Our great friend congress infant MICA has introduced an admendment that the folowing news item claims would prevent HSR ( Acelas ? ) from stopping in Connecticut.
http://www.courant.com/opinion/editorials/hc-ed-fast-train-must-stop-here-20150306-story.html
another slice reports that a Texas state legislator has introduced a bill to prevent any federal funds from being used for rail. That leaves how many slices remaining ?
http://www.examiner.com/article/texas-lawmaker-pushes-ban-on-federal-aid-to-texas-rail-transit
From the first link: "First the good news. The House of Representatives passed a bill Wednesday that should improve Amtrak service on the heavily traveled Northeast Corridor, and calls for a study of high-speed rail service on the 450-mile corridor between Boston and New York."
450 miles Boston-New York? it must really wind about.
Johnny
blue streak 1 Our great friend congress infant MICA has introduced an admendment that the folowing news item claims would prevent HSR ( Acelas ? ) from stopping in Connecticut. http://www.courant.com/opinion/editorials/hc-ed-fast-train-must-stop-here-20150306-story.html
"........which is subsidized in most parts of the world." This argument is the refuge of the intellectual lazy!
The case for subsidizing high speed rail in the United States, however it is defined, should be based on an optimum solution for the U.S. What is the best solution for the U.S. is the key question. Other countries may have some best practices that are worth considering, but at the end of the day the solution should be structured to meet the needs of the U.S. People in other countries are not going to pay for a new NEC passenger rail system.
A new, 450 mile high speed rail system between Washington and Boston would cost mega billions. Where will the money come from, especially for a nation with a government debt burden of 119 per cent of GDP? The nation has not been able to scrap up the money to build new North River tunnels let alone a 450 mile high speed railway.
Sam1Where will the money come from, especially for a nation with a governmental debt burden of 119 per cent of GDP?
According to GAO's affirmation of the Bureau of Fiscal Service's figures, in 2014 National Debt was $17.81 trillion, which was 103.2% of GDP.
C&NW, CA&E, MILW, CGW and IC fan
Did not take long. Blumenthal chimes in against Mica.
http://www.progressiverailroading.com/high_speed_rail/news/Sen-Blumenthal-says-no-to-highspeed-rail-bypassing-Connecticut--43790
As well its D vs. R
The downfall of actual HSR between Boston and DC is too many population centers that will demand to be stops.
Never too old to have a happy childhood!
schlimm Sam1 Where will the money come from, especially for a nation with a governmental debt burden of 119 per cent of GDP?
Where will the money come from, especially for a nation with a governmental debt burden of 119 per cent of GDP?
My reference was to governmental debt, which includes federal, state, and local debt. Ultimately, for the most part, although there are some potential exceptions, the entire debt burden has to be serviced by the taxpayers.
Passenger rail has depended on a heavy infusion of government monies, i.e. federal, state, and local, for operations and capital investment. This is likely to continue.
A heavy debt burden is a constraint on the capacity of government to fund capital investment, i.e. high speed passenger rail, waterway improvements, etc.
According to the Federal Reserve, at the end of the 3rd Qtr 2014 (latest numbers), state and local debt was approximately $2.9 trillion. At the end of January 2015 or thereabouts, according to the Treasury Department, the federal debt was approximately $18.1 trillion. The two sum to $21 trillion.
The reporting dates for the two categories are different. The U.S. Treasury reports the federal debt on a nearly daily basis; the Federal Reserve reports the state and local debt quarterly.
At the end of December 2014, according to the Bureau of Economic Analysis, the current dollar GDP of the U.S. was $17.7 trillion. Total governmental debt divided by GDP is approximately 119 per cent.
Federal debt consists of two components: public debt and intra-governmental debt. The federal debt is approximately 102 per cent of GDP, as per the numbers in my spreadsheet. Public debt is approximately 74 per cent of GDP.
Obviously the debt ratio Is s very important component of federal, state and local government spending. The underlying factor is policy and how to allocate resources to meet your needs.
This is clear to see. Some states, Virginia, north Carolina, California and new York are pro rail. Others like Texas , Minnesota and Indiana, not so much. All politicians have to make these decisions. Some how I don't think the debt ratio is always at the heart of thier decisions.
Debt to GNP/GNI ratios as a statistic are analogous to debt to gross income for a corporation or individual. In the latter case, most homeowners have a total mortgage liability alone many times their yearly income. If other debts for loans, such asstudent loans are added, it is easy to have a ratio of 5:1. I think fiscal prudence is wise, but acting like the national debt means we have to engage in foolish austerity policies is short-sighted. This is especially true if we cease to invest in the infrastructure and other areas that will later add to efficiency and income because we are afraid to invest in the future.
Right on sclimm
blue streak 1Our great friend congress infant MICA has introduced an admendment that the folowing news item claims would prevent HSR ( Acelas ? ) from stopping in Connecticut. http://www.courant.com/opinion/editorials/hc-ed-fast-train-must-stop-here-20150306-story.html
Unless I missed something, I got the impression that the "no Connecticut stop" proposal was likely one of Amtrak's new NEC routing via Long Island. I suspect folks assume the "old- NEC" goes away once a new one is built and get excited.
-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/)
. UP through 12/31/2014:
Operating income: $8,767 million
total debt : $11,480 million total liabilities: $31,528 million
That yields ratios of 130.9% or more comparably 359.6%, yet I have n't heard anyone saying the UP cannot spend a penny to invest in better infrastructure.
Even in business, you have to spend money to make money.
Sam1The nation has not been able to scrape up the money to build new North River tunnels let alone a 450 mile high speed railway.
New tunnels would be a good first step. There is nothing about a "new NEC" that requires it to be constructed in one fell swoop. Best to let it develop organically.
oltmannd Sam1 The nation has not been able to scrape up the money to build new North River tunnels let alone a 450 mile high speed railway. New tunnels would be a good first step. There is nothing about a "new NEC" that requires it to be constructed in one fell swoop. Best to let it develop organically.
Sam1 The nation has not been able to scrape up the money to build new North River tunnels let alone a 450 mile high speed railway.
schlimm . UP through 12/31/2014: Operating income: $8,767 million total debt : $11,480 million total liabilities: $31,528 million That yields ratios of 130.9% or more comparably 359.6%, yet I have n't heard anyone saying the UP cannot spend a penny to invest in better infrastructure. Even in business, you have to spend money to make money.
The key debt ratios for UP or any private business are long term debt to equity, total debt to assets, total debt to capital, total debt to equity, and interest coverage.
For the UP, at the end of 2014, the ratios were 49.14% long term debt to equity; 21.18% total debt to assets; 24.25% total debt to capital; and 51.49 per cent total debt to equity.
UP's debt structure is well below that of the industry averages and is manageable.
The debt for a private business is micro-economics. The debt for a nation is macro-economics. The two are not comparable.
UP's interest rate coverage is 9.34, which means it had $9.34 of income at the end of 2014 to cover every dollar of its interest burden. Its cash flows are more than adequate to cover the interest on its debt.
A business invests in property, plant, and equipment to make money. Most large business organizations, at least, have sophisticated financial models to determine the probability of earning a return on their investments.
The problem for passenger rail, at least in the initial stages, is that it does not generate a return on invested capital. It soaks up resources.
Determing an interest rate coverage for the U.S. Government is not possible. It had a deficit of $680 billion in 2013, as per the CBO, and the deficits are expected to continue for the next decade.
If one uses the same model as analysts use to determine interest rate coverage for a business, the government has negative interest rate coverage. Not a good outcome!
Interest on the national debt in 2013 was 7.8 per cent of federal revenues. The CBO estimates that interest on the national debt will consume 16.3 per cent of federal revenues by 2024. Comparatively, although they really are not comparable, UP's interest expense in 2014 consumed 2.2 per cent of revenues.
The biggest concern is not the current interest burden generated by the debt; it is the burden in the out years as interest rates return to normal, and the national debt, as well as state and local debt, continues to increase.
I still have the same question. Where will the money come from to build a new, high speed railroad for the NEC?
I agree. Building better passenger rail systems, irrespective of where they are located, in manageable increments would be a better outcome for the U.S. than an attempt to go all out.
Of course the key ratios are known, but they are not comparable. You also overlook the benefits (beyond direct ROI to Amtrak) to the economy of infrastructure investment.
In answer to your original question the funding for the infrastructure will come from a combination of taxes and borrowing.
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