Why the U.S. Has So Little Amtrak Service
Amtrak was established by the Rail Passenger Service Act of 1970 and began operations on May 1, 1971. It was created to relieve the struggling railroad corporations of their historic obligation to carry passengers. Half a century of public investment in highways and air travel had undermined the ability of railroads to provide passenger service at a profit and was causing a crisis in the industry. (Check out Episode 2 of our main series for an in-depth exploration of this history.) So the public bailed the railroads out by creating Amtrak, a quasi-public corporation that would henceforth carry passengers across almost the entire U.S. rail network.
However, as we learn in this Rail Bite, Amtrak was given a contradictory mandate. On the one hand, it was expected to preserve passenger rail service, which had long ceased to be viable as a profit-seeking enterprise. On the other hand—and at the same time—it was expected to turn a profit and avoid relying on taxpayer subsidies. Because of this, many people believe that Amtrak was created to fail.
Whether it was created to fail or not, Amtrak’s planners had their marching orders. They set about designing a system they thought could eventually turn a profit. The result was that Amtrak discontinued about 250 trains—roughly half the system at the time—on day one of taking over passenger service from the private sector. Despite these cuts, aimed at minimizing losses, Amtrak has still never turned a profit. So it has been forced to cut service time and time again.
To adjust to this reality, Congress has shifted the statutory language surrounding Amtrak several times, to emphasize providing service and to de-emphasize—and ultimately eliminate—the obligation to turn a profit. However, Amtrak is ultimately constrained by the amount of money the federal government chooses to allocate to it, and that amount has thus far never been sufficient to generate a genuine revitalization of the system.
https://solutionaryrail.substack.com/p/rail-bite-6-maddock-thomas-on-why