South By North Strategies, Ltd.

Amtrak Costs: National + NC

It is no secret that the United States lacks a robust inter-city rail system, even in regions of the country where the population densities exist to support such services. Instead, the U.S. provides inter-city rail through Amtrak, a hodgepodge system made up of a higher-speed  rail line in the Northeast (Acela), a mix of state-supported regional services like North Carolina’s Piedmont, and a smattering of long-distance routes like the Sunset Limited running between New Orleans and Los Angeles).

Like all forms of public transportation in the United States, Amtrak’s routes require public subsidies to operate, thought the exact size those subsidies has proven controversial and difficult to compute. In response, Subsidy Scope,a project of the Pew Charitable Trusts, has attempted to comprehensively measure those costs (though not any of the benefits, such as environmental impacts).

According to the study, when the costs of depreciation are included, 41 of Amtrak’s 44 routes lost money in 2008. The greatest losses, and therefore the greatest subsidies, were incurred by long-distance routes like the California Zephyr, which runs between Chicago and San Francisco and lost $193 per passenger in 2008. At the other extreme, the higher-speed Acela line running between Boston and Washington made $41 per passenger.
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Strengthening Community Colleges

Writing in the November issue of The American Prospect, Thomas Bailey and Jim Jacobs of the Community College Research Center ask if community colleges can rise to their potential in the midst of a recession. Among those challenges is a need to pay more attention to non-credit occupational programs. Say Bailey and Jacobs:

Community colleges also need to clarify their role in the changing occupational landscape. What is the future role of a two-year occupational degree or a shorter-term certificate? At least colleges must improve the connections between credit and non-credit programs to widen opportunities for students in the booming non-credit work-force arena. And community colleges need to strengthen their relationships to four-year colleges to make transfer more effective. Some states are allowing community colleges to confer a limited number of bachelor’s degrees, and many colleges have invited four-year colleges to give courses on their campuses ….

Editor’s Note

Between November 5 and November 17, Policy Points will be updated on a reduced schedule. During that time, the blog will be updated once per weekday at approximately 8 AM. Posting will return to a three-per-weekday schedule on November 18.

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Around the Dial – Nov. 4

Economic policy reports, blog postings, and media stories of interest:

• The New Yorker’s James Surowiecki explores the logic of price wars.
• Mark Thoma of the Economist’s View warns against declaring victory too soon.
• Economist Mark Zandi details public policies to help small firms hire.
• The Economic Policy Institute asks how tax policies can foster prosperity.

A National Mortgage Market

In a new Economic Letter, the Federal Reserve Bank of San Francisco analyzes changes in the national mortgage market following the bursting of the housing bubble. Concludes the Bank:

As the U.S. housing market has moved from boom in the middle of the decade to bust over the past two years, the sources of mortgage funding have changed dramatically. The government-sponsored enterprises—Fannie Mae, Freddie Mac, and Ginnie Mae—now own or guarantee an overwhelming share of originations. At the same time, non-agency mortgage securitization and loans retained in lender portfolios have largely dried up.