The National Passenger Railroad Corporation was created by the US Government in 1971 to consolidate the fledgling passenger rail industry in the United States. Branded as ‘Amtrak’, this organization operates 300 trains, carrying more than 84,000 passengers daily.
Amtrak’s mission is to deliver intercity transportation with superior safety, customer service and financial excellence. Amtrak operates a nationwide rail network, serving more than 500 destinations in 46 states, the District of Columbia and three Canadian provinces on more than 21,300 miles of routes, with more than 20,000 employees. Last year Amtrak recorded $3.2 billion in revenue and while incurring $4.3 billion in expenses.
According to AMTRAK’s Business Plan published in 2013, the company prioritized 5 goals:
Goal 1 – Safety and Security:
Become North America’s safest, most secure railroad by creating a collaborative, team-oriented workplace culture that minimizes risks and maximizes passenger and employee safety.
Goal 2 – Customer Focus:
Advance customer service quality by responding to the wants, needs and expectations of our customers in order to improve their experience and maximize passenger and partner satisfaction.
Goal 3 – Mobility and Connectivity:
Improve national mobility and connectivity by growing Amtrak’s business through new partnerships, routes and frequencies to increase ridership system wide.
Goal 4 – Environment and Energy:
Contribute to the nation’s environmental health by attracting automobile and air travelers to trains, while improving Amtrak’s efficiency and reducing transportation related carbon emissions and fossil fuel consumption.
Goal 5 – Financial and Organizational Excellence:
Attain a standard of organizational excellence by aligning our products, services, processes and culture with stakeholder expectations to improve financial performance and overall business results.
Beholden to Government Whims
Unfortunately for Amtrak, despite these logical business goals, its operations are still dictated by a very fickle and confused Congress. Amtrak is reliant on Federal Subsidies greater than $1 Billion annually. Efforts over the past decade to secure this funding through multi-year legislative allocations have repeatedly failed; forcing Amtrak officials to plead their case annually before a highly politicized legislature. The inevitable outcome is an inability for multi-year planning and an inability to secure the proper funding for the investments necessary to make Amtrak competitive with existing forms of inter city transportation.
Inability to invest
One glaring example of this failure to properly invest in necessary technologies was seen in the May 15th, 2015 derailment of a Northeast Regional Train in Philadelphia. Subsequent investigations found this deadly incident was caused by operator error. The conductor failed to slow the train to the prescribed speed for a curve, resulting in multiple cars coming off the tracks. Amplifying the apparent failures that led to this disaster, was the fact that the technology to prevent it had already existed, however Amtrak had failed to fully implement it due to funding and technical issues.
Inability to divest unprofitable operations
Amtrak’s operating problems are further complicated by a Legislative Requirement to maintain long distance intercity rail lines that are perennially unprofitable. Amtrak officially are continuously berated by Congress for their inability to generate a profit, while ignoring that the continued reauthorization of the Passenger Rail Act, with its declaration that “long distance passenger rail is a vital and necessary part of our national transportation system and economy,” is the proximate cause for a majority of the operating expenses.
In the most glaring example of Congressional ineptitude regarding Amtrak’s operations, members of Congress floated the idea of privatizing the Northeast Corridor of Amtrak. This line, running from Washington, DC to Boston, and including the only high speed rail in America, is often the only profitable line for Amtrak. When pressed, the backers of the plan identified that private investors were willing to raise private capital to make the necessary infrastructure investments to keep the line operational. What they failed to address is how that plan would benefit the remainder of Amtrak which would then struggle even more to match revenues to the growing costs of running the remaining long distance passenger transit lines that Congress continued to mandate.
If the process for securing funding for Amtrak continues to be a contentious and annual process the enterprise will continue to fail. Despite the $1.5 Billion it will receive from tax payers this year, Amtrak is simply securing the minimum amount required to remain solvent, removing any possibility of making the investments required to remain a viable option for intercity transportation in the United States.
Compounding this problem is the fact that Amtrak is still beholden to an outdated federal mandate to operate inefficient and unpopular long distance routes. Congress should reevaluate the stance and determine if it is indeed integral to the national economy. If it does find that the long distance routes need to be maintained, the façade of Amtrak remaining a semi-private venture should be removed, subsidies should be increased, and the railroad network should become part of the nationally funded infrastructure. If not, Amtrak should be entrusted to divest unprofitable lines and prioritize capital expenditure towards the routes that are profitable or can be in the immediate future.
 Amtrak Website
 International Business Times. “Amtrak’s Failure to Gain Wireless Spectrum Rights Stymied Safety Technology” May 15, 2015.
 The Brookings Institute. “New Amtrak Bill Still Means the Same Old Funding Debate” September 16, 2014.
 Washington Post. “House GOP proposal would privatize high-speed rail along Amtrak’s Northeast Corridor” May 26, 2011.