Yes, It Is Stupid to Blame Lack of Subsidies for Amtrak's Derailment

From Marc Scribner of CEI. Excerpts:

"It is true the technology at issue would possibly or even likely prevented this specific crash, speeding the deployment of it would dramatically increase costs and very likely reduce overall rail safety."

"the train was reportedly traveling at 106 mph right before it went into the 50-mph curve. By the time the engineer pulled the emergency brake, it was too late and the train entered the curve at 102 mph."

"It is likely the Philadelphia derailment is largely due to human error. In a similar 2013 crash in Spain, the operator was found to have recklessly ignored speed warnings before entering a 50-mph curve at 121 mph, killing 79 and injuring 140 when the train derailed and crashed into a concrete wall. In 2005, a Japanese commuter train derailed after it entered a 43-mph curve at 72 mph, killing 106 and injuring 562. The operator was killed, but he had likely intentionally increased the speed to unsafe levels."

"Unfortunately, Amtrak has a small but powerful constituency and taxpayers have now doled out more than $45 billion in subsidies to keep Amtrak afloat. Amtrak accounts for just 0.15 percent of passenger-miles and 0.8 percent of trips more than 50 miles in the U.S.

Enter the Rail Safety Improvement Act of 2008 (RSIA). RSIA Section 104 (codified at 49 U.S.C. § 20157) mandated the installation of PTC systems on all intercity and commuter passenger railroads and large freight railroads by December 31, 2015. PTC harnesses new communications technologies aimed at improving safety and routing. This unfunded mandate had been opposed by the railroad industry, but was quickly adopted following the 2008 Metrolink crash in Los Angeles. While there are indeed safety benefits to PTC, as Baruch Feigenbaum from the Reason Foundation notes, the costs are positively staggering:

Positive train control is one of several methods to improve railroad safety. While PTC can prevent accidents by using GPS, sensors, and other technology to stop trains remotely, the costs are astronomical. The Federal Railroad Administration (FRA) places the cost at more than $13 billion to install and maintain a nationwide class I PTC system. Consulting firm Oliver Wyden estimated that PTC has a 20 year benefit between $0-$400 million. Even if all $400 million in benefits are realized, the cost/benefit ratio range is $1 in benefits for every $20 spent on the system.

While not as lopsided as Oliver Wyman’s estimate, the Federal Railroad Administration’s (FRA) own benefit-cost analysis in the 2009 regulatory proceeding that implemented RSIA’s PTC mandate estimated annual safety benefits to be $90 million versus estimated annual maintenance costs of $860 million (pp. 140-144). As the FRA noted at the time, “Obviously a system which costs $5.75 billion initially, and then costs another $860 million per year to maintain does not make a lot of sense financially if the returns are limited to $90 million per year.”"

"while PTC technology can provide some meager safety benefits and perhaps could have prevented the Philadelphia derailment, most railroad fatalities are not caused by overspeed derailments or train-train collisions. Rather, many more occur where railroads meet roadways, and often are the fault of drivers attempting to beat the train or stalled vehicles on the tracks.

But instead of working harder to improve grade crossings, which is where around 270 people are killed every year by trains, railroads have been forced to reallocate resources in an attempt to comply with the PTC mandate’s wholly unreasonable 2015 implementation deadline. In addition, commuter railroads face a more than $12 billion maintenance backlog to bring their existing systems up to a state of good repair, which is a major safety problem facing rail transit systems throughout the country.

Both the Government Accountability Office and the Congressional Research Service have acknowledged that Congress’s 2008 PTC mandate may be perversely having a negative impact on rail safety, as resources are diverted away from superior safety initiatives and into a largely ineffective politically selected technology.

While Congress deserves much of the blame for its absurd PTC mandate, it is important to remember that Amtrak is a uniquely dysfunctional entity. As the Cato Institute’s Randal O’Toole provides in this summary, a February report from Amtrak’s Office of Inspector General found:

Amtrak employees are more than three times as likely to be injured or killed on the job as employees of BNSF, CSX, Norfolk Southern, or Union Pacific.

This poor record, says the report, is a direct result of a lack of accountability “at all levels.” Employee injuries in 2013 were only one-twelfth as likely to result in disciplinary action as in 2009, resulting in employees who believe today that they “can ignore rules and safe practices with impunity.” Safety is of so little importance in the organization that three out of four of the employees interviewed by the inspector general wrongly believed that Amtrak’s safety record was better, not worse, than other railroads.

It is important to note, however, that while Amtrak’s incompetence makes its railroad less safe, rail is still very safe compared to other modes. Only air travel is safer, as Baruch highlighted in his post. Rare accidents will continue to happen, even when PTC is fully implemented. But a problem the tragic Philadelphia derailment exposed is one the shameless Amtrak boosters in Congress will never address: passenger rail is the least resilient passenger mode.

As I said in the beginning, Amtrak service in the affected Northeast Corridor section was just restored this morning, nearly a full week after the derailment. Could you imagine if a similarly tragic pile-up or series of accidents closed parallel Interstate 95, which carries the vast majority of passenger traffic between Boston and Washington? Most of those trips are made by private automobile, but as Randal noted in 2011, private and unsubsidized intercity bus companies in the Northeast I-95 corridor carried 50 percent more passengers than Amtrak. Highways that close after major auto crashes with multiple fatalities generally reopen within hours.

The same goes for aviation, where crashes during takeoffs or landings may close an airport for just hours, such as when Asiana Airlines Flight 214 crashed at San Francisco International Airport in June 2013, resulting in three deaths and 187 injuries. After the September 11 terrorist attacks killed thousands, the national airspace system was fully reopened after three days.

Rail is inherently less resilient, which is one the major arguments against the system that supporters of perpetual subsidies of Amtrak ignore. I fully support privatizing the Northeast Corridor of Amtrak and winding down most of the unprofitable long-distance routes. But no amount of improved management would resolve passenger rail’s inherent lack of resilience.

There is no way to reasonably fund Amtrak out of this fatal flaw, and intellectually honest Amtrak boosters know this. What is intellectually dishonest is politicians like Sen. Schumer arguing that a lack of sufficient taxpayer subsidies is responsible for the Philadelphia derailment. As I noted, PTC is a horribly inefficient way to improve rail safety and Congress’s misguided 2008 mandate likely reduced overall safety by forcing railroads to misallocate resources away from needed core capital improvements.

So, contrary to what some of the more shameless elements of the political class, such as Sen. Schumer, have been arguing, Speaker Boehner was right: it’s just plain stupid to blame allegedly insufficient taxpayer subsidies for last week’s Amtrak derailment."