A few weeks ago, the Antiplanner reviewed the proposed Texas Central high-speed rail line between Dallas and Houston and concluded it was not viable. Last week, the Reason Foundation released a much-more detailed review that reaches the same conclusion.
Reason’s report notes that Texas Central officials claim they won’t need any subsidies, but still plan to ask the federal government for government-guaranteed low-interest loans. While Reason joins with the Antiplanner in supporting private rail projects, the desire for government-backed loans, says Reason, makes it “critical to assess the viability of this project.”
Reason’s assessment concludes that Texas Central officials have overestimated ridership and underestimated costs. As a result, ticket revenues are likely to fall almost $100 million per year short of operations & maintenance costs. Of course, that means there would be nothing left over to repay the government-guaranteed loans, so lenders would be out about $18 billion. That’s based on a construction cost of at least $20 million per mile based on the fact that the only high-speed rail lines that have been built for less had cheap or free right of way. Since the line in Texas would go over mostly private land, the right of way isn’t likely to be cheap.
One of the projects on the supposed Trump infrastructure priority list (which, I am 90 percent convinced, is not an official Trump administration list) was a Dallas-Houston high-speed rail line. When the Antiplanner called this project a boondoggle, I received an email from a supporter saying it will be entirely privately financed. While that would alleviate my objections, I remain skeptical that it could work.
The Texas Central project is backed by the Central Japan Railway and proposes to use Japanese high-speed rail technology in the 240-mile corridor from Dallas to Houston. Trains would make only one stop between those two cities, making the journey in 90 minutes at top speeds of around 200 miles per hour.
Here’s a rare example of a headline asking a question whose answer is “yes”: “Did bullet train officials ignore warning about need for taxpayer money?” Although the headline would have been more accurate if it had stated, “Bullet train officials cover up warning about need for taxpayer money.”
When the California High-Speed Rail Authority put the 2008 measure on the ballot for the state to build the line from Los Angeles to San Francisco, they claimed that the line would earn more than a billion dollars a year in operating profits (compare tables on pages 21 and 22), and that private investors would gladly invest around $7 billion in the project in order to get a share of those profits (figure 26).
As recently as two months ago, when asked at a legislative hearing if other high-speed rail operations earned “a substantial profit,” rail authority chair Dan Richard replied, “all of them, virtually all of them, make operating profit.” But Richard had to know that was a lie.
Socialists “always run out of other people’s money,” said Margaret Thatcher. “It’s quite a characteristic of them.” Some of the best examples can be found in the field of passenger rail transportation.
California’s plan to pay for high-speed rail with revenues from sales of greenhouse gas cap & trade permits has hit a speed bump. The first sale, which was expected to bring in $150 million, only brought in $10 million. At that rate, it will be centuries, instead of the planned decades, before the line is built.
When Atlanta opened its streetcar line, it offered the service for free for a year. As soon as it began charging a dollar a ride, ridership dropped by nearly 50 percent. Now the state of Georgia is threatening to shut the line down because of inept management resulting from a lack of funds.
Progressive Railroading, which has never met a passenger train subsidy it didn’t like, claims that, after six years and $1.3 billion, work on moderate-speed rail service between Chicago and St. Louis is “nearing the finish line.” Since the trains will go a maximum of 110 miles per hour, it isn’t true high-speed rail; Progressive Railroading calls it “higher-speed rail” while the Antiplanner prefers the term “moderate-speed rail.”
It turns out that Illinois is also approaching “the finish line” at moderate speeds. After nearly six years of work, Illinois has trains running at 110 mph on only one 15-mile segment of the 284-mile trip. The “final phases” of the project will be completed “within the next few years,” the magazine says vaguely.
When it is done, trains that currently take 5 hours 20 minutes will finish the trip in “about” 4 hours 30 minutes, for an average speed of 63 mph. Google maps says people can drive the distance in 4 hours 20 minutes, so the train will still take more time than driving. Plus, of course, the train probably won’t go where most people want to go as there just aren’t that many businesses or residences within walking distance of either Chicago Union Station or St. Louis’ Amtrak station. If you are driving alone, the $27 cost of an Amtrak ticket is enough to pay the marginal costs of driving; if you have some passengers, you’ll save money even counting all the costs of driving.
The Los Angeles Times has a special report finding that the California high-speed rail project will cost far more and take far longer than the rail authority is promising. The official cost estimate remains $68 billion for an abbreviated system despite the fact that a 2013 Parsons Brinckerhoff report to the authority said there was no way the project could be done for that price.
P-B’s report was “never made public” and the rail authority refused to release it under the state public records act. However, “an engineer close to the project” slipped a copy of the report to the Times.
The rail authority has established a record for ignoring such reports. In 2012, another consultant told the authority that costs should be revised upwards by 15 percent. The authority simply fired the consultant.
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.