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Opinion: Why should all Californians pay for high-speed rail?

(The following column appeared on the Los Angeles Times website on October 20.)

LOS ANGELES — Today's question: Why is high-speed rail a top infrastructure-spending priority that every California taxpayer should contribute to? Dan Tempelis and Adrian Moore debate Proposition 1A.

* * *

A boost for our economy, infrastructure and environment

Point: Dan Tempelis

The strength of California's economy and way of life depends on our ability to move both people and commerce throughout our state. But today, our once-exemplary network of freeways is constantly clogged, and our major airports are stressed beyond capacity. California is in transportation gridlock.

As our population grows steadily toward 50 million people by 2030, these challenges will get worse.

The high-speed train that will be built under Proposition 1A is an important element of a long-term, environmentally responsible transportation solution that has been a proven success throughout the world for nearly 50 years. Connecting all of California's major cities at speeds up to 220 miles per hour, it will offer a reliable, comfortable and affordable alternative to cars or planes for both long-distance and regional transportation.

This project is arriving right on time for California, as our economy struggles and our current transportation systems clogs. The construction phase of the project will generate about 160,000 jobs, while permanent operation of the system will create more than 400,000 jobs, including those spawned by businesses around revitalized downtown train stations. This is the kind of direct, job-creating investment California communities need as our economy works to get back on its feet and continues to be one of the largest in the world.

Congestion on our freeways and at our airports costs the California economy about $20 billion per year in lost time and wasted fuel, time and energy that would be better invested in job-creating businesses. By offering a reliable and affordable transportation alternative, high-speed trains will help ease congestion that slows our lives and hampers our economy.

High-speed trains will be electrified, paying long-term dividends for our environment by replacing transportation growth that would otherwise take place via cars and planes that burn fossil fuels. High-speed train service will save the state 12.7 billion pounds of greenhouse gas emissions. High-speed trains are three times more energy efficient per passenger than a plane and five times more than a car and will save Californians about 12 million barrels of oil per year.

The high-speed train project is a forward-thinking investment in California's future, much like the state water project and university system were decades ago. Financing will be through a state, federal and private partnership, maximizing the value of every state bond dollar. Under the funding partnership, each state bond construction dollar will attract at least two or more added partner dollars. Proposition 1A authorizes $9.95 billion in bonds for the state's portion of the funding, but taxpayers are protected. If partner matching dollars are not raised, the state bonds for construction cannot be spent under the law.

The high-speed train system has been in the works for California for a decade, undergoing peer-reviewed research by experts from the U.S and countries where high-speed systems have run safely since the 1960s. The result is a well-thought-out system designed to be a key element of California's transportation future.

Vote yes on Proposition 1A for the high-speed train -- to ease congestion, fight pollution and boost our economy.

(Dan Tempelis is a professional engineer who is project manager of the Los Angeles to Palmdale segment of the proposed high-speed train system.)

* * *

Wrong investment, wrong time
Counterpoint: Adrian Moore

California is facing an unprecedented financial crisis, with Gov. Arnold Schwarzenegger recently warning the federal government that the state may need billions in bailout funds, which it is not likely to get.

We are in this fix because the state's leaders failed to face the music and passed a budget that does not deal with out-of-control spending or the long-term structural problems with the budget. Now we Californians are going to the voting booths, where we are being asked to vote on a lot of spending measures. We can't afford to make the same mistake the Legislature did; we are going to have to make some tough choices.

The largest spending measure on the ballot is Proposition 1A, which would provide $9 billion for high-speed rail and nearly another $1 billion for related local transit projects. Proponents promise to build a high-speed train that is faster, will carry more passengers, be far more efficient and have much lower fares than any other in the world. I don't believe it, and neither should you, because the facts don't bear it out.

Will a train running through the agricultural Central Valley on its way between L.A. and San Francisco really carry more passengers than a train running through Japan, where densities are much higher along the entire route, where gas prices are much higher, where car ownership is much lower and where a big chunk of the population already travels by train? Not likely. No train system in the world comes close to the numbers being predicted by the California High-Speed Rail Authority.

You argue, Dan, that we should put aside concerns about our state's fiscal problems because nothing but good can come from building high-speed rail now. Let me answer each of your points in my own order.

You point out that our transportation system is in terrible shape and how much it is costing our economy and our lives. Good point. We approved a $20-billion bond two years ago, supposedly to fund our most urgent transportation infrastructure needs. High-speed rail was not on that list, and our system is in worse shape now than when we approved that bond. Wouldn't it make sense to tackle our crumbling roads and our aging transit systems and at least bring them up to a basic level of adequacy before we embark on spending tens of billions of dollars on a new technology that may or may not work?

You also argue that the high-speed rail project will create hundreds of thousands of jobs. Transportation funding should be viewed as a mobility issue with decisions made based on effectiveness, not as a jobs program. But yes, if the state spends billions of dollars on new infrastructure, it does help the economy grow and create jobs. Similar amounts of jobs would be created by spending the same money on expanding roads and airports, fixing our levees or improving our water infrastructure. Sensible infrastructure investments help the economy grow. Of all our choices right now, we have many more fundamental infrastructure needs than high-speed rail. And all of them deliver more bang for our bucks than rail.

High-speed rail is amazingly energy efficient, you say, and will save billions of pounds of greenhouse gas emissions. Very unlikely. That will only happen if the ridiculously high ridership numbers the rail authority predicts come true. At more realistic ridership levels, high-speed rail would make a modest contribution to greenhouse gas reductions -- but at a very high price. Various studies from environmental groups and university researchers have identified dozens of ways California can reduce greenhouse gases for $100 to $200 per ton, and the state has yet to fund most of those ideas. But this expensive, ineffective high-speed rail plan would cost 10 to 20 times that, up to $2,000 per ton of greenhouse gases removed. At some point, cost effectiveness needs to be considered.

Finally, you say that the $9 billion in state taxpayer funds (double that to $18 billion after debt service) from Proposition 1A will be matched by the federal government and the private sector. Well, proponents say that the first phase of the project will cost about $40 billion, but a more realistic figure is nearer to $60 billion. Between $31 billion and $51 billion is a lot to find under sofa cushions in these economic times.

The federal government is deep in record debt, faces falling tax revenue during this economic downturn and has no program to fund high-speed rail. Proponents tell us not to worry, that Congress will pass a new law creating a high-speed rail program and California will be first in line for the money. Well, maybe. Or maybe not. And the private sector? The rail authority's financial plan is not the most reliable plan ever put together. It expects the private sector to line up to invest, and it was crafted by Lehman Bros. before current economic realities came home to roost. Let's just say that the chances of the private sector investing tens of billions of dollars in a project that has no chance of making a profit are nil -- and leave it at that.

Proposition 1A is a very risky, big-spending bet at a time when California has no money to spare. The rail authority's plan is deeply flawed and ridiculously optimistic. Maybe the state and the private sector will have a better plan in the future, but this one is not the right investment.

(Adrian Moore is vice president of research at the Reason Foundation.)

Tuesday, October 21, 2008

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