Replies

“But to suggest China’s problems is proof that high speed rail is a bad idea is weak. If the argument is population density, etc., then that’s different. But suggesting high speed rail is bad for the US because the author wrongly concludes it is bad for China.....well, that’s not much of an argument.”

What’s weak is the sales pitch about the economics of high-speed passenger rail infrastructure and operating costs. Those costs vs getting the revenue to support them from ticket sales has proven more difficult than what was sold. The result has been steeply lower than predicted passenger acceptance, which has added to the level of subsidies to sustain operations and fund more development. That difference between what was sold and what has been obtained, financially, is not unusual for high-speed passenger rail.

The only factors that have mitigated those problems anywhere in the world ARE sufficient population density along or within easy reach of a high-speed line together with cost factors in other transportation modes available in the same area, or the absence of other competing transportation modes in the same area, and only if those conditions produce a ticket-price “market” for high-speed passenger rail at a price-point that will sustain the revenue needed to support both its operations and pay off its debt.

If those factors were not the case, every nation that now knows how to build high speed passenger rail lines would be scrambling to replace ALL their old rail lines for them. They are not. Not because they do not know how and not because they could not raise the funds if they wanted to, but because the ROI or the basic economic viability for them is NOT possible in just any and every circumstance.

China also has the unique circumstance of being forty, fifty or sixty years behind most western nations in the establishment of its total “modern” transportation infrastructure. Thus, a lot of what it is able to to it can do “brand new” from scratch without as much existing older, but working, transportation routes to consider, to have to tear up, build over, redo, disrupt and replace. The “high speed rail” considerations change immensely in an environment with a lot of existing and working modern infrastructure. Like the U.S.

China has another factor that plays well with “high speed rail” which is it has more places with strings of towns and cities with an aggregate population density along those strings that IS at levels more supportive of the passenger-density needed for revenues to sustain the higher costs of high speed rail - and they ARE higher costs.

If there is any question in all this for the U.S. it is not whether or not the U.S. should participate in the use of high-speed rail systems. It is WHERE in the U.S. we COULD RESPONSIBLY do so.

Unfortunately, the economics of building AND operating high-speed rail systems (two kinds of costs), the population densities they need in order to be financially sustainable without government subsidy, the location of such population densities in the U.S., and the economics of alternative systems of transportation, taken together suggest that their costs per passenger mile will be higher than where that have been built and are being built in other countries at this time, and they are NOT cost competitive at this time, with the alternatives.

Why? There is only one string/corridor of towns and cities in the U.S. with an average and aggregate population density sufficient for truly high speed rail to be supported by the revenue from its passengers. But that revenue would take a huge amount of time, or never (given the interest on the debt borrowed to do it) to recover the capital costs of building it; because that one area is the Boston to Washington, D.C.corridor; and the capital costs of building it along that corridor will be immense.

To work, operationally, it would have to be built as much as possible over the existing pathway (best case operationally, and for future passenger revenue, but worst case construction-cost wise). To save money on building it it would have to built miles away from the existing pathway where more vacant land might be available (operationally worst case, and less attrative to the population density needed to supply the needed level of passengers, though best case on initial construction costs). We could afford to build it, but then could not afford to keep it operating because it wouldn’t attract the passenger density needed, or we could build it and then never pay for both its operations and the bonds we sold to pay for it - perpetually issuing new bonds to pay-off the old, perpetually pushing off the end date of the debt.

Other than that corridor, the building costs may not be as humongous but the population densities will not be there to provide the revenue to pay for ongoing operations AND pay off the debt incurred to build them, because states will go into debt to help the operating subsidies.

Most new high speed rail operations in line to be built in the U.S. WILL be sites of PERPETUAL need for government subsidies just to continue to exist, and subsidies at a higher rate per passenger mile than other modes of passenger transportation.

In the U.S. they will all be Concordes. Technological successes and financial failures. If that were not the case, our best private rail companies in the country, those that know the most about rail transport and about high speed rail - our rail freight transport companies, would be scrambling to get into the high speed rail passenger business on their own dime, believing the investment would pay off. They know better. The politicians know little other than how to attract another class of crony capitalists who will take their profits and leave the taxpayers with operations that have to be subsidized to stay alive.