Even the left-leaning Washington Post, which has not endorsed a Republican for President since 1952, is getting fed up with the Obama administration’s desire to waste billions on impractical high-speed rail boondoogles that would transport few people at enormous cost (while providing work at inflated wages for politically-powerful unions). In an editorial entitled “California’s High-Speed Rail System Is Going Nowhere Fast,” the Post’s editorial board points out that
THINGS JUST WENT from bad to worse for high-speed passenger rail in California. After the Golden State’s voters approved a $9 billion bullet-train bond issue in 2008, officials said they could build an 800-mile system by 2020, for $35.7 billion. The cost projection now, as issued by the state Nov.?1: $98.5 billion, with a completion date of 2033.
Time to pull the plug, right? Not according to Gov. Jerry Brown (D). The new “business plan is solid and lays the foundation for a 21st-century transportation system,” he said. Equally upbeat, Transportation Secretary Ray LaHood offered Mr. Brown his congratulations on “a sound, step-by-step strategy for building a world-class high-speed rail network.”
This is unreal. Apart from the bond issue and $3.6 billion in federal funds already in hand, the cash-strapped state hasn’t credibly identified a source of funds for the system. The new report basically repeats previous assertions that, if California builds, federal and private-sector dollars will come. This is wishful thinking in an era of massive federal deficits, and if the opportunities for the private sector were really so great, where are the companies clamoring to invest?
Actually, the gigantic cost estimate amounts to an indirect confirmation of the doubts voiced in several independent analyses, which have focused on not only the rail plan’s mythical funding but also its high ridership projections — and the attendant risk that California will get stuck with expensive operating subsidies as well as billions in debt service. . .
As questionable as this project is, we would have less business objecting if the only money at risk was California’s. But the Obama and Brown administrations are talking about devoting the nation’s funds to what looks more and more like a boondoggle. If the president and governor won’t slam on the brakes, then Congress or the California legislature must find a way to prevent the spending. Somebody, please, stop this train.
Earlier, Marc Scribner pointed out that the Obama Administration’s “high-speed” rail projects aren’t high-speed, and are monumentally wasteful and costly, in addition to the fact that they would duplicate existing modes of transportation, would leave local governments on the hook for huge operating costs, and would be used by only a tiny percentage of the population. Obama administration rail projects are expensive white elephants that will be used by very few travelers at an enormous cost per mile, and will not enable trains to go anywhere near as fast as they do in Europe, Japan, or China (making Obama’s claim that they are “high-speed” rail deeply misleading).
The massive California rail project will be a failure even under the most optimistic, pie-in-the-sky scenarios. At a $98 billion cost, and a minimum 5 percent return required to attract bondholders given California’s mediocre credit rating, it needs to generate a whopping $4.9 billion of value per annum. There’s just no way it will ever do that, even if gas prices skyrocket. Most people in California don’t want to go to the other parts that often. For an incredibly rosy scenario, figure 15 million Californians could want to use this with any significant frequency, and 5 million tourists. So 20 million people, max. That means it has to be worth $250 for each of them each year just to have the rail line there. That doesn’t even cover the operating costs, which are separate, and it will probably need a significant operating subsidy. How many will take even one trip per year? But it costs less than $250 to fly between San Francisco and Los Angeles — far less than $250 if you bargain-hunt and buy far enough in advance. This project may even be a failure from an energy efficiency vantage point. If the air passengers travel in a large, modern, relatively fuel-efficient airliner, where they share the aerodynamic inefficiency over a large passenger base, how many decades would it take before the rail line adds to energy efficiency, considering the energy it takes to build it? If the trains run half empty, does it ever improve energy efficiency?
This rail project is starting to approach the cost of a medium-sized war.
It would be much cheaper (although still costly) to do an Interstate 5 deluxe bus lane instead — like a Mercedes bus going 100 miles per hour, with free Internet, beverages and snacks. That would be more energy efficient than the train. With a subsidy per year of probably only a couple hundred million dollars, it would be a better investment over every time frame — although it still would cost taxpayers.
People should be suspicious of Obama administration claims that these boondoggles will create jobs. The Obama Administration’s previous jobs claims have never panned out. It said that if the $800 billion stimulus package passed, unemployment would never go above 8 percent, but it actually peaked at over 10.3 percent. The “green jobs” Obama promised in the stimulus package never came into being, as even The New York Times has conceded. Instead, the green-jobs spending ended up inadvertently outsourcing American jobs to China. Obama relied on exaggerated claims to push through the stimulus package, claiming it was needed to prevent the economy from suffering from “irreversible decline,” even though the Congressional Budget Office admitted that the stimulus package would shrink the economy “in the long run.”
Even though the economics of high-speed rail are much more favorable in China than the U.S., high-speed rail in China has proven an economic disaster, contributing to skyrocketing government debt. A finance professor in China recently sounded the alarm about exploding provincial and national debt in China, and said that its slowing economic growth is being concealed by the inclusion in economic output figures of wasteful government spending on things like “infrastructure” and “railways” that will be harmful in the long run.