Industry Market Trends

Is High-Speed Rail a Boondoggle?

Apr 02, 2013

America's global competitors are racing to construct or expand sophisticated high-speed rail networks, while U.S. plans for high-speed rail have stalled. Should we continue to pursue construction of advanced train systems for commuting, travel, and business, or is high-speed rail a colossal waste of public funds?

"Building a new system of high-speed rail in America will be faster, cheaper and easier than building more freeways or adding to an already overburdened aviation system, and everybody stands to benefit," declared President Barack Obama when he released his strategic plan for a nationwide high-speed rail system in April 2009.

"With a high-speed rail system," said Vice President Joe Biden, "we're going to be able to pull people off the road, lowering our dependence on foreign oil, lowering the bill for our gas in our gas tanks."

A high-speed rail system would relieve traffic congestion and reduce air pollution. Biden has called the program "a giant environmental down payment." How has this investment panned out?

In a recent news segment, CNN raised serious doubts about the viability of a high-speed rail network, charging that "four years and $12 billion after [Obama's] pledge to bring high-speed rail across America, the slow trains are just moving a little faster." The program has so far created 134 "scattered projects" across the country that seem far from achieving the goals laid out in 2009.

For example, Washington state received $800 million from the federal government to improve the trip between Seattle and Portland. But that investment has only made the three-hour forty-minute ride 10 minutes shorter. Washington's trains max out at 79 mph and average in the low 50s. In a January report in the same series, CNN found that $52 million spent on tracks in Vermont only shaved 28 minutes off of Amtrak schedules - not a great return on investment, considering the amount of public funding devoted to these projects.

However, Paula Hammond, former secretary of transportation for Washington state, argues that there are other benefits from the project, such as expanded routes and more reliable scheduling. She explained that the state never intended to build a system like the famous "bullet trains" of Japan and Europe. Notwithstanding grandiose D.C. promises, in the Northwest region, said Hammond, "we want the ability of our communities to be connected so that we can provide travel, a daily business trip between Seattle and Portland, and the opportunity not to have to fight traffic."

CNN correspondent Anderson Cooper complained that it seems "misleading" to bill these federal expenditures as "high-speed rail" funding when they're really just being used to make slow trains move a little faster.

For now, the most ambitious plan for a high-speed bullet train is a California project that would connect Los Angeles to San Francisco and run trains at speeds of 200 mph. However, the expected cost of the California project mushroomed from $34 billion when first approved in 2008 to $98-$118 billion in May 2012, with no track laid thus far. The high projected cost has led California to scale back its plans, and the project remains unpopular among California citizens.

"Costly high-speed rail and other intercity rail projects are not federal priorities, especially in this era of trillion-dollar budget deficits," the conservative Heritage Foundation argues. "They should not be exempt from budget cuts." Evidently, House Budget Committee chair Paul Ryan (R-Wis.) agrees. Federal high-speed rail funding would be eliminated under Ryan's 2014 budget proposal.

But rail supporters are not taking these criticisms lying down. In January, Streetsblog, a news source dedicated to sustainable transportation, took aim at CNN's reporting on high-speed rail, calling it "a high-profile smear campaign on the high-speed rail program from a mainstream media source trying to expose government corruption and waste where none exists."

In reality, Streetsblog explains, the federal rail program was never just about bullet trains; regional improvement projects were always an important part of the program. Also, a fully functional high-speed rail network would take much more than four years to build: "[T]o expect something as massive and complex as high-speed rail to instantly appear like magic the minute the deal is inked is, well, a little nave."

Any long-term high-speed rail development is more likely to be a "multi-generational effort." And, contrary to CNN's implied message, high-speed rail is already operating in the U.S., with rail ridership growing by 49 percent since 2000. "Imagine how many people would flock to trains if they were fast, elegant, and on time," Streetsblog argues.

Moreover, construction and support of a high-speed rail network may become a national priority if the U.S. hopes to maintain a competitive advantage within the global economy. By comparison, countries in Western Europe have had an advanced high-speed rail system for decades.

China, the U.S.'s main economic competitor, has already completed more than 5,800 kilometers of high-speed railway, according to Singularity Hub. In the next two years, China intends to double that amount to connect its most densely populated regions with its busiest manufacturing centers, and plans to hit 31,000 miles by 2020.

Of course, strategies that work in China wouldn't necessarily succeed in the U.S., but rail advocates think America's failure to keep up with high-speed rail development will work against its ability to provide a favorable and efficient environment for business activity.