$44 Per Ride Subsidy

Last week, the Antiplanner commented on a proposed passenger train between New Orleans and Baton Rouge. Yesterday, The Advocate, a New Orleans weekly, published an op-ed on the same train.

The article calculates that the subsidy per ticket will average $44. Considering that the proposed fare is only $10 for the first few years, rising to $13 after ten years, this would be a horrendous subsidy, at least compared with other intercity trains. Subsidies to the average Amtrak train are about equal to the ticket price, not three to four times the ticket price. On the other hand, subsidies to urban transit average $3 for every dollar paid in fares.

In comments on the op-ed, one of the defenders of the proposed train says, “in the 1930s in the middle of a Depression we built a network of airports that served as foundation for a commercial airline industry we see today.” The two clear differences are that most airports pay for themselves with landing fees, and the airline industry in the 1930s was rapidly evolving and growing. By comparison, the technology for the proposed train hasn’t changed since the 1930s, and passenger train ridership is declining. It is a continual source of amazement that so many Americans consider subsidies to an obsolete forms of travel such as streetcars, light rail, and intercity rail to be normal and acceptable.

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17 thoughts on “$44 Per Ride Subsidy

  1. FrancisKing

    It’s a tale of two cities.

    If the proposed rail service is supposed to take 2% of the traffic off the road, this will not work. The reduction in travel cost by removing 2% of the traffic from a very congested road means that, through the magic of elasticity, that the 2% of traffic will reappear on the road anyway. Fail.

    On the other hand, it is possible to have successful high speed rail. I live in Bath, UK and sometimes travel to London. If you get a hire car, the journey to Heathrow airport is very doable. But to central London, with the metro, the train is better. It connects directly to the metro, and doesn’t have problems with London driving and parking. Success!

  2. paul

    The reason that it is convenient to travel to the center of London by car is that central London was built around the transit that was economically dominant at the time it was built. This was initially walking, then horse drawn omnibus, then trams and underground. As motor driven buses became economical then the underground expansion was discontinued and London grew around the bus, then the car on the outskirts of the greater London area. In the center of London cars don’t work well but on the edge of London transit doesn’t work well unless it is to the center where cars don’t work well.

    Trying to re-impose older types of transit, such as new streetcar lines or trains on cities built around the car doesn’t work well. New Orleans and Baton Rouge don’t have enough of an old city center built around trains or walking to warrant building a train between them. There just won’t be enough use, hence the huge subsidy. Run a comfortable express bus service between these city centers instead.

  3. prk166


    $44 subsidy seems like a lot, but when you look at the cost per visitor to operate some National Park Service areas, $44 seems cheap.
    ” ~Frank

    It blows my mind how some, including the most popular one Great Smokies National Park – charge zero admission. I get that you’re not going to be able to charge much for Andrew Johnson’s museum in Greeneville. But the Great Smoky Mountains NP?

    Most people wouldn’t blink thrice about paying $30 / car for an entrance. Great Smoky NP could easily cover their annual operating costs – IIRC less than $20M – from vehicle fees alone. Granny has to pay $270 / month for her meds but at least we let people go to a park for free, eh?

  4. prk166

    Do you have a source for that? I’ve heard a few people claim similar things but have never found proof of it being anything more than an urban legend.

    Either way, 80 years on if there’s something legal blocking charging admissions why wouldn’t we change the law? Why are we handing out bread and giving circuses to those who can most afford to buy their bread and pay for the circus?

  5. aloysius9999

    GSMNP – technically, it is free passage on US 441 in Tennessee.

    Is the following explanation found on the NSP GSMNP web pages at
    http://www.nps.gov/grsm/planyourvisit/whyfree.htm proof enough?

    Why No Entrance Fee?

    The reasons for free entry to the national park date back at least to the 1930s. The land that is today Great Smoky Mountains National Park was once privately owned. The states of Tennessee and North Carolina, as well as local communities, paid to construct Newfound Gap Road (US-441). When the state of Tennessee transferred ownership of Newfound Gap Road to the federal government, it stipulated that “no toll or license fee shall ever be imposed…” to travel the road.

    At that time, Newfound Gap Road was one of the major routes crossing the southern Appalachian Mountains. It’s likely the state was concerned with maintaining free, easy interstate transportation for its citizens. North Carolina transferred its roads through abandonment, so no restrictions were imposed.

    Action by the Tennessee legislature would be required to lift this deed restriction if Great Smoky Mountains National Park ever wished to charge an entrance fee.

  6. Frank

    And compared to the cost of an F-22 fighter jet they’re both cheap, but what does that have to do with anything?

    The topic of the post is a subsidy for things/services the average citizen/civilian can or does use. (Civilians don’t use F-22s, so the comparison is specious.) While my comment was a bit tangential, it is about subsidy, so it’s on topic. Yes, rail subsidies per passenger can be high, but there are other subsidies that are much, much higher, such as—again—the cost per person to use some NPS areas. For instance, the cost per visitor to Lake Clark NP is $268. Now that’s a subsidy!

  7. Sandy Teal

    I disagree about user fees to enter federal lands. That would make some sense if the federal government would sell of the federal lands if it did not collect enough user fees to cover the cost of the land, but we all know that is not the case.

    So reality is that the federal government will keep the land no matter what. The Park Service would really be glad to just keep every off most of the land and concentrate the use where they want it, but that is “royal lands” and not “public lands”.

    I think the aim of public land user fees is to cover marginal cost of user benefits, like campsites and bathrooms and maybe high-use trails. The Park Service doesn’t own the views or even the land — it is the public’s land. But the Park Service could legitimately decide whether to install bathrooms and campsites where the public is willing to pay for the cost.

    One thing the user fee public should not pay for is NEPA and bureaucratic costs. That is a government drag on the economy and not a test of free market willingness to pay.

  8. Builder

    I guess my major question was why are we discussing Park Service policy in a blog concerning a railway? It seemed to be getting perilously close to the argument you sometimes hear that goes something like this. Yes, X is bad but not as bad as Z so why should we stop X?

  9. Frank

    “I guess my major question was why are we discussing Park Service policy in a blog concerning a railway?”

    Because it’s related and people want to? If I’m too far off topic, people are free to ignore me.

    “It seemed to be getting perilously close to the argument you sometimes hear that goes something like this. Yes, X is bad but not as bad as Z so why should we stop X?”

    Certainly not my argument as I favor the end of all subsidy.

  10. prk166

    @aloysius9999. thanks. That explains why I wasn’t googling correctly. It is about US441, not all of the park land. They could, if they wanted, have a user fee for Clingmans Dome.

    Then again, why cover operating costs with user fees when you advertise it being “free” to it’s users so the next time the NPS doesn’t like the budget, they can feign shutting it down, eh?

  11. Frank

    “why cover operating costs with user fees when you advertise it being ‘free’ to its users so the next time the NPS doesn’t like the budget, they can feign shutting it down, eh?”

    Ah, the Washington Monument strategy. My former NPS supervisors admitted to me that they used this very strategy in an effort to agitate visitors in the hope they would write their reps demanding more money for the NPS.

    When I was in Hawaii a few years ago, I drove all the way across the island to catch the last Pearl Harbor tour. I arrived to find the last tour cancelled due to bogus budget reasons, but they hadn’t bothered to update their website. Instead of writing my congressman, I spoke frankly to the interp supervisor on duty, calling them out for their shenanigans and citing actual NPS budget numbers I brought up on my smart phone. Then I wrote the chief of interp and the local newspapers, but nothing ever came off out and no one responded.

    Coercive monopolists and bureaucratic do-nothings have no reason to be responsive to their customers’ demands. Their only purpose is self-serving.

  12. the highwayman

    The Autoplanner; “In comments on the op-ed, one of the defenders of the proposed train says, “in the 1930s in the middle of a Depression we built a network of airports that served as foundation for a commercial airline industry we see today.” The two clear differences are that most airports pay for themselves with landing fees, and the airline industry in the 1930s was rapidly evolving and growing. By comparison, the technology for the proposed train hasn’t changed since the 1930s, and passenger train ridership is declining. It is a continual source of amazement that so many Americans consider subsidies to an obsolete forms of travel such as streetcars, light rail, and intercity rail to be normal and acceptable.”

    Rail isn’t obsolete, it’s politically suppressed.
    The real cost of driving is some where around $2 per mile and roads are not expected to be profitable.
    In the USA, you also have close to a trillion dollars worth of automobile debt(car loans).
    Mentioning airports is also like mentioning parking lots. The sky is there, whether you fly through it or not. :$

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