The Classic Example of Amtrak

They may not say it, but through their actions it's clear that plenty of people think history is unimportant; "bunk," as Henry Ford said in 1916. As the holder of a degree in history, I'm kind of sensitive about that. Particularly if you're someone in a position of authority, or want to be in a position of authority, either a knowledge of history or access to a staff that includes people who are knowledgeable about history is essential. Why? Because it helps prevent you making grand, bold statements about how to change and improve things, when those "changes and improvements" have already been tried and, generally, failed.

Yesterday, Republican presidential hopeful Mitt Romney - incidentally, my preference would be that Romney gets the nomination, if for no other reason than among the likely victors, Romney seems like he would do the least damage to the United States in the event of a Republican win in 2012 - suggested in an op-ed in the New Hampshire Union Leader* that one way to cut down on government spending would be to privatize Amtrak, the United States' government-owned national passenger rail system, describing it as "a classic example" of one of the services "that the private sector can perform better than the public sector."

It reminds me of whispers during and after the Toronto mayoral election last year about potential privatization of the Toronto Transit Commission, the city's public transit operator. The same arguments were trotted out, that a private operator would run more efficiently and conduct itself with an eye toward customer service and so on, and that everyone would be better off if the ways to get around were owned and run by organizations with profit as the first goal.

But would it really?

An Amtrak California Capitol Corridor train in Oakland, California.

When it comes to transit operators, Amtrak is actually fairly recent - it's only forty years old. Its establishment in 1971 was essentially a last-ditch effort on the part of the US government to save the passenger rail system from oblivion. With the construction of the Interstate Highway System after the Second World War and the new availability of passenger air travel, rail had difficulty competing in a market that it had once dominated through sheer lack of alternatives. At that time, all passenger rail in the US was provided by private companies, and since they were hemorrhaging money thanks to ever-smaller passenger numbers, they did what made sense for them: either terminating their passenger services, or going bankrupt. Amtrak was a "last hurrah," an experiment in tying together as many privately-owned passenger routes as possible under public ownership, and it wasn't expected to last.

Yet it did.

Government operation has kept passenger rail alive, if not necessarily vital, in the United States since 1971, and as culture continues to shift and air travel becomes more and more frustrating, rail may be bound for a renaissance. So the solution is... to privatize it? Is that the government's job - to be a caretaker? Does it really make sense for the government to run preferred but uneconomic services in times when a profit can't be made from it, but as soon as a profit can be made, control should be given up to private companies - with the revenues not coming as dividends to the government that supported it in the lean times with tax dollars, but to new owners just looking for profit?

No! What all governments everywhere need is a source of revenue, and more often than not, that comes in the form of taxation. Yet the people who raise a hue and cry about high taxation are frequently the very same people who advocate selling off profitable or potentially-profitable national assets. It's really very simple - the more assets that the United States government owns that make more money than they cost to run, the less taxes it needs to levy in order to maintain its operations.

There are things more important than the profit motive.

*As of this writing, Romney's op-ed does not seem to appear on the Union Leader's website. I was greeted with a big Ron Paul banner ad, though.