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Economy / Privatization

The High Cost of High-Speed Rail

By Christine Harbin on Oct 28, 2009

During the drive home from work yesterday, I listened to a discussion of high-speed rail on NPR’s “Marketplace.” Mitchell Hartman discussed a new report from the Pew Research Center reminding us that high-speed rail depends on federal assistance. Pew calculated that Amtrak receives a $32 subsidy per ticket, on average, from taxpayers. Amtrak, however, estimates that the size of the subsidy is $8. From the show’s transcript:

The difference is Pew includes all the costs of running a railroad, like depreciation — that’s wear-and-tear on tracks and trains — and overhead, like the legal and HR departments. Taxpayers pick up those costs too. Amtrak got $1.3 billion in funding last year.

The program even quoted Randall O’Toole, a Cato Institute senior fellow and self-described “Antiplanner”:

Best thing we can do for mass transportation would be to privatize it, let the private operators respond to the market, and then we’ll have a more efficient system that might be attractive to more people.

O’Toole has written several policy studies for the Show-Me Institute on the subject of high speed rail and its free-market alternatives. His most recent, “Why Missouri Taxpayers Should Not Build High-Speed Rail,” was published late last month.

High-speed rail is relevant to Missouri, particularly as officials consider upgrading the tracks from Saint Louis to Kansas City to accommodate high-speed trains. As David Stokes testified before the Joint Committee on Transportation Oversight earlier this month:

For Missouri to build true high-speed rail — the type that American tourists ride in Europe at 150 mph — would cost Missouri taxpayers billions more, all to serve the small percentage of the population that uses passenger rail.

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About the author

Christine Harbin

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