Wednesday, July 22, 2009

Show-Me-the-Money Train: Debating State-Funded Subsidies for Amtrak

As we ponder the national high-speed rail system, this is a good time to consider the relative merits of our nation's existing passenger rail service, Amtrak.

This week the House Appropriations Committee boosted dramatically the funding President Obama had requested for the high-speed system, raising it from the $1 billion the President had wanted to $4 billion. This money would be above and beyond the $8 billion already included as part of the $787 billion stimulus.

The bill would also contribute an additional $1.5 billion to Amtrak. Though Amtrak has been working toward independent solvency for decades, it has always had to rely upon funding from the federal government to continue operations.

What you may not know, however, is that states often chip in on the subsidies to keep in-state Amtrak lines in operation. Here in Michigan, where our budget woes have corresponded to the poor state economy, we spend $7.3 million of Michiganders' money to keep open our lines that run to Chicago.

And B. Candace Beeke, writing for the Business Review Western Michigan's blog "West Side Story," thinks that's too much money to spend on the few of us (that's right, I do ride the Pere Marquette line from Holland to Chicago) who take the train, especially in these difficult times:

In normal times, one could argue that the $7.3 million the state spends to subsidize two Amtrak rail lines to Chicago is simply the cost of supporting public transportation.

And it just might be a valid argument, if Amtrak could show great value for the money it receives from the taxpayers of Michigan.

We don't argue with the notion that having train service to Chicago is a nice thing. But is it truly a need that requires a public subsidy?

Our issue here is twofold: Is the $7.3 million now spent on Amtrak the best use of dwindling financial resources for a state mired in a persistent fiscal crisis; and who is using the train to Chicago?

Is there a high public good being accomplished through the Amtrak subsidy? Or are we merely providing folks who want to go shopping on the Miracle Mile a taxpayer handout to help pay their way to the Windy City and back?

That's why -- at least from the perspective of triggering a much-needed conversation -- we welcome the efforts of some lawmakers in Lansing who want to trim Amtrak's subsidies. . . .

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