Friday, March 09, 2007

Prospects for Texas commuter and inter-city rail

Today is a bit rushed, so I'd like to pass-along an email dialogue I had with reader David Gratvol (with his permission) on prospects for rail to Galveston, College Station, and in the Texas Triangle. Before we get to that though, I'd like to take a short moment to recognize and celebrate Houston Strategies' two-year anniversary. I've learned a ton, both from having to cohere my scattered thoughts into written form as well as from your insightful comments. I hope you've enjoyed it as much as I have, and I'm looking forward to the next two years (and beyond). As always, thanks for your readership.

On to the dialogue:

> Dear Mr. Gattis
>
> I have been a steady reader of your blog for the past
> year and I wanted to tell you that I find it quite
> enjoyable and informative. Your suggestions and advice
> on how to improve our city while still keeping level a
> headed view of what is realistic and what is simply
> "pie in the sky" ideas are refreshing and encouraging.
>
> Though one of the issues that I wish to ask you about
> is your view on commuter rail. While you have stated
> your dislike quite clearly you seem to have made an
> exception for a Galveston line which I found
> intriguing. As a college student spending the past
> year and a half between Houston and New York it is
> clear why a commuter rail is a success in New York and
> cannot be in Houston. That is New York has weak road
> system for its population resulting in long and
> complicated routes from the suburbs to the city as
> well as a chronic lack of affordable parking. Houston
> is blessed to have the exact opposite (maybe too
> blessed).
>
> That being said a Galveston line would not primarily
> be for daily commuters to Houston or Galveston but it
> would act more like an intercity rail line. That begs
> the question weather other commuter lines could also
> be good for Houston if the focus was more to make them
> frequent (and maybe high speed) intercity lines. The
> one that comes to mind is the 290 idea that would run
> a line from downtown Houston to College Station.
> Naturally all the logistics and cost would need to
> tolerable.
>
> With all that said I wanted to know your opinion on
> this and the possibility of other intercity lines such
> as the infamous Texas Triangle and the new Texas T
> bone. Maybe on a slow day you could write a blog on
> the subject. Anyways thank you for taking your time to
> read this and I would be grateful to any feedback.
>
> Sincerely
>
> David Gratvol

David,
Thank you for your very kind compliments. Here are the reasons a Galveston line can make sense:

1) local transit at both ends to get you to your final destination
2) highly populated corridor
3) regular congestion on the existing freeway
4) tourism potential in addition to commuters (better overall utilization
for the capital cost)
5) existing tracks that make the cost much more reasonable

Unfortunately, College Station would lack 4 of these 5 (I think the tracks
exist, but I don't know their freight utilization). It really even lacks
commuters. The Galveston line has a major job center at Clear Lake in
addition to downtown and Galveston, so people could live near any of those 3 and commute to another one. There are limited job centers along a line to College Station, and essentially no daily commuters between the two. Because of that, I think Greyhound service is probably adequate between Houston and CS.

As far as broader inter-city rail in Texas, I'm very skeptical of the costs
vs. the benefits, especially because most of the cities in Texas don't have
very robust local transit. It works in the DC-Boston corridor because it's
not hard to get the last few miles to your final destination on local lines,
but that's not true in Texas. If a person's going to have to rent a car or
use a taxi anyway, they really might as well take a cheap and fast flight on
Southwest (or take a Greyhound bus, or just drive themselves). California
is actively looking at intercity high speed rail, and they have a much
higher population and more density than Texas, along with more local
transit, better pedestrian weather, and much more congested freeways and airports. My thinking is wait and see if California successfully pulls it
off first. If so, then maybe Texas should start taking a look.

Regards,
-Tory

> Dear Mr Gattis
>
> Thank you for responding to me so quickly. I would
> just like to add a few more points before bringing
> this question to a close.
>
> Your five points on what is needed for a viable
> commuter rail are accurate, but the reason I suggested
> that a Houston- College Station rail is not because it
> fits the classic definition of what is needed for a
> commuter rail. the other Metro proposal one towards
> the south west fits that one but falls because of your
> points.
>
> The reason I suggested it was because of what is in
> College Station. Namely Texas A & M University.
>
> so point 1 about poor local transportation is mute if
> the station ends on the campus itself.
>
> Its also quite possible that the University itself
> would be willing to subsidize the construction and/or
> the fare cost for its students (Rice University
> provides free year light rail passes for all its
> students)
>
> Also Princeton has a small rail line off the NJ
> transit rail that goes straight to the campus.
>
> To say that A & M would not do something similar is
> not out of the realm of possibility
>
> Granted the idea would need to be explored, but I
> think it justifies a full ridership analysis to see if
> it would be justifiable. Keep in mind it would have
> other stops so like Jersey Village and Hempstad so
> others would use it to go to Downtown.
>
> As for the point about intercity rail I have to agree.
> California and the Midwest (around Chicago) have more
> demand for high speed rail. Though I dont quite agree
> that we should wait until California has rail to move
> forward. As you know these things take years (if not
> decades) it could take 15 years for those areas to
> have an effective system, if not longer. To start
> after them would mean Texas high speed rail in 30
> years. Rather it might be a good idea to say 3-5 years
> behind California , but still move the process along.
>
> We do not want to start a system that is ineffective,
> but on the other hand it would be worse to start one
> when we badly need it. As for your concern about poor
> local transit. With the Light rail in Houston and Dart
> growth in Dallas and even Austin's moves in 20 years
> when it would arrive we will have good local transit.
> Also the point about a quick flight on South West. The
> point would be that the rail could get you from
> downtown to downtown faster than SW could.
>
> Sincerely
>
> David Gratvol

David,

I'm just not sure TAMU would generate enough riders to justify a line that long (90+ miles). Princeton does have rail to NYC (50m away), but it also surrounded by suburbs with employees that commute to Manhattan - not the case in College Station. I'm all for better ties between Houston and TAMU though. Maybe there needs to be very nice bus (more upscale than Greyhound - nice seats, tray tables and power for laptops, wireless Internet), that does the route on an express basis (few stops) on a pretty regular schedule. Something that gets a bit of marketing/branding so people know about it and use it. "Aggie Express"?

I agree high speed rail might get you downtown to downtown faster than SWA. But only a tiny percentage of Houston and Dallas jobs are in their downtowns (less than 7% in Houston's case, worse in Dallas). DFW in particular has them spread all over the place. And it would cost tens of billions to move maybe 2-3 thousand people/day, saving them maybe half an hour or so vs. flying. Houston's LRT, for example, cost about $300m for 7.5 miles to move more than 40,000 people a day, and even that's on the edge financially and subsidized (tickets don't cover costs, as opposed to aviation).

Regards,
-Tory

Your thoughts welcome in the comments. David also gave me permission to share his email, if you'd like to contact him. In a format to thwart spam-bots, it's gravtol (at) yahoo.com.

35 Comments:

At 11:11 AM, March 09, 2007, Anonymous RedScare said...

Tory,

while the cost of building high speed rail between Texas' largest cities may be prohibitive, you are far too dismissive in your other points. Air travel has gotten more frustrating and time consuming, and promises to get more so. Additionally, while you correctly point out that 7% or so of workers are in downtown, you do not state, nor do you know how many business travellers are in, or travelling to those downtowns. I suspect it is a far higher percentage.

I doubt time savings would only be 30 minutes. A traveller from downtown could be on the train in less than 30 minutes from his office, whereas it would take 30 minutes or more just to travel to the airport. Add the 30 minutes or more to get on the plane and the reverse at his destination and an airline traveller may spend 3 to 4 hours getting to his destination, versus 2 to 2.5 hours by rail. This is not insignificant to a business traveller.

2,000 to 3,0000 daily travellers is also a bad guess. But, even that number of passengers travelling to each of the 3 cities in the triangle equates to 12,000 to 18,000 trips daily. If they are round trips, the number doubles.

Considering a high speed rail trip is faster than either air or auto travel, and adding it's cache versus each, only a prohibitively high ticket cost would doom it. On that issue, I have no figures.

 
At 1:17 PM, March 09, 2007, Anonymous Brian Shelley said...

Has it ever been considered to build the infrastructure, but not own and operate the trains or main tracks? Allowing chartered trains to privately operate using the infrastructure could help build a more cost effective utilitization of the infrastructure. I could easily see a Houston-College Station train fill up on football game days, graduation weekend, etc…, but not a full time set schedule. Trains to South Padre for spring break, Galveston for Mardi Gras, or the Houston Rodeo could work as well. Private operators have the flexibility to dynamically assess ticket demand and allocate trains on an as needed basis. Some subsidization of train riders is warranted since they would otherwise consume subsidized transportation (freeways).

 
At 7:29 PM, March 09, 2007, Anonymous Anonymous said...

On the Galveston-Houston line is there some kind of externality that would justify the government doing it, instead of the already operating rail company. The route down highway three is already an operating line. If it would cover its own costs I would think that we would already be seeing passenger service.

 
At 7:40 PM, March 09, 2007, Anonymous random thoughts said...

The rail line won't cover its own costs, the same reason private companies really can't make money by building private roads without government help.

In the end, a commuter rail is like all public services provided by the government (police, fire, etc). And like almost all public services, there are benefits to the local economy as well.

On the post, I think having a regional rail system in Texas would be great. Flying is increasingly becoming a serious inconvenience (getting to the airport early, dealing with parking, can't bring this or that on, etc). Even if the train takes a little longer, I think the idea sounds a lot less stressful. I used to take Amtrak in the Northeast when I lived up there. and it was great. But, I will grant the argument that one negative for such a system is the lack of decent public transport in Texas cities. But, hopefully, this is going to change!

 
At 8:52 PM, March 09, 2007, Blogger Owen said...

redscare,

Air travel has gotten more frustrating and time consuming, and promises to get more so.

And rail travel is different ... how? I can drive to Houston in five to six hours. Amtrak takes nine hours -- longer than Greyhound. I see no reason to use rail to get to College Station when buses would do just fine.

I doubt time savings would only be 30 minutes. A traveller from downtown could be on the train in less than 30 minutes from his office, whereas it would take 30 minutes or more just to travel to the airport. Add the 30 minutes or more to get on the plane and the reverse at his destination and an airline traveller may spend 3 to 4 hours getting to his destination, versus 2 to 2.5 hours by rail.

Sorry, but these numbers don't add up. Yes, it would take about 30 minutes to get to the airport. It could take a similar amount of time to get to a rail station too, and you'd probably want to get there about as early just in case (you can arrive at the airport 15 minutes before your plane leaves as well, it's just not smart). I don't see why, then, the train would be shorter.

Moreover, if there are ANY stops along the train route, the trip will probably be longer. This is why Amtrak is generally much longer than driving.

 
At 8:55 PM, March 09, 2007, Blogger Owen said...

random thoughts,

On the post, I think having a regional rail system in Texas would be great. Flying is increasingly becoming a serious inconvenience (getting to the airport early, dealing with parking, can't bring this or that on, etc).

Trains are equally inconvenient. At the very least, trains are no less inconvenient than buses, and buses are cheaper and can move about as quickly (especially if you're using freight lines, which could lead to unpredicable delays).

I used to take Amtrak in the Northeast when I lived up there. and it was great.

Amtrak is massively subsidized and still failing. They have a few lines in the North that run regularly, true, but that's about it, and the cost is still absurd. It's a bad sell to cite Amtrak as an example of success.

 
At 9:07 PM, March 09, 2007, Anonymous Brian Shelley said...

Re: "The rail line won't cover its own costs, the same reason private companies really can't make money by building private roads without government help."

Yes, and that reason is that modern governments got into the business of building a huge glut of free roadways. Privately held toll roads existed for hundreds if not thousands of years. It's hard to make a profit when your competition gives it away for free.

Anonymous: "is there some kind of externality that would justify the government doing it, instead of the already operating rail company". The problem with private production of rail services is that the government subsidizes roadways (Don't bring up the gas tax please, it doesn't even come close to covering full road expenditures) so much that it killed the railway business years ago. A better question would be does rail traffic have to be subsidized less than roadways? For Texas the answer is almost assuredly no.

The externality that I think many are hoping for is that rail service would change development patterns over time and become more cost effective as rail service theoretically creates it's own demand and is better integrated into the wider transportation system. For the vast majority of people who have genuinely experienced both, travelling by train is by far the most enjoyable way to go, and I think that's why many root for it.

My proposal of having on-demand service as opposed to set schedules is an attempt to keep costs down. Local governments might build the train station, but private companies would actually run the trains. It would operate more like an airport. Whether or not it would actually save money is up to debate.

 
At 11:45 PM, March 09, 2007, Anonymous Mike said...

Owen, we are talking about high speed rail.

Tory, your comment that high speed rail between downtowns would fail because only 7% of the region's jobs are downtown is like saying that airports will fail because only a small percentage of the region's jobs are at the airport.

I get the feeling you guys are trying not to see this.

 
At 12:22 AM, March 10, 2007, Anonymous random thoughts said...

owen-

The interstate system you drive on daily is "massively subsidized" as well. But, for some reason, the SUV-driving free marketers in Houston have no problem with tat government subsidy.

Amtrak has had a problem because they continue to operate long haul routes. There really is no reason to run trains between, for example, Chicago and San Francisco. Obviously, that route belongs to the airplane. But regional travel could be handled much more efficiently and more environmentally friendly through high speed rail ala Europe. Look at the routes between San Francisco and LA, Seattle and Portland, South Florida, Northeast Corridor, and (yes) between the major cities in Texas.

 
At 6:22 AM, March 10, 2007, Anonymous John said...

For a business traveler, high speed rail between Houston, Dallas, Austin, and San Antonio would be far superior to air traveler, even if you're getting off the train and into a rental car at your destination. Time spent on the train is a solid block of time in which you can work, make phone calls, or just relax so you arrive fresh at your meetings out of town, because you haven't been sitting in a seat designed for someone who's four feet six inches tall. It beats the heck out of the car to garage to terminal to security to gate to plane and then back again horror of air travel.

The economics are another question, but in terms of user experience, rail just beats the pants off of flying for these shorter distances.

 
At 8:33 AM, March 10, 2007, Blogger Tory Gattis said...

John: yes, clearly the experience is better on a train, the question is the economics.

I do believe gas taxes substantially cover the costs of highways, including interstates. They do not cover the cost of the local street grid, which is required no matter what (all through history, even before the car, transit or not), so is appropriately covered by local property taxes.

mike: the 7% jobs note is in reference to the benefit of trains over planes for getting you right into downtown - it's very limited in this case. It means, in most cases, travelers will still have to get a rent car (or ride local transit) to get to their final destination. That's just the nature of multicentric cities like DFW and Houston. We won't get the same benefit as connecting the downtowns of say, NYC and DC, or Paris and London.

 
At 12:35 PM, March 10, 2007, Anonymous Anonymous said...

Tory: 7% jobs note .... in most cases, travelers will still have to get a rent car.

Since this part of the hassle is true for both the existing system and for an imagined train network, we shouldn't really even be bringing it up.

This includes many of the other things people keep bringing up. You would have to take time getting to the train station and finding parking just like at the airport. You have to be able to get a rental car or taxi either way.

Wikipedia puts the average travel speed of high speed rail at 125mph. If there are no stops That gives us an hour and a quarter trip between Houston and Austin, an hour and a half to San Anton, and two hours to Dallas. (These times were arrived at by halving my normal travel times since when on the interstate I generally avearage a little over 60 mph.)

Southwest lists their gate to gate times between Houston and

Dallas 55 minutes a saving of one hour over an imagined train
San Anton 45 minutes a saving of 45 minutes
Austin 45 minutes a saving of 30 minutes

I see a lot of downside here. I think if I was going somewhere as a business traveler it wouldnt be much of a debate, unless there really existed that much more hassle at an airport over a train station. The only times I have ever traveled in the triangle by plan as a business traveler (read: minimal luggage) it really wasnt that much of a hassle. Admittidly that was pre 9/11 is it thirty-sixty minutes in the security line now? If so them maybe I could see a rail line competing from Houston to San Anton/Austin/Dallas.

 
At 2:08 PM, March 10, 2007, Anonymous random thoughts said...

I think the other issue here is the increasing congestion at our airports. Our airports are REALLY crowded and the ability for the system to continue to grow in response to the increasing demand is limited.

I think good regional rail networks could be one answer. Again, long-run routes should be out of the question, but within certain regions rail is certainly feasible and a good option.

 
At 6:14 PM, March 10, 2007, Blogger Tory Gattis said...

rt: yes, airports are congested in CA and the northeast - creating some argument for rail there - but again, not in Texas. Every airport in the triangle has plenty of capacity and room for growth.

 
At 6:18 PM, March 10, 2007, Anonymous random thoughts said...

So we wait until there is a major congestion problem before creating a possible solution? It's coming, just a matter of time, especially given the projected growth in places like Houston and Dallas.

Considering how long it would take to plan and build such a system, even if the airports in Texas are fine for 20 years we need to start now.

 
At 8:24 PM, March 10, 2007, Anonymous Mike said...

I can see a lot of people preferring a fast train ride between the cities, especially if it means avoiding the hassle of airports (has anyone else had to do the thing where you step in the little chamber and they puff air at you?).

Is it true that it was pressure from Southwest Airlines that caused politicians to shelve the Texas Triangle idea back in the early 90's? If that was the case, then it says that Southwest, for one, thought that people would take the train! It also says a lot about how things get done in our state government....

 
At 10:21 PM, March 10, 2007, Blogger Tory Gattis said...

I believe SWA was opposed, but on pretty legitimate grounds: the train would be heavily subsidized by govt, while airline fees fully cover the cost of airport infrastructure. That's not a level playing ground competitively. I don't think they opposed it per se, just the subsidies.

 
At 11:59 PM, March 10, 2007, Blogger Justin Sabrsula said...

Tory,

I'm not sure I agree with your comment that most cities in Texas don't have transit to cover last-mile trips. Houston is obviously moving in that direction, connecting downtowns to large business districts, Dallas's DART rail is also expanding to cover similar areas, Austin's commuter rail between downtown and other large business centers opens next year, and San Antonio has a large, urban bus network. How is that any different L.A. and San Francisco?

 
At 11:14 AM, March 11, 2007, Blogger Tory Gattis said...

Texas is (very) slowly moving in that direction. But:
-Most travelers, esp. business, usually won't take local bus networks
-SF Bart rail is bigger
-LA rail is bigger
-CA has almost twice as many people as TX, and at much higher densities
-CA airports are much more congested
-CA freeways are much more congested
-Almost all of CA's population lays in a line along the coast from San Diego to LA to SF to Sacramento - ideal for a long rail line with stops all along. The geography of TX's population doesn't work as well

And despite all these advantages, even CA is having serious trouble making the economics work. Not a good sign for TX.

 
At 11:45 AM, March 11, 2007, Anonymous RedScare said...

A few points.

One, air travel cannot be timed by just the time in the air. Most airports are far from city centers, requiring surface travel to get there. Because of their size, parking is a time consuming task. Check in and boarding is time consuming.

High speed rail stations, because their are fewer trains, are smaller, meaning less time is spent getting to and on the train. Parking is closer. The station will be more centrally located, saving time for everyone except for the small percentage of people near an airport. Even rental cars will be quicker to get, as they will be right outside the station, as opposed to a satellite lot miles from the terminal.

By the way, Wikipedia list the MINIMUM speed of high speed rail at 125 mph. Typically, high speed trains run at 155 to 185 mph. Some are over 200mph. A trip to Dallas could be expected to take an hour and 20 minutes to an hour and a half of actual rail time. The savings comes from the inefficiencies of travel to and from the airport, getting into the boarding area, and getting on the plane.

Tory, your suggestion that Herb Kelleher did not oppose high speed rail per se is laughable, and frankly, colors all of your other comments. SWA absolutely opposed the rail on ALL grounds, especially competitive grounds. He used his connections in the Legislature to saddle it with so many restrictions that it could not get off the ground. I am surprised that a free marketer like yourself does not condemn the anti-competitive tactics of SWA. I am also surprised that you support government placing obstacles in front of business attempting to bring transportation options to the travelling public. If the Legislature and the federal government merely supported high speed rail at the SAME level as the airline industry, we would already have it.

 
At 12:20 PM, March 11, 2007, Blogger Tory Gattis said...

I don't know the details of SWA's opposition. I'm sure they'd prefer to avoid competition. But I'm pretty sure the essence of their argument was "no govt subsidies" - which is a fair argument and killed it.

Govt provides *no* subsidy to air travel. Ticket fees and taxes completely cover the costs of airports, FAA, and air traffic control. That is absolutely not true of Amtrak, which receives huge subsidies.

If a private operator wants to make a go of Texas triangle high-speed rail, I say let them. I'd even be ok w eminent domain to get the land at a fair price, as long as they had to pay for it (i.e. the govt doesn't just grant them the land). Heck, I'm even ok with giving their bonds tax-free status (although not taxpayer guaranteed). But it won't happen, because the economics are nowhere close to being there.

 
At 1:13 PM, March 11, 2007, Blogger Owen said...

mike,

Owen, we are talking about high speed rail.

Granted. That just increases the cost, though, and limits the service area because you can't have stops along the way. If anything, advocating for high-speed rail multiplies the problems.

 
At 1:22 PM, March 11, 2007, Blogger Owen said...

random thoughts,

The interstate system you drive on daily is "massively subsidized" as well. But, for some reason, the SUV-driving free marketers in Houston have no problem with tat government subsidy.

That's because the vast majority of the costs are internalized; SUV drivers pay gasoline taxes, gasoline taxes go to building freeways, SUV drivers drive on freeways. It works out perfectly. With rail transit, however, you end up with everyone paying taxes for a service that only a small minority actually uses.

If you're willing to support internalizing the costs of high-speed rail to a level similar to freeways, that's one thing. But you're not advocating anything close to what exists with the freeway system.

[R]egional travel could be handled much more efficiently and more environmentally friendly through high speed rail ala Europe. Look at the routes between San Francisco and LA, Seattle and Portland, South Florida, Northeast Corridor, and (yes) between the major cities in Texas.

I don't believe much of European rail is high-speed. I've ridden trains throughout Europe before, and they were traditional trains.

In any event, I just don't see the need to invest huge gobs of tax dollars in high-speed trains when low-fare regional air carriers like Southwest seem to be serving that market quite well.

 
At 1:32 PM, March 11, 2007, Blogger Owen said...

random thoughts,

High speed rail stations, because their are fewer trains, are smaller, meaning less time is spent getting to and on the train. Parking is closer. The station will be more centrally located, saving time for everyone except for the small percentage of people near an airport. Even rental cars will be quicker to get, as they will be right outside the station, as opposed to a satellite lot miles from the terminal.

I doubt there will be any major time savings, as many of your premises are flawed. Although the high-speed rail station would be centrally-located, it doesn't follow that it would be more or less convenient for travellers. A minority of travelers live and work in downtown. Further, Hobby Airport is already conveniently-located for inner-city travelers. IAH is better for those working at Greenspoint or in the Woodlands.

The stations are smaller, true, but many business travellers use taxis anyway, so there is no benefit to them. And parking at the airport really isn't a problem if you're willing to pay for it. In either case, economy parking will probably require a long walk or shuttle service.

In short, I think your case for incredible time savings is pretty weak.

 
At 1:33 PM, March 11, 2007, Blogger Owen said...

Oops. Last comment was for redscare.

 
At 9:09 PM, March 11, 2007, Anonymous random thoughts said...

First, Tory, I am not sure how one can make the assumption that the government supplies no subsidies to the airlines. I seem to remember billions of dollars worth of payouts to the airlines after Sept. 11th. These bailouts have occurred several times in the past. Additionally, federal funds are used to expand airports all the time, including security expansions that have been funded through Homeland Security. Finally, the federal government has specific laws to protect domestic airlines from foreign competition, another federal subsidy. I need to calculate the numbers, but I would be shocked if these subsidies were less than the measly amount the government forks over to Amtrak each year.

Second, owen, many of the costs of driving are not internalized. That is why we have such a ozone pollution problem in our cities, to say nothing of the effect of driving on global warming. Additionally, the federal government gives out millions of dollars in subsidies for highways that are entirely local (610 for example). People in Seattle who never use those local highways are subsidizing these costs. Federal taxes also support airports, even if they are entirely local (not a hub for example). Thus, federal dollars are used to subsidize these transportation modes , but for some reason rail critics don't have a problem with that.

Oh, and Southwest did scuttle the planned system in Texas.
Link:
http://en.wikipedia.org/wiki/High-speed_rail_in_the_United_States#Texas
Hardly free market capitalism. Sound like cronyism to me.

 
At 11:14 PM, March 11, 2007, Anonymous Thomas said...

"Govt provides *no* subsidy to air travel. Ticket fees and taxes completely cover the costs of airports, FAA, and air traffic control."

This is simply not true. While the Airport and Airways Trust Fund covers most of the FAA's operating and capital expenses, it does not cover all of them. In FY 2006, for example, $2.6 billion of the FAA's $13.9 billion budget came from general fund appropriations, i.e. subsidies. FAA budgets are available for review here:

http://www.faa.gov/about/budget/

There are also other forms of subsidy, such as the Essential Air Service Program, which provides government subsidies to airlines in order to ensure air service to small town and rural airports which would otherwise be unprofitable to operate.

It could also be argued that the commercial aviation industry recieves substantial indirect subsidies from the federal government, for instance the tax breaks received by Boeing, which supplies the bulk of equipment owned by the domestic carriers, or the fact that nearly half of the nation's commercial aviation pilots originally received their training in the military, or "fly America" clauses that require government workers and contractors to use domestic carriers even though a foreign carrier might fly the same route at a cheaper cost.

I'm not arguing for or against these subsidies, and I'm not getting into the larger discussion of passenger rail and the subsidies it requires. I'm simply pointing out that *all* transportation, including commercial air travel, is subsidized.

 
At 11:21 PM, March 11, 2007, Blogger Tory Gattis said...

RT: Sept.11 was loans that were paid back. Airport security is paid for by the ticket security fees. Foreign competition I don't think is very relevant: very minor impact in the scheme of things, and we are talking about a potential monopoly rail provider here.

Federal taxes do not support airports. Again, it's the fees tacked on your ticket. Federal gas taxes do pay for the federal interstate system, but Texas gets back less than it puts in, so, if anything, our drivers are overpaying for the freeways they use, not underpaying. Broadly speaking, though, federal gas taxes more or less eventually go back to the local communities - Seattle has their own interstates. Even Hawaii has federal "interstate" highways, which is sort of absurd when you think about it.

Ah, the Wikipedia a referencable source. Yes, it can give background, but it hardly qualifies as a definitive statement on what SWA did or did not do. But note this quote: "Funding for the project was to come entirely from private sources, since Texas did not allow the use of public money. The original estimated cost was $5.6 billion, but the task of securing the necessary private funds proved extremely difficult."

 
At 2:18 AM, March 12, 2007, Anonymous random thoughts said...

Tory-

The following report makes it pretty clear that the airlines received $5 billion in direct federal grants. These were not paid back as they are grants. Also, the loans reduced the airlines cost of capital, another subsidy for the industry.

http://www-econ.stanford.edu/academics/
Honors_Theses/Theses_2005/Chang.pdf

As far as specific federal subsidies to the airlines, passenger facility fees actually make up a very small portion of the federal money given to airlines (1.6B out of 12B). Direct grants make up a higher percentage (2.4B). The majority is federal bonds (7B).
http://www.gao.gov/docsearch/abstract.php?
rptno=GAO-03-497T

And I noticed that the high speed rail was to be built with private funds. Yet, even despite this fact, SW still used its political connections through the state legislature to kill the project. Again, hardly free market capitalism.

Anyway, I think it's pretty clear that the airline gets a lot of subsidies from the federal government. So, claiming that high speed rail would require subsidies (even though that is not clear) is not a reason to sink the project.

 
At 2:25 AM, March 12, 2007, Anonymous random thoughts said...

Just as a comparison:

The GAO article stated that the airlines got about $10.4B a year (12B-1.6B).

Over the same period, Amtrak got less than $3B.
http://www.publicpurpose.com/amtrak-subys.htm

Interesting numbers.

 
At 10:33 AM, March 12, 2007, Blogger Tory Gattis said...

OK, to sum up my position: if a comprehensive economic analysis of the economics of the airline industry was agreed upon by a commission, I'd be ok offering a matching subsidy (on a per passenger-mile basis, if it exists) to a private operator, and then see if any want to build the system. My gut says the economics will still be so far from working, there will be no takers. That implies that the benefits do not outweigh the costs, because not enough people are willing to ride and pay high enough prices to cover the costs.

 
At 5:07 PM, March 12, 2007, Anonymous Anonymous said...

Assuming the various subsidy numbers thrown about in this thread are right, the ratio of airline to Amtrak subsidy is ~4:1.

A quick look at bts.gov shows that the ratio of air to Amtrak passenger miles is ~100:1.

Interestingly, the highway to transit passenger miles ratio is about the same 100:1.

jt

 
At 11:31 PM, March 12, 2007, Anonymous Mike said...

Tory said:

"But I'm pretty sure the essence of their argument was "no govt subsidies" - which is a fair argument and killed it."

How are you so sure that SWA was only opposed to the subsidies? Do you have a source?


Owen said:

"[High speed rail] just increases the cost, though, and limits the service area because you can't have stops along the way."

Airplanes don't make stops along the way either.

 
At 10:45 AM, March 13, 2007, Blogger Tory Gattis said...

> How are you so sure that SWA was only opposed to the subsidies? Do you have a source?

Note that I said "pretty sure". I do not have a source, just the way I've heard the story from others or in the media a few times over the years. Obviously, they're not going to come out publicly and say "we oppose rail because it increases our competition" - they'd be laughed out of the room. Their primary public objection was the subsidies. Nobody knows what their lobbyists said to individual legislators behind closed doors.

 
At 12:30 AM, March 14, 2007, Anonymous Mike said...

Fair enough. I think I'll err on the side of cynicism when it comes to those closed-door negotiations.

 

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