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Saturday, April 18, 2009

On high speed rail

Here's my take on Obama's high-speed rail speech. Basically, like most of his speeches, the words sound great when they come out of his mouth and, because he is spending other people's money there are some who say 'yeah, give me high speed rail." It might be visionary but that doesn't make it guaranteed to succeed or that it should even be implemented.

From the speech:

"What we're talking about is a vision for high-speed rail in America. Imagine boarding a train in the center of a city. No racing to an airport and across a terminal, no delays, no sitting on the tarmac, no lost luggage, no taking off your shoes. (Laughter.)"

This is crap. If there were as many people trying to get on trains in Savannah as are trying to get on airplanes in Savannah, all the same security apparatus would be put in place by TSA and there would be delays. The train might not sit on the tarmac but there would be delays and there would be no alternatives - a rail is a rail and if it suffers a mishap there is no alternative. With air travel you can at least reroute or take another plane to reach your destination. Thus, while it seems cool to take high-speed rail, if it is as popular as it is made out to be, then it will suffer from all the same problems as air travel. If it isn't as popular as air travel then it will be extremely expensive per passenger.

Moreover, how do you get to the center of the city. I am 20 miles north of Charlotte. Do I have to get into a car to drive to the train station? Why is that any different than driving to the Airport? Do I have to ride mass transit to get 20 miles down the road? How long would a bus ride take - at least an hour probably, which is the hour ahead of schedule I am supposed to arrive at the airport. Again, not much of a savings there.

Perhaps there is a local light-rail line that I would ride to the main train station. Concord is a town of 65,000 or so folks spread out over more than 100 square miles. How do I get to the local train station, which might be ten miles away? Walk, ride a bike, have the missus drive me in our car?

As for delays, please. When we were in England, there were delays - delays in leaving the station, delays in entering a station, the trains often stopped in the middle of a trip for no apparent reason. This with no air conditioning and it was approximately 100F. On all local train systems I have riden, including Atlanta, Chicago, Washington, Boston, and Dallas, I have experienced delays.

"Imagine whisking through towns at speeds over 100 miles an hour, walking only a few steps to public transportation, and ending up just blocks from your destination. Imagine what a great project that would be to rebuild America."

Are we really supposed to think that trains are going to be allowed to "whisk" through towns at 100 mph? I can see this happening only if the tracks are elevated, buried, or otherwise barred from having hapless drivers, pedestrians, cyclists, dogs, cows, deer, and other living things from getting on the tracks. Is the vision to run the tracks down the median of an interstate or along side the interstate? Perhaps that would work, but take a close look at bridges over interstate highways. There are three basic designs that I recognize. Two of these three have supports in the middle of the median, i.e., the middle of the damn bridge. How do you run a rail down the median with that in the way? Perhaps you only bury the tracks every bridge? Not really practical. How about building elevated tracks as the trains whisk through town? Again, it doesn't seem very practical and it would be terrible aesthetics.

To keep animals (bipedal and otherwise) will there be a cyclone fence on either side of the track? Again, nice look.

In Arlington, Texas, the Amtrak train came "whisking" through at about 50mph, which I believe is the highest allowable speed of a train in an urban area. How does Obama square a train going through Arlington at 100mph? Think about any city in which you live - who wants a 100mph train racing through.

Oh, the train won't go through the cities at 100mph only the countryside at 100mph? Okay, but that's not what Obama said.

"Now, all of you know this is not some fanciful, pie-in-the-sky vision of the future. It is now. It is happening right now. It's been happening for decades. The problem is it's been happening elsewhere, not here."

It did happen here we just abandoned it for a more efficient means of transportation. Just because people don't remember or choose to ignore that fact doesn't make it less of a fact. We had "high speed" rail - the widest network of passenger rail in the world with the largest amount of ridership, with the greatest innovation, with some of the fastest trains in the world, all the way through through WWII. However, with the advent of the interstate highway system and the maturation of the national highway system, people naturally moved to the more efficient automobile, abandoning the passenger rail system until it was nationalized in the 1970s and we were given Amtrak in its place.

The problem with the single high-speed rail between, say, Savannah and Augusta is that there is simply not enough ridership to make the project pay. If it could be done profitably then it would have been done. If there is a fixed-cost holdup so that it takes the government to build the rail then it shouldn't be built. The reason is that instead of having a number of companies competing for ridership and continually becoming more competitive, we will have a single monopoly who will lobby to remove all other competing forms of short, medium, or long-distance transportation so to ensure their monopoly. The monopoly will have no incentive to become more efficient and will gladly strand passengers in the middle of their trip without fear of market repercussions. Any political pressure to improve the operation of the rail system will be offset by their ability to lobby politicians and regulators more effectively than any general citizen.

If the government wants to take everyone's car away and put them on a train, I think they will have a hard time doing so. If they want to take everyone off a plane and put them on a train, I think they will have a hard time doing so. If the government wants to spend $11 billion on a down payment for high-speed rail (the light rail line in Charlotte is 8 miles and cost $1 billion), they will use rhetoric such as this.

"In France, high-speed rail has pulled regions from isolation, ignited growth, remade quiet towns into thriving tourist destinations. In Spain, a high-speed line between Madrid and Seville is so successful that more people travel between those cities by rail than by car and airplane combined. China, where service began just two years ago, may have more miles of high-speed rail service than any other country just five years from now. And Japan, the nation that unveiled the first high-speed rail system, is already at work building the next: a line that will connect Tokyo with Osaka at speeds of over 300 miles per hour. So it's being done; it's just not being done here."

There are several misleading statements in this paragraph. First is the cost of driving in these other countries. It is prohibitively expensive for most people to obtain a driver's license much less be able to afford a car, insurance, gasoline, maintenance, etc. Thus, many people do not have an automobile and are therefore less mobile and by definition have less freedom of choice.

Moreover, all of these countries have very different characteristics than the US. Madrid to Seville is about 330 miles - essentially the distance from Savannah to Chattanooga. However, Madrid has a population of 5.1 million in about 600 square miles whereas Seville has a population of 695,000 in a 54 square miles. Seville has a population density of 12,000 per square mile and Madrid has a population density of 8,500 per square mile. Georgia Department of Labor estimates DeKalb County (Atlanta) has a population density of about 1,300 per square mile and Chatham county (Savannah) is about 503 people per square mile.

Here's an interesting table depicting the average incomes and, more importantly, the population density. Notice the northeast has the highest density and that, if anywhere, is where high speed might make some sense, but Philadelphia to Boston is only 300 miles.

"There's no reason why we can't do this. This is America. There's no reason why the future of travel should lie somewhere else beyond our borders. Building a new system of high-speed rail in America will be faster, cheaper and easier than building more freeways or adding to an already overburdened aviation system –- and everybody stands to benefit."

I don't think everybody stands to benefit. In fact, many people might stand to be harmed by reducing the ability of individuals to drive their own cars to their own destination of choice. Let's take a hypothetical.

Imagine a high speed rail from Savannah to Augusta which has replaced the interstate highway system or that travel to Augusta from Savannah is expensive by car. How many trains run between Savannah and Augusta? Let's be optimistic and say two each way - one in the morning and one in the evening. You get on the train in the morning to head to a Cold Play concert in Augusta. However, the concert is over at 11pm and the last train leaves for Savannah at 10pm. What to do? I suppose you could spend the night in the train station, but they will probably roust you out and in the least it will be uncomfortable. An alternative is to spend the night in a hotel room, which will cost you another $50 or more. So, let's say the cost of the train is about equal to the cost of fuel up and back to Augusta, but now the concert is going to cost you $50 more and a lot more time - you have to wait 8 hours or so to get on the train the next morning.

Now, this might not sound so bad. Yet, if you have to be at work the next day or otherwise don't want to have to stay in Augusta any longer than necessary to see your favorite band, this is not a good outcome. Perhaps you don't go to the Cold Play concert after all. Perhaps you are priced out of the concert by the additional $50 expense.

You might say, that's not so bad for those in Augusta. There are fewer people competing for Cold Play tickets in Augusta and this will allow more Augustans go to see the concert. Perhaps. But what if there are only 5,000 people in Augusta who want to see the event. Is this enough people to see the band play in Augusta? Perhaps not. Perhaps Cold Play decides that it isn't worth it to play Augusta because the transportation system has made it impractical for those in the region to get to the event and back home in a manner that is idiosyncratic but necessary.

Now Cold Play decides only to play in the bigger cities where train service might be a bit more frequent. Perhaps there is a train that leaves Atlanta at 1am to go to Savannah (I doubt that would ever happen, but it might). Thus, the four hour drive home from Atlanta's Cold Play concert is replaced with a four or five hour train ride. That doesn't sound so bad. However, there are fewer Cold Play concerts in Georgia because Cold Play decided not to play Augusta. Now there are more people competing for the tickets in Atlanta, which in turn drives up the price of tickets in Atlanta. Perhaps die-hard Cold Play fans pay the higher price or scalp a ticket on the street. Perhaps others are priced out of the market for Cold Play tickets and therefore they suffer that loss, such as it is.

Notice the tour t-shirts of any big rock band. There are, perhaps, five or six cities in Europe - major capitals perhaps - and then thirty or more U.S. cities, many of them not even state capitals or necessarily very large concentrations of people. Rather, the U.S. cities have a transportation network that is tied to individual choice and decision making rather than clumsy and clunky government decisions.

This is only one example. There can be hundreds of others that can be thought up and would suggest that there would be considerable negative economic consequences of such a high-speed rail system replacing our current transportation system.

There are more issues that have not been brought up. For example, how much is a high-speed rail system going to cost. Let's be conservative and say $10m per mile. From Savannah to Atlanta that's about $2.5 billion for the rail. Let's say each high-speed train costs in the area of $100m. Let's assume two trains dedicated to the Savannah-Atlanta route and one train in reserve for a total of $300m in fixed costs of trains. Let's assume the marginal cost of train travel is $100 per mile (I don't know any of these numbers to be true, but I am trying to illustrate how the plan might not make sense).

For a trip between Savannah to Atlanta the marginal cost will be $25,000 one way or $50,000 for the round trip. Let's assume the train trip will costs roughly what it costs to drive, say around $100 round trip. Thus, for each run of the train from Savannah to Atlanta, we would need 500 people on the train - EACH RUN. This only allows the train to break even on the individual round trip, we haven't put any money to the fixed costs of the train. My point is not that any of these numbers are necessarily correct but at what point can you say the train will make sense?

Currently there is a supply of about 1300 seats on direct flights from Savannah to Atlanta on any given day (via travelocity). Of course there are people driving from Savannah to Atlanta every day - perhaps another 1500? So, if there are 3,000 people making the trip form Savannah to Atlanta on any given day, which is about about 1% of the Savannah population, how many people can be expected to take the train. Let's say 15% of those flying and 20% of those driving would take the train (after all the train is only leaving once in the morning, is heading to a specific location as President Obama indicated which might be miles away from where an individual needs to be, and it is going to take longer than flying). Thus, the train would have about 525 people on it. Rather close to the number I conjured up for the train to break even on each run.

This is a no-wiggle-room situation. If, for some reason, the train breaks down a couple of times and people decide to forego the experience for their car, and the train fails to even cover average variable cost the train is in a negative profit situation.

This is why the train hasn't been built by a private rail system and why if it is built by the public it has a high probability of being inefficient, requiring of subsidy, and of ultimately making people worse off.

If a private road was to be built which would compete legitimately with car and plane travel, then I might buy into the idea that competition would make the high-speed rail profitable practical and desirable. On the other hand, having the government propose to spend tax dollars on a road that will not compete in a free market against other modes of transportation promises to waste tax payer dollars but also to reduce our freedoms by increasing the costs of other modes of transportation and in arbitrarily reducing our choice set.

As for an overburdened aviation system, where does he get this from. At the height of air travel a couple of years ago it was the case that planes were running at or near capacity, there was considerable wait times getting planes in the air and on the ground and to gate. However, now airlines are parking planes, on-time percentages are increasing, wait times have decreased even as air prices come down.

Finally, high-speed rail proponents are not being honest about what is going to be entailed with every proposed line:

1) environmental and economic impact studies in every county in which the train travels (13 between Savannah and Atlanta alone)
3) lawsuits concerning eminent domain (notwithstanding the Kelo decision)
4) multiple bidding rounds for railbed preparation and potential lawsuits if the right "mix" of firms is not selected.
5) multiple bidding rounds for the trains
6) likely unionization of labor (at all levels)
7) new regulatory body or at least a section of the DoT to oversee construction and operation
8) an increase in the size and scope of the TSA
9) an increase in potential danger to local citizens and animals
10) increased lobbying to raise gasoline, tire, car, license taxes on private automobiles.
11) increased lobbying to raise gasoline, tire, license, landing, taxi, baggage fees for commercial aviation.
12) increased lobbying to ensure the continuing subsidization of the high speed rail system even after it is long proved to be unprofitable.
13) once institutionalized and its near monopoly is ensured, the quality of the trains, service, timeliness, etc. will be curtailed.
14) the train system is unprofitable at current ridership levels - therefore the government approves more subsidies and increased prices much like the US Postal Service.

All for what?

If the price of travel in private automobiles doesn't change and yet congestion declines on the roads, this would represent a real decline in the cost of driving which would actually encourage more people to drive, perhaps negating whatever gains there were thought to be had.

I am suspicious that such grand plans can actually work, primarily because the private sector would do it so much more efficiently and if the private sector can't find a way it is not clear that a government operation will be able to find a way.

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The viewpoints are absolutely correct. The type of transportation system adopted in one country may not be suitable in another country. American roadways emerged in such a big way because it was profitable from the beginning for the individual automobile owners. There would not be any dearth of capital if the rail system in America was competetive.
America has a huge land mass and its population density in many areas is so thin that undertaking such a massive project would not be justified as it will be a white elephant for all the years to come.
Apart from that American mindset is different from European or Asian mindset and it is more aligned towards individual freedom in many areas including movement.
In the years to come there will be more aircrafts designed for taking only 100 persons with very high frequency. So future air travel will also be more flyer friendly.
For a glimpse into the world of futuristic transportation system please read my science fiction novel MEGALOPOLIS ONE 2080 A.D. The website is http://www.eloquentbooks.com/MegalopolisOne2080AD.html
First what a lame way to promote your "sci fi" book. I live in Augusta, GA and there would be nothing but benifits for a HSR to come to our town. There is no major highway from Aug to Savannah. The trip is over 3 hrs long. There is a major highway (I-20) from Atlanta to Augusta which takes 3 hours if you're lucky! Traffic, construction, lack of parking, you name it. The HSR from Atlanta to Augusta would save us time and money. It would create jobs in the second biggest city in GA (Augusta). The argument is lacking. The only reason this has not gone into effect is funding. Yes tax money is being used for it but at least this is one stimulus bill program that actually has depth. People leaving the training in the past for cars? Sure! because cars became faster than trains. now we have come full circle where trains are faster than cars. Eminent domain? Not likely. Most of the land not occupied by a citizen of Georgia is already owned by the government, and the state already said not one person would be displaced. The rail system is a viable option. one that WE INVENTED! Take a trip from Augusta to Atlanta and tell me by the the time youre there if you didn't wish there was a train that would have gotten you there in one and a half hours non stop.
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