How Long Can Amtrak Keep It Up?
To its great credit, Amtrak is still managing to provide an essential transportation alternative to some 30 million passengers a year. And that’s in spite of having to cope with a daunting number of obstacles.
Infrastructure. Billions of dollars are needed for repairs and deferred maintenance all along the Northeast Corridor, and for new tunnels under the Hudson River.
Equipment. There isn’t enough and what they’re using is old and should be replaced. All of it. But there’s no money thanks to …
Congress. The politicians continue to micro-manage Amtrak. All this meddling increases the operating costs, of course, but Congress continues to underfund Amtrak anyway.
Management. Current CEO, Joe Boardman, is watching while his underlings try to achieve profitability by cutting costs—including most of the little amenities that helped make sleeping car passengers feel welcome and appreciated.
Oversight. The Board of Directors is comprised of political appointees and it’s rare that any of them has any real railroad experience. Occasionally they are asked to perform political dirty work, however. For example, Bush appointees fired former CEO David Gunn, the most competent president Amtrak has ever had.
Freight railroads. In theory, they’re supposed to give priority to Amtrak trains running on their tracks. In practice, they often don’t, so Amtrak is often late. Sometimes very late. Toaster ovens from China arrive on time, however.
With all this going on, it’s no surprise that standards throughout the Amtrak system appear to be slipping little by little. There are fewer choices on the dining car menus and the same meals are served on every Amtrak train day after day. There is no real on-board supervision, so every car attendant does things his or her way. And more and more of the on-board crews, even veteran employees, seem to be losing some of their enthusiasm for the job.
Still, in spite of all these issues, Amtrak long-distance trains are continuing to provide essential public transportation for millions of people all across Middle America and they are another option for additional millions like me, who prefer to travel by train.
The question is, given all those obstacles, how long can they keep it up?
Jim, you nailed it! Its funny that I’ve heard several passengers over the years complain about the equipment, food, etc on Amtrak and then say something like “Until Amtrak can provide better service, its funding should be cut way back”. It is almost like they think most of the money is going to management bonuses or something…
That’s what’s so maddening about all this: a lot of the arguments/objections/opinions we run up against make no sense at all.
All good points! These are the requisite questions the media should be asking NOW. In essence, when you further dissect Amtrak, you understand how concerned an advocate or customer should actually be; as well, to question where has the oversight from Congress, FRA, and DOT been.
As we always start a business analysis with “the head of the fish,” how relevant is it for Amtrak, as essentially a state-owned enterprise, to continue to pretend it is a corporate entity with a Board of Directors? A real firm seeks outside board members knowledgeable in key areas of business to advance the firm’s mission. In Amtrak’s case, it should have had board members with experience in finance, marketing, leisure travel, food/beverage, and railroad (Class 1) operations.
Instead, the board has been typically loaded up with northeastern politically connected people with no rail experience, or, even sufficient political clout to pushback on the gadflies roosting in Congress. With the growing food/beverage fiasco aimed at diminishing what’s left of the long distance train experience, we have to hold this board accountable for oversight of management. Indeed, to paraphrase Senator Baker from the Watergate hearings, ‘either when did this board know about the downgrading of diners and the extension of the “Silver Star” experiment; or, if not, why not?’ As well, under this board Amtrak directed over $300 Million towards infrastructure improvements of the Northeast Corridor. As those funds came out of the overall national operation, why did this board not make it an issue to FRA/DOT/Congress that Amtrak was sacrificing the national system for the parochial interests along the Northeast Corridor? Accordingly, as Amtrak continues as a state-owned enterprise, it does not require a politically connected board. Instead, Amtrak should report directly into the DOT.
Frankly, when it comes to management–operations, Class 1 relations, working rapport and respect from Congress, I would reference how Eisenhower did not hesitate in 1943 to replace Fredendall with Patton in Tunisia, knowing Patton had the necessary technique to motivate troops, create unstoppable momentum, and achieve his goals with the fewest casualties. Amtrak cannot be allowed to operate afraid of its shadow and in secrecy, like the Stasi, where communications and requests for information are tightly controlled re operations and state corridor costing; how Congress looks askance upon any Amtrak proposal, even if the proforma evidences increased revenue; how the Class 1 railroads simply run roughshod over Amtrak, violating their own prior legal agreements re expeditious dispatching.
Whether the board continues or not, Amtrak requires a David Gunn to make Congress a partner to grow Amtrak by acquiring more and newer equipment; to be respected by the Class 1s and have the guts to hold them to the line re legal operating agreements; to understand Amtrak can only grow out of its losses by increasing service and routes; to revive state relationships by adhering to GAAP accounting principles re costs, overhead, and internal subsidies to prevent the dumping of unnecessary costs on the non-NEC corridors and long distance trains; to appreciate how HR cannot be outsourced, but must work from within the company, imbued with its culture, so recruitment is achieved in sync with the expectations of management; to understand that for Amtrak to survive, it must jettison its ownership and infrastructure responsibility over the Northeast Corridor.
With that said, do we have another year to wait until the next President of the USA is sworn in and changes begin with the DOT..?