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High-Speed Rail Debate Refuses to Quiet Down

Posted by Ken Orski on Monday, November 1st, 2010

Innovation NewsBriefs
Vol. 21, No. 26

In a November 1 column in the Washington Post reproduced below, the respected economist Robert J. Samuelson attacks the Administration’s high-speed rail program as “wasteful spending masquerading as a respectable social cause.”  While we do not agree with all of Samuelson’s conclusions, we do think his article contains some well-founded and convincing arguments. Samuelson’s key argument is that “we are prisoners of economic geography” of post World War II suburbanization. The resulting demography, he contends, has made trip origins and destinations too dispersed to support intercity passenger rail service in most corridors. (It’s not clear if he would include or exempt the Northeast Corridor from this conclusion; we would exempt it).

Samuelson’s blunt assessment appears in stark contrast to the Administration’s confident prediction, in the words of top federal  transportation officials, of “a world class network of high-speed corridors” that would connect “80 percent of America in the next 25 years at a cost of $500 billion.”  How can professional judgments be so diametricaly opposed and whose  judgment will prevail? We shall not know for a long time. But in the near term, Samuelson’s conclusion is likely to resonate more strongly in the deficit-conscious next Congress and among fiscally-strapped state governments: “The Administration’s championing and subsidies [for high-speed rail projects], he writes, “represent shortsighted, thoughtless government at its worst. It’s a triumph of politically expedient fiction over logic and evidence.”

CALIFORNIA RAIL PROJECT IS HIGH-SPEED PORK
By Robert J. Samuelson
Washington Post, Monday, November 1, 2010

Somehow, it’s become fashionable to think that high-speed trains connecting major cities will help “save the planet.” They won’t. They’re a perfect example of wasteful spending masquerading as a respectable social cause. They would further burden already overburdened governments and drain dollars from worthier programs – schools, defense, research.

Let’s suppose that the Obama administration gets its wish to build high-speed rail systems in 13 urban corridors. The administration has already committed $10.5 billion, and that’s just a token down payment. California wants about $19 billion for an 800-mile track from Anaheim to San Francisco. Constructing all 13 corridors could easily approach $200 billion. Most (or all) of that would have to come from government at some level. What would we get for this huge investment?

Not much. Here’s what we wouldn’t get: any meaningful reduction in traffic congestion, greenhouse gas emissions, air travel, oil consumption or imports. Nada, zip. If you can do fourth-grade math, you can understand why.

High-speed inter-city trains (not commuter lines) travel at up to 250 miles per hour and are most competitive with planes and cars over distances of fewer than 500 miles. In a report on high-speed rail, the nonpartisan Congressional Research Service examined the 12 corridors of 500 miles or fewer with the most daily air traffic in 2007. Los Angeles to San Francisco led the list with 13,838 passengers; altogether, daily air passengers in these 12 corridors totaled 52,934. If all of them switched to trains, the total number of daily airline passengers, about 2 million, would drop only 2.5 percent. Any fuel savings would be less than that; even trains need energy.

Indeed, inter-city trains – at whatever speed – target such a small part of total travel that the changes in oil use, congestion or greenhouse gases must be microscopic. Every day, about 140 million Americans go to work, with about 85 percent driving an average of 25 minutes (three-quarters drive alone; 10 percent carpool). Even assuming 250,000 high-speed rail passengers, there would be no visible effect on routine commuting, let alone personal driving. In the Northeast Corridor, with about 45 million people, Amtrak’s daily ridership is 28,500. If its trains shut down tomorrow, no one except the affected passengers would notice.

We are prisoners of economic geography. Suburbanization after World War II made most rail travel impractical. From 1950 to 2000, the share of the metropolitan population living in central cities fell from 56 percent to 32 percent, report UCLA economists Leah Platt Boustan and Allison Shertzer. Jobs moved, too. Trip origins and destinations are too dispersed to support most rail service.

Only in places with greater population densities, such as Europe and Asia, is high-speed rail potentially attractive. Even there, most of the existing high-speed trains don’t earn “enough revenue to cover both their construction and operating costs,” the Congressional Research Service report said. The major exceptions seem to be the Tokyo-Osaka and Paris-Lyon lines.

President Obama calls high-speed rail essential “infrastructure” when it’s actually old-fashioned “pork barrel.” The interesting question is why it retains its intellectual respectability. The answer, it seems, is willful ignorance. People prefer fashionable make-believe to distasteful realities. They imagine public benefits that don’t exist and ignore costs that do.
Consider California. Its budget is a shambles. To save money, it furloughs state workers. Still, it clings to its high-speed rail project. No one knows the cost. In 2009, the California High-Speed Rail Authority estimated $42.6 billion, up from $33.6 billion in 2008 – a huge one-year increase. The CHSRA wants the federal government to pay almost half the cost. Even if it does and the state issues $9.95 billion in approved bonds, a financing gap of perhaps $15 billion would remain.

Somehow that is to be extracted from cities, towns and investors. The CHSRA says the completed system will generate annual operating profits, $3 billion by 2030. If private investors concurred, they’d be clamoring to commit funds; they aren’t.

All this would further mortgage California’s future with more debt and, conceivably, subsidies to keep the trains running. And for what? In 2030, high-speed rail trains would provide only about 4 percent of California’s inter-regional trips, the CHSRA projects.

The absurdity is apparent. High-speed rail would subsidize a tiny group of travelers and do little else. If states want these projects, they should pay all costs because there are no meaningful national gains. The administration’s championing and subsidies – with money that worsens long-term budget deficits – represent shortsighted, thoughtless government at its worst. It’s a triumph of politically expedient fiction over logic and evidence. With governments everywhere pressed for funds, how can anyone justify a program whose main effect will simply be to make matters worse?

C. Kenneth Orski is a public policy consultant and former principal of the Urban Mobility Corporation. He has worked professionally in the field of transportation for over 30 years, in both the public and private sector. He is editor and publisher of Innovation NewsBriefs, now in its 21st year of publication.

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