Cost-benefit. The one issue that HSR has evaded, hidden from, ignored, and denied. And it's the cost-benefit question that we all persist in evading in California. What Randal O'Toole says about the proposed Arizona train is even more appropriate for the California high-speed rail project based on "cost-benefit."
California voters supported the development of this project with almost no facts or data in hand. There were wild and vague promises of low costs for construction, high revenue returns and over one hundred million annual riders. Smoke and mirrors. None of those promises were true, and have been challenged repeatedly.
A real assessment of the dollars and cents facts, as done by William Grindley and his team and reproduced in this blog over the past several months, paints a different picture and thereby also looks at the cost/benefit ratios of what actual construction and operation will look like. http://www.cc-hsr.org/
We recently posted a series of graphs that display all the relevant numbers and what they say is what O'Toole is saying in this article. It just doesn't pencil out. High-Speed Rail is not cost effective. The taxpayers will be on the hook forever, and in very large amounts, to build and operate a train with far too few riders. And those riders will be the affluent who can afford high-priced tickets, or have them expensed by their employers. They will not be the rest of California which will continue to seek alternative, regular Amtrak rides if they can't fly to their destination. Otherwise, they will continue to drive. So, what's the point?
What we are confronting in California will be a poorly performing project with very high costs and very low benefits. That should be reason enough to terminate the project now.
Have I mentioned that the federal Congressional Budget Office did a review of the government high-speed rail program in the Department of Transportation and found not a single cost-benefit analysis?
This is a confirmation that the program was never intended to solve national transit problems. It was intended as economic stimulus merely by the transfer of federal funds to the states; that is to say, political pork.
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O'Toole: Heavy overall expense makes such rapid transit unfeasible
by Randal O'Toole - Jul. 24, 2011 12:00 AM
At first glance, high-speed trains between Phoenix and Tucson sound like a great idea. I love trains, and the idea of boarding a comfortable train that will whisk me to my destination seems very attractive.
But I am also an economist, so I have to ask, "Who will pay the cost? Who benefits? And do the benefits justify the costs?"
There is a good reason autos and airplanes have largely replaced passenger trains. Rail lines, especially high-speed lines, are extraordinarily expensive to build, maintain and operate. Justifying these costs requires huge volumes of traffic, and our decentralized world has few places dense enough to support such passenger traffic.
Take the Boston-to-Washington corridor, by far the densest in the nation. Amtrak's Acela may be the fastest way to get from downtown to downtown, but few people live or work downtown anymore, so the Acela carries only about 2 percent of passenger traffic in the corridor.
To cover its operating costs (but not its capital costs), Acela fares from New York to Washington begin at $139. By comparison, JetBlue fares begin at $39, while a variety of bus companies offering rides for $15 to $20 carry almost 50 percent more passenger miles than Amtrak. Buses take about 80 minutes longer than the Acela but offer free wireless Internet so travelers' time isn't wasted.
Amtrak carried the equivalent of more than 10 million trips in the Boston-Washington corridor in 2010. The Arizona Department of Transportation estimates a Phoenix-Tucson high-speed train would attract, at most, 1.9 million trips a year, or about 2,600 round trips per day, in 2050. That is nowhere near enough to cover costs, so the trains would require millions in annual operating subsidies as well as hundreds of millions, if not billions, in capital subsidies.
Nor are trains particularly environmentally friendly. Intercity buses use 60 percent less energy per passenger mile as Amtrak trains, and when full life-cycle costs are counted, the difference is even greater. Autos are getting more energy-efficient each year, and by 2025, the average car on the road will use less energy per passenger mile than any high-speed train.
Tourists riding the high-speed trains in France and Japan have come home with fantasies of American high-speed rail. Yet high-speed trains don't work very well in those countries, either. Most require significant subsidies, and the average residents of France and Japan ride the TGVs or bullet trains less than 500 miles, equal to about one round trip, per year.
I recently visited Japan and rode both the subsidized bullet trains and the parallel conventional trains that, because Japan is so densely populated, operate at a profit. Most riders of the conventional trains were students, senior citizens and working-class families, while most riders on the high-speed trains were well-to-do business travelers and foreign tourists.
For the vast majority of Arizona residents, building high-speed rail means taking their tax dollars to subsidize trains they won't be able to afford or find convenient to ride. Those who do ride the trains will be relatively wealthy people who don't need your subsidies. As much as I personally love trains, I have to conclude that high-speed rail is a bad idea for Arizona.
Randal O'Toole is the author of "Gridlock: Why We're Stuck in Traffic and What To Do About It." Reach him at rot@cato.org.
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