I agree with your last paragraph. And, since I have no reason to think that Sam1's estimates of costs and ROIs are wrong, the question remains, "Why, then, have several other modern societies (nations) created and maintained HSRs, as well as excellent non-high-speed passenger rail systems?" They must be seeing value that we in North America don't see. I think we may come to look at our decisions differently if we try to understand the value that these other people have assigned to HSR.
Some other comments:
Please don't hold the "transformation of the electric power industry" up as a good example. Deregulation of electric power so far has had very mixed results. Power costs in Texas, for example, are a continuing controversy, as are the ways that the now deregulated power companies treat their customers. Furthermore, electric power has migrated to the dirtiest source of energy we have available, coal. The govt hasn't helped much by discouraging full exploitation of nuclear energy sources through nuclear fuel reprocessing and breeder reactors; our govt is paranoid about weapons grade nuclear materials. As a result, we leave more than half of our nuclear energy in the waste fuel, and, in addition, the waste fuel is much more hazardous than it otherwise would be.
Don't forget that the govt built the entire jet aircraft industry with military funding. Without that investment of trillions of dollars from about 1943 to about 1975, commercial jet aircraft literally would not have gotten off the ground.
If the purpose of stimulus funding is to stimulate, then it doesn't much matter how we spend it. I admit that it seems better to use it for something "useful" or "beneficial," but the money will go to wages and salaries regardless of what it's for. Of course, we don't want any of it to go outside the country, so we shouldn't be using it for products from Bombardier, Siemens, Kawasaki, and that Spanish company that Texas is hiring to build our toll roads.
Unfortunately, both freight and passenger rail transportation in North America seem to be stuck in a rut dated about the late 1950s. RRs let much of the technology evolution go by until the mid-nineties, and now they are catching up. Evolution is definitely required, more so with passenger rail than freight. What we really need is both high-speed passenger and high-speed freight rail service.
Maybe the California HSR planners think they can do it much less expensively with more modern equipment and processes.
Paul MilenkovicJohn Kneiling had long reasoned in Trains Magazine that railroads, properly run, would run trucks off the interstates and would run the barges and lake boats off the waterways. They would also see precious little in the way of passenger traffic apart from passenger trains operated as forms of entertainment. Not such a silly prophesy -- ocean going ships have effectively ceased being a means of transportation for anyone, but the cruise industry, essentially entertainment, is big business. I agree with you that intercity trucking, from the government side, is a boondogle as is inland shipping. So keep those boondogles and raise you an HSR system? The other piece of reasoning is that the government has a hand in running, regulating, or subsidizing near everything -- your self made man or woman may have gone to a public school or benefited from a government-built road or had one's life saved by government-funded medical research. As a result of this, there is no such thing as capitalism, individual initiative, profit motive (apart from profits enabled by government as a first mover or enabler), and we may as well subsidize something that a group of people want without any regard to economic efficiency. The government wastes so much money on the military, so what is a little bit more waste on HSR? The one thing I have to say in defense of Sam, who hails from the electric power utility industry, and as an engineering educator, and electrical engineering educator I may add, the general view has always been is that the power company is where we place our graduates who cannot get work anywhere else. Sort of like the traditional role for railroads for my mechanical engineering and civil engineering colleagues. The power companies were (mostly) privately-own and highly regulated natural monopolies, and that the power companies had their rate base and their traditional ways of doing things and kind of clunked along was just the way all of the Econ 101 textbooks explained it had to be. Then came power deregulation. It had some spectacular stinkers (think Enron), but Sam tell us there has been a sea change in the efficiency, cost effectiveness, and dynamism of the power companies and the people working there. Sam has essentially one idea -- that if the power companies can be transformed from a quasi-governmental system of guaranteed profits and guaranteed employement and all of the personal and institutional sluggishness that goes with that, maybe some policy changes can work the same kind of magic on railroads and on Amtrak. There are a bunch of other people who claim that passenger trains are going to solve the congestion crisis, the oil imports crisis, the road rage crisis, and who knows, the social isolation crisis by having strangers chat in lounge cars. I suspect that a lot of the impetus is that for a lot of people, trains are a form of entertainment (so are cruise ships, but there is nothing frivolous about them, they are a large, profit-making business sector), but if they were simply entertainment, they would not justify the large infusions of money people want for them. If trains are to be more than entertainment and to make meaningful contributions to the listed social problems, there needs to be some sea change in the railroad industry and especially the passenger train industry (Amtrak). It appears to be working for the power company, and you all should not rule out the same thing happening in the passenger train industry.
John Kneiling had long reasoned in Trains Magazine that railroads, properly run, would run trucks off the interstates and would run the barges and lake boats off the waterways. They would also see precious little in the way of passenger traffic apart from passenger trains operated as forms of entertainment. Not such a silly prophesy -- ocean going ships have effectively ceased being a means of transportation for anyone, but the cruise industry, essentially entertainment, is big business.
I agree with you that intercity trucking, from the government side, is a boondogle as is inland shipping. So keep those boondogles and raise you an HSR system?
The other piece of reasoning is that the government has a hand in running, regulating, or subsidizing near everything -- your self made man or woman may have gone to a public school or benefited from a government-built road or had one's life saved by government-funded medical research. As a result of this, there is no such thing as capitalism, individual initiative, profit motive (apart from profits enabled by government as a first mover or enabler), and we may as well subsidize something that a group of people want without any regard to economic efficiency. The government wastes so much money on the military, so what is a little bit more waste on HSR?
The one thing I have to say in defense of Sam, who hails from the electric power utility industry, and as an engineering educator, and electrical engineering educator I may add, the general view has always been is that the power company is where we place our graduates who cannot get work anywhere else. Sort of like the traditional role for railroads for my mechanical engineering and civil engineering colleagues. The power companies were (mostly) privately-own and highly regulated natural monopolies, and that the power companies had their rate base and their traditional ways of doing things and kind of clunked along was just the way all of the Econ 101 textbooks explained it had to be. Then came power deregulation. It had some spectacular stinkers (think Enron), but Sam tell us there has been a sea change in the efficiency, cost effectiveness, and dynamism of the power companies and the people working there.
Sam has essentially one idea -- that if the power companies can be transformed from a quasi-governmental system of guaranteed profits and guaranteed employement and all of the personal and institutional sluggishness that goes with that, maybe some policy changes can work the same kind of magic on railroads and on Amtrak.
There are a bunch of other people who claim that passenger trains are going to solve the congestion crisis, the oil imports crisis, the road rage crisis, and who knows, the social isolation crisis by having strangers chat in lounge cars. I suspect that a lot of the impetus is that for a lot of people, trains are a form of entertainment (so are cruise ships, but there is nothing frivolous about them, they are a large, profit-making business sector), but if they were simply entertainment, they would not justify the large infusions of money people want for them.
If trains are to be more than entertainment and to make meaningful contributions to the listed social problems, there needs to be some sea change in the railroad industry and especially the passenger train industry (Amtrak). It appears to be working for the power company, and you all should not rule out the same thing happening in the passenger train industry.
I think John Kneiling's predictions were contingent upon a few pesky details such as changes in things like labor law and a rather selective set of values not shared by the majority of the public, and I think that crippled his arguments into uselessness. In a democracy, the only thing that matters is the majority of the vote. It's entertaining to fume that a society is voting itself into the poorhouse, but they do have the right to do so. Plenty of societies have gone up against the wall.
I'm not saying I disagree with either you or Sam on your value systems. Nor in your objectives. I'm saying that an argument that posits that tangible ROI or economic efficiency of a public investment is the only objective worth measuring is probably not going to go anywhere useful. I don't think the public much cares about ROI or economic efficiency, and I think the public has a sophisticated method of ranking its choices that economists, pundits, and experts often don't get. Politicians usually get it very well, however. They're some of the smarter people I know.
RWM
Sam1Railway Man I did? Could you cite me the studies that say that trucking pays its fair share of the incremental costs that aren't produced by or paid for by the trucking industry, please. AASHTO says otherwise. Also, why do you want it to be incremental instead of fully allocated? The statement "the investment in most forms of transport infrastructure have been paid for by the users" strikes me as broad. Are you referring only to the U.S.? What about water transportation? If I recall correctly, riverine transportation does not pay for but a fraction of its infrastructure. What about seaports? Are they all self-funded? That leaves what else ... buses, probably not; trucks, probably not; light rail and heavy rail, probably not; personal autos, probably yes; freight railways, probably yes; airlines, who knows. I can't add that up to "most" if we assign each mode a value of 1, but if we add up the total infrastructure investment made to date in discounted dollars, maybe it's a plurality. Would you be considering the lands withdrawn from the tax rolls for the streets in the accounting? RWM This issue is whether investment in high speed rail is the best way to spend the stimulus grant. I don't think that it is. I would use it to improve regional rail in short, high density corridors where there is a good chance of recovering the operating costs and contributing something to the capital costs. Citing investments in other transport infrastructure was meant to show that the costs could be recovered and, in fact, especially with respect to air and highway, have been. Given the poor financial performance of passenger trains, I don't think that they can recover their capital costs, especially high speed rail, although that is not the only criteria I would use for investment. A discussion of trucks, in retrospect, is off topic. I said simply that there are studies pro and con with respect to whether they cover their fair costs. If your concerned about the veracity of the studies, I am sure that you can find them.
Railway Man I did? Could you cite me the studies that say that trucking pays its fair share of the incremental costs that aren't produced by or paid for by the trucking industry, please. AASHTO says otherwise. Also, why do you want it to be incremental instead of fully allocated? The statement "the investment in most forms of transport infrastructure have been paid for by the users" strikes me as broad. Are you referring only to the U.S.? What about water transportation? If I recall correctly, riverine transportation does not pay for but a fraction of its infrastructure. What about seaports? Are they all self-funded? That leaves what else ... buses, probably not; trucks, probably not; light rail and heavy rail, probably not; personal autos, probably yes; freight railways, probably yes; airlines, who knows. I can't add that up to "most" if we assign each mode a value of 1, but if we add up the total infrastructure investment made to date in discounted dollars, maybe it's a plurality. Would you be considering the lands withdrawn from the tax rolls for the streets in the accounting? RWM
I did?
Could you cite me the studies that say that trucking pays its fair share of the incremental costs that aren't produced by or paid for by the trucking industry, please. AASHTO says otherwise. Also, why do you want it to be incremental instead of fully allocated?
The statement "the investment in most forms of transport infrastructure have been paid for by the users" strikes me as broad. Are you referring only to the U.S.? What about water transportation? If I recall correctly, riverine transportation does not pay for but a fraction of its infrastructure. What about seaports? Are they all self-funded? That leaves what else ... buses, probably not; trucks, probably not; light rail and heavy rail, probably not; personal autos, probably yes; freight railways, probably yes; airlines, who knows. I can't add that up to "most" if we assign each mode a value of 1, but if we add up the total infrastructure investment made to date in discounted dollars, maybe it's a plurality. Would you be considering the lands withdrawn from the tax rolls for the streets in the accounting?
This issue is whether investment in high speed rail is the best way to spend the stimulus grant. I don't think that it is. I would use it to improve regional rail in short, high density corridors where there is a good chance of recovering the operating costs and contributing something to the capital costs.
Citing investments in other transport infrastructure was meant to show that the costs could be recovered and, in fact, especially with respect to air and highway, have been. Given the poor financial performance of passenger trains, I don't think that they can recover their capital costs, especially high speed rail, although that is not the only criteria I would use for investment.
A discussion of trucks, in retrospect, is off topic. I said simply that there are studies pro and con with respect to whether they cover their fair costs. If your concerned about the veracity of the studies, I am sure that you can find them.
OK, let's strike all that from the record and circle back to your point:
"This issue is whether investment in high speed rail is the best way to spend the stimulus grant. I don't think that it is. I would use it to improve regional rail in short, high density corridors where there is a good chance of recovering the operating costs and contributing something to the capital costs."
Behind that point I think there's a premise, which appears to me to be "recovery of operating cost and contribution to the capital cost is important [to the public]." My addition in brackets, since we need to have an agent of action.
Is it important? Value to the public often has nothing to do with tangible measures such as farebox recovery. I spend a great deal of my time over on the economic valuation side of the railway, on all sorts of projects ranging from public-private partnerships to alternative financing to simple value deals, and I'm continually intrigued (or perplexed, or confounded, or bemused) by what the public decides to value. The public frequently confirms the expenditure of billions on initiatives that have no economic rationale at all, and just as frequently walks away from deals that provide quanitifed, obvious, public cash benefits, for reasons that I can only ascribe to ideology or taste.
(Note: I'm not coming at this as an advocate of high-speed rail. Or an opponent. I have no partisan bones in this game. Whether the $8 billion is spent on high-speed or corridors, I personally, professionally, and as a citizen am pretty happy. In fact professionally I'll be much more in demand on the corridor side.)
In other words, I'm not sure your point is even worth arguing, because I'm not sure the premise is valid. It would seem a majority of the public didn't fall over in apoplexy over the $8 billion in stimulus funding. And I don't think the public expects this will somehow pay for itself someday either. So if the public likes the idea, and is aware of the basic economic outcomes and is not expecting some other outcome, is there even a problem? Perhaps the more interesting discussion is why the public would prefer $8 billion on HSR rather than on short high-density corridors.
If GM "killed the electric car", what am I doing standing next to an EV-1, a half a block from the WSOR tracks?
Railway Man No one other than the trucking industry claims that trucks pay their own way. AASHTO does not. No reputable highway engineer claims this. Pavement damage varies as the 4th power of the axle loading. Axle loadings are measured using the ESAL, or Equivalent Single Axle Load, an empirically determined formula. An axle carrying 18,000 lbs. creates 3,000 times as much pavement wear as an axle carrying 2,000 lbs. See http://pavementinteractive.org/index.php?title=ESAL Now, if you want to make an economic argument that the fees, taxes, and economic activity created by trucks, subtracting the air emissions, congestion cost, delays to other vehicles, accident cost (heavy trucks are involved in one of every eight fatal accidents in the U.S.), are a net positive, and that no costs are externalized, be my guest. RWM
No one other than the trucking industry claims that trucks pay their own way. AASHTO does not. No reputable highway engineer claims this. Pavement damage varies as the 4th power of the axle loading. Axle loadings are measured using the ESAL, or Equivalent Single Axle Load, an empirically determined formula. An axle carrying 18,000 lbs. creates 3,000 times as much pavement wear as an axle carrying 2,000 lbs.
See http://pavementinteractive.org/index.php?title=ESAL
Now, if you want to make an economic argument that the fees, taxes, and economic activity created by trucks, subtracting the air emissions, congestion cost, delays to other vehicles, accident cost (heavy trucks are involved in one of every eight fatal accidents in the U.S.), are a net positive, and that no costs are externalized, be my guest.
You misread my posting. I said that trucks cause more damage to roads than passenger cars. So do most others with a knowledgable interest in transportation. The question is whether they pay their fair share of the incremental costs. There are studies that say they don't; there are also studies that say they do. And not all of them were produced by the trucking industry.
Your reference does not say anything about costs. It is basically an engineering discussion, which I appreciate more than you might imagine.
This is not even relevant to my original position, which is that the investment in most forms of transport infrastructure in the U.S. have been paid for by the users. The one exception is passenger rail, especially since 1971. And this is the basis of my skeptism regarding high speed rail.
OK, suppose intercity highways are for the most part maintenance-free were it not for the pounding from large vehicles, i.e. trucks. That would suggest that passenger cars are heavily cross-subsidizing trucks, which further suggests that passenger cars are more than paying their own way and then some, in contrast with the 20+ cents/passenger mile Amtrak subsidy.
Would not a more effective use of railroads be to free them of passenger trains so they could more effectively carry volumes of freight and remove truck traffic from the highways?
Are not passenger trains only marginally more fuel efficient than cars (current Amtrak) whereas freight railroads are multiples of the fuel efficiency of trucks, especially for the heavier commodities carried at lower speeds? Would not a more effective use of advocacy resources in solving problems of highway congestions, carbon emissions, energy independence to promote the use of railroads as freight carriers?
There are advantages in safety and traffic flow to segregating passenger from freight transport. Perhaps the emphasis is all wrong on building an entirely new network of passenger-only rail lines (i.e. HSR). Perhaps the emphasis should be on rubber tires on pavement as the primary ground passenger mode and on doing what it takes to get the freight traffic back on rails.
Would not a more effective use of railroads be to concentrate on removing the mass of trucks from the roads instead of making a marginal contribution of removing a slim fraction of the cars?
As to the impact of buses, buses carry 10 times the intercity traffic as Amtrak in the U.S., but I hardly ever see a bus on the Interstate, but I see truck after truck after truck. Perhaps the advocacy community is "barking up the wrong tree" as it were.
There are strong institutional reasons why getting trucks off the highways is a difficult proposition. Many men and women derive their livelihood from trucks. Railroad freight operations are so heavily "batched" that trucks offer the kind of "just-in-time" delivery and inventory control that may be impossible with the way railroads are structured.
On the other hand, freight has well-known intermodal solutions to solving the "last mile" problem apart from putting a freight siding at every last business concern. Containerization. Autos do not have as effective of an intermodal answer. AutoTrain? Mass parking at Amtrak terminals as at airports combined with a catch-as-catch-can as car rental, taxis, the thin network of local transit in many cities, or getting rides from friends? In other words, the freight intermodal problem has been "solved" by the Hyster Corporation container side-transfer gear -- Hyster is the company that introduced the world to the "Dumpster" (not a generic term but a trade name) of a ubiquitous transferable container material handling system for garbage.
Getting much of the intercity truck traffic off the Interstates has a technological solution in terms of containerization, if transportation policy were to embrace it. Getting more than a fraction of a percent of intercity autos off the highways has a much more expensive solution -- I guess it is HSR, that the speed of HSR would induce people to put up with the inconvenience of the intermodal interface to it, much as we put up with that inconvenience with air travel.
oltmannd Sam1In fact, there is a scant probability that the operators will even recover their operating expenses. No, in your opinion "there is a scant probability that the operators will even recover their operating expenses". There is no hard evidence that this is a fact. There are, in fact, some estimates in existence that say otherwise that you chose to disagree with by labeling them "promoters". They are based on at least a modicum of science, although, admittedly, they are an extrapolation. So, reality is that no one knows with much certainty what the results of any HSR project might be.
Sam1In fact, there is a scant probability that the operators will even recover their operating expenses.
No, in your opinion "there is a scant probability that the operators will even recover their operating expenses". There is no hard evidence that this is a fact.
There are, in fact, some estimates in existence that say otherwise that you chose to disagree with by labeling them "promoters". They are based on at least a modicum of science, although, admittedly, they are an extrapolation. So, reality is that no one knows with much certainty what the results of any HSR project might be.
The average fare on the NEC between New York and Washington is $105.80 or 46.8 cents per mile. The average fare between Boston and Washington is $137.90 or 30 cents per mile. The average fare between New York and Philadelphia is $84.55 or 92.5 cents per mile. Of course, the complete fare structure for the NEC would produce different results between any two fare points, but these are reasonably representative.
The average stated fare on the California High Speed Rail Line, according to the report on NPR by the Chairman of the California High Speed Rail Board, will be $55 or approximately 13.1 cents per mile. Unless the California HSR draws an enormous crowd, how it will cover its operating costs when Amtrak barely covers its operating costs on the NEC, except for the New York to Washington segment, mystifies me. This is why I think that high speed rail, as currently proposed, has scant chance of covering its operating cost. And it has practically no chance of covering the capital costs.
The investment in the NEC is in the neighborhood of $9.6 billion or an average of $21 million per mile. The proposed investment in the California High Speed Rail Project (HSR), which appears to be the poster child for high speed rail in America, will be north of $40 billion, if the project comes in on time and within budget, which is problematic. The estimated rail mileage is 420 miles. The cost to construct the system will be approximately $95.2 million per mile.
Scant means not quite coming up to a stated measure. It does not mean that high speed rail could not cover its operating expenses; it means that the probability of doing so, given the performance of high speed rail in other environments, is unlikely.
Business people invest in projects that have a reasonable chance of success. They don't know the future, but they have an array of tools to paint reasonable scenarios of whether the project is likely to succeed. In my company we demanded a lot more than just a modicum of science.
I am, however, open to new evidence. Please direct me to the authoritative references you claim but have not cited for the independently audited studies showing that high speed rail, as proposed, will cover its operating costs and contribute something to the capital investment. By independent audit I mean the numbers have been audited by a large, independent accounting firm, e.g. PricewaterhouseCoopers, KPMG, Deloitte, etc. that does not have a stake in the outcome.
Most perspectives are a function of opinions. Whether an investment in high speed rail is a good idea or a bad idea; whether it will cover its costs or won't, is an opinion. Opinions that are backed-up with verifiable, independently audit data carry more weight with me than those that lack the support.
Taconic St. Parkway is another...plus a 50 mph limit! Very easy on maintenance....and you may be surprised just how far you can go in an hour at 50 mph!
RIDEWITHMEHENRY is the name for our almost monthly day of riding trains and transit in either the NYCity or Philadelphia areas including all commuter lines, Amtrak, subways, light rail and trolleys, bus and ferries when warranted. No fees, just let us know you want to join the ride and pay your fares. Ask to be on our email list or find us on FB as RIDEWITHMEHENRY (all caps) to get descriptions of each outing.
oltmanndBetter than the Van Wyck. How about the Northern State Pkwy - cars only
Oltmannd: Great example for about NSP! Takes us old southern gentlemen to remind the northerners what is good or not. Also thought about the fact they are subject to much salt and winter weather that us southerners don't have to contend with.
DeggestyRailway ManNo one other than the trucking industry claims that trucks pay their own way. AASHTO does not. No reputable highway engineer claims this. Pavement damage varies as the 4th power of the axle loading. Axle loadings are measured using the ESAL, or Equivalent Single Axle Load, an empirically determined formula. An axle carrying 18,000 lbs. creates 3,000 times as much pavement wear as an axle carrying 2,000 lbs. RWM, am I missing something? Since 18,000 is nine times 2,000, shouldn't it be 6,561 times as much damage (nine to the 4th power is 6,561)? Johnny
Railway ManNo one other than the trucking industry claims that trucks pay their own way. AASHTO does not. No reputable highway engineer claims this. Pavement damage varies as the 4th power of the axle loading. Axle loadings are measured using the ESAL, or Equivalent Single Axle Load, an empirically determined formula. An axle carrying 18,000 lbs. creates 3,000 times as much pavement wear as an axle carrying 2,000 lbs.
RWM, am I missing something? Since 18,000 is nine times 2,000, shouldn't it be 6,561 times as much damage (nine to the 4th power is 6,561)?
Johnny
The referenced page answers this. The 4th power law is an equivalency. The actual formulas are complex. The weight on the axle must be converted into ESALs. A passenger car generates about 0.003 ESALs. An 18,000 lb. axle generates 1.0 ESALs -- for reasonably strong pavements.
Look through the page, and these pages:
http://pavementinteractive.org/index.php?title=Flexible_Pavement_ESAL_Equation
http://pavementinteractive.org/index.php?title=Rigid_Pavement_ESAL_Equation
Better than the Van Wyck. How about the Northern State Pkwy - cars only. Built in the mid-1930s, it still has the original concrete underneath a veneer of asphalt (it wasn't repaved at all until the mid 1970s). Compare it to I-70 in Kansas which was being completetly rebuilt down to the sub-grade during this decade. It was built in the early 1970s.
-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/)
Sam1 The question is whether the higher fuel taxes and fees cover the incremental damage done by trucks. The American Trucking Association can cite studies showing that the higher taxes and fees cover the incremental damage; other studies (Texas Transportation Institute) show that they do not.
The question is whether the higher fuel taxes and fees cover the incremental damage done by trucks. The American Trucking Association can cite studies showing that the higher taxes and fees cover the incremental damage; other studies (Texas Transportation Institute) show that they do not.
SAM: I can give one concrete example that trucks are destructive. The Grand Central Parkway in New York City from the Van Wyck to LGA airport bans all trucks and buses. It was built before 1966 and as far Ias I know has never been shut down for major repairs or potholes. Can you say that about any route allowing trucks? Any of you NYC fellows know differently since its been several years since I've been on the Grand Central?.
RWM : thanks for the formula!! The fourth power!!!; wow trucks are really gettiing subsidized big time plus I guess buses are also getting subsidized.
r
Sam1The notion that the operators of high speed rail will somehow be able to reverse this pattern is not supported by any hard evidence that I have seen. In fact, just the opposite is the case.
If the NEC isn't hard evidence, then what is?
If you are looking for hard evidence w.r.t. something that doesn't exist, that is a tautology.
blue streak 1 Sam1So the government no only recoups the cost of the highways through the fuel taxes, it gets a payback through the higher taxes paid by more profitable commercial users. SAM: I believe the conventional wisdom is that trucks do not pay for the maintenance. An 80,000# tractor trailer is considered to cause much more dmage than they pay for in taxes and user fees. I forget the figures but it is something like 240 times a 5000# car and about 800 times a sub compact car. I believe it is some kind of exponential curve. Remember the threads on here that talked about how much more roadbed, track, mtc., etc that is needed to go from RR cars of 286,000# to 315,000#. Any of our highway engineering people have the exact figures?
Sam1So the government no only recoups the cost of the highways through the fuel taxes, it gets a payback through the higher taxes paid by more profitable commercial users.
SAM: I believe the conventional wisdom is that trucks do not pay for the maintenance. An 80,000# tractor trailer is considered to cause much more dmage than they pay for in taxes and user fees. I forget the figures but it is something like 240 times a 5000# car and about 800 times a sub compact car. I believe it is some kind of exponential curve. Remember the threads on here that talked about how much more roadbed, track, mtc., etc that is needed to go from RR cars of 286,000# to 315,000#. Any of our highway engineering people have the exact figures?
Transportation experts have long recognized that trucks cause more wear and tear on highways than automobiles. This is why the taxes and fees for them are considerably higher than those for autos. For example, whilst the federal tax on gasoline is 18.4 cents a gallon, the tax on diesel fuel, which is the primary fuel for heavy trucks, is 24.4 cents per gallon. Interestingly, some states have a higher tax on diesel, although a few of them have a lower tax.
Most users of common access facilities claim that they pay more than their fair share to use the facilities. The airlines, for example, claim that they pay a disproportionate share of the cost of the federal airways. This may be true.
The key point, however, is that the users of the nation's transport facilities, which were jump started by the federal and state governments, have or are paying for them in most instances.
I don't believe the promotors of high speed rail have a prayer's chance of recovering the investment. I don't think they can even recover their operating costs. This is why I am opposed to using government money to build a high speed rail network, especially a national one.
henry6 I'd like to go back to the (often heard or posted) comment that if there was profit or if it had potential then investors, private enterprise, would do it. But that is definitely not the case, nor was it ever! From the Erie Canal to the Panama Canal and so many others around the world (I know there are or were some private capitlaized canals) it took governments and/or governents in partnership with private capital. The Union Pacific Railroad relied very heavily on government land grants and protections in order for private enterprise to succeed. So why does this come up everytime a major project which will benifet people and private business is proposed? Should only private enterprise do anything concerning commerce from making mining a mineral and making widgets to carrying the raw material to the factory and finsihed product to market? Does anyone have any idea how far back in time we would be if Dewitt Clinton turned his back on the concept of the Erie Canal or if Abraham Lincoln couldn't fathom the need for a transcontinental railroad? Or how would you get to work in the morning if there were no roads from your house to your place of work? I just don't get this fearful fervor against governments doing anything to progress society and the feeling that if a private investor isn't going to do it then it shouldn't be done.
I'd like to go back to the (often heard or posted) comment that if there was profit or if it had potential then investors, private enterprise, would do it. But that is definitely not the case, nor was it ever! From the Erie Canal to the Panama Canal and so many others around the world (I know there are or were some private capitlaized canals) it took governments and/or governents in partnership with private capital. The Union Pacific Railroad relied very heavily on government land grants and protections in order for private enterprise to succeed. So why does this come up everytime a major project which will benifet people and private business is proposed? Should only private enterprise do anything concerning commerce from making mining a mineral and making widgets to carrying the raw material to the factory and finsihed product to market? Does anyone have any idea how far back in time we would be if Dewitt Clinton turned his back on the concept of the Erie Canal or if Abraham Lincoln couldn't fathom the need for a transcontinental railroad? Or how would you get to work in the morning if there were no roads from your house to your place of work? I just don't get this fearful fervor against governments doing anything to progress society and the feeling that if a private investor isn't going to do it then it shouldn't be done.
The federal and state governments, sometimes in partnership with private capital, invested in transport infrastructure, e.g. canals, railroads, highways, airways, waterways, etc., because they realized the need to do so to jump start the projects. They expected to recoup their investment from user fees. In most instances they did.
Given the dismal financial performance of passenger railways trains throughout the world, there is little chance that investing in high speed rail will enable the investors to recoup their investment. In fact, there is a scant probability that the operators will even recover their operating expenses. This is why I question the wisdom of using public or private monies to build high speed rail.
I favor using government monies to invest in conventional rail infrastructure associated with short, high density corridors, where expanding highways and airways is cost prohibitive, because there is a good chance that the operator can recover the operating expenses and, as is the case with the NEC, contribute something to the capital investment.
The Interstate Highway System (IHS) was built in response to a market demand by motorists (personal and commercial) for a better highway system. They lobbied Congress to make it happen. The game plan was for the government to provide enabler funds to jump start the building, which they did under the ruse of building a defense highway system, but ultimately it would be paid for by the users through fuel taxes, which is what has happened.
Until 1999, the Highway Trust Fund (HTF) ran a surplus, except for the building years. From 1999 to 2007 it had to draw down the surplus to continue to fund the highways, primarily because Congress would not raise the fuel taxes. In 2007 the U.S. government had to transfer approximately $3.4 billion from the general fund to the HTF, and in 2008 it transferred approximately $8 billion.
Transferring monies from the general fund to the HTF means that the motorists who pay federal income taxes are still paying for the highways, although using general funds tends to shift the burden from lower income motorists to higher income motorists. Thus, lower income motorists are not paying the same amount per vehicle mile as upper income motorists to use the federal highways.
Commercial users of the Interstate Highway System, e.g. truckers, bus companies, etc. must cover their costs, including fuel taxes as well as earn a profit, or they go out of business. Most of them pay higher fuel taxes than non-commercial users. They pay federal income taxes on their profits, and the federal government earns a return on the highways. Because the IHS has allowed freight carriers, as well as bus companies, to operate more efficiently, they have earned higher profits, and they have therefore paid higher amounts to the federal government. So the government no only recoups the cost of the highways through the fuel taxes, it gets a payback through the higher taxes paid by more profitable commercial users.
Personal users do not earn a return on the investment in highways or any other public conveyance, but they supposedly pay for their proportional use of the system.
The same concept applies to the nation's railroads, airways, waterways, etc. In many instances they too were kick started by the federal government. In fact, the Army flew the mail during the earliest years of commercial aviation. That is how Charles Lindbergh got his start. Ultimately, the investment in the airways, waterways, etc. produced a return for the commercial users with the same impacts as described for the highways.
The biggest difference between railways and other transport rights-of-way is that the former are controlled by the operator, whilst the common air, water, etc. rights-of-way are controlled by the federal and statement governments. If we were starting over, I suspect a better system would be to have the rails built and owned by the government, with private operators marketing and running the trains.
With the exception of the NEC, Amtrak cannot cover consistently its operating costs. Thus, even if the government funded the building of the rails ala the highways, airways, waterways, etc. or took them over, there is scant evidence that any operator could cover his or her operating expenses and earn a return for the investors.
The notion that the operators of high speed rail will somehow be able to reverse this pattern is not supported by any hard evidence that I have seen. In fact, just the opposite is the case. Given the costs, which many people want to ignore, high speed rail would be a greater financial drain than the current system. It will be likely a perpetual drain on federal and state government resources.
I agree ... Sam will not.
Dave
Lackawanna Route of the Phoebe Snow
Phobe Vet, Sam1: Regarding the comment "If high speed rail was truly a good idea, investors would fall all over themselves to fund it": When discussing HSR as an investment, [Problem#1] compare right of ways to highways. When in history did the market decide it needed an Interstate Highway System? Who ever invested in the IHS? Who ever measured the return on investment of the IHS? Many companies today, in my humble opinion, take the IHS and the state highways for granted, and are not concerned with the cost of highway maint. Perhaps it's because the cost of IHS is shouldered by everyone who pays state, federal taxes and buys fuel at the pump. Which probibly is the way to go regarding HSR, or as already mentioned, an Interstate Railway System (Administration). [Problem#2] I agree with the statement "Amtrak is not a public transport system ala a municipal transport system". However, I do not agree to continue equating Amtrak with HSR. Amtrak, as we all know, currently is the only passenger railroad provider. This will change with the adoption on a governemnt controlled HSR system/IRSA. Once all railroad companies and tax payers are funding IRSA, there will be other passenger railroads operating, because these companies will have track available to operate on...in other words, once the market sees a coast to coast HSR/IRSA system in place, we will see long distance, regional, and inter-city train service providers besides Amtrak. As long as the sections of HSR that are under consideration now continue to be associated with Amtrak, or NS/CSX/UP/BNSF, the market will not be interested, due to the belief that the tracks are owned by these above mentioned railroads, and use to companies outside this group will be restricted. [Problem#3] A distinction needs to be drawn between intercity/commuter rail travel, and long distance train travel. The idea that there's only to be a few HSR ROW's in America is very short sighted. America needs a system of HSR ROW's. And as far as "how are we gonna pay for it" goes, all railroads and taxpayers will have to support this HSR/IRSA system, just like we support the Interstate and state highway system; through fed and state taxes, at the pump taxes, and driver/vehicle excise taxes.
Way Off Topics for Sam1!
We visited our relatives in San Antonio this past week and went by your neighborhood. Can you tell me which I-35 through Austin is supposed to be the "through" route, the upper deck or the lower one? The signs are no help at all and the traffic was terrible.
You have mentioned many times your extensive career in the electric power industry. Would you please give us a few opinions on how you think electric power should evolve in the United States? It's not totally OT because electric power could be the future of RR power. It would be nice to hear from an expert.
Maybe another thread, like the "Trackside Lounge - Spring 09 Edition," would be appropriate for such a discussion.
Railway Man oltmannd HarveyK400Chicago - Cleveland ($1,187M): I cannot fathom the high cost for this corridor. This works out to $3.4M a mile, including the Toledo - Cleveland stretch. Would this include a new additional track along side the existing NS tracks between Fort Wayne and Cleveland? Not be much curve easement would be needed. The map indicates that the former Wabash alignment would be used; but this line was abandonned. Could it be that the cost includes aquiring the ROW in this case (rather than being a tenant)? It would be quite a bit cheaper to us the NS Chicago Line and just plop down a third track, but that means you trade Fort Wayne for Elkhart and likely lose the bulk of the Columbus - Chicago traffic. Devil's in the details -- seen a cost breakdown? RWM
oltmannd HarveyK400Chicago - Cleveland ($1,187M): I cannot fathom the high cost for this corridor. This works out to $3.4M a mile, including the Toledo - Cleveland stretch. Would this include a new additional track along side the existing NS tracks between Fort Wayne and Cleveland? Not be much curve easement would be needed. The map indicates that the former Wabash alignment would be used; but this line was abandonned. Could it be that the cost includes aquiring the ROW in this case (rather than being a tenant)? It would be quite a bit cheaper to us the NS Chicago Line and just plop down a third track, but that means you trade Fort Wayne for Elkhart and likely lose the bulk of the Columbus - Chicago traffic.
HarveyK400Chicago - Cleveland ($1,187M): I cannot fathom the high cost for this corridor. This works out to $3.4M a mile, including the Toledo - Cleveland stretch. Would this include a new additional track along side the existing NS tracks between Fort Wayne and Cleveland? Not be much curve easement would be needed. The map indicates that the former Wabash alignment would be used; but this line was abandonned.
Could it be that the cost includes aquiring the ROW in this case (rather than being a tenant)?
It would be quite a bit cheaper to us the NS Chicago Line and just plop down a third track, but that means you trade Fort Wayne for Elkhart and likely lose the bulk of the Columbus - Chicago traffic.
Devil's in the details -- seen a cost breakdown?
A study of alternatives would also be nice to see.
oltmanndHarveyK400Chicago - Cleveland ($1,187M): I cannot fathom the high cost for this corridor. This works out to $3.4M a mile, including the Toledo - Cleveland stretch. Would this include a new additional track along side the existing NS tracks between Fort Wayne and Cleveland? Not be much curve easement would be needed. The map indicates that the former Wabash alignment would be used; but this line was abandonned. Could it be that the cost includes aquiring the ROW in this case (rather than being a tenant)? It would be quite a bit cheaper to us the NS Chicago Line and just plop down a third track, but that means you trade Fort Wayne for Elkhart and likely lose the bulk of the Columbus - Chicago traffic.
oltmannd Sam1 The promoters of high speed rail put the best spin on their numbers. I would not bet the farm that the projects will cover their operating costs. I would like to see an independent audit of the projections, i.e. an audit conducted by one of the big four accounting firms, with the fees paid by an independent agency. One of the promoters of the California High Speed Rail claims that a ticket from LAX to SFO will go for $55. Really! Amtrak cannot cover its total NEC costs with Acela fares of $155 between Washington and New York. And its investment is less than 25 per cent of the announced investment in the California HSR project. I would love to see the audited numbers for the California projections. Having spent more than 20 years directing audits of just these sorts of projects, I am amply familiar with how people spin the numbers, most of which are based on estimates, to make their project sound viable. This is not a promoter's report. It is one done for the various state DOTs by expert consultants. These generally use fairly standard ridership models. Many times, these same models underestimate commuter and light rail traffic (see Charlotte, Albequerque and lately Phoenix). This particular study used Amtrak's highly inefficient current costs to figure train operation costs, but did figure that some newer ROW maintenance methods into that part of the cost. Of course, there is a lot of uncertainty with any new venture with long lead times. It is particularly hard to calibrate ridership models for new corridors because there haven't been any implemented anywhere! Sensitivity to trip times, frequency and price are very well known, however. (I'm surprised you didn't take the chance to show this an example of regionalism that's working. Look at how many states pitched in to do the study....)
Sam1 The promoters of high speed rail put the best spin on their numbers. I would not bet the farm that the projects will cover their operating costs. I would like to see an independent audit of the projections, i.e. an audit conducted by one of the big four accounting firms, with the fees paid by an independent agency. One of the promoters of the California High Speed Rail claims that a ticket from LAX to SFO will go for $55. Really! Amtrak cannot cover its total NEC costs with Acela fares of $155 between Washington and New York. And its investment is less than 25 per cent of the announced investment in the California HSR project. I would love to see the audited numbers for the California projections. Having spent more than 20 years directing audits of just these sorts of projects, I am amply familiar with how people spin the numbers, most of which are based on estimates, to make their project sound viable.
The promoters of high speed rail put the best spin on their numbers. I would not bet the farm that the projects will cover their operating costs. I would like to see an independent audit of the projections, i.e. an audit conducted by one of the big four accounting firms, with the fees paid by an independent agency.
One of the promoters of the California High Speed Rail claims that a ticket from LAX to SFO will go for $55. Really! Amtrak cannot cover its total NEC costs with Acela fares of $155 between Washington and New York. And its investment is less than 25 per cent of the announced investment in the California HSR project. I would love to see the audited numbers for the California projections.
Having spent more than 20 years directing audits of just these sorts of projects, I am amply familiar with how people spin the numbers, most of which are based on estimates, to make their project sound viable.
This is not a promoter's report. It is one done for the various state DOTs by expert consultants. These generally use fairly standard ridership models. Many times, these same models underestimate commuter and light rail traffic (see Charlotte, Albequerque and lately Phoenix).
This particular study used Amtrak's highly inefficient current costs to figure train operation costs, but did figure that some newer ROW maintenance methods into that part of the cost.
Of course, there is a lot of uncertainty with any new venture with long lead times. It is particularly hard to calibrate ridership models for new corridors because there haven't been any implemented anywhere! Sensitivity to trip times, frequency and price are very well known, however.
(I'm surprised you didn't take the chance to show this an example of regionalism that's working. Look at how many states pitched in to do the study....)
The $55 fare quote was made by the head of the California High Speed Rail Project on NPR. He is a retired California high court judge. I'd call him a promoter.
In most cases consultants are paid by the client. They have a nasty habit of putting a more favorable spin on the outcomes than an independent auditor paid by an overseer without any stake in the outcome. This is especially true if they see some additional business. I spent more than 25 years dealing with consultants. They seldom lie. But they are quick to determine the sponsor's objectives, and they tend to put together the best scenarios to support them.
People who have a viable commercial idea (vision) don't need to run to the government for funding. Venture capitalists will provide all the money required. Equally important, promoters of a good deal have no problem with independent audits.
Those who run to the government for funding know that their vision will never fly in the market place, and they are not keen for an independent audit of their financial estimates.
The California HSR project appears to be a good example of regionalism, but it will depend on how much money they get from the federal government. If they limit their federal take to 20 per cent or less, I would think that it is a good regional project. If they want 80 per cent of the funding to come from the federal government, it is not a good regional project.
Phoebe Vet Sam1 What the government spends the military, education, social programs, etc. has nothing to do with what it should spend on promoting or operating a commercial activity like passenger rail. The question is whether the spend is a good investment. Investing in a commercial activity (intercity passenger rail) that has a low probability of covering its operating costs, let alone its capital costs, is a poor business decision no matter what spin you put on it. It is you who cited the huge national debt, even quoting the debt per taxpayer to support your argument that Amtrak is a terrible burden that we are leaving to our heirs. I merely pointed out that Amtrak's portion of the deficit is infinitesimal, and is worth the investment. Mass transit benefits society as a whole. That is why every municipal bus system, light rail system, and subway system is subsidized by the political entity it serves. A national rail system benefits the entire country and therefore is a proper use of federal tax dollars, no matter what spin YOU put on it.
Sam1 What the government spends the military, education, social programs, etc. has nothing to do with what it should spend on promoting or operating a commercial activity like passenger rail. The question is whether the spend is a good investment. Investing in a commercial activity (intercity passenger rail) that has a low probability of covering its operating costs, let alone its capital costs, is a poor business decision no matter what spin you put on it.
What the government spends the military, education, social programs, etc. has nothing to do with what it should spend on promoting or operating a commercial activity like passenger rail. The question is whether the spend is a good investment.
Investing in a commercial activity (intercity passenger rail) that has a low probability of covering its operating costs, let alone its capital costs, is a poor business decision no matter what spin you put on it.
It is you who cited the huge national debt, even quoting the debt per taxpayer to support your argument that Amtrak is a terrible burden that we are leaving to our heirs. I merely pointed out that Amtrak's portion of the deficit is infinitesimal, and is worth the investment. Mass transit benefits society as a whole. That is why every municipal bus system, light rail system, and subway system is subsidized by the political entity it serves. A national rail system benefits the entire country and therefore is a proper use of federal tax dollars, no matter what spin YOU put on it.
You failed to include my comments recognizing that the $8 billion slated for high speed rail is indeed small compared to the national debt or the annual federal operating budget and deficit. However, it is more debt. And one does not cure an addiction to debt by adding to it anymore than one cures alcoholism by giving a drunk just one more drink.
Amtrak is not a public transport system ala a municipal transport system. The elimination of a public transit system in most cases would work a hardship on the many poor people who rely on it. Amtrak is an intercity system, although some people use it to commute. If it dried up and went a way, most users would have a viable alternative.
Investing $8 billion of taxpayer money in high speed rail, or any other rail for that matter, should be a function of a demonstrated need for it. The best way to determine whether there is a need for it is the market place. If high speed rail was truly a good idea, investors would fall all over themselves to fund it.
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