RALEIGH – I am pro-rail. I think railroads remains a viable transportation option for North Carolina, and that state policymakers should pursue a systematic strategy of removing impediments to the expansion and success of the railroad industry.
That’s one reason why I rail so much against taxpayer subsidies for passenger rail.
Long ago, railroads became primarily a freight business, not a passenger business. Other than a few lines in the Northeast, Amtrak service is a subsidized luxury, not a viable business. While passengers finance virtually the entire cost of the alternatives – roads and airlines – passenger rail is heavily subsidized by non-users.
Tax-funded improvements to Amtrak service may have some ancillary benefits to the real railroad business of moving freight, but it also sets up new impediments to adequate, punctual freight service. Rail companies will go along with passenger-rail schemes if subjected to the right amount of political pressure, but industry executives will tell you privately that they’d rather keep the tracks open for money-making freight hauls, rather than be sucked into a new round of federal control of the private railroads.
Trucking long ago became the mainstay of the freight business in North Carolina and the nation, and rail isn’t really an option for many kinds of customers. But if you are hauling bulk goods – and particularly coal for North Carolina power plants – rail is the logical, least-cost choice.
The best way to allow North Carolina businesses to make efficient use of rail transportation in the state would be to:
• Require passenger-rail service to pay for itself through tickets, advertising, or other revenue. If it does, fine. If it doesn’t, clear the tracks for the paying customers. There are better alternatives, anyway.
• Reform environmental and other regulations that unnecessarily increase the cost of the rail lines themselves or of the industrial customers that make up the majority of the demand for rail transportation.
• Sell the state-owned North Carolina Railroad to the highest bidder. Use the proceeds to pay down state debt and invest in valuable state infrastructure such as roads and bridges that cannot practically be shifted into private management or ownership.
I know that these ideas may drive some defenders of the status quo to distraction. Some may even want to run me out of town on a rail, a project for which they will no doubt seek taxpayer subsidy.
Hood is president of the John Locke Foundation.