Bad love: The administration and high-speed rail

Carlos Bonilla Contributor
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Today’s budget will flesh out the financial details of the president’s ardor for high-speed rail. In the stimulus package in 2009, in the State of the Union Address (where he argued for giving 80 percent of Americans access to high-speed rail) and via Vice President Biden’s speech on spending an additional $53 billion over the next six years, the administration has been arguing for a massive spending effort on trains as fast as planes instead of automobiles. But does it make sense?

First, $53 billion is not close to enough to build high-speed rail. Only last year Amtrak estimated that high-speed rail just on the Northeast Corridor would cost $117 billion (in 2010 dollars). The president’s plan includes extending beyond the densely populated Northeast corridor to encompass “emerging and regional corridors.” This is going to cost a lot and the administration is hiding the real price tag.

Second, it is a money loser. A careful financial analysis (see my longer article at AmericanActionForum.org) indicates that if things go well, the Northeast corridor high-speed rail is designed with a built-in loss of $6.25 billion per year. To put this in perspective, it amounts to as much as $406 per passenger. Of course, things do not always go well. A combination of 20 percent higher costs and 20 percent lower revenue (if, for example, airlines competitively reduce fares to retain traffic) produces a system with a built-in loss of $14 billion a year.

The administration’s vision for high-speed rail is likely a fiscal black hole. The Northeast Corridor is the most densely populated section of the country, the one most accustomed to rail travel, and the area with the best public transportation system to accommodate rail travelers once they reach their destinations. Amtrak’s fiscal projections for this project may be the best that can be expected for any of the high-speed rail corridors promoted by the administration.

This should come as no surprise. The administration evidently fell in love with trains by watching Europe. But in Europe, trains lose money and require tons of taxpayer subsidies. The French government provides a subsidy for track renewals, a capital infusion to offset debt, a payment to subsidize costs of maintenance, subsidized travel for large families, subsidies for members of the military and police, and payments to cover pension costs. Yikes.

Finally, despite President Obama’s flippant comment that high-speed rail could be travel “without a pat-down,” rail is not safer. Just a week after the president’s State of the Union address, the U.S. State Department issued a travel alert for the United Kingdom citing “the potential for terrorists to attack public transportation systems, aviation and other travel infrastructure.”

Since 9/11, 793 deaths worldwide have resulted from terror attacks on rail systems, both urban and inter-city (non-conflict zones only). This includes 191 deaths in Madrid when ten bombs exploded in 2002, 39 in London in 2005 as part of a coordinated attack that also claimed 13 bus riders, and 209 dead in 2006 in Mumbai. In contrast, only 42 deaths have been aviation related, with 36 of these occurring this past month in Moscow when an explosive device was detonated in the international arrivals hall, an area of the airport that was unsecured in Moscow and which is unsecured in the US as well.

It is hard to envision spending over a hundred billion dollars on a new high-speed rail system without implementing security measures to protect it. Eurostar, the operator of the trains in the Channel tunnel, has this to say about passenger screening on its web site:

Eurostar terminals x-ray all luggage and security screen all passengers and their hand luggage. They also have measures in place that are not visible. Eurostar works with the authorities in France, UK and Belgium to ensure its security measures meet their requirements as well as extra measures over and above what the authorities ask for.

Get ready: here comes the “pat-down.”

America needs 21st-century transportation networks and other infrastructure. It does not need and cannot afford the president’s love affair with high-speed rail.

Carlos Bonilla is a transportation expert with the American Action Forum.