Caifornia's High Speed Rail Initiative

Early in President Obama's tenure in the White House he pushed for a high-speed rail initiative in which the Federal Government (ie - we, the taxpayers) would provide seed money to states to build high-speed rail lines. As I argued some months ago in this blog, high speed rail is only economically viable in a very few high-density population areas, and even marginal there. Like supersonic airliners, high speed rail lines are sexy but require massive subsidies to build and maintain. Ohio, Wisconsin and Florida all declined to take federal seed money for high-speed rail systems, judging that it would saddle the state budgets in the long run with ruinous subsidies to keep such lines running.

Now the California legislature, by a very close vote, has approved $8 billion in funding to start building the first segment of a high speed rail line to eventually link Sacramento, San Fransisco and Los Angeles, a rail line whose eventual cost is currently estimated at about $68 billion (it was originally estimated at $45 billion).  Unions of course pushed hard for this project, hoping for more jobs.  But like most such projects, the true cost will no doubt double or triple again by the time it is built.

To make matters worse, the Federal government insisted that the first segment be built in California's central valley, the area with the lowest population density and therefor the smallest possible ridership, so there will be minimal income from this first segment. And once the federal seed money runs out in a few years, California will be left paying the full construction and maintenance costs.

The question is whether this is a bold move by the state to provide advanced infrastructure, or a stupid move in the face of a $16 billion deficit in the current state budget.  I suspect it will turn out to be the latter, leaving California eventually with a very expensive white elephant and an even deeper debt problem.