[Creva4k]

Lots of things to say:

Thanks for the link Dan.

First, to give a sense of perspective, in the US the number of passenger miles of passenger traffic is almost exactly equal to the number of ton-miles of freight traffic. So every time you see a passenger moving, somewhere, sometime, there is a ton of freight moving the same distance as well. Since both passengers and freight contribute to road congestion, a system that moves primarily freight can still be helpful at relieving congestion.

Second, railroads still carry the most freight in the US. There is significant over-reporting of truck freight (and under reporting of rail) because truck-rail intermodal service has become largely seamless. If a shipment leaves a factory by truck, goes five miles down the road, and travels the rest of the way by rail, for all the shipper knows it went the whole way by truck, and is counted as such.

Third, most growth in rail traffic has been low-sulfur coal from Wyoming to everywhere, and truck-rail shipment (known as intermodal) shipments, especially imports from Asia. The railroad industry's largest current customer is UPS.

Fourth, there would be more passenger rail in the US if we paid the full social cost of automobile travel, which would mean adding about 50 cents per gallon to the gas tax. I'm not sure this would save Amtrak, which still has high costs and poor management, as I have mentioned before. Passenger rail does not make money in many other countries in spite of very high gas taxes and other disincentives for automobile use. I suspect this is due to over expansion of the passenger system to many small, out of the way towns. Frequent bus service would be better and cheaper.

Fifth, I don't think that having the government own the right of way would be a good solution in the US. The US rail industry is a going concern as is. Well over 90 percent of railroad traffic is subject to some form of competition from other railroads, trucks, barges, alternative products (e.g., natural gas vs. coal for electricity generation), or alternative sources (e.g., eastern vs. western coal), so monopoly is not an issue (See my response to Kid a few weeks ago), and there is effective regulation in cases where it is.

Lastly, political influence causes governments to do a really lousey job of pricing infrastructure. For example, the rental rates that Amtrak pays to freight railroads are frozen at 1956 levels. Cities usually own port facilities and lease them to long-term tennants, but much of the dredging, etc is done virtually for free by our dear friends at the Army Corps of Engineers. A fully loaded truck does as much damage to US highways as 10,000 cars, but pays only about 60 percent of its marginal infrastructure cost in taxes. But the all time champion example comes from Canada, where the Crow's Nest Pass rate agreement froze grain rates at 1897 levels for almost 100 years. This had a substantial negative effect on Canadian railroad investment and traffic to the Pacific Rim.

edit: formatting