There's an article today from CNBC that highlights a new rail line that will go from Miami to Orlando in Florida. The line will cost 2.5 billion dollars and it is already under construction. The big deal according to CNBC is that the rail cars and controls are being built in high tax California rather than low tax Florida. The geniuses at CNBC even headline the article "Who's laughing now?"
The funny thing at which to laugh, however, is not where the train cars are being built. Not surprisingly, the rail cars are being built by one of the few manufacturers of rail cars remaining in the USA. That Siemens plant is located in Sacramento, California. No, the funny thing is that the Florida rail line is being built with private funds. It's total cost will be 2.5 billion dollars for the roughly 250 mile run between Miami and Orlando with a number of intermediary stops. In California, they are building a high speed rail line between Los Angeles and San Francisco. That line is currently estimated to cost $60 billion for a 350 mile run. It is being built with government funds. That means that the private line in Florida will cost ten million dollars per mile, while the line built in California with public money will cost just over $170 million dollars per mile. It's pretty funny that the California public train costs over seventeen times what the Florida private train does.
Why is it that the California line is so much more expensive? The Florida line will have cars with all sorts of special amenities designed to lure travelers away from their cars. The California line is supposed to have similar amenities. The California line is supposed to travel somewhat faster than the Florida line, but not by enough to make a major difference. The Florida line uses mostly existing right of way, but much of the California line does as well.
The real difference in cost is that the Florida line is being built by a private firm with the goal of making money. It is making rational choices for expenditures based upon what the customers will want and need to choose the train. The California line is being built by the state and federal government who are more interested in satisfying different political groups than in building a train line that will actually lure people from their cars. California doesn't really care about the cost.
There's one final difference of importance. The Florida line should be completed in less than one-third the time anticipated for the California line to be built. In fact, there is a serious question if the California line will ever be completed.
So maybe we should ask CNBC again: "Who's laughing now?"
The funny thing at which to laugh, however, is not where the train cars are being built. Not surprisingly, the rail cars are being built by one of the few manufacturers of rail cars remaining in the USA. That Siemens plant is located in Sacramento, California. No, the funny thing is that the Florida rail line is being built with private funds. It's total cost will be 2.5 billion dollars for the roughly 250 mile run between Miami and Orlando with a number of intermediary stops. In California, they are building a high speed rail line between Los Angeles and San Francisco. That line is currently estimated to cost $60 billion for a 350 mile run. It is being built with government funds. That means that the private line in Florida will cost ten million dollars per mile, while the line built in California with public money will cost just over $170 million dollars per mile. It's pretty funny that the California public train costs over seventeen times what the Florida private train does.
Why is it that the California line is so much more expensive? The Florida line will have cars with all sorts of special amenities designed to lure travelers away from their cars. The California line is supposed to have similar amenities. The California line is supposed to travel somewhat faster than the Florida line, but not by enough to make a major difference. The Florida line uses mostly existing right of way, but much of the California line does as well.
The real difference in cost is that the Florida line is being built by a private firm with the goal of making money. It is making rational choices for expenditures based upon what the customers will want and need to choose the train. The California line is being built by the state and federal government who are more interested in satisfying different political groups than in building a train line that will actually lure people from their cars. California doesn't really care about the cost.
There's one final difference of importance. The Florida line should be completed in less than one-third the time anticipated for the California line to be built. In fact, there is a serious question if the California line will ever be completed.
So maybe we should ask CNBC again: "Who's laughing now?"
1 comment:
Thanks Jeff, Just another reason Government needs PRIVATIZATION at as many levels as possible!!! Government has NO ACCOUNTABILITY
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