Doyle’s High Speed Rail Problem: Cost-Effectiveness

By Aaron M. Rodriguez

 

Wisconsin's High Speed Rail?

ImageEarly in January while speaking to the Greater Milwaukee Committee, Governor Doyle expressed that the current economic crisis presented Wisconsin with an unequaled opportunity to do things only dreamed of in the past. The federal stimulus money, Doyle said, could be utilized to build an intricate high speed rail network from Chicago to Minneapolis that would interface with Milwaukee, Madison, and Green Bay. The rail project would cost billions of dollars, but Doyle believes that if it's built, the demand will be there to warrant the project.

Doyle's ideological response offers a glance into the mindset of a liberal. He could have shown a reluctance toward accepting a trillion dollar bill simply because a substantial tax burden will oppress the next generation of Americans. Instead, however, he showed an eagerness to spend Wisconsin’s share of the handout on innovative ideas that aren't practical and don't work. This is similar to an indebted person using a sizable loan to purchase a new mansion and a lavish yacht instead of neutralizing his debt.

After expressing enthusiasm for high speed rail, Doyle was asked if there was evidence that demonstrated the availability of travelers for such a system. Doyle responded,

 

“If you could get from the Twin Cities to Chicago in equal the time it takes you to go to the airports and fight through everything and you can end up in downtown Twin Cities or downtown Chicago and it's on a good, new high-speed comfortable train, then I think you're going to see a lot of demand for it - particularly as it comes through Madison and Milwaukee. Just as we heavily subsidize our road transportation system, we subsidize heavily our air transportation system. I don't think people should say rail is somehow not subject to subsidy when the others are."
Doyle’s response concedes that the appeal of high speed rail is predicated upon its demand; so the question is, where is the demand and does it warrant spending on rail?

 

The Cost Effectiveness of Amtrak (high speed rail)

The first pertinent and logical question taxpayers should ask about any local project is, “Does evidence show that the benefits will off-set the costs?” The question is particularly important because all available data suggests that high speed rail costs billions of dollars to create, operates at a steady stream of losses, insignificantly reduces highway traffic, and pollutes the environment nearly as much as planes and automobiles respectively. Let’s look at the facts.

In May of 1971, Amtrak was built to provide a rail transportation service to intercity passengers. It was concocted by the Nixon administration because there was a steady decline of private passenger rail services from 1920 to 1970. (The one exception was WWII when rail was used to transport U.S. troops.) Since the time of its inception, Amtrak has lost an average of $500 million a year. This does not include the 2.3 billion dollar infusion it received from Congress in 1998 and 1999. And today, Amtrak is in worse shape than before Congress elected to intervene. In a 1998 audit, it showed that Amtrak lost money on all 40 rail routes that were audited except for 1.

 

The Cost of Foreign High Speed Rail

The problem of efficient operations isn’t just limited to the U.S. Japan’s bullet trains turned a once profitable Japanese National Railways into virtual bankruptcy, forcing the Japanese government to absorb $200 billion in losses. And in Europe, the European Union currently spends $100 billion a year subsidizing intercity rail. It would appear, therefore, that government-run high speed rail operates with substantial losses in both hemispheres. But as Governor Doyle said,

 

“Just as we heavily subsidize our road transportation system, we subsidize heavily our air transportation system. I don't think people should say rail is somehow not subject to subsidy when the others are.”
Fair enough, so let’s look at the differences in cost efficiency of high speed rail and roads.

 

The Cost Effectiveness of High Speed Rail Projects

Image In 2004, a report was published by the Midwest Regional Rail Initiative that proposed upgrading a network of rail lines connecting 8 major corridors. It would use conventional diesel-powered trains that operate at speeds up to 110 mph. It would cost about $7.7 billion to initiate the system, which does not include the continuing operational costs. Divided up and averaged out, it would cost about $2.4 million per mile of track. This is fairly close to the costs of building a four lane highway that includes on and off ramps, and over and under passes. The problem, however, is that rail doesn’t have the occupant capacity to make its money back like highways do. Due to the passenger shortage of rail, highways are nearly 3 times more cost-effective. The Midwest Rail proposal represents about 1.3 million passenger miles per year, whereas highways represent about 3.5 million passenger miles per year. Unless engineers can find a way to upgrade railroad track with three times more efficiency or increase passenger occupancy on trains by 3 times the current amount, it makes little sense to keep pushing such a project.

In 2000, Florida voters passed an amendment to the state’s constitution forcing the construction of a high-speed rail system that could run at speeds of 120 mph. Florida’s High Speed Rail Authority planned to build a 92 mile rail line from Orlando to Tampa. The project would cost about $2.5 billion, which represents $27 million per mile of track laid. Apparently, building a track for high speed rail in Florida is nearly 40 times more costly than building a highway of similar lengths. When the costs were revealed to Florida citizens, they repealed the measure.

In 2000, the California High Speed Rail Authority published a plan to build a rail line in the San Francisco Bay area (the plan itself cost $58 million). To build the rail line, it would cost anywhere from $33 to $37 billion, which is about $47 to $52 million per mile of track laid. The California high-speed rail system is estimated to represent $2.30 per annual passenger mile. This is still more than 3 times the cost efficiency of rural highways of similar lengths. Also, if building railroad track is roughly 3 times as costly as building highway, then the continuing maintenance costs should be similarly proportional. These examples are sufficient to support the conclusion that high speed transit is a flawed idea that liberals just can’t seem to let go.

In February, Doyle accepted a trip to Spain in order to see their bullet trains in action. Doyle stated that

"European cities are better connected by rail than air, eliminating the hassles of airports while offering dining cars and swank first-class accommodations."
I have a question for Governor Doyle - don’t airlines offer the same fine dining and first-class accommodations, but actually transport passengers much faster to their destinations without requiring significant taxation? To most travelers, the speed of transit offsets the inconvenience of airports. Furthermore, the cost of building high speed rail doesn’t justify its relatively listless demand. It’s hard to determine why Doyle is so enthused about Wisconsin getting a high speed rail system. Could it be grounded in the liberal obsession of being more like Europe, or possibly having big brother assume more control of our lives – including our mode of transportation? If rail is not cost effective, then why pursue it with such vigor?

 

Final Thoughts on Doyle's High Speed Rail

On April 17th, the Wall Street Journal reported that President Obama called for $13 billion “to launch a new era of high speed passenger rail transportation.” This would represent the first step in a financial process that is estimated to cost at least half of the $787 billion found in the stimulus package. The Obama administration is billing the proposal as a way to boost the local economy of rail spike and locomotive makers. However, what’s often missed in the reporting is that less than 1% of the population will ride it, but 99% will end up paying for it. Even where the demand was greater, high speed rail didn’t work in either Europe or Japan, but somehow it’s expected to work here.

If Doyle gets what he wants, it will be yet another example of a democrat spending money (that isn’t his) on projects that most taxpayers don’t want, won’t use, but will be forced to subsidize for generations.

Comments (8)
  • Andrew  - I don't think so

    I think you need not to look at the issue in terms of "liberal" or "conservative". I think like any "product", HSR and IPR can be sold to the public, especially if the public is building and paying for them. If you're so bent of economics, you should know how advertising works.

  • Arne Roy Jorgensen, PE  - Personal Transporttion Network Instead of HS Train


    High speed rail is not only very expensive to install and a hazard on ground level but does not save total personal transportation time. High speed rail is still based on accumulating an economical number of passengers that are willing to leave at a designated time to make a trip from an inconvenient station with limited and probably expensive parking nearby to travel to a designated station that still leaves the passenger to find his way to the final destination. Should the high speed train make a number of stops to pick up and drop off other passengers, the time to slow down, load/unload and get up to speed again adds to the travel time. Only when a personal transportation network is designed using today’s technology that provides a reduction in total travel time from point of origin to the final destination is less than that of a car and at a cost less than a car will such a system be able to pull enough people from their cars to justify such an investment. Then that will only be practical in high density cities and intercity transportation between high density cites with many stops along the corridor.

    Arne Roy Jorgensen, PE

  • Blake  - Serious lack of critical thinking

    The author shows either a serious lack of critical thinking, or he is lying to his readers for political reasons. Mr. Rodriguez' argument that roads are more cost effective fails to take into account the difference in energy consumption between cars and trains. He does a good job comparing the construction costs, but he neglects to mention that high speed rail is 5 times more efficient per passenger mile than cars. This increased operational efficiency more than makes up for the relatively higher construction costs which he puts at 3 times. A cost comparison for a trip from Orlando to Tampa found that it would be $12 cheaper and 20 minutes faster to take a high speed train compared to driving, and that even includes parking fees at the train station.

    The author's claim that high speed rail didn't work in Europe or Japan is also wholly incorrect. It might not be self-sufficient, but it has proven to be a worthy infrastructure investment. Mr. Rodriguez chose to only include information that supports his beliefs, while completely ignoring any information that contradicts them. The real problem is, the information he ignored clearly outweighs the information he presented.

  • M. Griego  - The flaws here are astounding

    The biggest flow is in the section where the author claims to address the "subsidy" differences between roads and rail an then fails to do so. The author claims "The problem, however, is that rail doesn’t have the occupant capacity to make its money back like highways do," which is wholly false. 90% of the roads in America make exactly zero dollars a year. ALL they do is COST money. If every highway as described by the author were a toll road, like every railway is, you would see a drop off in usage on the highway. If the author acknowledged the costs of maintaining a personal vehicle and included them in the efficiency comparison, the author would see the true cost of highways to Americans. It isn't that they are vastly more expensive than rail, it's that they are vastly less effecient. The idea that freedom comes from sitting in your car on a packed highway during rush hour is insane. The only reason people oppose high speed rail is because it's different. We can argue all the subtely we want but that is the crux of it. Trains are for Europeans. Cars are for Americans. That's the common sense thinking and all the thinking apparently that is going on on this issue.

  • Ron Burleigh  - Burleigh - Is there any 'real' truth in any of the

    It appears that, as usual, when one individual states a series of supposeable 'factual' data someone can always find data that was either left out or at the very least supports the other side of a story. I feel that 1) if there is a HS system in the US (lets not use the rest of the world due to different demographics) that has been successful (with out government or state subsidy) then lets examine and put it up as an example of HS success; 2) If there is not one that is successful, then lets examine why the Fla HSR to Tampa would be. Use impericial data, not 'I believe or I feel' which is what most of the pro HSR supporters are currently using. I love riding the train when ever possible, but at what 'real' cost per mile. Please include 'cost to build'; cost to maintain; cost to subsidize to develop a 'cost per mile' based on true estimated average ridership.
    The problem with 'the building it and they shall come attitude' is that it's 'in for a penny, in for a pound' and whether it's state or federal money that has to be spend to keep it running it still our money.

  • Mr. Hochstetler  - Mr. Hochstetler

    This article could have driven the point home by including the addition of the destination transportation costs. Remember folks, we do not just travel fron train staition to train staition! We still need to complete the journey to and fron the train station. Taxi fairs and car rentals must be calculated. Add in these costs and inconvieniencies and the cost per mile gap gets even greater! Looks to me like the cost per mile gap is less than a dollar/mile for car and could be 6 or 7 /mile for the train.

  • h-samadi  - cost to built high speed rail way per km

    hello i will know how many built high speed rail way per km now . tanks

  • Anonymous  - the comparison between the high speed train cost a

    Did the comparison between the high speed train cost and the high way cost take in consideration how much benefits from saving gas; insurance compensation as result of accidents on high way and the comfortable of passengers through traveling in train than on car or bus through at least 20 years?

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