In the current uproar about "slashing" the budget through sequestration and the inability of Congress to find places to cut spending in a rational way, I thought it might be worthwhile to look at one of the places that president Obama has pushed for increased government spending. I am speaking, of course, about high speed trains. Obama pushed through billions to be spent on these systems as part of the first stimulus in 2009. Since then, Obama has continued to push for construction of high speed passenger rail systems as a means to promote economic growth. The president has even told us that construction of a high speed rail system opens up an area to rapid economic growth, and he has pointed to experience in parts of europe as proof of what he is saying.
It really is worth bringing a dose of reality to the discussion about high speed rail. In 2012, Amtrak carried just over 31 million passengers on its nationwide system. That was the highest number of passengers ever handled by Amtrak since its founding many decades ago. Indeed, the number of riders is up by close to 50% in the last 12 years alone. That's the good news; here is the bad: The only part of the Amtrak system that is profitable is the Northeast corridor between Washington and Boston. Amtrak generates nearly 54% of its revenues on this small portion of the system alone. If one adds in the New York to Harrisburg, New York to Albany and a few other similar short runs in the Northeast, close to two thirds of all the Amtrak revenue is accounted for. The Northeast already has high speed rail, and the Obama plan does not call for new construction there. The president wants to spend tens of billions of dollars to build high speed rail systems in areas where there is virtually no one taking the train. How many people are actually going to go by train from San Francisco to Los Angeles? Will it be enough to justify spending $70 billion dollars to build the system? At least there are tens of millions of people along that route. How many people live between Cleveland and Cincinnati; and how many would take a train along that route?
The point is that Obama has looked at the densely populated areas of europe where there is a tradition of train travel and seen the benefits that accrue from speeding up rail service and then just assumed that the same thing would work in the USA. The actual fact, however, is that a new system built in the USA would just suck up resources to build it and then more resources to keep it running. In short, high speed rail would be a great place to cut the budget. If there are so many important programs that just cannot be cut (according to Obama), then he ought to give up on the ones like high speed rail that just throw money into a hole in the ground.
It really is worth bringing a dose of reality to the discussion about high speed rail. In 2012, Amtrak carried just over 31 million passengers on its nationwide system. That was the highest number of passengers ever handled by Amtrak since its founding many decades ago. Indeed, the number of riders is up by close to 50% in the last 12 years alone. That's the good news; here is the bad: The only part of the Amtrak system that is profitable is the Northeast corridor between Washington and Boston. Amtrak generates nearly 54% of its revenues on this small portion of the system alone. If one adds in the New York to Harrisburg, New York to Albany and a few other similar short runs in the Northeast, close to two thirds of all the Amtrak revenue is accounted for. The Northeast already has high speed rail, and the Obama plan does not call for new construction there. The president wants to spend tens of billions of dollars to build high speed rail systems in areas where there is virtually no one taking the train. How many people are actually going to go by train from San Francisco to Los Angeles? Will it be enough to justify spending $70 billion dollars to build the system? At least there are tens of millions of people along that route. How many people live between Cleveland and Cincinnati; and how many would take a train along that route?
The point is that Obama has looked at the densely populated areas of europe where there is a tradition of train travel and seen the benefits that accrue from speeding up rail service and then just assumed that the same thing would work in the USA. The actual fact, however, is that a new system built in the USA would just suck up resources to build it and then more resources to keep it running. In short, high speed rail would be a great place to cut the budget. If there are so many important programs that just cannot be cut (according to Obama), then he ought to give up on the ones like high speed rail that just throw money into a hole in the ground.
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