GOOD BUYS/BAD BUYS: A very bad buy: The egregious government “enterprise”

Let’s take a trip. Let’s avoid the endless security lines and traffic that inevitably delays flights at many American airports owing to an outdated air traffic control system. Let’s take the government train. Let’s take Amtrak, the government railroad that loses tens of millions of dollars each year and billions since the government takeover of passenger railroads in the 1970s. Let’s find a new kind of traveler’s hell.

All Aboard

In an attempt to avoid the headaches of air travel my wife, the ever-comely Suzanne Hall, and I recently took the train to Syracuse, New York from New York City’s Penn Station.

What a mistake. We either should have rented a car for the entire trip or stayed home.

On our vacation trip to upstate New York, a place of economic disaster in a high tax state, was bad (We saw many cities that looked like they were bombed. I asked several Syracuse residents about the local economy. The most common answer was, “It sucks.” Yet our state government, in a Prince Potemkin ad campaign, runs tube spots telling everyone New York State’s economy is great).

The problem with our train trips, and with Amtrak as well as the anomaly of all government enterprise, is it offered no sensible alternative to taking a plane or driving a car.

Problems began when we boarded our train in Penn Station. Many of the floors were gunky. The windows hadn’t been cleaned. There was no overhead sign telling us the stops. We were late going upstate. We began our return trip with an hour delay at a Syracuse train station that looked like something out of the 1960s-television series Petticoat Junction, only there was no Kate or Uncle Joe.

Once on our train from hell that frequently shook, we asked for a quiet car. “We have no quiet car,” we were told. Let’s get something to eat.

Amtrak Grub and Equipment—God Help Us

No one in his or her right mind would buy anything substantial from the dining car, which was a wreck with many places tapped over. Coming back from Albany, they had to remove the locomotive and put on a new one. The first passenger car, for about 20 minutes, was open, with no barrier. Someone might have fallen on the tracks. But, since they seemed to be switching crews at Albany, there appeared to be no one watching this potential danger point. Is Amtrak waiting for another disaster, such as the one that occurred a few years ago in Philadelphia?

Why doesn’t Amtrak have adequate equipment and better service, such as a true high speed train? Why does it run the joke of a so-called high speed train, Acela, that runs along the Eastern seaboard line, charges premium prices, but delivers anything but high-speed service?

Government Running a Business?

I can explain it in a sentence: Government no more knows how to run a business than I know how to play midfield for Real Madrid. The difference is this: I cheerfully concede the latter while Amtrak supporters in and out of government never seem to concede the former. They just demand the poor taxpayer pay more and more geld to close annual deficits. And why is that? Why aren’t we getting a good service?

The good services we get usually come from some person or group of persons who expertly run an enterprise and make a ton of money. This person or group of persons usually is someone who has dedicated himself or herself to pleasing the changing tastes of consumers (Of course, I exempt the crony capitalist, who really isn’t a capitalist but a kind of pol masquerading as a business person).

Since these people make a lot of money, they can pour back some of it into the enterprise. This provides better equipment. Money is also available to reward employees, who want to stay with the business and whose expertise improves the service. All of this improves the quality of the enterprise. Those who don’t do so, who run their businesses like Amtrak, go broke. They have to find another way of earning a living.

Here is where Amtrak goes off the rails. Its high paid executives, despite repeated failures, are never penalized by consumers, but rewarded by their political butt-buddies, no matter how badly they do. (I wish I had this kind of system when I was failing in high school. Unfortunately, or fortunately depending on your point of view, I didn’t. So, since I went to Catholic school and didn’t go a public school, I went to summer school whenever I failed. The Irish Christian brothers, like fickle consumers who demand good service or take their business elsewhere, were taskmasters).

Despite the promises of the 1970s, when Amtrak executives promised big profits or what one well lubricated honcho said would “be the biggest turnaround in business history,” Amtrak has never made money. And, as a badly run business, it often charges dirt cheap prices to get people to ride because it knows most people don’t value their services and won’t pay premium prices. Still, there might be the potential to make some money if Amtrak knew what it was doing. The latter is tantamount to saying that the people who ran the Tom Dewey campaign of 1948 and Hillary Clinton’s campaign this year knew what they were doing.

Amtrak in a Time Warp

Short run service—say from New York to Washington or New York to Philadelphia or New York to Boston—has the potential to make money if Amtrak actually modernized its high-speed services. Today it just pretends it has high speed service.

When I was a teenager, back in the late 1960s and early 1970s, back in the last days of the Pennsylvania Railroad—which was driven into bankruptcy along with other railroads by outrageous overregulation—there was a Washington to New York service called the Metroliner that took three hours. Today, almost a half century later and with Amtrak having invested hundreds of millions of dollars in the Acela train—along with their cracked undercarriages—the scheduled time is still three hours. Despite decades of technological advances, Amtrak is stuck back in the 1970s. But it is also true of the rest of the system.

Many of its long-distance routes are a joke, maintained only because a group of politicians has threatened no more funding for Amtrak if their line is cut. But how many people actually want to ride an Amtrak train from New York to Savannah, Georgia, for some 17 hours—and with dining car food that could make any civilized person sick— when you could ride a plane, with all of its inconveniences for about two hours.

When I have something unpleasant to do, I’d rather get it over with as soon as possible. That’s why I take a plane. But that is also why the government, posthaste, should sell off Amtrak and every other government enterprise. When an entrepreneur fails at a business, he moves on. Time for Amtrak and its failing executives to move on.

About The Author

Gregory Bresiger

Gregory Bresiger is an independent business journalist from Queens, New York. His Personal Finance articles have appeared in publications such as The New York Post & Financial Advisor Magazine. He is the author of the eBooks “Personal Finance For People Who Hate Personal Finance” and “MoneySense”.