Monopolists and Republicans Derail Amtrak Even as Rider Demand Rises

Transportation analyst Arnav Rao touches on Amtrak’s failures are less about government inefficiency and more the result of corporate monopolies, financialization, and political sabotage.

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In early March, Elon Musk called Amtrak, the U.S. intercity passenger rail service, an “embarrassment” and suggested that it should be privatized. 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. In the same vein, Amtrak’s rollout of new, higher-speed, trains to be used on the Northeast Corridor between Washington D.C. and Boston has been delayed by nearly four years. But there is also little debate that latent, unfulfilled demand exists for a good American passenger rail service, not only in the Northeast, but 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 problem is primarily that Amtrak runs mostly on tracks owned by private, monopolistic freight rail corporations that are now 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 that is currently enjoying a renaissance in Europe.

Unfortunately, the Crescent is so frequently delayed that it attracts only a negligible market share. Though they are required by law to give Amtrak trains priority over their own trains, freight railroads routinely do the opposite with impunity in order boost their own profits and please their Wall Street masters. In the case of the Crescent, the host railroad is Norfolk Southern, which routinely makes the Crescent and other Amtrak trains operating on its tracks pull over on sidings and wait for hours as its freight trains pass.

Making matters worse, Norfolk Southern, like other major freight railroads, has taken huge cost-cutting measures in recent years to further boost its short-term profits, which in turn causes its freight trains to break down more frequently and otherwise block Amtrak trains. In 2023 only 24 percent of southbound Crescent trains arrived within 30 minutes of their scheduled arrival time, due in large measure to delays caused by crew shortages or overlong, broken-down, Norfolk Southern freight trains.

Even in the Northeast Corridor, where Amtrak owns its tracks and runs a profitable and substantially more reliable service, efforts to bring the service on par with peer nations worldwide has been repeatedly stymied by corporate monopolies and hostility from Republican lawmakers.

Take for example Amtrak’s efforts to improve its highly popular, money-making Acela service between Washington and Boston. When seeking next-generation trainsets to recapitalize an aging fleet, bring higher-speed service to the corridor, and improve the service, Amtrak had only a handful of suppliers to choose from. In 2016, Amtrak chose Alstom, a French giant in locomotive manufacturing that controls nearly 50 percent of the global market share of high speed trains.

When Alstom failed to develop a computer model that could meet safety testing requirements, it strong-armed Amtrak into letting it begin serial production of the trainsets anyway. Though Amtrak promises to at last put the trainsets into service sometime this summer, as of this writing, they are still idled in a yard in Philadelphia due to unresolved design defects that could have been avoided if Alstom did not flex its market power.

Republican lawmakers have compounded the problems for Amtrak by repeatedly blocking efforts to improve infrastructure, especially on the aging Northeast Corridor. For example, in 2010, New Jersey Governor Chris Christie killed efforts to construct a new tunnel to alleviate congestion at a critical chokepoint on the Northeast Corridor. The result has been crumbling infrastructure and unnecessary, avoidable delays. 

President Trump has also been similarly hostile to Amtrak. In 2017, Trump proposed ending all federal support for long distance Amtrak routes, which serve as critical transportation links for rural communities. In his first term, Trump also held up funding for the construction of new tunnels under the Hudson River to fix the critical chokepoint on the Northeast Corridor. The ouster of Amtrak’s CEO signals that Trump is poised to take a familiar, hostile stance toward Amtrak.

Can Amtrak survive such challenges? Last summer the U.S. Department of Justice charged Norfolk Southern with violating federal law by routinely delaying the Crescent. If the DOJ continues to prosecute the case under the Trump Administration, and if it prevails in court, that could bring serious relief for passengers throughout the Amtrak network. This assumes, however, of course, that the Trump administration doesn’t first defund the system on the grounds that rail passenger service in the United States is inherently “inefficient.”