On land gifted to them by the government.

Given the key function railroads had in opening up the west, I think you'll struggle to argue that that was even close to a bad deal.

Indeed, that, if anything, is exactly the kind of investments that a government should be making.

If in the mid-19th century these were gifted to the railroad companies as 99 year leases, the value to the companies wouldn't have been very different, but we wouldn't be in thrall to them today.

and what if the railroads looked at the 99 year lease offer and said, "no thanks fam"? What if is such a pointless game to play.

99 year leases have been very, very common throughout history. Simply doing a present value calculation yields the result that to an investor, a 99 year lease and a 999 year lease are approximately the same value today.

nongovernment investments tend to be more sustainable, because they are driven by observed demand, instead of cronyism or politics. This was one of the few railways to survive the great railway crash, it's still operated today:

https://en.wikipedia.org/wiki/Great_Northern_Railway_(U.S.)

> This was one of the few railways to survive the great railway crash

The government well made its money back before the great railway crash.

Let's say the Internet suffers a crash in a few decades. Few would argue that any previous investment into the Internet was not worth it.

you're cherry picking an example that succeeded. Let's say DARPA's investment in ESP doesn't turn out in a few decades. Few would argue that any previous investment into ESP was not worth it. (disclaimer: I'm being paid on a stupid darpa grant now)

Non-governmental investment - except for the 3 million acres in Federal land grants.

The land grants weren't for the land that the railroads ran on. It was for adjacent property that they could develop or sell. And not all the transcontinentals relied on land grants (e.g., Great Northern).

No, Amtrak supposedly has priority by law: https://www.washingtonpost.com/news/powerpost/wp/2016/04/29/...

Based on this article, I'm under the impression that the law was overturned. The most recent article I can find about the status of adjudication suggests that Amtrak will have a very difficult time upholding that law: http://lyldenlawnews.com/2016/09/22/u-s-faces-a-choice-on-am...

Yes, and that law didn't come out of the blue. More pertinently, a purpose built passenger rail line will have priority for passengers.