Despite continued evidence that high-speed rail is a waste of money, reporters still write articles lamenting that high-speed trains in America are “elusive.” It’s elusive for a simple reason: it makes no sense, being slower than flying, less convenient than driving, and far more expensive than both.
Due to the high costs, high-speed rail projects proposed more than 100 years ago were similarly flawed. In 1893, someone proposed to build a 100-mph line straight from Chicago to St. Louis for $5.5 million–around $135 million today when using GNP deflators but more than $6.5 billion when measured as a share of the economy at the time. The proposal went nowhere.
Then, in 1906, someone proposed a similar, 100-mph line from Chicago to New York called the Chicago-New York Electric Air Line (several railroads at that time were named “air line” probably because they wanted to indicate they offered the shortest route between two points). The line would have either no curves or none that trains couldn’t negotiate at 90 mph. It would have no grade crossings so wouldn’t have to stop for other trains or risk hitting cars crossing its tracks.
Quentin Kopp, who once chaired the California High-Speed Rail Authority and led the effort to persuade voters to pass the 2008 law authorizing its construction, is speaking out against the project as currently planned. To succeed, he says, high-speed rail needs to run on dedicated tracks at high speeds and frequencies.
Instead, the current plan calls for California’s high-speed trains to run on the same tracks as slower Amtrak and commuter train. This will greatly reduce the average speeds because high-speed and conventional trains can’t be safely operated together. The current projected frequencies are two to four trains per hour (half in each direction), while Kopp says 10 to 20 trains per hour is needed for the trains to be “financially secure,” which presumably means that fares cover operating costs as required by the 2008 law.
When Kopp first proposed the project, it was supposed to cost $33 billion. Now it is expected to cost $68 billion for slower, less-frequent trains. Kopp has personally been involved in legal challenges against the project.
California Representative Nancy Pelosi famously told Congress it would have to pass the Obamacare bill to find out what it said. Now California officials are telling residents they will have to spend tens of billions of dollars building the San Francisco-Los Angeles high-speed rail line to find out how much a ticket will cost. As one official says, “We will not know until late in the game [meaning after the line is built] how everything will turn out.”
On one hand, all of the ticket prices quoted to date–which range from $50 to $105 a ticket–are based not on rail costs but on airline prices: the quoted fares are set to be below, and supposedly competitive with, airfares. On the other hand, the ballot measure approved by voters in 2008 requires that fares cover operating costs–and proponents claimed that the trains would earn such a large operating profit that private investors would willingly put up billions in exchange for being able to keep those profits.
The high-speed rail authority projects that the line will attract 18 million to 31 million riders a year and, at the currently projected ticket price of $86 from LA to San Francisco, would earn $700 million more per year than its operating costs. Yet even the low figure of 18 million is unrealistically high. In 2014, Amtrak attracted fewer than 12 million riders on its Boston-to-Washington Northeast Corridor, which has more people today than the California corridor will have in 2030. While Amtrak’s trains aren’t as fast as the California rail line might be (although it won’t reach its full promised speed until sometime after 2040), the Northeast Corridor is anchored by the New York urban area’s 19 million people. By comparison, the middle of the California route is Fresno with fewer than 700,000 people. That means most of the trips in the Northeast Corridor are less than 250 miles long, while most in the California corridor would have to be much longer for it to be a success.
Japan has test-run a mag-lev train at faster than 600 kilometers per hour, a fact that is ” further humiliating the US rail industry,” says Business Insider. As an American, I feel totally humiliated by this test.
After all, after spending more than $100 billion (about $350 million per mile) on infrastructure that will require millions of dollars of precision maintenance each year, Japan will have a Tokyo-Osaka train whose normal top speed of 500 kph will be barely 60 percent as fast as the cruising speed of a Boeing 737-600 and less than 55 percent as fast as the cruising speed of a Boeing 787. Compared with mag-lev, those airplanes require hardly any infrastructure: a few acres of approximately smooth runways, a few air terminals, and air traffic control.
With great fanfare, Jerry “Moonbeam” Brown and a host of other politicians signed a rail in Fresno as a symbolic gesture toward starting construction of California’s high-speed rail project. But, despite what they say, California can’t afford to build it, and the plan they can’t afford won’t really be high-speed rail all the way from Los Angeles to San Francisco anyway.
Recall that back in 1994, California estimated that this high-speed rail line would cost less than $10 billion (about $15 billion in today’s dollars). At that price, experts at the University of California calculated, taking the train from Los Angeles to San Francisco would cost almost twice as much as flying and more than driving.
By 2008, when the measure reached the voters, the project’s estimated cost had grown to $33 billion in 2008 dollars (about $36 billion in today’s dollars). Soon after voters approved it, the cost quickly zoomed to $65 billion in 2010 dollars (about $71 billion in today’s dollars).
Los Angeles Times architecture critic Christopher Hawthorne–who claims to be an “unabashed supporter” of high-speed rail–reviews Anaheim’s new train station and finds it “oddly antiseptic.” Hawthorne doesn’t care that taxpayers spent $2,764 per square foot for what is essentially a big glass tent. He is a little disturbed that the design is so dysfunctional that train passengers “exit onto an uncovered platform, take the elevator or stairs [up] to a pedestrian bridge, and then enter the building at its highest interior level” only to have to go back down again to get to ground level.
What really bothers Hawthorne is that the building is “empty of context and obvious character,” and–most devastating of all–“placeless” meaning it would be “equally at home in Tacoma, Wash., or St. Louis.” The architects, he thinks, should have adapted regional forms, similar to the way L.A. Union Station used the Spanish Mission style.
While Hawthorne’s critique is pretty negative, it is also naive. He thinks that reducing “California’s reliance on the automobile is going to require architectural as well as infrastructural leaps of faith.” Sorry, even the most perfect architectural design won’t overcome rail’s inherent disadvantages over the convenience of cars and the low cost of flying.
In the hierarchy of dumb projects, building a high-speed rail line to connect two cities that are just 32 miles a part would rank very high. Yet the Texas Department of Transportation and the Federal Railroad Administration are proposing just that: a line from Dallas to Ft. Worth. They are currently asking for comments on the scope of the environmental impact statement, due next Monday, December 15.
Not surprisingly, the biggest beneficiary of this project, so far, is Parsons Brinckerhoff, which seems to have its fingers in every ridiculous rail project in the country. One of the company’s employees is acting as “communications manager” for the project and delivering PowerPoint presentations about it to the public.
After going to the effort of writing an environmental impact statement in order to be eligible for a federal Railroad Rehabilitation and Improvement Financing loan, All Aboard Florida has suddenly switched tracks and says it wants a private activity bond instead. Private activity bonds are issued by cities or states, but the funds are given to private entities that are responsible for repaying them–for this reason, they are sometimes called conduit bonds.
Since they are issued by a government entity, they are tax exempt. Yet the private companies that get the funds range from American Airlines, which built new terminals at JFK and other airports, to Transurban, which built HOT lanes on Virginia’s I-495. The tax exemption allows bond issuers to pay lower interest rates, giving companies that receive such bonds an advantage over their competitors. The tax exemption is also controversial, as it effectively costs the federal government money.
All Aboard Florida, which is part of the Florida East Coast Railway, promises to build a moderately high-speed (110-125 mph) rail project without any subsidies. Yet it also wants government loans of one sort or another to do it. It has already issued $405 million in bonds paying a whopping 12 percent interest–which one critic notes puts them in junk bond territory–with the up-front expectation that the bonds will be repaid out of a much lower interest $1.6-billion loan that the company expects to get from the federal and/or state governments.
Given that President Obama supports high-speed rail and noted fiscal conservative Robert Poole, of the Reason Foundation, has specifically endorsed All Aboard Florida, why would the company suddenly switch from the planned RRIF loan to a private activity bond? The company’s press release emphasized that the new bonds wouldn’t pose any risk for taxpayers, suggesting that company was sensitive to local critics who claimed that the RRIF loan could leave taxpayers holding the bag when the company defaulted.
Another possibility is that the Federal Railroad Administration let the Florida company know that full funding of the proposed RRIF loan was unlikely. This would have been the largest RRIF loan in history and one of the few dedicated to passenger rail.
The Antiplanner remains suspicious that running sixteen trains a day in each direction between Miami and Orlando is not really a viable project. If it truly were viable, would Florida East Coast really need to get tax-subsidized loans to make it work? Why doesn’t it save itself the trouble and red tape that comes with federal or state support and simply go to the truly private bond market? I suspect the answer is that not enough private investors would have faith in the company’s ridership and fare projections to fully fund the project.
Tonight, the Antiplanner will be in Rochester, Minnesota to address a proposed high-speed train between Rochester and Minneapolis. I’ll speak at the Rochester International Event Center, 7333 Airport Drive SW, at 7 pm.
The Minnesota Department of Transportation is going through the process of preparing an environmental impact statement for the “zip train.” I suspect there is only a tiny chance that the train could be funded, but MNDOT wants to be ready in case money for high-speed rail falls out of the sky as it did in 2009 when Congress passed the stimulus bill. Not surprisingly, Parsons Brinckerhoff is also behind the effort.
The response to a request for comments on the scope of the planned EIS produced so much opposition that MNDOT is taking longer than it expected to produce a final scoping document. Among other things, MNDOT has decided to include a “no-build” alternative in the EIS, the absence of which would have been reprehensible. After all, the no-build alternative was found to be the environmentally preferred alternative in the EIS for the Tampa-Orlando high-speed train (see p. 2-38).
The New York Times had an article recently arguing that the $11 billion Congress has spent on high-speed rail grants since 2009 has produced little visible results, mainly because most of it was spent on increasing the speeds of existing trains by two or three miles per hour rather than building new, true high-speed rail lines. This was followed by an editorial saying that “American lawmakers have not given high-speed rail the priority it deserves.” Population “growth will put an incredible strain on the nation’s highways and air-traffic system,” the editorial predicted, and high-speed rail would alleviate that strain.
In response, Forbes contributor Tim Worstall says, “The New York Times is wrong; there is no case for high-speed rail.” Worstall accepts the conventional wisdom that cars make sense for trips under 100 miles and planes make sense for trips of more than four hours, but in between there is a “sweet spot” in which rail makes sense. However, he continues, with the development of self-driving cars, that sweet spot disappears because the only advantage of trains is that riders can work or relax while on board, and since self-driving cars will allow people to do that too, there won’t be any need for high-speed trains.
Worstall is right about the New York Times being wrong, but he is wrong that there is a sweet spot today in which high-speed rail has an advantage over driving or flying. In claiming that such a sweet spot exists, Worstall is underestimating both the advantages of driving when and where you want to go and the excessively high costs of high-speed trains.