High Speed Rail

Even the Coronavirus Might Not Be Able to Kill California's Bullet Train Boondoggle

As the state deals with budget cuts and deficits, some boosters still fight to keep construction going.

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California's response to the spread of COVID-19, which included almost completely shutting down entire sectors of the economy, has devastated the state's bottom line, requiring billions in budget cuts and potentially draining the state's $16 billion "rainy day" fund.

One might think that such a fiscal disaster would cut through the institutional inertia keeping California's $80 billion bullet train boondoggle active and kill it off for good. But the reality is that even amid a new recession (possibly a depression) and a $54 billion deficit, and despite story after story about the project's mismanagement, the bullet train plan is still somehow chugging along.

A few vultures are circling overhead. Lawmakers—yes, Democratic lawmakers in this one-party state—seem to be coming to terms with the fact that a decline in state revenue doesn't match well with the regularly increasing price tag for a cross-state bullet train, currently under construction in the Central Valley. In June state Assembly members introduced a resolution that would tell the California High Speed Rail Authority (CHSRA) that it needs to defer signing a massive new contract to install 171 miles of new track and implement a 30-year service agreement until lawmakers actually appropriate more money to the project to cover those costs. The resolution passed the Assembly on June 11 by a vote of 63-0. While the resolution doesn't legally prohibit the CHSRA from pushing forward, it's a big warning flag to that body that the Assembly might not come through with the actual money to back up any contracts that are signed.

There's more: In late May, the Los Angeles Times reported that according to consultants to CHSRA, if and when the bullet train starts starts carrying travelers, it will lose money and will require operational subsides by the state.

This would seem to be a massive problem. The ballot initiative passed in 2008 authorizing bonds for the bullet train specifically states that it will not require an "operational subsidy"—no additional local, state, or federal government money can be used to keep the trains going. But according to an independent business analysis by accountants KPMG and Deutsche Bahn, a German rail company, the first operating train line in central California could lose between $40-90 million a year.

None of this should come as a surprise to the bullet train's biggest critics. From the very start, analysts for the Reason Foundation (the nonprofit which publishes this website) have been predicting that the train will require operational subsidies that will eventually reach hundreds of millions annually.

The huge economic downturn has also threatened other sources of funding for the bullet train. As Reason Foundation Senior Policy Analyst Marc Joffe noted earlier in June, money from cap-and-trade auctions in California plunged from $613 million in February to a mere $25 million in May. A quarter of this money is used to fund the bullet train project.

Even though state operational subsidies would technically violate the terms the voters approved, bullet train proponents are trying to weasel out of the problem by turning over operations from CHSRA to another government agency, possibly the San Joaquin Joint Powers Authority. Needless to say, changing who operates the train doesn't erase in any way the reality that the bullet train will be getting government subsidies to operate, and the Legislative Analyst's Office warned earlier in the year that this switch appears to be inconsistent with the "spirit" of the ballot proposition approved by voters.

"Whatever California is going to get from this project, it is not what voters approved in 2008," says Joffe. "The legislature should put a new, more realistic transportation plan in front of voters. This should include finishing the 111-mile segment under construction but not electrifying it. Rather than extending it further to the north and south, it could just be connected to the existing line that provides Amtrak service in the Central Valley."

As part of his presidential campaign, Joe Biden is promising to expand high-speed rail across the country, claiming that it will get "millions of cars off the road." Of course, that's not what high-speed rail actually does. As its more realistic proponents will admit, bullet trains compete with airlines, not with highways. But Biden's impractical plan is likely to inspire some bullet train boosters in California to hold out hope for a federal bailout if Biden is elected in November.

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  1. “…As part of his presidential campaign, Joe Biden is promising to expand high-speed rail across the country, claiming that it will get “millions of cars off the road.”….”

    As if we needed even more evidence of his dementia…

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    1. You won’t be laughing when Biden destroys Drumpf in the debates. Unless, of course, Drumpf chickens out.

      #BidenIsAsSharpAsEver

      1. Keep dreaming.

      2. The two of them better hope there’s no third party on the stage. Just about anyone could mop the floor with both of them.

        1. Remember in 2016 when we had two of the worst candidates in a lifetime running?

          Gary Johnson got 3.27%.

          So wouldn’t be too sure about that.

          1. Johnson wasn’t allowed to debate the duopoly candidates.

            1. I don’t think we’ll see Ms Jorgenson on stage with Biden and Trump anytime soon either.

          2. Gary won that election by 328%. Even Jo Johansen revealed cluelessness about law-changing spoiler votes in a Bitcoin interview. Before 1972, all votes were wasted, for they sanctioned looter collectivism and increased coercion. With under 1/10,000 of HALF the vote, the LP got its plank into Roe v Wade, and made conservatives forever deaf-and-dumb on conscription for genocidal wars. The war on enjoyable plants is dying as Libertarian votes replace kleptocracy ballots in the sort of mathematical progression whereby democracy replaced monarchies and CDs replaced vinyl LPs. That’s “The case for voting Libertarian”, you WIN! Looters lose!

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    2. I’m surprised he didn’t say “millions of horses”.

    3. But it will! His Green New Deal will depress the economy so badly that millions will have no job to commute to.

    4. The following nations already have high speed rail: Belgium, China, Denmark, France, Germany, Indonesia, Italy, Japan, Morocco, The Netherlands, Russia, Saudi Arabia, South Korea, Spain, Sweden, Taiwan, Turkey, the United Kingdom, \and Uzbekistan
      But the richest nation in history and the state with the 5th largest economy in the world cannot afford it?
      Uzbekistan? This nation of 33 million and ..with per capita incomesof about $600 per year compared to California with per capita income of $66,000.

      High speed rails promotes economic growth, reduces greenhyouse gas emissions, and connects large cities. The California plan is to develop the Central Valley connections first, to benefit the 7 million residents with a need for economic growth, since “Seven of the ten counties in California with the lowest per capita incomes are located in the Central Valley. “

      1. According to one study, a mere $10 billion spent on the SCORE rail project will have the following impact:
        – Over 1.36 million jobs will be created over the life of the SCORE project
        The SCORE project would increase regional output by $1.7 trillion
        $10B on one project will increase the state’s economy by more than 50%. Imagine how much of an increase the HSR will produce. California will have an economy larger than the rest of the country. Trains truly are magical.

      2. “…High speed rails promotes economic growth, reduces greenhyouse gas emissions, and connects large cities. The California plan is to develop the Central Valley connections first, to benefit the 7 million residents with a need for economic growth, since “Seven of the ten counties in California with the lowest per capita incomes are located in the Central Valley. “…”

        You.
        Are.
        Full.
        Of.
        Shit.

        1. Haven’t you read the reports? The Central Valley is going to boom once the trains are running. If only the people of Merced could get to Fresno in under 1 hour, businesses would relocate from all over the world.

          1. Taking you from where you aren’t in Merced to where you don’t want to be in Fresno!
            Moonbeam’s choo-choo!

      3. Yes, everyone knows that using up valuable resources to develop products for which people don’t want to pay at least cost “promotes economic growth.” Just yesterday Apple was announcing a bunch of new products that they are hoping will have massive losses.

      4. How many unions were there to deal with for “living wages”? How many environmental impact studies? How many lawsuits? How many redundancies? How many acres of land were just taken for this use instead of purchased or even eminent domained (“fair market value”). How many of these lines actually connect useful end-point, like two major cities instead of a boondoggle in the desert connecting noplace to nowhere?

  2. Why do Democrats love trains but then refuse to promote high density housing in urban areas? On top of that, wouldn’t a metro or tram line be more effective for public transportation needs than a high speed line that would only be used a few times per year by the average citizen?

    1. Oooh, oooh! I know that one.

      Democrats love trains because trains are a super efficient way to move dollars from the pockets of stupid voters into the pockets of consultants, contractors, developers and transit union bosses then to campaign coffers of Democrats.

  3. “devastated the state’s bottom line”

    That’s not fair. If California is having financial problems, it’s because Drumpf refuses to allow what we Koch / Reason libertarians know is necessary for economic prosperity — unlimited, unrestricted immigration.

    #OpenBordersWillFixEverything

    1. Joe Biden is going to build a high speed railroad from Mexico City to Los Angeles and the American citizen is going to pay for it!
      #Biden2020

      1. We just can’t bring in people from Mexico fast enough!

    2. California has long been ignoring that problem and allowing unlimited immigration anyway. A few federal Border Patrol agents are like a screen door on submarine for the flow of illegal aliens flooding into California.

  4. I can fly from SF area to LA area for $50. A dozen different flights each day from any given airport. And I’m there in two hours, lines included. So why would I ever take a train?

    Sure the TSA is a major pain in the butt, but anyone who thinks the TSA won’t be groping train passengers is fucking deluded. PLUS with the train I have to stop in every assemblyman’s district along the way.

    1. Airplanes run on horrible fossil fuels while trains run on clean electricity generated from the hopes and dreams of the average Democrat voter. Just watch the Matrix and you’ll understand.

      1. So we need electric jetliners powered by electricity. Because as long as it’s generated in other states, electricity generation is clean!

        1. Ah, you mean the Lockheed Electra!

    2. Well then obviously we need to tax the hell out of aviation kerosene so that you’ll stop choosing transportation modes wrongly… duh. The additional tax revenues can go into a fund earmarked for rail subsidies and studies assessing the gender impacts of bike trails on banana slugs… mostly the academic studies though.

    3. High speed rail in the current US transportation climate is a shared self-delusion of city planners, politicians, and well-connected contractors and bond lawyers.

      It exists to grant power and money to those people, cheered on by a media stacked with progressives who majored in journalism because other majors were hard.

    4. “…Sure the TSA is a major pain in the butt, but anyone who thinks the TSA won’t be groping train passengers is fucking deluded.”

      People who make claims to intelligence have told me they won’t. The same people who gripe at the TSA lines while boarding a ferry on the SF Bay.
      These people are NOT serious or they are simply mendacious.

  5. Dungeons & Dragons will finally address racist stereotypes.

    It’s about time they acknowledged that not all orcs are evil.

    1. How long until we get a Lord of the Rings remake with a sympathetic Sauron? Because, after all, he looked pretty black and it’s pretty shitty of all the white race’s to hate on his people just because they’re hideous perversions of nature.

      Relevant scene from Chasing Amy?

    2. Baldur’s Gate: Autonomous Zone

  6. Thank God the project is not being stopped. There have been so many times I’ve found myself in Fresno wondering, “What’s the most costly and inconvenient way to get to Merced?” and not having an answer. Now I will!

  7. “it will lose money and will require operational subsides by the state.”

    Duh! There isn’t a single passenger rail system anywhere on the face of the Earth that runs without operational subsides.

    If they price the tickets high enough to cover operating costs, no one would use it.

    1. That’s the same for EVERY public transport system in the U.S.

  8. Wow, The resolution passed the Assembly on June 11 by a vote of 63-0. rochester electrician

  9. Here comes uncle Jo

    He’s a movin’ kinda slow at the junction.

    1. Sadly, only people approaching Biden’s age would get that joke.

      1. “_Petticoat_Junction_ is an American sitcom that originally aired on CBS from September 1963 to April 1970.” — Wikipedia

        Biden was born in 1942. One could have been born as late as about 1964 and still have enjoyed _Petticoat_Junction_ during its original run.

        1. But it was/is sexist as hell, so Joe would never actually watch it.
          He would just mail in for a scratch and sniff picture – – – – – –

  10. It’s an $80 billion cockroach.

  11. “It’s the train, Boss. The train! The train!”

  12. It will still be going and increasing in costs until the day no one will buy California bonds and/or the Federal Govt doesn’t continue to subsidize it. Until then California and US taxpayers will be shaken down some more.

  13. So long as Taxpayers outside of CA are not asked to subsidize this legislative idiocy, let CA do what it wishes. But don’t go asking for a bailout.

  14. Personally I want to see California go bankrupt, be denied a bailout, get busted down to federal territory status, and readmitted to the Union in pieces.

    1. Said pieces NOT to include San Francisco, Los Angeles, and Sacramento.

  15. California lawmakers understand perfectly the consequences of importing brainwashed terrorists. So to them the advantage of 19th-Century transportation is that it is really difficult for hijackers to steer a train into the Statehouse in Sacramento.

  16. “The legislature should put a new, more realistic transportation plan in front of voters…”

    Better yet, just leave transportation out of the hands of government, including the paving and building of roads and highways. The US once had a perfectly could passenger rail system as anyone can see by looking at an ~1880 railroad map of the US. Towns used to spring up along the railroad tracks. Now they spring up along the interstates.

    The IHS put the final nail in the coffin of private profitable mass transit, both intercity and inner city. For intercity, it is obvious. But, the IHS also destroyed the cities as educated people bought cars and moved to the suburbs. Businesses followed, leaving the inner cities to decay along with their private trolley and bus companies. The IHS also required the seizure of millions of acres of private property, including homes, under eminent domain laws.

    Taxpayers should not have to pay for things they don’t necessarily want.

    1. “Taxpayers should not have to pay for things they don’t necessarily want.”

      Agreed but what is it taxpayers want? Their behavior says they want highways over rail by a ratio of about 110 to 1. Further, taxpayers have been proving for over 90 years that they are willing to pay for highways, with state and gas taxes. There are no comparable state or federal taxes on rail passengers. Rail is entirely paid for with general fund money and diverted highway user taxes.

      You are on the right track though. We should spend more money on what taxpayers want and less on what they say they want. Winston Churchill said, “I no longer listen to what people say, I just watch what they do. Behavior never lies.“

      Re your comments on the history of rail, I would suggest you read “Romance of the Rails: Why the Passenger Trains We Love Are Not the Transportation We Need” by Ranal O’Toole.

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