AMTRAK - THE MODEL FOR THE AUTO INDUSTRY

Since the government is now in the business of taking over and running business. I thought I would take a look at their other business operations and see how they have been doing.

I know, you say that our Dear Leader doesn't want to run all these new business's he has taken over. And I should give him a break because he is new, and his programs haven't taken effect yet. I would beg to differ. He is doing exactly what he said he was going to do during the campaign. But lets not argue politics, lets look at government business's, and how successful they are.

Let's start with AMTRAK, I just looked into them, and I learned a lot.

Prior to 1970, the passenger rail system was privately owned. By 1970, what with everyone having cars, and air travel being affordable for most people, the passenger rail system was going out of business. I guess they hadn't invented the new bail out system yet. So to save the industry, in 1971 President Nixon and Congress created AMTRAK.

At the time, President Nixon was only planning to run the company for two years. I guess it was supposed to be able to stand on it's own at that point. But, I guess we will never know, because it has been a disaster ever since.

For some reason, it has always been the victim of insufficient capitol funding and political folly.

The decline of the passenger train.

One bright invention of the government was the Interstate Commerce Commission. (ICC). This would be the equivalent of today's Czar's that we now have overseeing everything. The ICC, much like today, was simply government bureaucrats with no business experience, telling businessmen how to run their business. Does any of this sound familiar?

In wisdom that only comes from a government bureaucrat, they decided, among other things, that train lines that were not making money should be merged with train lines that were profitable. That in effect made the entire passenger system inefficient, slow, and costly.

The various railroad companies were now losing money thanks to the ICC. So they sought to consolidate and merge their companies to try to stay afloat, and maybe become profitable again. Well, we all know how the government feels about corporate mergers, so the ICC delayed any action for decades. Subsequently, the rail system began to fall into disrepair, due to the fact they were losing money.

Another factor in their decline, and I will say it, was the Unions. Huge pensions, work restrictions, is it me or does it sound like I am describing General Motors?

Factor in the government had put a heavy tax burden on the railroads in their heyday. So naturally in their declining years, they still had a heavy tax burden.

By the late 1960's, all this government intervention had just about killed the passenger rail system. I guess this is when the phrase Too big to fail first go used.

In 1970 they passed the Rail Passenger Service Act, and the rest is history. We have been running a government owned and operated choo choo train system ever since. And it appears that our little train system losses money by the Millions every year.

Let's see, government intervention and Unions dictate how to run the train lines, and heavy taxes are imposed. Then when they are about to vanish into history, the government comes up with a temporary solution and takes over the passenger train system. 39 years later, we still own the company, and it has yet to make a profit.

Our Dear Leader said he doesn't want to run the car companies? Yeah right.