• Strategy
  • CFO.com | US

Good Week/Bad Week: Be Sure You’re Right

House committee okays funding for Amtrak; ''moral courage'' of lawmakers hailed by cow-catcher lobby. Plus Kozlowski on art, Disney on parade, and thimbles on symbols.

Disclaimer: This column, such as it is, does not, in any way shape or form, purport to adhere to traditional journalistic concepts. It has not been approved by the European Commission, the Warren Commission, the Cato Institute, the Ponds Institute, the House of Burgess, the House of Burgers, or any regulatory or standards-setting body associated with the Comics Code Authority. In addition, the prose contained within does not meet the august literary standards set by Earl Stanley Gardner, Earl Morrall, Earl Grey, Zane Grey, the Old Grey Mare, or Mare Winningham.

While the items in this column are based on real events, most everything else is made up. Some quotes are real, some are phony as a two-dollar nickel. Please, no lawsuits.

GOOD WEEK:

1. Amtrak

Things appear to be looking up for Amtrak, the for-profit-har-dee-har-har-har national railroad corporation. Late last week, the House Transportation Committee voted unanimously to authorize $6 billion over the next three years to fund the struggling train operator. The committee members, who seemed to be in an avuncular mood, also authorized $1 billion to carpet Guam, then tried to see how many legislative assistants they could squeeze into the Dirksen cloakroom.

The vote was seen as a slap in the face to the Bush Administration, which is keen to transfer control of the struggling railway to states. Congressional Republicans have repeatedly bashed Amtrak’s poor performance, including a laggardly 72 percent on-time record for the Acela, the company’s flagship high-speed service. All 27 of the Acela engines, however, are currently out of commission due to brake problems.

Officials at the railroad now say many of the high-tech trains, which cost nearly $1 billion to build, will not be back in service for at least another three months. Initially, officials at the railroad indicated all the trains would be in service by early May, In announcing the set back, an Amtrak spokesman noted: “Due to a lack of parts, many of the trains won’t be placed in service until sometime in mid to late July,” adding that the delay is “no biggie. Summer’s not a peak travel period, anyhow.”

Ultimately, the White House would like to see the loss-making national railroad privatized and opened up to competition. Sources close to the White House, however, say some advisors to the president question if privatization will save Amtrak or merely delay its demise. In addition, Administration officials are thought to be deeply divided over what to do about loud talkers in the quiet car.

Certainly, a look at Amtrak’s finances does not paint a pretty picture. Last year the railroad lost $600 million. In 2003, the GAO detailed Amtrak’s finances in a 200-page report to Congress. It made for fascinating reading. That year, Amtrak generated $1.6 billion in revenues, but had $2.1 billion in costs. Of the $2.1 billion in outgoing funds, nearly $1.3 went for salaries and benefits for Amtrak’s highly unionized workforce.

When asked to discuss the exorbitant salaries and cushy benefits going to the railroad’s mostly nonskilled employees, Train Workers Union chief Paul Panograf replied: “This country does not support railroads. Look at France. Look at Belgium. They have excellent trains in Belgium. You know what else? They have these little chocolates over there — I forget what you call ‘em. But they’re just delicious, very dark and flavorful with just a hint of clove. I don’t know why we can’t make chocolate like that in this country. All we’ve got is Hershey’s kisses. You call that chocolate?”

Discuss

Your email address will not be published. Required fields are marked *