Proposition 1A - formerly called Proposition 1 - the High Speed Passenger Train Bond Act, has all the earmarks of a dicey, money-eating pipedream. This proposition overestimates the benefits and severely underestimates the costs and the risks associated with building a high-speed rail system the length of California.
Perhaps California can benefit from a high-speed rail system someday, but right now, the money would be better spent expanding and repairing our overloaded and crumbling roads and their associated infrastructure. That will provide the same number of jobs with a guaranteed benefit to the taxpayers. A high-speed train with limited stops will do nothing to relieve the commuting nightmare.
Prop 1A is fundamentally dishonest; a multibillion-dollar public works project cannot be based on a slippery slope of stacked baloney. Supporters do not know where they are going to put it, much less what it's actually going to cost, but you can be sure of one thing, it will cost a mint. They are using a shop-worn, but effective, political tactic; they're betting that once you're in for $10 billion you'll never pull out no matter how expensive it gets.
The state cost estimates are a fairytale. Supporters estimate state costs at just under $10 billion to start. The true state cost, without interest, will be three times that, $30 billion, and only if we get lucky. I know that because history tells me so.
Even after inflation adjustments, big projects typically double or triple in cost and this project will be breaking new ground; that's an invitation for costs gone wild. Boston's Big Dig was estimated at an inflation adjusted $6 billion and ended up costing "a staggering $22 billion," said the Boston Globe.
The San Francisco-Oakland Bay Bridge eastern span replacement had a 2003 estimate of $2.6 billion, by July 2005, only two years later, the estimate had risen to $6.2 billion and it is still going up. Caltrans constantly underestimates the costs of building bridges and they build bridges all the time.
Financing the bonds for 30-years will double the cost to $60 billion. The proposition's supporters published this argument rebuttal, "California's high-speed rail network requires NO TAX INCREASE…" After all the financial collapses, do you believe you can get something for nothing? Sounds like the same old Sacramento shell game to me; incur debt now and pay through the nose later. Haven't we all seen this movie before?
No one can even guess the cost to operate and maintain the system. The Legislative Analyst says, "additional unknown costs" probably in excess of $1 billion a year. That's a big number with no upper limit. I believe the operating costs are severely underestimated and competitive fares will not cover the costs. I know because history tells me so.
The best models for costs and fare offsets are the current public mass-transit systems in the nation and they do not come anywhere near recouping their operating costs, much less the capital investment. Many of them have to be subsidized 85-cents on the dollar or more to keep them running.
Amtrak has been knocking down billions in annual subsidies for decades without improving service or their financial condition. Why should they? The general public is paying so a few people can ride at artificially low fares and the same thing will happen with this high-speed train proposal. The fare subsidies are a disincentive for the mass transit systems to run efficiently and keep their costs down, it becomes a wound bleeding money.
The first step in justifying the high-speed rail system is to come up with honest cost estimates, not fairytales; the second step is to ensure the fares will be marked to cover the operating costs; the final step is to see if those numbers, real numbers, make economic sense. We do not need a high-speed rail line whose primary purposes will be to increase government debt, allow politicians from southern California to go home every night and speed lobbyists to and from Sacramento, all at enormous cost to the taxpayers. Vote no on Prop 1A.
Corrections:
-Richman's column on Sept. 19 on platinum parachutes for government employees should have read, "government employment costs are 50 percent more than private sector costs."
-In Richman's column Sept. 26 on economic development, it should have said the consultant, Mr. Harrigan of EDC, indicates he was not referring to Measure T when discussing the city's 1 percent sales tax take. Richman had attempted to contact Mr. Harrigan through the city's office of economic development prior to publication, but there was no answer and response to a message.
Marty Richman Got a question or a comment? Send us an email.
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