Even though they lose about a half a billion dollars a year.
When it comes to profitability, one of Amtrak's main three services is not like the others. While routes in the Northeast Corridor make a decent profit and individual state corridors just about break even, long-distance routes that traverse thousands of interstate miles and often connect remote areas suffer an indecent loss.* Last week, at a hearing about Amtrak's fiscal future, Bill Shuster, chair of the House transportation committee, suggested it may be time to cut these routes loose (via Streetsblog):
"We’ve tried to impose this on the nation and it doesn’t seem to be working. We talk about rural areas — I come from a rural area, and 98 percent of the people have cars, people aren’t clamoring to get on trains and travel the United States. They have other modes to do it."
Shuster's response to the situation is certainly a logical one. As we pointed out last fall, Amtrak's long-distance routes lose, on average, $111 per rider. (For comparison, the Northeast Corridor makes $20 a head, and state routes lose about $11.*) Long-distance trains did carry about 4.75 million riders in 2012, but they cost more than a billion dollars to operate, and stood more than $500 million in the red.
Nevertheless there's a three-part case to be made for keeping long-distance routes around. (Let us be clear that the type of long-distance trains referred to here are not high-speed long-distance trains, though we recently made a case for those, too.) Part one is the fact that ridership on longer routes seems to be on the rise.
Take the statistics from Amtrak's fiscal 2012 [PDF]. Each of the fifteen long-distance routes carried more passengers than the year before, and the class as a whole had its best ridership in two decades. At least three routes set ridership records, including a nearly 13 point jump for the Texas Eagle (Chicago to San Antonio). Even more impressive growth, if not a record, occurred on the Empire Builder (Chicago to Seattle and Portland), whose ridership rose nearly 16 percent and now comfortably exceeds half a million a year.
A recent advocacy report on long-distance trains [PDF], prepared by the Midwest High Speed Rail Association and the National Association of Railroad Passengers, points to these increases as a reason for a three-tiered investment plan in these routes. The report calls for service upgrades (including longer trains and more frequency), infrastructure improvements (track and station design changes to reduce travel time), and new equipment (especially a fleet more suitable to overnight rides). "Lack of service, not lack of demand, is what limits usage," concludes the report.
Now, ridership in isolation isn't always the best metric — though if the routes were losing money and riders, the case for long-distance trains probably couldn't be made at all. So the long-distance report also makes a broader social argument for the continuation (at worst) and expansion (at best) of this service. As an example, the report's authors point to the benefits of the Southwest Chief service running 2,265 miles from Chicago to Los Angeles.
Now, the statistics alone are pretty grim. While the route carried about 375,000 riders and made about $51 million in 2012, it also lost some $158 per passenger last year — second worst of all the long-distance lines. But long-distance advocates say these figures don't tell the whole story.
Instead, they point to the fact that the Southwest Chief manages that many riders despite running only a single train each day. They argue that its 31 intermediary stops (and access to 528 city-pairs in all) provide a mobility option for 25 million Americans within 25 miles of a station, many of whom live in areas where intercity air and bus service is decreasing. They say that one in five Southwest Chief passengers travels between two cities that couldn't possibly sustain their own service, and that nearly two-thirds travel from one end point to an intermediary station — a sign that long-distance trains offer a service that's fundamentally distinct from air travel.
In simpler terms, they make the case that without long-distance trains the United States would lose a truly national passenger rail network:
Goals like “operational self-sufficiency,” “profit” or “minimize federal operating support” are neither reasonable nor sound public policy objectives. Their effect is to block improvements needed to modernize the nation’s intercity passenger train system and rejuvenate our increasingly expensive and dysfunctional transportation system. The driving purpose should be to harvest the public benefits that trains produce for the communities they serve and for the nation as a whole.
Again, this part of the case has its problems as well. The number of people whose only intercity travel option is Amtrak has "tripled" in recent years [PDF], according to train chief Joseph Boardman, but that figure still remains less than 1 percent of the rural population. For better or worse, social reasoning tends to carry less weight than finances when federal subsidies are involved.
But at the Congressional hearing last week, Boardman himself made a fiscal case for keeping money-losing long-distance trains in service. He explained that once you cut back on long-distance service, it becomes prohibitively expensive to add it in again, because the freight trains that use the extra track room place a premium on it. In other words, said Boardman, if at some point Amtrak decided to reinstate (not to mention expand) a cancelled long-distance service, it "probably can't afford to do so."
So there you have it. There are certainly problems with the finances of long-distance trains in the United States, and this service class remains the most rational place to begin a discussion on Amtrak's fiscal health. But policymakers must bear in mind that choosing to suspend these trains while they address the problems may be no different from choosing to eliminate them.
Top image: A man walks by the Amtrak train station in Williston, North Dakota. (Shannon Stapleton/Reuters)
* Correction: An earlier version of this post inaccurately stated that routes in state corridors make money. They lose about $11 per passenger.