Thursday, January 26, 2012

The New York TImes Debate: Does California Need High-Speed Rail?

Here is a super discussion, or "debate" in the New York Times, hot off the press.  It involves Elizabeth Alexis, Prof. Richard White, Prof. Rick Geddes, Bill Davidow, Shannoon Tracey and Emily Rusch.

You can find their remarks below. However, there's one of the six which I won't post and that's from Emily Rusch of CALPIRG.  

That organization remains totally tone deaf to our pleadings and the array of critical documentation that has become nationally recognized.  Despite considerable effort to engage in meaningful dialogue with Emily, I proved to be unsuccessful. Here she regurges the CHSRA party line of promotional and false hype. With CALPIRG and Emily, there is no room for debate. 

Let's take a quick look at each of the comments. But, the bottom line is that five of the authors, whether they believe that high-speed rail is a good thing or not, agree that California should not have this project.

Elizabeth Alexis focuses on costs. That may be the single most flagrant aspect of this project. If the Boston Big Dig cost over-runs went from under $2 billion to final costs of over $22 billion, what is to prevent this project from doing the same? 

The rail authority has been cranking up the cost forecasts since before the '08 elections when Proposition 1A was voted for and made this project viable. Now the costs are climbing past $100 billion and we are nowhere near construction.  Typically, once construction starts (and can't be stopped) is when costs really skyrocket.

And, capital development costs are not the only impending disaster.  The operating costs have not yet been seriously confronted by the rail authority.  That's not surprising, since those costs will absolutely guarantee requiring disallowed government subsidies.

Imagine this: The year is 2033.  Phase 1 of the train system is now complete. Rolling stock, bright and shiny, is sitting on the tracks.  But the law prohibits government operating subsidies.  Nothing moves. Nothing happens. The train cannot operate. Tickets can't be sold. Interest payment debt on borrowed funds and construction contracts accumulate. There are no funds for staffing this massive rail organization.  

Now what?  $200 billion, $300 billion out of taxpayers' pockets for a rail system that can't be used? Or, will we all be hit, against our will, with those state huge subsidies described by Elizabeth?  Even with $200. tickets, we end up paying through the nose, forever. And only those who can afford this expensive ride stand to benefit from those subsidies that we all must pay. How lunatic is that?

Elizabeth says that this train costs too much and delivers too little.  Well, yes it certainly does cost too much. But it sure will deliver!  It will deliver grief to the tax payers of the US and of California.  It will deliver devastation to the regions through which it passes.  This rail authority will deliver the biggest mistake, the biggest scandal of greed and corruption in US history. That's what it will deliver.

 Richard White, our next author, released a book last year analyzing the fraud, skullduggery and corruption which promoted the Transcontinental Railroad from St. Louis to the California Coast. 

White's point is simple and clear.  We don't need it and we can't afford it. The case for HSR has not been made.  There is no discernible demand.  Where transit is needed, this train will be of no use. One of his best phrases is "a monstrous leech of a project sucking away needed revenue."

Richard Geddes makes the case that high-speed rail does have a place, but it's not in California, it's the NorthEast Corridor. He suggests that a much more sensible first effort would be to connect Los Angeles with San Diego, inasmuch as this is the second most heavily trafficked route in the US.

Geddes also cites Bent Flyvbjerg, our favorite academic authority on cost over-runs and under-productivity, of which this project promises to be the definitive example. His basic point is that HSR should only be built where it makes economic sense.

That's another way of saying that the cost-benefit analysis should dictate whether this project is a go or no-go. And we have already seen from a litany of criticisms from a variety of authoritative sources that for this project, the cost-benefit equation absolutely does not pencil out.

Bill Davidow raises an issue, which he describes as a too narrow band-width, in describing high-speed rail.  His point has been broached here before. Fewer people, certainly fewer business people will be travelling, especially inter-city, because it costs too much and the job can be performed adequately using all the IT tools now at hand. Virtual meetings are now standard, and all those participants did not get into cars, or airplanes, or passenger trains. While not perfect (yet), Skyping becomes a one on one meeting, available anytime, anywhere without leaving your laptop. Travel not necessary.  Times are changing and these changes are non-trivial.

The fist point to make is that if this SF to LA train is meant for business travelers, that train-ride novelty will wear off very quickly, since it consumes time and money, and the unproductive time consumed round-trip will be enormous, considering the first and last mile portion of these trips.

And, if train time is working time, the trip can be slower and less expensive. Business alert: Less travel expense budgets mean larger bottom line. Summary: We don't need it. Steve Jobs used to say, "The journey is the reward." Exactly, its become a non-essential, luxury, recreational experience ; a reward.

Building a several hundred billion dollar train for vacationers is not the best use of taxpayer dollars, especially when education is being slashed to ribbons.

Shannon Tracey does believe that California needs high-speed rail. We, of course, disagree. But, her construction is more in the hypothetical and the abstract.  That is, HSR should be part of the overall transit structure and strategic plan for California's transportation infrastructure. Maybe yes, maybe no. But we won't know until and unless we develop such strategic over-arching plans and policies.

She acknowledges there is so far no such plan or agenda that has been deemed workable or garnered sustained support from the California voters.  If a new ballot appeared this November, polls tell us that they would vote this project down, now knowing much more than any of us could in 2008.

Shannon's basic argument is, Americans are unlikely to continue to write blank checks absent clear plans and accountability.  And there, we agree. There are no clear plans -- to the contrary -- and there certainly has been no accountability. And finally, she calls for a "larger conversation" about the state's transportation needs, and that conversation has not yet taken place. Instead, the vision of high-speed rail has sprung from smoky back rooms in Sacramento, acquired a life of its own and now is being shoved down the throats of all of us in California, against our will. 

Does California Need High-Speed Rail? We, of course, have an answer to that question. 

However, there should be absolutely no doubt that California does not need this High-Speed Rail Project. The evidence for that is overwhelming.

 JANUARY 26, 2012 5:29 PM
Does California Need High-Speed Rail?
President Obama and Newt Gingrich can agree on at least one priority: high-speed rail. But Floridians decided they would rather not have one. Now the debate is raging on the West Coast.
Does California need a high-speed rail line, ultimately connecting San Francisco to Los Angeles? Can the state afford it?

1. California Needs a Rail Project, but Not This One

Elizabeth Goldstein Alexis is a co-founder of Californians Advocating Responsible Rail Design.

California absolutely needs to invest in its transportation infrastructure, including a robust rail network. High-speed rail could help shrink the effective distances between California’s unconnected regions. Voters in 2008 endorsed the vision by authorizing $9 billion of bonds.

The current proposal costs too much and delivers too little.
At the original price tag of $33 billion and the promise of $55 tickets for a quick trip between Los Angeles and San Francisco, the debate about high-speed rail was more about “want” than need. Costs are now closer to $100 billion, ticket prices will be much higher to attract private investment, and the impact on farmland and cities seems far greater than originally anticipated.

There is an adage in construction: “Good, fast and cheap — pick two.” In this case, we have a trifecta with plans that are bad, take decades and are outrageously expensive. The cost to taxpayers to build the project equates to a public contribution of almost $200 for every projected round trip in the first 30 years of operation. The public will pay 90 percent of the building costs and take most of the risk, and yet the private sector will collect 100 percent of any operating profits.

The current project costs too much and delivers too little. But why?

The state auditor just released a scathing report that gives some clues. The project is being run by layers of consultants under-supervised by a skeletal state agency unable to manage the myriad conflicts of interest that are killing high-speed rail. The project’s primary consultant, Parsons Brinckerhoff, does both the cost estimates and the cost-benefit analysis. It is curious how they have moved in lockstep.

The real challenge is not finances or engineering or cranky neighbors. It is finding the political will to step back and figure out how to make sure public projects are designed for public benefit, not private.

2. A Waste of Money, for Years to Come

Richard White, the Margaret Byrne Professor of American History at Stanford University, is the author of "Railroaded: The Transcontinentals and the Making of Modern America."

The debate over high-speed rail in California is not about California’s future, or the promise of new technologies, or the American Way. Californians are debating whether to build a very expensive railroad line between Los Angeles and San Francisco.

This is like building a state-of-the-art driveway while your house collapses.
We shouldn’t build it. At best it will not solve any problems for decades to come, and at worst it will become an expensive problem itself. It will become a Vietnam of transportation: easy to begin and difficult and expensive to stop.

In a state dismantling its education system and watching its existing infrastructure collapse, it is criminally profligate to build a system that will drain revenue from more-needed projects. This is like building a state-of-the-art driveway while your house collapses.

Highway 5 between Los Angeles and San Francisco is miserable, but it is not the key transportation problem in California. For high-speed rail to work, it needs to get people out of cars, but the project doesn’t touch the huge mass of traffic, which swirls daily in the Los Angeles and San Francisco metropolitan areas. High-speed rail between Boston and Washington, D.C., connects trains with functioning public transportation systems. This is not true in Los Angeles nor in large parts of the Bay area.

The projected cost of high-speed rail has risen from roughly $33 billion to $100 billion or more even as the promised system has shed Sacramento and San Diego. There is so far no private investment in the project and no federal contribution beyond the initial grant. The state auditor is only the latest to slam the California High-speed Rail Authority as a tool of its consultants and contractors. By all signs, California taxpayers will take the risks; private corporations will reap the gains; and California will either be left with what it can now fund — a white elephant running between Merced and Bakersfield — or a monstrous leech of a project sucking away needed revenue.

3. The Right Idea in the Wrong Place

Rick Geddes is an associate professor of policy analysis and management at Cornell University, a research associate at the Mineta Transportation Institute, and a visiting scholar at the American Enterprise Institute.

High-speed passenger rail is a commendable public policy goal that can provide valuable benefits to the public, but should only be pursued where it makes economic sense. A project should move forward if the revenue from all sources is sufficient to cover operating costs while making a contribution to its capital costs, including paying off debt and providing its investors with an adequate return on their investment. That's true regardless of whether the investors in question are private individuals or taxpayers.

If America wants true high-speed rail, we should first improve the Northeast Corridor between Washington and Boston.
The proposed high-speed rail line between Los Angeles and San Francisco is unlikely to meet that test. The estimates of costs recently doubled, to almost $100 billion, and it may ultimately cost much more. Research by the Oxford professor Bent Flyvbjerg shows that costs are underestimated for rail projects by about 45 percent on average, the most of all types of transport projects. High-speed rail could become California's Big Dig. Moreover, ridership — and thus revenue — is often overstated.

Given uncertainty in cost and ridership, along with the fact that even the most optimistic estimates peg the costs at a minimum $50 million per mile, Californians would be wiser to first complete a line from San Diego to Los Angeles. Demand for high-speed rail between its sprawling cities could then be observed before building a much more expensive Los Angeles-San Francisco line, almost three times the distance.

But if America wants true high-speed rail, we should first improve the Northeast Corridor between Washington and Boston. Much more modest expenditures there could increase speeds on a line where there is proven demand for high-speed rail service in some of the most congested areas of the country. These cities — as opposed to many in California — have relatively dense downtown areas featuring several public transportation options at train destinations.

There are solid ways to move forward with high-speed rail in the United States, but a new line between San Francisco and Los Angeles is not among them.

4. We Need Rail Less Than We Used To

Bill Davidow is the author of “Overconnected: The Promise and Threat of the Internet.”

Is the California high-speed rail project just a clunky old low-bandwidth connection?

The answer is both yes and no. In a recent article in The Atlantic, I discussed how much of our physical infrastructure is an information proxy in disguise. One of the functions served by office buildings, retail stores, air and rail travel, lecture halls and paper was to transfer information. In many cases, the Internet can replace these things.

The Internet has greatly reduced the need for people to travel to exchange information. Now we travel for experiences.
For example, many of the reasons we might go to a retail store involve information, more than “the experience.” A shopper might want to find out what is available or how much an item costs. This is commodity information that can easily flow to the consumer over the Internet.

Then there is the noncommodity experience that stores provide. Many people find shopping is an enjoyable pastime. Frequently shoppers want to try on clothes to see how they fit and feel.

Just as there are both commodity reasons and noncommodity reasons for shopping, there are commodity reasons and noncommodity reasons for travel.

For centuries the commodity reasons for travel have been under assault by more efficient information transfer technologies — books, the telegraph and telephone, faxes, video conferencing, and the Internet. These technologies have reduced the need for travel.

We still need travel for all the noncommodity experiences that are important in our lives. We want to visit our families and hug our grandchildren. Or Angelenos want to go skiing, and the slopes of downtown Los Angeles just aren’t enough.

In the future, the Internet will commoditize more and more of the reasons for travel. Those free videophone calls on Skype are getting pretty good. But there will be plenty of noncommodity reasons people will want to “be there.” Those reasons will create a big demand for low-cost, efficient, fast and comfortable high-speed travel.

So high-speed rail is a clunky old low-bandwidth connection — but people will want to use it because it supports the noncommodity experiences we all crave.

The question, of course, is whether enough people will want to use it. I would feel more confident in the proposal if it were starting in an area with higher demand, like San Diego to L.A.

5. One Part of a Larger Plan

Shannon Tracey is the Northern California field organizer for the Transportation for America coalition, based with the partner

California’s high-speed rail conundrum is emblematic of the short-comings in our nation’s approach to building and maintaining the transportation infrastructure we need to survive and prosper in the future.

Does California need high-speed rail? Almost certainly. California, just like the other 49 states, urgently needs many things from our transportation system: Relief from the congestion that clogs our cities. Connectivity that enables us to compete in the global economy. Access for everyone to jobs, health care, schools, cultural and family activities. Safe, affordable transportation options that help us earn energy independence, avoid rising gas prices and protect the quality of our air. California needs a 21st century transportation system to achieve these goals, and high-speed rail should probably be a part of that system.

There is no cheap option: yes, the rail project could cost $100 billion. But roadwork and airport expansions have a price tag as well.
But first we need to ensure our transportation agencies are focused on a plan that will work and has support from the public. These agencies also need transparency and accountability — which critics of the California High-Speed Rail Authority fear are lacking. But the same could be said of just about every agency operating under the outdated federal transportation program, which Congress is years overdue in updating. We lack clear direction and a clearly defined set of objectives that can help us achieve important projects like the L.A.-San Francisco line.

We must also face the fact that there’s no cheap way to meet the travel demand for California’s burgeoning metro population and economic activity, whether it’s the $100 billion for high-speed rail or the billions in highway and airport expansions that would otherwise be needed. But Americans are unlikely to continue to write blank checks absent clear plans and accountability.

High-speed rail can contribute to the future for California, if it is pursued with purpose and honesty about value – and only if it is part of a larger conversation about the transportation system we need and how to get it.

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