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Amtrak Ridership at "Record" Levels, More Subsidies Needed

Posted by Paul Gessing - August 23, 2008

News stories this week cited the fact that Amtrak ridership has risen significantly in recent months in response to high gas prices. In a free market, a record number of riders would mean record profits (or at least increased profits), but Amtrak is America's state-owned, socialist rail system (government ownership of the means of production, in this case a railroad), so profits are not even a consideration. In fact, Illinois Senator Richard Durbin has used increased ridership to argue that more taxpayer dollars should be funneled into the rail system, in part to purchase more train cars.

As the story points out, however, rail advocates shouldn't get too excited about the railroad's so-called "success": Even though Amtrak ridership last month increased 14 percent compared to July 2007, the railroad provides less than 1 percent of all trips made nationwide, as car and air travel reign. Air and rail rely far less on subsidies on a per passenger mile basis.

This one-percent is at a relatively high cost to taxpayers of more than $1 billion per year. The Southwest Chief, which runs through New Mexico is one of Amtrak's most heavily-subsidized routes operating at a cost to taxpayers of $236 per passenger.

Thoughts?   Add Comment -


Jack Ferry said on Aug 23 2008 at 7:40pm
Post Date Wednesday, August 27, 2008

The New Republic

The End Of Aviation

What will happen when America can't afford to fly?

Bradford Plumer, The New Republic Published: Wednesday, August 27, 2008

As the age of cheap oil comes to a close, it's springtime for gloomy futurists. Visions of a brutish world marked by violent squabbles over dwindling reserves, of junkyards littered with abandoned cars, of suburban slums overrun by weeds, of the collapse of industrial agriculture--none of this sounds as outlandish as it once did. Still, most of these horror stories are likely overstated: Energy experts tend to agree that, with a little ingenuity and a generous helping of political will, we could transition away from fossil fuels without being forced to give up our modern lifestyles.

But there's one big exception--an area where a post-carbon world really could mean a radical shift in the way we live. That's the world of commercial flight.

Early signs of an aviation apocalypse are already upon us. As oil prices flirt with $130 per barrel and the dollar struggles, airlines are paying nearly 80 percent more for fuel than they did a year ago. Twenty-five airlines have gone belly-up this year--three to four times the usual yearly rate. Major carriers like American, Northwest, and United, still reeling from the industry downturn after September 11, go barely a month without announcing layoffs and capacity cuts.

And it gets worse from there. Despite recent fluctuations, a growing number of economists are bracing for oil to hit or surpass $200 per barrel in a few years, and most industry analysts agree with Douglas Runte, of RBS Greenwich Capital, who told The Wall Street Journal in June, "Many airline business models cease to work at $135-a-barrel oil prices." After all, most airlines barely figured out how to be profitable in a world of low fuel costs. Jeff Rubin, chief economist of Canadian investment bank CIBC World Markets, has predicted that gasoline will hit $7 per gallon by 2010, forcing some 10 million cars in the United States off the road. If that happens, he told me, "You're going to see an even bigger exit in the airline industry."

As if one plague wasn't enough, the threat of climate change could mean further doom for airlines. In Great Britain, green groups are lobbying hard in favor of aviation fuel taxes and against a proposed third runway at Heathrow Airport, wewhile activist groups, like one called Plane Stupid, have taken to unfurling banners from atop Westminster Palace and elsewhere with slogans like WE FLY, WE DIE. They argue that, at a time when greenhouse gases are pushing global temperature to perilous levels, flying--one of the most energy-intensive forms of travel around--is a luxury the planet simply can't afford. (While aviation currently accounts for just 3 percent of man-made carbondioxide emissions, it's one of the fastest-growing sources, and the true climate impact of flight is around 2.7 times that of carbon dioxide alone, thanks to the added warming effects of nitrogen-oxide emissions and jet contrails.)

As a result of this advocacy, a social stigma against flying is slowly spreading across Europe. While air travel isn't covered by the Kyoto Protocol, the next round of climate-treaty talks will likely address the issue, and the EU has recently announced that it will bring aviation into its emissions-trading regime--forcing airlines to pay for 15 percent of their carbon use starting in 2012. "That's the real deal," says Bill Swelbar, a research engineer at MIT's International Center for Air Transportation. "When you look at some of the taxes and fees being discussed in Europe, we might as well bankrupt our industry today." John Whitelegg, a transportation expert at York University's Stockholm Environment Institute, estimates that requiring airlines to pay the full environmental costs of flight could raise fares as much as five-fold.

Few of the analysts I interviewed wanted to venture predictions about aviation's end of days. One far-reaching scenario, however, was put forward by Anthony Perl and Richard Gilbert, two Canadian transportation experts who, in their new book Transport Revolutions, envision a world in which rising oil prices have reduced domestic flying in the United States roughly 40 percent by 2025--even assuming that airlines improve fuel efficiency by about 50 percent. In such a scenario, the United States could go from having nearly 400 primary airports down to 50 or so; instead of dozens of flights each day between New York and San Francisco carrying 200 people apiece, there might be only a handful carrying 800 or more in new extra-jumbo jets.

The Federal Aviation Administration, for its part, remains bullish on flight, predicting that U.S. airlines will carry 1.3 billion passengers by 2025, nearly double the current number. But even the FAA is starting to soften its outlook, since, already this year, fares in the United States have risen nearly 15 percent on average and some 2.7 million fewer people are expected to fly this summer than last. American Airlines has announced a 12 percent cut in domestic capacity for the rest of the year; United Airlines, a 16 percent cut. Regional jets--smaller planes carrying fewer than 50 passengers that account for one-fourth of all flights today--are being grounded en masse. In the short term, cuts may prove healthy for many airlines, letting them scale back to profitable core markets. But, if oil prices do soar past $200 per barrel, major carriers could start downsizing sharply, abandoning more routes and smaller hubs, and even going out of business for good.

Maybe the gloomy futurists have a point after all, and mass aviation could be coming to an end. No longer would air travel be like the Internet or television--a cheap technology available to virtually anyone, shaping our world in countless little ways. If that happened, the result would mean more than just the end of easy weekend jaunts to Bermuda or annual Christmas visits home. It could mean major shifts in the economy, changes in immigration patterns across the world, and perhaps even a remapping of the planet as we know it.



In the 1950s, flying was a special event: You could hardly find a ticket from New York to Europe for less than $5,000; men put on suits, women wore hats and heels, and some of the luxury planes, like Pan Am's Clipper, had bridal suites, dining salons, and beds. But, in the late '70s, under pressure from consumer groups and business interests, Congress deregulated the industry, allowing upstarts to open up new routes more easily and compete on price, ushering in the modern age of mass aviation. Between 1975 and 2005, inflation-adjusted airfares in the United States plunged some 40 percent, while the annual number of passengers more than tripled. A similar shift swept across the Europe in the '90s, as deregulation gave rise to popular "no-frills" carriers like Ryanair and Easyjet. By 2001, The Atlantic Monthly was envisioning a dawning age of "air taxis"--small planes that would make flight as quotidian as hailing a cab.

Deregulation had its costs: Airlines ditched amenities and service to offer rock-bottom fares; congestion and delays plagued travelers; and the industry itself became tempestuous for individual companies and their workers. Yet these seemed like minor sacrifices for the democratization of flight, as middle-class travelers were able to visit places once accessible only by books. Attractions changed: Small museums and historic sites tucked away on interstates began to collect dust, while popular hotspots like Cancún and Waikiki became choked with tourists.

Other sociological changes wrought by cheap air travel have also been striking. Since 1980, the number of international migrants has doubled to nearly 200 million, as skilled workers and low-wage immigrants alike, knowing they could affordably return home, became more willing to set off for foreign shores. Within Europe, low-budget airlines like the Hungarian carrier Wizz Air will transport Poles and Hungarians to Western Europe for as low as $26, which has enabled a surge of Eastern European migrant workers into the United Kingdom--most of whom stay for less than three months, according to a recent study by the Institute for Public Policy Research in London. "You'll have, for instance, a Polish doctor who spends most of his time in Poland but commutes to Scotland for a long weekend shift when most Scottish doctors aren't working," says Danny Sriskandarajah, who co-authored the report. "That would've been unheard of five years ago."

In large countries such as the United States, cheap airfare has helped facilitate the geographic dispersion of families and businesses alike. In the 1980s, some onlookers predicted that these trends would spell the demise of large urban centers. That never happened--there are still advantages to agglomeration--but new patterns did emerge. Academics took it for granted that they could toss around ideas with far-flung colleagues at conferences. Trade shows and conventions attracting millions changed the way business was conducted. For a growing subset of college grads, traveling abroad became a way of "finding themselves" before settling down. Long-distance relationships became commonplace--one recent survey in Europe found that three million Brits were looking for love abroad rather than at home, as flying to the continent for dates was just as cheap as taking trains around Britain. Of course, there was a dark side, too: Democratic air travel created new opportunities for terrorism and, as the 2003 SARS epidemic made clear, new pathways for the rapid spread of disease.

More important, if less evident, was the air-freight revolution of the 1980s, as companies like Federal Express bought up planes and transformed logistics and shipping in the United States, creating a system that sped up deliveries, gave the economy vast new flexibility, and fueled the rise of Internet distributors like Amazon and eBay. Air freight now plays a huge role globally, carrying, for instance, one-third of the value of all U.S. imports. And the system relies heavily on cheap fuel: Every night, FedEx keeps a number of empty planes up in the air, to better respond to requests at a moment's notice.

Airports themselves, rapidly expanding both in number and size, have become engines of urban growth. At the extreme end sits Brasília, which was not only conceived in the 1950s as both a capital and a major air hub, but had its first building materials flown in by air and was designed to look like an airplane from above. But airport-driven development is increasingly common in the United States, as well: John Kasarda, a University of North Carolina business professor, has coined the term "aerotropolis" to describe the mini-cities that have grown up around airports, bringing in first hotels for business travelers, then office parks packed with pharmaceutical and tech companies that need to ship out their products quickly. In the '80s, Dallas-Fort Worth's status as a major air hub brought in hundreds of thousands of distribution and manufacturing jobs, along with a conglomeration of high-tech firms that now rivals Silicon Valley.



Even in the most pessimistic scenarios, the social changes wrought by cheap airfares are not going to run perfectly in reverse, like the bombing of Dresden in Slaughterhouse Five. Kasarda, for instance, is skeptical that even large increases in fuel prices will mean the end of aerotropolises, which have become largely self-sustaining. But what if a hefty decline in air travel is upon us? What would that mean?

To start with, flight may become once again largely confined to a more elite jet-setting class. The rest of us may have to vacation closer to home: Even the relatively modest 30 percent dip in air travel after September 11 proved a boon to old-fashioned local attractions like the Texas State Fair and the Bronx Zoo. And many people may think twice about relocating a flight away from family members. "It will involve a shift in people's decisions of whether they have to move," says Vered Amit, a professor of anthropology at Concordia College who studies transnational mobility. "If people are separated for longer, don't see each other as often, it's going to hurt."

Immigration, meanwhile, did not begin with the birth of Easyjet, but some migration flows could cool off--the 465,000 Poles who have flown off on low-cost carriers to work in the United Kingdom since 2004, for instance, or the 70, 000 Filipinos who migrate to the United States each year, or the Caribbean workers, skilled and unskilled alike, who fly frequently up to North America, often maintaining homes in both places.

As for the economy, no doubt a number of business fliers--who account for roughly one-third of all air travelers--will start teleconferencing instead. (Those who do still fly will enjoy the drops in both congestion and delays that come with capacity cuts.) Air freight could be harder hit, which may mean, among other things, that Americans can no longer walk into a Whole Foods in January and find blueberries flown 12,000 miles from Tasmania. During the early '90s, local produce distributors were heralding the fact that air freight had nearly quadrupled the number of items available in U.S. supermarkets. Perhaps not for much longer.

As people stop crossing the globe so frequently, the landscape will change, too. Popular tourist resorts accessible mainly by air, like Orlando and Las Vegas, could decline--much as, ironically, Atlantic City did in the latter half of the twentieth century, when air travel made it easier for East Coasters to fly off and gamble in the Nevada desert. The entire state of Alaska--whose denizens have been called "the flyingest people under the American flag"--would be dramatically altered if the small planes dotting the small airports and frozen lakes across the state could no longer afford to fly quite so often.

Dismal fates could await areas with high per capita concentrations of airport employment, such as Dallas-Fort Worth, Miami, and Tucson. Jack Kyser, chief economist for the Los Angeles County Economic Development Corporation, points out that some California cities like Fresno have managed to attract business by promising easy air access from L.A. in precisely the sort of regional jets that are now endangered. And what about the airports themselves--which, as the greens engaged in pitched battles at Heathrow remind us, were often financed based on projections of near-infinite growth and $60-per-barrel oil? Will many of them become, as one industry analyst quipped to me, "half-empty mausoleums"?

Small towns will be especially vulnerable to losing scheduled air service. That's already happened to nearly 30 U.S. cities in the past year, from Wilmington, Delaware (population 72,000) to Boulder City, Nevada (14,000). Hagerstown, Maryland, lost all commercial air service recently, rendering its new $61.8 million, 7,000-foot runway useless. Some of the towns in danger--like Massena, New York, nestled along the Canadian border--lie nowhere near four-lane highways and have been connected to the outside world primarily by airplanes, which they rely on to bring in business clients or take residents to medical centers. One local official in northern Wisconsin recently offered to Milwaukee Magazine a theory on the influx of new residents who don't mind the harsh winters: "They know they're not stuck here. They can fly out for a month or two."

For now, the federal government picks up a large part of the tab for flights to roughly 140 smaller communities with its

Essential Air Service Program, which costs $110 million per year and provides subsidies as large as $1,300 per passenger.

As fuel prices rise, Congress will have to decide if it wants to directly bankroll ever larger portions of the air network.

Meanwhile, even worse troubles might afflict the developing world, where the global tourism industry brought in $205 billion in 2005; many poorer countries, like those in the Caribbean, have tourism-based economies that depend on cheap air travel. True, there are parts of the world under heavy environmental strain from stampeding tourists--the Gálapagos Islands were recently added to UNESCO's "danger list." But a decline in flight-based tourism could also hurt local ecologies as governments, seeking to replace lost tourist cash, raid their own natural resources: In Ethiopia, for instance, Germany recently funded an eco-tourism project to forestall illegal logging in the Bale Mountains.



Is there a way to avoid this fate? I reached Richard Gilbert, one of the analysts warning of a potentially drastic decline in U.S. air travel over the next two decades, as he was returning from a meeting in Toronto with the U.S. Transportation Research Board, a government research body. I asked him what sort of response he gets when he discusses his book with industry insiders. "You see three arguments," Gilbert told me. "One is that ingenuity, American or otherwise, will overcome the problem in terms of oil prices. The second is that we'll wrestle it to the ground with technology. And the third type of response--and this one doesn't have a specific argument--is that this just can't happen."

It's always dangerous to bet against human ingenuity. But, while most of the technology needed to replace gas-guzzling cars with, say, plug-in hybrids either exists or sits just over the horizon, decarbonizing air travel is a much harder prospect, not least because of the massive amounts of energy needed to lift a large passenger plane in the air. The industry has already boosted the fuel efficiency of jets 70 percent in the last four decades, and is now left sanding down the rough spots--tinkering with ultralight materials, flying more slowly, or even charging passengers for extra bags. Propeller planes use less fuel than jets but are only really viable for some short-haul flights. Engine manufacturers say that more advanced technologies like fuel cells and carbon capture are still technically infeasible, while "blended wing" designs--planes shaped like stealth bombers to reduce drag--have barely left the drawing board. Improvements in air-traffic control will reduce both the length of flights and fuel-wasting delays, but may not be enough to surmount $200-per-barrel oil.

Virgin Airlines CEO Richard Branson has held out high hopes for jet biofuels, though spikes in food prices and massive deforestation have dimmed ethanol's star. Someday we may get solar-powered jets or hydrogen fuel cells, but, as the Intergovernmental Panel on Climate Change concluded in its landmark 1999 aviation study, "There would not appear to be any practical alternatives to kerosenebased fuels for commercial jet aircraft for the next several decades." The military may be one exception: The Pentagon, worried about peak oil scenarios, has pushed to fuel its Air Force with liquefied coal, which may keep fighter jets aloft, but would have horrifying climate consequences if used on a broad scale.

That means, in the next few decades, high-speed trains-which require considerably less energy per passenger than airplanes--may prove the most viable alternative to flight. York University's Whitelegg notes that, in Europe, trips shorter than 300 miles make up about 45 percent of all flights; most could be traversed nearly as quickly by train, if the proper infrastructure were built. Hank Dittmar, CEO of the Prince's Foundation for the Built Environment, sees airports morphing into "travelports" that seamlessly link rail and air networks, with the latter used largely for long-distance.

Trains, of course, can't span oceans. Perhaps the most unlikely alternative to emerge in recent months is the rebirth of the dirigible or airship, as companies have already been unveiling new designs for niche tourist trips and transporting cargo. The good news is that modern helium airships are far safer than the Hindenburg and emit a great deal less carbon than jumbo jets. The bad news is that natural reserves of helium may be running low and, more to the point, airships can't carry many people at a time, don't handle heavy weather well, and are quite slow: A flight from New York to London would take around 40 hours. (Fast passenger ships would take twice as long, though modern ocean liners suffer in peak oil scenarios, too.)

In an age when American consultants can commute weekly by air and return home to their spouses on the weekends, or when Manchester United soccer fans think nothing of hopping on a flight to follow their team for a quick game in Turin, it's almost impossible to imagine a world in which employers gave workers, say, three weeks off so that they could board a modern-day zeppelin and float home for the holidays. As even George Monbiot, the British environmentalist who has thundered most furiously about the need to downsize air travel in order to stave off drastic climate change, concedes, abandoning the age of mass aviation would be a hugely disorienting change. "It flies in the face of everything we have been encouraged to regard as progress," he has written. But the end of oil, or the urgency of global warming, or both, could well force that change upon us. Is that something our world, increasingly accustomed to its frenetic, globe-trotting pace, could handle?

Bradford Plumer is an assistant editor of The New Republic.

Copyright © 2008 The New Republic. All rights reserved.


Allen said on Aug 26 2008 at 9:19pm
It shouldn't be a surprise that Amtrack has so few riders. While it would cost me $59 one-way to ride from Grand Junction to Denver it takes over twice as long as driving. And I only have one train a day to take on a route like that. So instead of getting up in the morning and leaving at 8 or 9 and being home by noon or 1, I sit around until nearly noon and don't get home until a bit before 8. So instead it looks like I'll rent a car for the weekend, one that I'll barely drive during my time there, and drive home late Sunday night because it'll cost me $400 to not work on monday + $59 for the train.