Subsidizing Amtrak imposes unfair costs on the hundreds of millions of people who do not use its services; the Northeast Corridor alone will cost taxpayers about $1.2 billion per year over the next 20 years, very little of which will go to help low income people. The United States federal government should cut its subsidies of Amtrak’s Northeast Corridor services, and Amtrak should then cease to provide services that cannot break even. Simultaneously, the federal and relevant state governments should implement the Northeast Express Lanes (NEL), which would charge cars and allow buses to travel for free in a two-way pair of dynamically tolled, uncongested highway lanes on nearby stretches of I-95 and I-93. Coach buses already offer far cheaper tickets than Amtrak, they are self-sustaining businesses, they carry many more low income riders, and the NEL would make them just as fast as the train. This practical approach would make northeast corridor transportation faster, cheaper, more consistent, more flexible, fairer, more environmentally friendly, and financially sustainable.

Travelers’ Options Today

Travelers have a lot of options for traveling along the northeast corridor; just a fraction of them take Amtrak. Every major segment of this route is served by at least four coach bus companies and three airlines, and most people elect to drive. Planes are the quickest option, trains are in the middle, and cars and buses, often contending with stiff traffic, are, on average, the slowest. Driving can be the quickest option if traffic conditions are right, but during much of the day, traffic is neither common nor predictable. Despite this significant drawback, most people choose to drive. After all, driving means you can leave when you want, do not have to get to or from station or terminal, and have a car handy at your destination. Buses are in a tough spot, as they lack the subsidies or rail and are subject to the same traffic as cars while lacking their flexibility, yet buses still attract a decent share of riders by offering a lot of options and very low prices.

Amtrak offers high-end Acela Express trains targeted at business travelers and modestly slower regional trains targeted more at value-conscious travelers and people traveling from smaller destinations. Heading from D.C. to New York on a September weekend, a passenger can choose from 16 Acela Express trains, and 21 Amtrak regional trains, 48 flights across three airlines, or 101 buses across five bus companies. That’s an average of one plane every 30 minutes and one bus every 15. Suffice it to say, there is no dearth of alternatives to Amtrak.

Plus, as seen above, driving costs a fraction of taking the train, and coach buses cost even less: 1/3 the cost of regional trains and 1/9 the cost of Acela. The government subsidizes Amtrak services on the Northeast Corridor, but these subsidies are not targeting low income travelers; buses are already far cheaper despite being run by unsubsidized private companies. As demonstrated by the American Travel Survey (see below), intercity bus riders are more likely to be low income (<$42,000 in 2019$) than Amtrak riders. Still today, buses remain the most affordable way to get between cities. In fact, Amtrak riders have slightly higher average income and are more likely to have college degrees than the average intercity traveler across all modes.

Average Energy Consumption Per Passenger Mile (BTUs) Intercity Bus Amtrak Domestic Air Travel Driving Solo 2-Person Carpool 4-Person Carpool 493 1536 2,438 4,778 2,389 1195 Source: M.J. Bradley & Associates, corroborated by Congressional Research Service

Bus also requires less than 1/3 the energy per passenger than the average Amtrak train, and buses produce lower particulate emissions per passenger. Driving with at least three people in the car is also a less energy-intensive (and much less expensive) option than Amtrak. Amtrak’s NEC trains are electric, but much of that electricity comes from fossil fuels.

Despite being more expensive and not so green, Amtrak does boast a key advantage over cars and buses: consistent travel times. Traveling by car or bus means running the risk of getting sidelined by traffic congestion. While travelers can mitigate this risk by leaving at odd times of day, that’s often a large inconvenience, and it doesn’t totally eliminate the risk of congestion. Plus, the most convenient departure times for many travelers, such as 5:30 p.m. on a weekday, are precisely when congestion is at its worst.

Driving from D.C. to NYC can take anywhere from 3 1/2 to almost 6, according to Google Maps. Regional Amtrak trains average 3 1/2 hours, Acela averages 3, both with about 75% on-time performance. Better consistency is one of the primary factors, possibly the main factor, driving northeast corridor travelers to Amtrak. However, highway congestion is not an inevitability; there are tools that can prevent it and allow cars and buses to provide the most consistent journey times.

The Northeast Express Lanes: Making Car and Bus Travel Consistent

Trains are often billed as a way around congestion; however, this takes for granted that urban highways will always be congested. This assumption that rests on the status quo, where personal cars are given free or relatively cheap passage even when a road is clogged with traffic. However, if governments designate special lanes for buses and toll-paying cars, bus priority (BP) lanes, they can make bus travel as quick and consistent as train travel, all while requiring no subsidies, costing passengers a lot less, operating more often, giving people more choice, and making it easier to get around. I call this particular set of BP lanes the “Northeast Express Lanes (NEL)”.

The NEL are a type of dynamic toll lane I call bus priority (BP) lanes; dynamic toll lanes charge cars a demand-responsive in order to maintain a steady flow of fast traffic: the more people want to use the lanes, the higher the toll. That way, the lanes never get overloaded, as the toll will always discourage some drivers from using them. During rush hour, the toll would be high. During the middle of the night with few vehicles on the road, the toll would typically be low or even $0. Buses or vans carrying a minimum number of people⁠—say, 12⁠—would always be exempt from the toll, hence the label “bus priority lanes.” This exception would allow buses to offer even cheaper tickets than they do today, as quicker journeys mean lower costs for operators. Carpools would also gain a leg up on single-occupant cars, as carpoolers could split the toll; a $40 toll becomes a $10 toll per person if you have 4 people in the vehicle.

Travel Time Driving from D.C. to NYC (assuming no storms, NEL blockages, etc.) Regular Lanes Today Northeast Express Lanes Lowest Traffic 3:36 3:36 Highest Traffic 6:20 3:47 The Northeast Express Lanes add a key element to car and bus journeys: consistency. People could plan their trips with a clear idea of how long they’ll be travelling.

The NEL would generally keep vehicles moving at at least 55 mph, making travel times consistent all day, every day. Travelers could count on driving or riding a bus between D.C. and NYC or between NYC and Boston in well under four hours, something they can’t do today.

The Northeast Express Lanes would not require widening highways; rather, two existing lanes, one per direction, would be converted. This would keep costs low. Plus, as seen below, dynamic tolls would actually allow more people to use the highway at busy times.

The Northeast Express Lanes would Save People Time

This graph refers to door-to-door journey times, which include time spent going to/from a station/airport and waiting for a bus/train/plane. Sources: Amtrak, Kamga (2015). Calculations: Notes and Appendices

This graph and the one following take into account the total journey time required for each mode, including time spent getting to/from the airports, train stations, or bus stops, time spent waiting for your departure, and of course, time spent in vehicle. For example, D.C.-NYC flight takes only about 1h 15m; most of a traveler’s time is spent getting to the airport, waiting for the flight, and then traveling from another airport. The big advantage of driving is that you do not have to wait and can leave right from where you are.

The NEL would make driving from D.C. to NYC the quickest option at all times. Buses would take less time than the Northeast Regional and only 33 minutes more than the Acela Express, whose tickets costs over nine times as much.

Between NYC and Boston, buses and cars look even better. Express buses would be notably quicker than regional trains or Acela. Therefore, one would expect almost all Amtrak riders and a lot of flyers to switch to one of these options.

Acela travelers used to business class amenities would still have options; a luxury coach bus company already runs service along the corridor, and with buses becoming the quickest option, one would expect competing bus operators to sprout up and offer more luxury- and business-oriented options.

The Northeast Express Lanes would Save Bus Travelers Money

Dynamic toll lanes would lower costs for bus companies, and in turn, to passengers. A shorter journey means using less fuel, paying a driver for fewer hours per trip, and using the same buses on more trips. Competition between existing and new coach operators would allow a good portion of these savings to pass onto consumers. Buses already offer a great value for northeast corridor travel, and NEL would make them faster and cheaper.

The Northeast Express Lanes would Save the Government Money

Amtrak service on the Northeast Corridor costs taxpayers hundreds of millions per year. Amtrak projects a $568 million profit for the NEC in FY2019; however, this claim only holds if you exclude depreciation, which means the reduction in the value of its assets over time, i.e., in large part, the cost of wear and tear. Amtrak estimates total FY19 depreciation at $868 million. Half of the tracks Amtrak owns are in the Northeast Corridor (97 percent of its routes run on tracks owned by private freight companies), and these tracks and their trains are the most intensively used assets on the network. (For more on Amtrak’s financial woes, see this post, from the Antiplanner.) Thus, if you assume that the NEC incurs 2/3 of Amtrak’s depreciation costs, it has a projected FY19 net loss of $11 million. Of course, this is a very rough estimate, but this approach actually paints a much rosier picture than if you look at what Amtrak will need to maintain the corridor going forward.

Amtrak’s 2016 five-year NEC Investment Plan notes that the corridor will need $38 billion worth of infrastructure over next 20 years just to maintain a state of good repair. After accounting for operating surpluses (before depreciation) and Amtrak’s projections for ridership growth, the railroad will require $1.2 billion per year for the NEC, or $70 per rider, paid for by federal and state tax revenue and debt. This is not an equitable distribution of resources; tens of billions of dollars that could be used in myriad ways, including measures that really do target the poor, are instead being funneled toward an expensive train service that serves a small, largely well-off group of travelers. Moreover, Amtrak is not providing an essential service on the Northeast Corridor; there are many bus companies on the NEC, and they all provide far more affordable service with almost zero subsidy per passenger mile.

The interstate highway system is paid for mostly by taxes on gas, diesel etc. Up until 2008, those taxes entirely covered the costs of highways, and simply raising the gas tax to its 1993 inflation-adjusted equivalent would close the gap. However, even at the current level, the rate of subsidy pales in comparison to that of Amtrak.

The profits generated by the Northeast Express Lane tolls and the billions in savings from cutting Amtrak service would be in addition to these regular highway revenues. These billions of dollars a year could go toward transportation vouchers for the poor, other poverty alleviation programs, fuel tax reductions, sales tax reductions, tax rebates, et cetera. Regardless of how that money would be divided—the ideal split depending heavily on one’s politics—the NEL would both improve transportation on the NEC and make it financially sustainable.

The Broader Benefits of the Northeast Express Lanes

The primary beneficiaries of the Northeast Express Lanes would actually be people making local journeys. The vast majority of people on the relevant sections of I-95 and I-93 are travelling within a single metropolitan area, not between cities. Whether someone’s going from Secaucus, NJ to Stamford, CT to visit family or commuting to a 9-5 job in downtown Boston, if they use this corridor, they’d have a new, faster way to make their trip. The NEL could lead a lot of people to switch from taking commuter rail or driving alone to riding express commuter buses or carpooling. Toll revenue from local car trips on the NEL could be used to compensate other local residents who choose not to use the express lanes through measures such as reducing license plate fees, lowering fuel taxes, lowering local sales taxes, or splitting the revenue and sending everyone checks. This way, people who chose not to drive on the NEL, including many low income people, would still benefit from the lanes. A well-designed system to distribute the revenues would provide net gains for all groups across the income spectrum.

The Way Forward

The federal government should begin working with the relevant states to implement the Northeast Express Lanes between Washington D.C. and Boston, and it should draft a medium-term plan for phasing out NEC Amtrak subsidies. This would likely mean the eventual end of Amtrak’s NEC train services. The Amtrak subsidies place an unfair burden on taxpayers, and the Northeast Express Lanes would ensure a smooth transition for train travelers toward the more financially sustainable option of coach buses. With the NEL, bus service would be even convenient for passengers, cost even less than it does today, and consistently offer similar travel speeds to trains.

I focused this piece on the intercity travel along northeast corridor because it is a case where the benefits of dynamic toll/bus priority lanes can clearly be shown. However, dynamic toll/bus priority lanes have the potential to improve travel along any congested corridor. They also don’t have to be two hundred miles long to have an impact; even an intervention of 8 miles, as was done outside Washington DC, can make a huge difference for drivers and bus riders.

Implementing the best transportation policy means making the smartest, most effective use of resources. That means questioning the notion that highways should treat a car with one passenger the same as a bus carrying 40. It means aiming toward the goal, mobility, rather than assuming that one technology (rail) is the best solution. It means enhancing people’s freedom to get around while minimizing the cost one person’s travel has on others. Practical, results-focused transportation policy can lead to a fairer, freer, more mobile society.

One Last Thing: Anticipating growth in the coach bus industry, I’ve invested all my money into rubber producers. After all, buses use tires, and tires use rubber. The stocks took a plunge recently, but I’m confident they’ll bounce back.