Excessive costs make U.S. rail look a boondoggle

October 4, 2010

When are big public-sector projects more of a drain than a stimulus for the economy? Strict anti-Keynesians would argue all the time. But even die-hard believers in government stimulus would have a hard time defending the merits of American rail projects. The simple reason: the costs involved are just too high.

Take Amtrak’s plan to improve the rail line connecting the Northeast corridor. The government railroad estimates it would take $117 billion to implement high-speed service. That exceeds the $17 billion cost of China’s longer high-speed train or the adjusted costs of earlier services in France and Japan.

Operationally, Amtrak’s plans are attractive. It proposes running fast trains on a dedicated track, which would run close to the existing Amtrak route between New York and Washington, but north of New York would divert from the current route, running to Boston through Danbury and Hartford (thus avoiding the congested suburban New Haven Line.) There would be several grades of service, with the fastest running at a maximum 220 miles per hour covering Washington-New York in 96 minutes and New York-Boston in 83 minutes — highly competitive with flight, even from Boston to Washington.

The problems are cost and time. Amtrak projects it would spend $274 million per mile, with completion only in 2040. That’s far out of line with similar projects abroad. The 1983 Paris-Lyon LGV Sud-Est was completed in seven years and cost $5 billion in today’s dollars, or $20 million per mile. In Asia, the 1964 Tokyo-Osaka Tokaido Shinkansen, criticized bitterly for its cost, was completed in six years for $20 billion 2010 dollars, or $63 million per mile. China’s Wuhan-Guangzhou line was completed last year after five years of construction for $17 billion, or $28 million per mile.

Excessive cost hasn’t always been an American problem — the 1,777 mile-long Transcontinental Railroad was completed in 1869, seven years after authorization, at a cost of only $1.1 billion in today’s dollars. Bureaucracy, complex environmental regulation, lawsuits, political pork and NIMBYism have combined to make the public sector thoroughly uncompetitive in both cost and time — apparently by a factor of five or ten times compared to other countries.

If 2011’s new Congress wants to restore competitiveness, it has at least one starting point.


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It is quite amazing that Amtrak predicts spending almost $52,000 per linear foot to upgrade the Northeast Corridor to HST standards, and that not before 2040. Translation: It can’t be done.

Are gold-plated electric High Speed Trains the answer? Can’t conventional rail technology be tweaked to provide relatively higher speeds? Do trains really have to go 250 miles per hour? Diesel-electric locomotives have demonstrated, through seventy years of reliable service, that they possess the flexibility and ability to adapt to extreme or unusual service requirements. Can they not be adapted to high-speed service as well? Eliminating catenary would be a major cost-saver.

I think it’s a mistake by Amtrak to assume that HST means gold-plated HST, with all the bells and whistles and corresponding high cost. Supercharged yet essentially conventional North American rail technology running on a dedicated roadbed may be a more appropriate solution. And the technology already exists here. JMHO.

Posted by Gotthardbahn | Report as abusive

There is no doubt that the Amtrak proposal is too expensive. Everything the US government does costs way too much, starting with everything DoD.

However, it is unfair to compare construction of the initial TGV or Shinkansen with the northeast corridor. The US has “engineered” massive suburban sprawl which makes accommodation of HS Rail very, very difficult. The same is true with EHV electric transmission — these projects cost many, many billions. There are very few clear corridors.

Needless to say the Obama Administration’s HS Rail plans are a sick joke. The Ohio project is almost $500 million for a 39 MPH service from Cleveland to Cincinnati.

Posted by upstater | Report as abusive

I don’t believe the need for competitiveness or that fiscal responsibility play a part in this rail project one bit. This rail project is just one more make work project for unions. The more it cost the better as far as the bureaucrats and politicians are concerned because of all the smiles at the union halls turning into coin for the democrats they worked with.

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