It looks like California's high speed rail project (which we've discussed here before) has become the boondoggle to end all of that state's manifold boondoggles. City Journal reports:
State officials are trying to remake the bullet train on the fly, promising at a legislative hearing in Silicon Valley to implement changes that would bring down the cost and speed up construction. But none of those changes alters the fact that the bullet-train project appears clearly to violate federal regulations governing stimulus spending on transportation.
. . .
State auditors, the University of California’s Institute for Transportation, and an ad hoc peer-review committee appointed by the legislature all lambasted the project’s financial plan as incomplete, overly ambitious, and based on unverifiable numbers. In January, the peer-review group issued its assessment: “We cannot overemphasize the fact that moving ahead on the HSR project without credible sources of adequate funding, without a definitive business model, without a strategy to maximize the independent utility and value to the state, and without the appropriate management resources, represents an immense financial risk on the part of the state of California.” The peer review followed a damning analysis published in November by the state’s nonpartisan Legislative Analyst’s Office, perhaps the most respected agency in Sacramento, which concluded that rail officials had yet to address how to fund the (at least) $98-billion-system linking Los Angeles and San Francisco.
. . .
The bullet train’s “reasonableness of financial estimates” is questionable, beginning with the project’s revenue forecasts. The LAO noted a projection of 44 million riders a year when the L.A.-Bay Area line is complete. That’s down from the hallucinatory claim of 117 million passengers that proponents of Prop. 1A offered in 2008, but it’s still ridiculous. In reality, 44 million passengers would be 50 percent higher than the number of people Amtrak carries to and from more than 500 stations in 46 states and three Canadian provinces each year.
How was the estimate derived? Elizabeth Alexis, a Palo Alto finance expert and co-founder of Californians Advocating Responsible Rail Design, delved into the methodology and discovered, among other things, that the rail authority assumed that the future cost of gasoline would top $40 a gallon. Alexis also noted that the public-opinion polls that bullet-train backers crafted to gauge potential passenger interest were heavily biased.
. . .
More than three years after voters approved the $9.95 billion bond measure, the HSRA still hasn’t determined who will operate the train once it’s built. A contractor? An existing state agency? A private-public partnership? Nobody knows.
There's more at the link. It's well worth reading the whole article. It's a prime example of political meddling, wishful thinking, and ideological blindness to reality.
City Journal notes that the project is now guesstimated to cost at least $98 billion (although no-one has any idea where and/or how those numbers were derived and/or calculated - the actual cost may be much higher). California has already committed to spending $3.5 billion on the project as it stands, before a single rail is laid - largely to fund 'investigations', 'planning' and 'consultations'. As City Journal points out, that's seven times more than was spent on the Solyndra debacle. It concludes bluntly:
"Solyndra times seven" must die.
I can't argue with that at all!
Politicians! Bureaucrats! Moonbats! Grrrr!
Peter
Whenever I read about some expensive project like this, I start dividing it by population numbers.
ReplyDelete$98 billion is about $300 per American, or $900 per household, or $3000 per Californian.
Let's vote: Who wants to pay their share?
And people think California is a place to live. Well, it is if you don't pay taxes..... My sister worked there fo 30 years and now lives in Nevada. Still can't sell her place in Cally, but so far no luck.
ReplyDeleteWe'll see what happens.