Washington Monthly - Elon Musk Wants to Privatize Amtrak, But the Real Problem Is Freight Monopolies

Transportation analyst Arnav Rao argues that while Elon Musk's push to privatize Amtrak grabs headlines, the real threat to U.S. passenger rail is the unchecked power of freight rail monopolies.

In early March, Elon Musk called Amtrak, the U.S. intercity passenger rail service, an “embarrassment” and suggested privatizing it. Soon after, the Trump administration forced Stephen Gardner, Amtrak’s CEO, to resign. In his comments, Musk—America’s “efficiency” czar—made clear he believes Amtrak’s sometimes poor service proves its inherent inefficiency as a government entity. 

But upon closer inspection, a more powerful explanation for Amtrak’s struggles emerges. Once again, we find a story of corporate monopoly and financialization, and in many cases, the corporate power problems are exacerbated by political sabotage. 

There is little debate that Amtrak is struggling. Recently, a train originating in Chicago arrived in Fort Worth, Texas, nearly 18 hours late, and was canceled the rest of the way to San Antonio. Similarly, Amtrak’s rollout of new, higher-speed trains to be used on the Northeast Corridor between Washington, D.C., and Boston has been delayed nearly four years. There is also little debate about the latent, unfulfilled demand for a good American passenger rail service in the Northeast and across America. Record ridership on Amtrak and frequently sold-out trains between cities such as Charlottesville, Virginia, and Atlanta prove this point. 

To understand Amtrak’s struggles, it helps to view Amtrak as two systems: the national system, where Amtrak leases space from freight railroads, and the Northeast Corridor, where Amtrak runs trains on tracks it owns. In the national system, the primary problem is that Amtrak runs mostly on tracks owned by private, monopolistic freight rail corporations controlled by hedge funds intent on maximizing short-term profits at the expense of service standards. 

Amtrak’s Crescent service, which runs daily between New York and New Orleans, provides a case in point. With more reliable, more frequent service, the passenger service along this route could easily divert far greater amounts of high-emission auto and airplane travel between cities such as Charlotte, North Carolina, and Atlanta. It could also attract far greater volumes of overnight sleeper-car service between cities like Atlanta and Washington D.C.—a form of not-so-high-speed rail service currently enjoying a renaissance in Europe. 

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