Billionaire tech entrepreneur Elon Musk, who heads the advisory “Department of Government Efficiency” as part of the Trump administration’s efforts to upend business as usual in Washington, told a tech conference this week that Amtrak should be privatized.
Musk offered no specifics on how Amtrak could be privatized or what company would be interested in running a passenger railroad that posted a $705 million adjusted operating loss in the fiscal year that ended Sept. 30.
Musk said Amtrak was an embarrassment compared to other passenger railroads around the globe. “If you’re coming from another country, please don’t use our national rail. It can leave you with a very bad impression of America,” he said.
Amtrak wasn’t the only government program in Musk’s crosshairs: He says anything that can be privatized should be, including the U.S. Postal Service.
Privatization, he says, brings with it the threat of failure, which provides an incentive for change. “Basically, something’s got to have some chance of going bankrupt, or there’s not a good feedback loop for improvement,” he said.
Amtrak says it’s on a path to reaching operational profitability for the first time.
“Amtrak’s business performance is strong. Ridership and revenue are at all-time highs, and transformative projects are underway that will greatly improve the customer experience,” spokeswoman Christina Leeds says. “By maintaining this momentum and the ongoing support we’ve built with our federal, state, and private-sector partners, the train service we operate across our nationwide network, as mandated by law, is on-track to reach operational profitability — for the first time in history — during this administration.”
Amtrak also says its new trains and ongoing infrastructure improvements will allow the railroad to handle more passengers.
“We look forward to working with President Trump, his administration, and Congress to build a world-class passenger rail system featuring incredible new bridges, tunnels, and trains. A new era of rail is on the way as we serve more Americans than ever, from rural towns to big cities across the great United States,” Amtrak says.
Musk’s comments were the latest threat to Amtrak since Republicans gained control of the White House and Congress in January. Executive orders have called for scrutinizing existing grants. Among them: Programs funded by the Federal Railroad Administration for the expansion of passenger service as well as for Northeast Corridor improvement projects.
Congress has already authorized spending $66 billion on rail-related projects through the Infrastructure Investment and Jobs Act of 2021. Included in that total through fiscal year 2026: $22 billion for Amtrak and $36 billion in federal-state passenger partnerships.
Much of the grant money remains tied up in the cumbersome FRA review process, which might get further bogged down by job cutbacks at the agency.
Proposals to privatize Amtrak or eliminate funding for the passenger railroad have come and gone over the decades.
In 1997, for example, the Amtrak Reform and Privatization Act aimed to wean the railroad off federal subsidies in preparation for eventual privatization. In 2005, the George W. Bush administration proposed transitioning Amtrak to a private operator, suggesting a federal-state partnership where Amtrak would focus on train operations, while track and station maintenance would be handled separately.
Note: Updated at 8:45 a.m. CT with comment from Amtrak.
Long distance trains like the California Zephyr are usually sold out by non train fans. There are many who enjoy trains and even blogging about them who aren’t railfans.
Most of the worlds passenger services are paid by the taxpayers, And Musk does not get it, AMTRAK is a service, just like the USPS not a business.
The late George Warrington told us how Amtrak was on a ‘glide path to self sufficiency’. This turned out to be a load of Barbara Streisand. The current claims that Amtrak “…(is) on a path to reaching operational profitability for the first time” sounds suspiciously similar. No passenger rail system in the world is break even or better and Amtrak will not be an exception. Maybe stop pretending, Amtrak. This is no time for a rerun of 1990’s sophistry.
It’s a shame, since traveling our country by rail is still the most civilized way to travel, in my admittedly biased opinion. However, Amtrak can’t survive on a market of railfans, most of whom only photograph the trains from the ground rather than occupy a revenue seat or compartment. The general public has zero nostalgia for the Super Chief, the Broadway Limited, or the COLA. They only want to get there, on time, for a reasonable price. For most, that means flying and driving.
Amtrak is a hard sell to most people, with many equating it with bus travel. Amtrak carries such a small sliver in the matrix of travel that if Amtrak disappeared tomorrow almost no one would notice. I would. But my opinion is hardly objective. There will be shouts of ‘underfunding’ of course. I can’t see clear to confiscating money from people who will never set foot on a regular service Amtrak train just so I can get the quality train travel experience that I think I somehow deserve. There are places to get that, such as the superb Rocky Mountaineer, but that isn’t a daily service mode of travel, and the high level of service comes with a completely justifiable commensurate ticket price. The RM is quite profitable, and they pay their cost of capital and their operating costs.
So, Amtrak, let’s stop with the ‘we’re going to be profitable’ smoke and mirrors.
First off, I pro rail passenger. Next, I do agree with Musk on him saying that Amtrak is an embarrassment. But that goes back to the politicians. Little or No funding.
Third, who would want Amtrak. Know Brightline wouldn’t want it. Even the NEC. Newest equipment is 20+ years old, Most equipment is 30 to 45 years old. All need to be replaced.
Then their is the Amtrak owned infrastructure. Most electrical (sub stations, overhead , etc.) is 85 years old, and the right of way (Bridges & Tunnels) need rebuilding/replacement (many over 100 years old) and some of the route needs to realigned.
Now throw in the various transit agencies (like PATH, SEPTA, etc.). They don’t contribute their Equal share of maintenance. Also they run many more trains NOW then when it route was developed. Depending on location, the NEC has anywhere from 2 to 6 tracks. With the greater number of trains NOW and Planned increases, the NEC needs additional track. Adding 2 to 4 tracks along the whole route. This would also see the need to increase the size of stations to accommodate growth.
Price tag could be anywhere between $500 billion to $1 trillion dollars. This is just an estimate. I’m just basing it on how much CHSR “WAS” meant to cost ($30 Billion), what has already be spent on it ($33 billion but no section completed), the present projected cost ($105-$110 billion), and what the true final price tag it will be ($200+ billion) if their are no more delays.
I’m not at all shocked by these comments, but at the same time the unelected billionaire has absolutely no clue the scale of rail in the US as compared to other countries say like France, Spain, or Japan. Doing some quick research, basically the mainlines in each of those countries are about as long as the Northeast Corridor from Boston to Washington DC. If he wants a direct comparison then use the NEC.
Obviously he’s not and he simply has no clue the scale of the US network, let alone the challenges of that network that’s been brought on by deregulation, mergers, and shareholder profits over everything else. Let’s not get into the fact that most of the mainlines outside of the Northeast Corridor are 1 or 2 tracks, not 3 or 4. Or all of the abandoned trackage, ripped up trackage, etc. that came with industry consolidation. But sure let’s privatize where everything is purely profit driven which means even less rail access IMO, but what do I know about corporate greed.
Agreed Steve Foster, and Amtrak, (or whom ever) needs to compete against the domestic flight airlines with high speed passenger service where ever possible.
Don’t lecture me Charles! I’m of American Indian ancestry my Grandfather was taken from his family & put in a Indian boarding school in Pipestone MN . I know all too well about discrimination. Yes, S Africa now has more equality after a long struggle by its original people!
His elitist attitude all comes from his Apartheid roots he has nothing but contempt for anyone he feels is not his equal, which is pretty much everybody. He & dementia Donny are on a “break everything” steam roller. For Donny it’s revenge for Elon its a way to eliminate regulatory agencies who hold up his projects, eliminate his competitors & assimilate the govt with his faulty technology. The NWS, FAA are all on his short list to adapt to his technology. Nothing is safe from this Donny & Co. blitz I just saw they are now selling National Park Svc prop visitor ctrs, interpretive ctrs & sites that store historic articles for preservation. This isn’t going to end well!
Whatever one thinks abut Musk (and I don’t care for him either) you have no grounds to slander his roots as Apartheid. South Africa is a multi-ethnic country (like USA) where at the present everyone has equal rights. Being white in South Africa (or Australia, Zimbabwe, Canada, USA, Argentina, New Zealand or snywhere else where Europeans settled) doesn’t mean one is for Apartheid.
I could turn it around on you, Galen, if you are Caucasian. USA is a former Apatheid nation. So if you live in USA and if you are white, then be very careful what you say about white people in other countries. White people who gnerations ago settled in Africa are no different from white people who settled in America.
Charles on this very site in the not to distant past individuals have slandered people because of their race. Musk definitely deserves no pass on this . Galen is absolutely right in his assessment of president musk.
Has Musk even traveled on Amtrak? If not, he has no idea what he is talking about. Amtrak and the United States Postal Service are intended to serve the public. Services are different from businesses. Does Musk believe a fire department should make money too? Some of this stuff we just pay for because it is nice to have. In the case of Amtrak, travel options are good. We shouldn’t be limited to driving or flying everywhere.
Most peple in USA, maybe 98% of USA, doesn’t travel on Amtrak in any given year. Doesn’t ptreclude them from their First Amendment rights to have an opinion.
@Charles Landey – Of course he has the right to an opinion, I said it was an uninformed opinion.
A fire department simply has the same utility to everyone that department serves. The same is true for police departments. They are both organizations that we don’t want to use their services but are necessary for civilized society. Amtrak is just the opposite: it’s an elective choice. This choice is not selected by 99% of the traveling public because they just want to get there. They have no nostalgia for railroading or passenger trains. I choose to travel on Amtrak when it works for my schedule, but my mind has the thumb of nostalgia on the scale.
We fans have no business raiding the treasury simply because we like trains.
amtrak doesn’t need to privatize we have the right to write to congress to stop budgets cuts for any passenger rail and to stop it from being privatize important to almost everyone including the communities and the public
I want what works best. Amtrak is not it.
You can write all you want but many US representatives don’t have Amtrak in or even near their districts. So it’s not an issue for them or their voters. The Senate keeps Amtrak going because its in 46 of the states. But its Senate support in many of those states isn’t enough to get an open checkbook for Amtrak–nor should it be for Amtrak’s current administration.
It all boils down to what a know-nothing dimwit Musk is, foolishly empowered by his arrogant and narcissistic fuehrer.
How did anyone as stupid as Elon Musk get to be the world’s richest man? The answer is simple: gaming the corporate welfare system.
I seem to remember the orange one saying he intended to put musk in charge once he got elected. So I’m not surprised that it happened. Everybody that’s ever dealt with musk knows what kind of an a-hole he is and it’s been NO secret what he stands for. Fox propaganda never let you know what you were voting for I guess. But don’t feel bad Charles he hoodwinked a lot of folks. The carnage had just begun. All that’s left to be done now is sit back and watch. In the end some of us might at LEAST find some comfort in the fact that we didn’t cast our vote for a crazy man.
“Musk said Amtrak was an embarrassment compared to other passenger railroads around the globe” – which are publicly funded!
I wonder if Musk has ever ridden Amtrak outside of the NE Corridor? The automobile and commercial air options undoubtedly work for long-distance travel for him, but what about those people for whom those options don’t work for various reasons?
Jeffrey,
The problem is that many of the passengers outside the NE Corridor that do ride the long distant trains do so as a form of relaxation or because they don’t fly or because they don’t want to ride a bus. The people who won’t fly is rapidly decreasing and the people who want to relax on a long distance train trip are basically asking the Feds to support their travel style. As for the Disability travelers, the few I know would rather fly for a few hours than have to put up with the much longer rail trips. Nothing short of real High Speed Rail will change that. There’s no way the Feds have the hundreds of Billions available now or in the foreseeable future to invest in HS rail projects.
Passenger trains were once private affairs so the idea of private passenger trains is not something new. The American passenger train was democratized in the middle of a paradigm that started with the New Deal and is coming to a conclusion currently before our eyes. A new paradigm will coalesce and I have no idea what form it will take let alone how the passenger train will fit into this new zeitgeist.
Right – if one looks at the ICC records even into the late 60’s the mainline trains were profitable Above-the-Rail including depreciation once you baselined them to highway and aviation program treatments by taking away onerous station and facility property taxes. In the lead up to NRPC some of the proposals were considering public funding for a portion of the losses but none struck on a concept of just public funding for infrastructure and let the private railroads respond to the consumer market. If the original Auto-Train Corp had been so treated it would likely still be with us today, perhaps offering more routes. Just imagine that!
V Payne, if passenger trains were cash flow positive, then please explain the train-off petitions that littered the ICC offices in the 1960’s. Explain why we lost the North Shore Line while you’re at it. Explain why the New Haven was a mess and had to be grafted onto PC. All three of those have a common theme and profitability isn’t one of them, save for the lack thereof.
REMEMBER FOLKS — As proven by their actions, Amtrak management over the past several years DOES NOT WANT LONG-DISTANCE TRAINS to succeed. Amtrak management is solely focused on Corridor and Regional trains! Isn’t it amazing that Amtrak can find enough equipment to operate 6-7 cars on every regional and corridor train, but can’t find enough equipment to add 2 or 3 coaches and sleepers to the long-distance routes, let alone add the Viewliner Diners sitting idle and empty at Beech Grove Shops! If Amtrak management truly wanted to increase long-distance ridership and truly serve the public, they would add equipment they already own to all the long-distance trains. But adding equipment and adding a few more on-board crew members would slightly add expenses that would violate the bonus program that Amtrak executives receive each year. Top management would lose their $500,000-$800,000 bonuses by actually running longer trains to carry more passengers and generate more revenue. The Amtrak bonus incentives are backwards and management has no interest in long-distance service. So let’s actually put the blame where it belongs — on Amtrak management’s failure to provide a product that the American public will repeatedly use. Why do Amtrak executives get rewarded for being inept and clueless about how to run a real passenger train network?
Look at how well privatization worked in the UK. Worked so well that the current government is looking to nationalize it. I’ve ridden on trains there both when It was British Rail and privatized and it was better in the British Rail days.
The only parts that would survive privatization would be the NEC and a handful of corridors.
The UK example is a pertinent one.
Remember that the former UK transport minister Louise Hague was believed to favour open access and its benefits to the local community. The new minister, Heidi Alexander, however is not so enthusiastic.
It appears that the UK government believes that it would be much more economically viable if it committed to providing open access services and staff into GBR as contracts expire and stopped granting future open access requests. This would support the Government’s objective of creating a reliable, affordable and efficient integrated railway in the country.
Of course, we will wait and see what happens for Amtrak.
Dr. Güntürk Üstün
Where in the U.S. Constitution is operation of interstate passenger rail service listed as a responsibility of the Federal Government?
We do a lot of things not mentioned in the Constitution, as we should. A basic framework is not a limitation of what government can do. The founding fathers, although wise, could not write a document, that could cover every possible scenario forever. Railroads didn’t even exist when the Constitution was written.
Well said, Marc.
Same can be said for airports, interstate highways, shipping channels and canals, locks and damns. Obviously Mr. Pinckney you are biased against passenger rail. Makes me wonder why you are on this RAIL fan site.
Amtrak trains are “energy-efficient,” “climate-friendly,” and a favorite cause of Joe Biden, three reasons for the new regime to “toss it into the wood chipper.” We’re in “Drill, baby, drill” mode now. And the constitutionally defined prerogatives of Congress, whether GOP led or not, are no longer honored by the executive crew.
Sorry I cannot under any circumstance endorse a post which gives any credit to Joe Biden. I won’t get into the undisputed facts that he was corrupt, unintelligent, senile, nasty pervert of a communist. I’ll let all of that go and just speak about Amtrak Joe’s handling of Amtrak. It was under Amtrak Joe that Amtrak absolutely tanked. Nobody was as bad for Amtrak as Amtrak Joe was. To hell with him.
“I won’t get into the undisputed facts that he was corrupt, unintelligent, senile, nasty pervert of a communist.”
Aw, Charles, I thought you were talking about Biden, not tRump (or Ronald McDonald Regan, for that matter).
Please try to stay on target….
I just don’t see a GOP Congress letting this happen in my opinion. Too many long distance trains going through the middle of the country & finally a chance to advance much better rail service through VA and NC, Southeast Corridor.. Second, what is wasted on a few DOD contracts can probably cover Amtrak’s current federal outlays. In other words, Amtrak is chump change. Plus, I don’t think anyone believes Amtrak would remotely have a chance to survive as a private nationwide entity. Maybe Northeast corridor and some glorified commuter corridor services where the states want to fund it.
…
I would advocate differently. Time to immediately drop Amtrak’s expansion to everywhere but gets no one to nowhere plan. Time to double down on existing service and frequencies & retain the few expansion corridors that make sense. Time to cut all the FRA red tape because there is a quite a few good projects on the books, engineered and ready that Congress funds should keep intact..
..
Finally, Time to let Brightline offer competitive service on existing Amtrak corridor routes!! Brightline has already looked at it and identified corridors from my understanding. You will see another big push for industry to meet railcar demand (think Siemens new East Coast plant expanding & their ever expanding Sacramento facility) and immediate frequency without Federal outlays.
“ I just don’t see a GOP Congress letting this happen”
Mr. Ekren, the GOP congress will do ANYTHING president musk and king trump tell them to do. Cutting Amtrak funding is coming and I seriously doubt any private entity will step in to take over. But cutting Amtrak funding is going to be the least of our troubles over the next four years. That’s four years IF the orange one decides to leave office after his term is over.
What nonsense. Amtrak is NOT a government department, never has been for one minute of its existence. It is an entity controlled by the government and subsidized by the government.
If anyone thinks that a private company would take on this task, they would need to be even stupider than Elon Musk is.
Charles,
I disagree with you on this point. As I’ve stated before, I believe the NE corridor would be of interest to either a foreign operator if the terms of the deal would be acceptable to both sides. Notice I said “foreign” since I don’t believe Brightline would want this at this point in time and there is no other US company able to handle it. As for the rest, if Amtrak is totally gone, I can see operators willing to operate various segments of it that they believe can be successful with financial help and/or tax brakes from state involved.
But they are “on the way to profitability” – no better time than now to privatize it.