rates. That does not mean we would not have raised more money; I’m sure we would, just a much lower amount than this graph compounds. With effective rates far below 30%, Clinton era tax law would by no means suck the oxygen out of the economy, but it is an undeniable exaggeration to simply take the GDP growth we did have to calculate what higher tax revenue there would be as if there would be no dampening effect from this austerity.

      All of this is what makes this graph so effectively support my argument, that we have a spending problem not a revenue problem. Even with this blatantly flawed methodology that tries to inflate the US Treasury’s lost revenue intake by assuming it could tap 20% of GDP year after year for two decades and enjoy uninterrupted annual GDP growth of MORE than 4% from 2011 to 2019 without a single recession along the way, with such laughable massaging of the numbers, in 2019 SPENDING STILL MAKES UP MORE THAN 2/3rds OF THE PROBLEM.

      That should give all of us pause as to exactly how bad a spending problem we have right now. This most wacky attempt to hide our runaway spending actual serves evidence to demonstrate that even under unrealistically rosy assumptions we still have runaway spending. It’s that bad.

      • DavidAppell

        This is a bunch of bullshit just trying to cover up your lying ass. There is no GDP growth with lower tax rates, nor revenue growth, and there was never expected to, and that’s according to pro-Bush economists:

        Time Magazine, 12/6/07: “Virtually every economics Ph.D. who has worked in a prominent role in the Bush Administration acknowledges that the tax cuts enacted during the past six years have not paid for themselves–and were never intended to. Harvard professor Greg Mankiw, chairman of Bush’s Council of Economic Advisers from 2003 to 2005, even devotes a section of his best-selling economics textbook to debunking the claim that tax cuts increase revenues.”
        https://www.time.com/time/magazine/article/0,9171,1692027,00.html#ixzz1KSEvg2oG

        If you ever expect to be a real writer, Eric, you’ll have to learn to present basic facts instead of basic falsehoods to prop up your ideology. Frankly, I don’t see any evidence that’s within your capabilities.

        • I have never said either in the article above or in comments here below that the Bush tax cuts raised more revenue for the Treasury than would have been otherwise taken in had they never been enacted.I read Greg Mankiw’s blog every day in my twitter feed, what I did say was uncontroversial, that there is a trade-off between economic growth and tax rates, and anyone who simply crafts a model that takes past GDP and merely plugs in higher tax rates without accounting for the marginal loss of growth will overstate the lost revenue.

          That does not mean there would be no lost revenue; it simply means it will have been overstated. If you do this on a graph covering two decades, this seemingly small error will create a significant distortion in your results. The fact that this progressive think tank’s graph does this and shows spending still makes up more than 2/3rds of our budget deficit in 2019 really highlights how bad a spending problem we have.

        • Rupert in Springfield

          Probably your biggest problem David is you just simply don’t look at the figures, you just go with nutty assertions.

          Fact is Bush2 came in with a mild recession, then got hammered with 9/11. Revenues dropped after 9/11 as they would in any recession of that severity.

          Bush2 cut tax rates, and wow, revenues went up soon after. In 2003 revenues had bottomed out, by 2006 they were back at 200 levels and by 2007 they exceeded 200 levels.

          THese numbers are readily available on any Google search. I just went to the most liberal source I could find, the Tax Policy Center

          https://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=200

          So the answer is no David, the Bush tax cuts did not cause the deficit.

          Eric is a writer David, and has actually written some books and from what I can tell seems to support himself with his work.

          That’s a big difference from you David. You sit in your apartment, with a car that wont start, and piss and moan about how everybody but you should pay for your housing and health care.

          Some advice – Start making at least enough to support yourself as a writer before you start acting like you know much about the topic.

        • guest

          Please delete the expletive! No not the scatology word, but the Appellant of curse.

      • DavidAppell

        And, let’s ask, where was all this GDP growth the tax cuts were supposed to bring? Let me remind you of the economic record:

        1Q08 -1.8%
        2Q08 1.3%
        3Q08 -3.7%
        4Q08 -8.9%
        1Q09 -5.3%
        2Q09 -0.3%

        So tell us, Eric — what GDP growth was missed in these projections?

        • Obviously, regarding this methodologically challenged graph you just shared with us, I am referring to GDP growth from 2003 to 2019. If 50 basis points were shaved off of two decades of growth, it compounds a greater loss than any one nasty recession’s contraction, but even during that recession, a further 50 basis points of negative GDP growth in that nasty recession and those numbers you just posted get worse.

  • DavidAppell

    Two simple graphs also show that we have a revenue problem, not a spending problem.

    1) Federal receipts as a percentage of GDP, down sharply since 2000:
    https://davidappell.blogspot.com/2012/11/bush-could-have-paid-off-entire-debt.html

    2) Federal spending as a percentage of GDP, down almost 2 percentage points since 2010:
    https://research.stlouisfed.org/fredgraph.png?g=dxz

    Eric, if have to lie to support your ideology, at least use lies that aren’t easily checked.

    • Were I to have lied, I would have had to have written something untrue. I showed a graph of real historical data that backed up my very true statement that soon after Bush’s tax cuts were implemented he began raising more revenue than Clinton did. That is a fact.

      You are of course talking about taxes as a percentage of GDP while I was very specifically referring to the nominal figure, but there is nothing contained in that spike in spending from 2001 to 2009 that was made necessary by the GDP growth we saw during those 8 years. Indeed the more we grow our economy the smaller our public expenditures should be relative to GDP just as an organization that grows should see economy of scale reductions in costs relative to its size. Whenever costs grow proportional to an organization’s growth, it is in a diseconomy of scale and thus has a spending problem.

      When you claim that our deficit is caused by the failure to tax enough revenue equal to 8 years of 20% of the GDP that we have had over those years, this claim of yours is not a fact. It is an assumption of what could have happened if two improbable assumptions of yours could have been true.

      First you assume that the United States COULD have sustained an intake of federal tax receipt revenue of more than 20% for 8 straight years. Anyone who has read the chapter on public finance in an intermediate macroeconomics textbook knows this is a pipe dream. In all of US history the federal government has only taken in revenue of equal to or greater than 20% of GDP twice. The first time ever was 1944. Those wartime marginal rates which were the highest we have ever had could only raise 20.9% of GDP! They could only be sustained another year as revenue dropped down to 17.1% of GDP in 1946 and remained there for most of the rest of the 20th century. Federal taxes for the next three decades were much higher than they were either today or in the Clinton years and yet federal receipts stayed around 17%. The highwater mark before Bill Clinton’s last year in office was in 1969 at 19.7% of GDP. Historically every time it touches or exceeds 19% a recession will follow. That is of course also the case in 2001 and 2002. Clinton’s tax rates were still in place but revenue both in nominal terms and relative to GDP were dropping before most of Bush’s tax cuts went into effect in 2003. Revenue did not increase until those bigger top rate cuts finally went into place. Attached below is a graph showing the upward limit to how large a percentage of GDP the IRS has been able to divert into the US Treasury. Rates have been higher than they are now and rates have been lower than they are now, yet revenue has very consistently fluctuated between a very narrow range of 15% to the very rare 20% with between 17% and 18% the consistent average.

      Which brings us to your second unwarranted assumption, that if tax rates would have been higher we would have seen the SAME GDP growth we did with lower taxes. This is essentially an intentional denial of the macroeconomic literature that has established empirically the existence of a trade-off between higher tax rates and economic growth. With the recent application of vector autoregression over the past decade the evidence has simply become irrefutable. That is not to say we would not have seen more revenue. I’m sure we would have, but it would be much less than simply taking a desired tax rate and plugging it into the actual GDP we have had and pretending you would get the same thing.

      Relative to GDP there is a very clear upward bound for federal tax receipts given the services that our government provides in return for them and it is clearly around 18%. Any attempt to take more than that and we begin eating our seed corn and historically the economy responds to this austerity rather quickly. Given that state and local taxes are going up well beyond historical levels, that 18% bound could eventually begin to lower as the IRS competes with local state Treasuries for more revenue.

      It is of course possible for receipts to go beyond 18% and 20% in a sustained way, but it would require nationalizing some industries so that the new revenue came from the purchasing of these publicly owned companies’ products such that these purchases were not reducing demand for goods in other areas of the economy (and by goods I of course mean both consumption goods and capital goods). That is of a tall order. Northern Europeans have sort of been able to pull this off with a national healthcare service, southern Europeans have not. Both northern Europeans and southern Europeans have failed to pull this off in any other sector so in the north they have been privatizing state owned industries, while in the south they have not. The rationality of America’s political culture resembles southern Europe more than the north, so I would not expect a better outcome here, thus we are stuck with 18% of GDP for the feds to play with.

      Once one understands this upward boundary of revenue, it becomes rather apparent just how bad a spending problem we have here in the United States when considering how little we get in terms of public goods for that money. Total US government spending (fed, state, county and municipal) is 38.9% of GDP; compare what we get in services compared to Germany’s 43.7%. There is a mere 5% spread in spending but a fare more than 5% spread in value. To balance the budget, the very finite amount of additional revenue we could possibly raise is to fund our very limited existing programs and their mediocre output of utility.

      Your second point, that there has almost been a 2% drop in spending relative to GDP since 2010 does not in any way support the denial that we don’t have a spending problem. Since 2010 we have had at least some GDP growth, less than 2% but at least something to compound for two years and we have ended the war in Iraq yet this cannot even reduce government expenditures by more than 2% of GDP? You made my point for me. That is evidence of a serious problem.

      • You’re not so much lying as very selectively cherry picking facts to back up your ideology. Your article is anti-scientific and irrational. You should start with a broad view of the facts, and see where they lead. Of course revenue is part of the problem. When the economy and population grows, taxes need to grow proportionally to cover expenditures.

        I wish that tax rates could go down, but it was highly irresponsible for Bush to cut taxes while increasing spending—shifting us from surpluses to deficits. When you go in the supermarket and load your cart, you have to pay for everything. If you don’t want to pay for it, don’t put it in your cart.

      • valley person

        Eric, there is no magical 18% limit to federal tax revenue. In point of fact, while we have “averaged” only 18% fed tax to GDP for the past 40 or so years, we rand deficits since we were spending 21% of GDP on average. The only years when we matched up, at around 20% to 20% were during Clinton and the economy was booming.

  • binhT

    Amtrak’s problem is too few trains per fixed unit cost. There is no shortage of train passengers. Adding schedules will increase revenue per fixed asset and improve the bottom line.

  • Amtrak currently has an 85% recovery ratio, which is to say that for every $1.00 that they spent to operate the system they receive 85 cents in revenue, with the Federal Government making up the the other 15 cents with their annual appropriation to Amtrak.
    By comparison, the National Park Service regularly has a 35% recovery ratio; they only take in 35 cents for each $1.00 they spend. It has been a financial loser for decades, with no possibility of ever even breaking even. Why is it that Randall O’Toole isn’t demanding that the National Park Service be scrapped?

    • DavidAppell

      Don’t expect Eric S to answer you. He is a hack writer who lies, and has no interest in correcting the facts.

    • Tyschev

      What company would ever survive with only 85% recovery ratio? And who says to shut down Amtrak, the idea was privatizing the venture. Give real business people the chance to make it a lively worthwhile thing for us all to have.

  • DavidAppell

    Will Eric Shierman and Oregon Catalyst be issuing corrections for his factual errors in this article?

    If not, why not?

  • valley person

    Another small point for Eric. Dude…you may have missed the memo but the Democrats actually won the election and we like trains.

    • LibsDeserveDeath

      Yeah – Obama won by a whole 2% of the popular vote and less than 500,000 votes in battleground states. Hardly a mandate; though I suspect you enjoy “man dates”.

      • 3H

        I know nothing of VP’s personal life, so don’t take this as confirmation of your premise… but if he did enjoy, as you call them, “man dates” is that a problem for you? Are you bigoted? Or are you attempting to be clever? Hint: you’re not.

        • valley person

          I’d like to date “LibsDeserveDeath” and give him/her a big smooch. I mean, he or she must be quite a hunk to display rage not just in posts, but even in their name.

          I get all flustered just thinking about him/her. Can I buy you a drink you hunky thing you?

          • 3H

            Does this mean we’re through? I wish you had told me in private instead of dropping this bomb in such a public forum.

  • The unnecessary war in Iraq cost 1,000 times more than Amtrak. Amtrak provides essential transportation for many people, helps people like me get to work, and helps hold our country together. It is silly to blame Amtrak for the federal deficit. The problem we have is in large part the result of Bush’s wasteful foreign adventure.

    Amtrak receives something like $1 billion in government funding to compensate for their legal mandate to provide service to a huge number of rural places that would otherwise have few or no transportation options. Recently the NY Times has identified $80 billion per year of corporate welfare given out by states and cities to attract “jobs”, spending based on very dubious math and economics. If that $80 billion were instead invested in commuter rail, high speed rail, freight rail, seaports, roads, bridges, training and education, we’d get a lot more economic bang for our bucks.

    https://www.nytimes.com/interactive/2012/12/01/us/government-incentives.html

  • mike

    If AMtrak is not subsidized how can I get to Seattle for so cheap?? I ask you.

  • valley person

    Eric, eliminating the Bush tax cuts at the top end would raise around 100 billion a year. Eliminating Amtrack would save 1.5 billion a year. Yet you say the former is paltry but the later is somehow important?

    Dude…buy a calculator.

  • Randall O’Toole? Seriously? You’re touting as an expert the guy who recently testified before a Congressional committee that we should privatize the nation’s air traffic control system??

    • Tyschev

      You don’t seem the kind of person I would expect to be reading here if you are so against privatizing air traffic control. What makes government control of the system so much better?

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