High-speed rail rushes California toward a fiscal abyss.
Will Illinois, too, hop aboard?
November 18, 2011 Chicago Tribune
Thanks to years of budgetary excess and a protracted economic slump, there are many states that face serious fiscal crises. Then there are states such as California and of course Illinois, for which the word "crisis" is an understatement.
California's projected state deficit next year may go as high as $8 billion, nearly triple what Democratic Gov. Jerry Brown had predicted. Unemployment is high, state revenues are down and spending just keeps going up.
So what does Brown propose? He wants to build a high-speed rail line that was originally estimated to cost $34 billion but now carries a price tag of $98.5 billion — and could wind up swallowing far more. It was supposed to be finished by 2020. Under the new estimate, make that 2033.
The governor wants to start with a line not from Los Angeles to San Diego or San Francisco to Sacramento, but from Bakersfield to Chowchilla — which would be the equivalent of running a bullet train between Decatur and Galesburg. With that 140-mile segment in place, he imagines, private investors, state taxpayers or the federal government will be happy to provide the money to construct the rest of an 800-mile system.
Brown shrugs off skeptics who see this as a bad idea at a worse time. "It is based on an optimistic assessment of where California is going," he recently told the Los Angeles Times. "Lincoln built the transcontinental railroad during the Civil War, and we built the Golden Gate Bridge during the Great Depression."
That's the kind of sober economic analysis that turned the Golden State's finances into a mound of lead. And it takes for granted that bullet trains (All aboard the Chowchilla Express!) serve as vital a function as those two historic projects.
In this country, however, high-speed rail is a chancy experiment that diverts funds from more mundane but proven modes of transportation. California assumes that in its final form, the system will carry some 30 million riders each year. But, writes Stanford University historian Richard White, "If California high-speed rail captures the same percentage of riders as Amtrak's Acela does in the Northeast corridor, an area with a long tradition of rail travel and a higher population than California, it would have about 5 million riders, not 28 to 37 million."
A report by California's Legislative Analyst's Office expressed fear that in the end, the system may have "little if any chance of generating the ridership to operate without a significant state subsidy." That's not exactly a surprise. We've noted before that, according to the Congressional Research Service, only two high-speed train lines in the world break even — one in Japan and one in France.
Rail buffs see no harm in such state assistance. But it would violate the terms of the original bond issue approved by voters, and it would put California state government even deeper in the red.
Anyone who thinks the federal government is going to cover the shortfall is dreaming. This week, in fact, House-Senate conferees voted against providing any additional money for high-speed rail. News reports Thursday suggested that Congress could formally kill the funding for President Barack Obama's high-speed rail program within days. Republican governors in Ohio, Wisconsin and Florida already have turned down money from Washington for fear of being left holding the bag. Those governors see that accepting federal money today means exposing their states' taxpayers to covering vast operating losses forever.
Here in Illinois, Gov. Pat Quinn clings to the notion that high-speed rail — in truth, medium-speed rail — will prove economical. At the slightest prompting he'll tick off potential destinations: Chicago, St. Louis, Champaign-Urbana, Indianapolis, Rockford …
This, remember, in an insolvent state that cannot pay its bills, that has nearly $200 billion in debts and unfunded obligations, and that struggles to maintain the essential rail service it has today.
Will Illinois now learn from the unfolding experience of California? If so, here's the lesson:
In the old days, locomotives ran on coal. The futuristic C alifornia version would most likely burn large supplies of cash. For a state drowning in debt, now would be a good time to get off the train. Well short of Bakersfield.
And for another state drowning in debt (hint: it has a big city by a lake), now would be a good time to say: This promises to be a bad trip. We'd rather not buy a ticket.
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