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While Portugal Cancels High-speed Rail, U.S. Government Considers $5 billion for Second California Project

While Portugal’s government cancelled a high-speed rail line between Lisbon and Madrid, politicians in the U.S. want to build another unnecessary high-speed rail line in California. According to the The Wall Street Journal:

Prime Minister Pedro Passos Coelho immediately suspended the expensive project when he took over the office in June last year, saying Portugal didn't have financial conditions to pay for it after requesting a EUR78 billion international bailout. Discussions on the line's future, however, continued.

Portugal's plan to build the EUR8.3 billion high-speed train network was launched in 2006 by then prime minister Jose Socrates. Many economists have raised doubts as to the benefits of the project, noting that the funds used to build the high speed train network would be better used for other means, or saved. 

While California’s economy is not nearly as debt ridden as Portugal’s, there are valid comparisons. Both California and Portugal have substantial debt; California has $361,000,000,000 and climbing. This equates to 18% of California’s GDP. Portugal has 400,000,000,000 euro of debt. This equates to 106% of Portugal’s GDP. Both have cut other services. Portugal started cutting pensions and reducing public service wages in 2010. California has already cut Social Security, child-care, public education, public safety, and libraries. According to Governor Jerry Brown, “These cuts to universities, in  home supportive services, schools, prosecutions are not good, they are not the way we would like to run California, but we have to live within our means. 

Apparently “living within our means” does not apply to high-speed rail. The meandering service connecting Los Angeles with San Francisco is now forecast to cost $100 billion. The first section will not start at either Los Angeles or San Francisco but connect Bakersfield to Merced in the sparsely populated central valley. The project has been panned by the California High-speed rail review group, the California Transportation Institute, the Institute of Transportation Studies and every other non-partisan group. Many Democrats in the state legislature now oppose the project. Senator Joe Simitian of Palo Alto said “…we don’t know, after three and a quarter years, what the plan of the High-Speed Rail Authority is.”

And the insanity does not stop with one line. According to NBC’s Today Show, a company linked to Senate Majority Leader Harry Reid wants to build a second bullet train line from Victorville (which many consider the middle of nowhere) in California to Las Vegas. The location of the train station is so remote that is not currently in the city limits. The Obama Administration is close to awarding $4.9 billion to build the 150 mile-per-hour train. The loan would be three times the amount that FRA has loaned 32 other projects through the Railroad Rehabilitation and Improvement Financing program since 2002. Transportation Secretary Ray LaHood has blessed the train because, “It means jobs.” Yet, the professionals at the Federal Railroad Administration (FRA) have major doubts about this new line.

Construction cost estimates stand at $6.5 billion not including interest on the loan. FRA found numerous problems with the way the consultant conducted the analysis. These include the overall model, the accounting of air travel time and air delay and the inducement of day-trips. FRA found almost all of the touted 80,000 jobs would be temporary. At most 722 would be permanent. Desert Xpress, the company that plans to build the line, was depending on private dollars. However after private investors failed to materialize, Desert Xpress turned to the attractive loan terms of federal money.

The biggest problem with this line is it relies substantially on automobile users. The Federal Railroad Administration, Congressional Research Service, and the Office of the Inspector General have found high-speed rail does not induce people to leave their cars or reduce highway congestion in any way. In the U.S. and across the world, rail improvements of less than 150 miles reduce automobile ridership less than 1%. Why? According to the Inspector General “Automobile travel differs greatly from air or rail travel in that it generally involves door-to-door service, offers greater flexibility in time of departure, and does not require travelers to share space with strangers.”

Other studies found most travelers were “broadly happy” going to Las Vegas by car or airline. Currently flights from Los Angeles to Las Vegas can be booked for under $100. This is likely far cheaper than tickets for the train could be.

Even pro high-speed rail group America 2050 does not think much of the Los Angeles to Las Vegas line. This type of project ranks poorly in the group’s two primary criteria of regional population and employment in the central business district. There is little population in Victorville and even less employment. The group did not think much of a plan to link downtown Los Angeles to Las Vegas, ranking it 5th in the region behind almost every other California corridor. This project that starts in the middle of nowhere, 100 miles from downtown Los Angeles, would rank even lower. 

The project has much to do with the political power of Senator Harry Reid. Reid initially backed another rail program but changed his mind after Sid Rogich, a Republican adviser to two presidential campaigns, helped Reid win re-election in 2010. Anthony Marnell, another member of Republicans for Reid, is president of one of several companies associated with Rogich. Marnell has donated at least $15,000 to political committees connected to Reid since 2010.

The Victorville-Las Vegas rail project is another unnecessary high-speed rail project. It makes less financial sense, than the Los Angeles to San Francisco project that stands to cost at least $100 billion to build. Instead of acting like Portugal and canceling the first unnecessary high-speed rail program, politicians may burden California with a second unnecessary high-speed rail line. Practical infrastructure and California do not belong in the same sentence.

Baruch Feigenbaum is Transportation Policy Analyst


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