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<P mce_keep="true">The Congressional Budget Office (CBO) and Government Accountability Office (GAO) have different missions.  </P> <P mce_keep="true">The CBO provides the Congress with (1) objective, nonpartisan, and timely analyses to aid in economic and budgetary decisions on programs covered by the federal budget and (2) the information and estimates required for the Congressional budget process.  Its major activity is to prepare cost estimates of proposed legislation.  Its reports contain no policy recommendations.  It is staffed by 250 economists and public policy analysts.  Douglas W. Elmendorf is the Director.  He is a Ph d economist.</P> <P mce_keep="true">The GAO investigates (audits) how the federal government spends taxpayer dollars.  It is an independent, nonpartisan audit agency that is staffed by 3,300 accountants, attorneys, computer experts, economists, and public policy experts, as well as support personnel, in 11 U.S. field offices.  Gene L. Dodare is the Acting Comptroller General of the United States and head of the GAO.  Like his predecessor, David M. Walker, he is a professional accountant.  </P> <P mce_keep="true">Successful entrepreneurs have a unique a vision, but they know that their visions will go nowhere unless they have a viable financial plan.  And viable financial plans mean financial planners, venture capitalists, and accountants.</P> <P mce_keep="true">The idea for Southwest Airlines germinated in the minds of a pilot businessman and attorney.  The first president was a CPA.  His business acumen, which reflected a wide variety of tools and techniques used by accountants, laid the operating and financial strategy that ensured Southwest's success.  Amongst other things the founders knew that their vision would not fly (no pun intended) unless they had a solid business and financial plan.  Needless to say, they got it right.  Unlike government projects, success in business requires a viable business plan.  And that means accountants, financial planners, etc.    </P> <P mce_keep="true">Speaking of the GAO, here are some key findings from its audit of a representative sample of the HSR plans afoot in the U.S., as per its March 2009 report:</P> <UL> <LI> <DIV mce_keep="true">Some proposed U.S. HSR corridors may be economically viable, although they are unlikely to cover their cost through ticket revenues. Decision makers have had difficulty ascertaining their viability due to the uncertainties of ridership forecasts, cost estimates, and public benefits. </DIV></LI> <LI> <DIV mce_keep="true">High speed rail tends to attract riders in corridors with high population and density, especially where congestion on existing transportation modes prevails. Service characteristics of a HSR rail relative to other travel alternatives-such as trip time, frequency of service, reliability, and safety-are also critical factors.</DIV></LI> <LI> <DIV mce_keep="true">Project sponsors must typically trade-off some level of ridership to reduce costs. For example, most domestic projects being considered are incremental projects on track shared with freight operators-a choice that limits the travel time competitiveness and reliability valued by riders that would be possible on more expensive, dedicated track. </DIV></LI> <LI> <DIV mce_keep="true">While all U.S. sponsors of HSR cited a variety of public benefits that would flow from their projects, the extent to which benefits have been quantified and valued varied across projects. Ridership and revenue projects are often significantly (overly) optimistic.</DIV></LI> <LI> <DIV mce_keep="true">In each of three countries the auditors visited, the central government paid the up-front construction costs of their country's high speed rail lines, with no expectation that its investment would be recouped through ticket revenues.</DIV></LI> <LI> <DIV mce_keep="true">Federal funding for rail in general, and high speed rail in particular has largely been obtained from general revenues, as opposed to trust funds or other dedicated federal funding sources, such as those that fund other transportation modes. </DIV></LI> <LI> <DIV mce_keep="true">Federal, state, and private funding constraints raise questions about how HSR is to be funded for the long haul. For example, private funding is difficult to obtain without significant federal and state government support.</DIV></LI> <LI> <DIV mce_keep="true">The Federal Railroad Administration, which has a key role to play in evaluating proposals for HSR projects, has not yet determined how performance and accountability will be incorporated into the review and evaluation of grant applications.</DIV></LI> <LI> <DIV mce_keep="true">The auditors did not find a national strategy for HSR, i.e. objectives, benefits, accountabilities, etc., and, therefore, recommended to the Secretary of Transportation that a HSR strategy be developed.  The Secretary agreed. </DIV></LI></UL> <P mce_keep="true"> </P>
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