Interesting story, but full of misconceptions about the "good old days." I read the story as passenger trains made money in the old days, but not now. In fact, if the railroads had not carried mail (and considered it revenue, not subsidy) passenger trains lost money then too. They were a loss leader and presented a public face to for the railroad.
In fact, even before airlines (and their hugh subsidies) became accepted, much intercity travel had moved to the auto, just as much freight movement had moved to truck.