California’s High Speed Rail Project Will Collapse Within Four Years

There is a new report on the cost overruns on the California High-Speed rail project. Those no longer matter. The project will not get any meaningful money to complete any useful part. I predict this project will collapse within four years. I am giving myself a bit of leeway in this prediction. I think it is likely the plug will be pulled on the project within two years. The exact timing depends upon the nature of Gavin Newsom’s and the California’s government’s retreat. Is the illusion of a project maintained in order to gain a position in the legal battles? The project is already a dead man walking.

Gavin Has to Kill It Because It Will Be Better for Gavin Politically

The new Governor Gavin Newsom has supported this in the past. As a new Governor, he has already started to walk away from it. I think the political calculus on this is clear. Newsom will toss this under the Caltrain. He cannot toss it under the high-speed rail because it will not be operating and will probably be too slow.

I think it works out best for Gavin if he kills it by the end of 2019, but there could be other legal and political reasons for the illusion.

There is no way Gavin goes for re-election with this zombie rotting corpse to be used against him by opposing Democrats or Republicans.

Details of the Financial Doom of This Project

The $12.7 billion they have in secured funding is not secure. The federal government will claw back $3.5 billion given to the project in 2010 under President Obama.

Once a 2022 deadline is missed for the first segment, then the Federal government will take back the $3.5 billion. Federal Republicans or Democrats will take the money back. There are some in California’s government who are hoping for a big Trump-Pelosi infrastructure deal to save them. Those people need to have blood tests for drug or alcohol abuse. I think the battle for the $3.5 billion starts before 2022.

The High-Speed Rail project has the fantasy that they will keep getting 25% of all the cap and trade money until 2050 for another $15.7 billion. This already gave them $1.7 billion. There is the lie that they need a total of $77 billion to get the whole thing done. They do not have all the land and they still have environmental lawsuits. It will not be completed for less than a $100 billion. It does not matter they will not even keep $12.7 billion.

Any money that they keep getting from Cap and trade will be less than the $3.5 billion that they will lose from Federal money.

There will be at least two major political and legal battles at the end. There will be battle for the federal government to take back $3.5 billion. Fair or not it does not matter. They will be looking to argue over some form of technical completion of a useless section of unused high-speed rail.

The other will be with the California voters and the lawyers who represent some of them. There will be the argument that the system is not in compliance with the terms of the $7.5 billion bond. The imagined system will not be built. There will still be a fight over how fast could it go. Could it reach the speed spelled out in the bond? This war has already started. The attempts to get the bond money back will not stop.

There is a new auditor report which details the delays and cost overruns.

72 thoughts on “California’s High Speed Rail Project Will Collapse Within Four Years”

  1. We here in California moved our primary up so the pandering to CA at the expense of say Iowa in the Democratic party will be quite strong.

    While the high level “give nothing up that enables your opponent” analysis is good it overlooks the lower level analysis of “you must first win the primary”. Soon it will be the 2020 presidential race and Pelosi won’t matter because she won’t be running.

    Hmmmm. Wondering if R’s in CA can vote for D presidential candidates in our wacky open primary races. <laughs maniacally>

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  2. That and Republicans and Democrats cannot agree on what constitutes infrastructure.

    R version of infrastructure: oil pipelines and roads for cars.
    D version of infrastructure: solar panels and trains.

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  3. Actually we need accountant-ish people for our leaders. People who can look at the ROI of a project and compare alternatives.

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  4. “To move an equivalent number of people would cost $170 billion in new freeways”

    The 5 freeway between LA and SF is two lanes in each direction. HSR is working hard to displace… two lanes and some commuter flights. At $77 billion. In the state that is pushing hard to bring self driving cars to market because they are the future.

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  5. Trump could totally troll Gavin Newsom in to keeping the train.

    One single post where he calls for it to be killed will result in the train being built no matter the cost.

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  6. Back around 2004 the 6 mile long Douglas Elevated Metro, here in Chicago, was rebuilt from the ground up. Cost was $640 million in today’s dollars, or $104 million/mile. The California system, at 520 miles and $77 billion would be about $148 million a mile. Sound like a fair deal to me considering that the Chicago line uses heavy rail that tops out at 70 mph.

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  7. With nine passengers that plane is a great idea for a country that doesn’t have a bottleneck in its ATC system. You need to look at the full technology stack and in the sort of crowded areas that will need such commuter planes that includes ATC.

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  8. And what will you do if the project is still going on after 4 years? With your bold prediction and opinion you should offer a bold bet as well. What will you do if & when the project continues?

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  9. <b>The criminal Trump</b>

    ^Lie #1. # of crimes Trump has been convicted of = 0

    <b>he is a disaster.</b>

    ^Lie #2. Read “Donald Trump is a Good President” by Michel Houellebecq or google “The USMCA is an America-first trade deal”

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  10. I think your problem is that you have enemies among commenters. Your comments get reported even if they were cleared by the software.

    Yes, well so much for the software ‘Fox News uses’ being so hot & all, eh? I mean, it should detect that going on as well and stopping it.

    I don’t hate Luca (Matteo Martini). I just post that pic because I am the ONLY one that sicko has a Stalker Wall for, remember? I mean: just like in the movies when the cops raid the sicko’s crummy apartment and find all the photos of his/her victims/future victims-to-be and such on an entire wall of some hidden room, ya know? I figured that should give me some retaliatory license. 🙂

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  11. I originally didn’t care for Trump. I thought he was running as a stunt like so many politicians do these days — but especially him. It’s his MO, after all. I also read his book back in the late 90s where he outlined how he wanted to run as an independent and then inflict an unconstitutional wealth tax to pay off the debt, etc.

    But then I was amazed and even astounded by what happened after that.
    He reminds me more and more of Andrew ‘Old Hickory’ Jackson.

    And he pisses off the Left just for breathing — there’s that. But mostly I like him for shredding RINO control of the GOP. At least temporarily. We’ll have to see if Trumpism survives Trump. #MAGA is very, very real, after all.

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  12. No, *I* personally do not.

    But the polls keep promising that for more money. And then libs on here scream at people like me for being against higher taxes because THEY don’t understand this…or rather, they live in this bubble reality that just isn’t real.

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  13. Whose 100 billion? I live in Illinois and I don’t want to pay for your ‘resilient’ transportation network in California. In my state the roads need repair, the airports need expanding, and the public transit system around Chicago needs massive repairs. We need our money here.

    You want a ‘resilient’ network in California? Sure. But YOU pay for it without Federal dollars.

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  14. This article misses the point of HSR which is to provide diversification and resilience to the transportation sector. It would be a mistake to assume that our transportation future is car and plane centric and limit the state’s options today for a future that does not arrive. HSR can form a backbone of another, more resilient and lower energy per rider, networked system to provide a needed alternative mode of transportation, especially in a state as large as CA. 100 billion is well worth the price for such insurance.

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  15. Profit or practicality never had anything to do with it. There’s a lot of people who’ve made really good money off this scam, convincing people that ‘All the COOL countries have HSR… so we should too!”

    Look, I LIKE the idea of HSR. But in the US? It’s not economical. It could never be economically feasible. There simply isn’t the demand for it, and AmTrak runs at a significant deficit outside the Acela corridor.

    Planes, unpleasant as they are, are simply faster, more versatile, and more sensible from an economic point of view.

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  16. “But… Europe has HSR! Japan has HSR! We should have HSR!”

    “Oh, stop whining. None of their systems operate at a profit, and Europe could fit nicely in Texas. Besides, we’ve got a high-speed system that doesn’t even need tracks. It’s called ‘airplanes’. Maybe you’ve heard of them?”

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  17. It’s an impossible train system, is the problem.
    The Tehachapi mountains are in the way and you can’t bullet train through them – you either have to slow down to get up and through the Grapevine adding hours to the journey or go around the mountains adding hours to the journey. When you’re done, the train system takes longer than hopping a short flight from LA to SF and costs more.
    There is literally no point to building it.

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  18. Wasting tax dollars on idiotic attempts to make a square peg (HSR) fit into a round hole (a geographically dispersed US population that demonstrably prefers the choice and mobility afforded by automobiles) is not an “investment” by any conventional definition of the term.

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  19. Where is the evidence that people will actually use the system as configured?

    I would expect a much greater amount of use out of the same money spent on freeways, which are proven to be popular with actual users. That is, when freeways are built, the public drives. When airports are built, the public flies. When rail is built, the public ignores it because it is both sluggish and expensive compared to other modes of transport.

    Why are we still building rail when it is so obviously a laughable waste of money? Counting the cost of infrastructure it is no more energy efficient than cars. And if we want to be realistic about our boondoggles, freeways can create the same number of construction jobs, too. But at least the public will actually benefit from them.

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  20. Eviation is already building a <300 knots fully electric airplane with current technology to be ready in 2021 albeit it is only a 9 passenger plane and the design is more efficient than current aircrafts design yet it is not a blended wing. The only caveat I should have added is that it is not going to happen at once, there will be stages.

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  21. LOL…

    You ought to have included the usual caveats:

    • IF 5 kWh/kg energy storage can be made
    • IF the public can cope with <300 knot airspeed
    • IF the exothermic immolation of high-E batteries can be mitigated
    • IF total, rapid battery-swap “recharging” is implemented
    • IF the comprehensive support infrastructure is widely adopted
    • IF manufacturers are prevented from becoming monopoly protectionist

    Just saying,
    GoatGuy

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  22. It’s not a simple train system. It is very challenging. But even if it were simple, you are right. CA can’t build it. Too much corruption.

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  23. That $21 trillion figure was the DoD AND HUD both, from 1998 – 2015.

    Mexico and China can afford HSR construction because they aren’t morons spending $77 billion on it like California does.

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  24. Nope. More money is wasted on state and local than by the Feds. And within the federal government, there is HUD, Dep of Agriculture, DoE, DoT…ALL waste money.

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  25. Twitter banning? That is far more likely. They ban a lot more. Twitter does not matter. Less than 1% of my traffic. Twitter is for arguing and they have a lot more bias and censorship problems.

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  26. If “they” come for me and my nothing site, they would have come for many thousands of bigger targets. Yes, some bigger and more extreme things have had deplatforming and rank impairment. We would be well down the road to Stalin when my site and my talk gets hit.

    This logic is also, why if the military draft returned, and I got drafted, then I would definitely go. Why? If they are drafting the 50 year-olds then things have gone way down the road to hell. I would definitely want to be armed.

    If my site is being censored, then the problems will have gone way down the road to crazytown. Bigger problems have gotten out of control.

    Somewhat applicable quote from Apollo 13. I just like quoting Apollo 13 and Godfather. Its a thing.

    Jim Lovell:
    Now listen, there’s a thousand things that have to happen in order. We are on number eight. You’re talking about number six hundred and ninety-two.

    Jack Swigert:
    And in the meantime, I’m trying to tell you we’re coming in too fast. I think they know it, and I think that’s why we don’t have a God-damned reentry plan.

    Jim Lovell:
    That’s duly noted, thank you Jack.

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    1. Not that nasty
    2. I said why it is a legal and business problem for them to “fix” it in a crude way
    3. The article describes why it is bad for Google’s business model to follow twitter with more obvious banning. Although Youtube – part of Google did deplatform Infowars
    4. I am down at 10,000 for the USA and 40,000 for the world and I am in the neutral area for 26,000+ articles. Only a few dozen are remotely political. I am one tiny box in an Indiana Jones warehouse.
    5. Manual manipulation is too labor intensive and Yahoo like. uneconomic.
    6. Infowars was an exception but sites have to be really extreme
    7. Mechanics of a real problem – a few of my articles have to go viral. Even more than my deaths per twh articles. One had about 500,000 pageviews. It altered my site profile with search for a time. It would be banning if this or some articles with politics went viral and changed my algorithmic profiles. But if suddenly I was getting linked by many extreme sites then issues would arise. I do not think what I wrote has that kind of viral, too successful risk.
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  27. In a world where corporations pay no taxes, the defense department cant account for $22 Trillian dollars, the wealthy are given $3 trillian tax cut, and we spend a whaping $800 billion a year on war, $100 billion is an insignificant sum of money.

    We can either invest in the future our country or continue our tobbagan ride to 3rd world status.

    Mexico, and China can afford the cost of HSR construction, but the richest nation in the worl can’t. Are you insane? African nations with the GDP of Kansas are building high speed rail.

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  28. It’s a boondoggle plan and simple. Not sure why big government types seem to think the state is the be all end all to solving problems. Wishful thinking does not trump hard facts – no matter how much money you through at it.

    Here let me help out a wishful thinker with some hard facts. The cost for the train is estimated at 77 billion. So how long will it take to pay for itself? Let’s be optimistic and assume 30,000 riders per day (over optimistic – sure but we love wishful thinking). Let us also assume a profit of 10 dollars per ticket – after all ongoing expenses (of course it is government run so those operating expenses will be high based on how mismanaged AMTRAK is, but again wishful thinking). So how many days before this magical rail system pays for itself? 256,667 days or a mere 721 YEARS.

    WHAT A FANTASTIC SOLUTION FOR MONEY!

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  29. US people intrinsically hate trains, airline and oil companies even hate such environmentally friendly systems . why build rail?

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  30. “At $77 billion dollars, construction of a high speed rail system from San Francisco to Los Angeles and Anaheim is certainly an expensive project. But it will cost a fraction of what the state would have to spend to achieve the same level of mobility for a population expected to reach 50 million people by the year 2030. To move an equivalent number of people would cost $170 billion in new freeways and airport runway expansions in the Bay Area and Los Angeles, assuming those projects would have both the necessary public support and environmental clearance. And while others have said we should wait for newer technology, high speed rail is a safe, reliable and cost effective system of transportation, proven around the world.” –San Francisco Examiner

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  31. BTW no flame wars. I think you have value and can behave. Play nice and I whitelist you in a week. Then you only get put back out in the open if there are valid complaints. I authorized all comments except dupes and the stupid Luca picture

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  32. I have passed through and approved a lot of moderated comments. I think your problem is that you have enemies among commenters. Your comments get reported even if they were cleared by the software. Part of it is Luca creating new accounts from new IPs and then reporting your comments. Do not respond to him. Have some patience. I will get them cleared. Do not bother resending a comment. If your record is clean for a week or so I will whitelist you. This should enable your comments to not get caught. Do not post that annoying picture of Luca. We get it you hate him. He is banned and I am rebanning his new accounts. Obviously this happens to him all the time, so he can generate new accounts from new IPs.

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  33. The future for 100-2500 miles rang mass transportation lays in blended wing electric airliners which will cost 10 time less compared to today’s flight per mile per customer and don’t require a rail system. Pretty sure that taken the cost of infrastructure, they are cheaper than bullet trains and just as fast. We have the technology at our fingertip and they will be ready at about the same time that this project is going to be completed.

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  34. And, while we’re at it, reelect a fine anti-establishment lame duck when the time comes to it in 2 years. No (absolutely) harm will come from it, and moreover, if ever there were a formula for turbo-charging a real change-and-awe president, it’d be Trump as a second term winner.

    Please, please, please … let Hillary run again.
    Single digits, baby.
    Single digits.

    And an omnipotent lame duck president, who actually could change things up without kowtowing to the swamp critters.

    Just saying,
    GoatGuy

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  35. Yep.

    Yet … unless he has his political Nads chopped off, his radically centrist conservative ideas hold next to the only hope that our political system might see a renaissance.

    Just saying,
    GoatGuy

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  36. You expect too much from government when it comes to quality and competence.
    Governments are a reflection of the electorate, the education and competence of the critical core of the electorate has cratered over the last few decades.

    You cant expect poorly educated people with an aversion to evidence based decision making to make decisions that tend to lead to positive outcomes.

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  37. Brian, I’ve really got to ask. Are you afraid that Google will censor the blog if it says nasty things about them or their execs?

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  38. I’m referring to the big donors to the Democratic Party. Unless you’ve got a big secret that you’ve been holding back from us, that’s not you. By the way, if you have any polling data on this we’d all love to see it.

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  39. No odd at all.

    The goal of these big projects are the same as defense contracts: To spread the pork in the most cost-mismanaged way. Period.

    The actual stated goal to lie to the public about is far, far, far away on the bottom of the list.

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  40. However, I believe 90% of the commenters do not need repeats of old insults

    What ‘old insults’? I was talking about Google execs. So were others. Got nuked. Far as I could tell, there were no insults made by myself or others replying to me. It was all perfectly on target to the context of the article.

    Meanwhile, other articles have GauchoWhatever constantly trolling my replies. Yet, they get through.

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  41. That article is under strict automatic moderation. There is no benefit to having a toxic conversation. I have already indicated why nanotargeted retribution from Google makes no sense for their business model. However, I believe 90% of the commenters do not need repeats of old insults. I think it would more interesting for a more nuanced debate that does not veer off into the same fights. More creativity or debates about safe-AGI or non-biased AGI are more interesting. Your comments are being held in moderation. I think I will have time to go through all held comments sometime this weekend.

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  42. Btw, Brian:

    Why are all posts to Google is Negligent in Allowing Vandalization But Fixing It is Tricky and Dangerous being shucked automatically to moderation?

    Is it because you are afraid of anything them that might piss off Google and thus NBF search results are retaliated against?

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  43. Why would this piss off Californians? The vast majority of California’s public is not happy with this boondoggle. Only the crooked graft politicians milking this for all its worth are in the tank for this thing.

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  44. Well, if they piss off California then some of those that give them funding here likely will not do so or will only fund the most progressive of Democrats (NOT THEM.) California is a major source of funding for the Democrats.

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  45. She’s either an alcoholic or suffering from dementia. Have you seen the videos that CNN magically do not air — the ones that show her at some local union hall spitting out complete nonsense?

    But she seemed more normal lately. So I am guessing the booze theory is the more accurate one.

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  46. There will be the argument that the system is not in compliance with the terms of the $7.5 billion bond. 

    It ISN’T.

    BTW, THIS is why there is a HATE GOVERNMENT, DON’T GIVE THEM ANY MORE TAXES ‘right wing’ in this country, kiddies. I mean, even I have to concede that if the government spent that money competently so in order to actually deliver HIGH QUALITY public goods/services for the taxpayers’ money, there wouldn’t be this resistence.

    But government doesn’t deliver high quality goods/services. It delivers poor quality results that costs 7 – who-knows-what more than projected or what other nations shell out for comparatively HIGH QUALITY results.

    And most of these boondoggles happen in states government for some time by Democrats. FACT.

    Bay Bridge, Big Dig, Public Pensions, screwed up Obamacare and now this?

    And then you wonder why folks like me post wherever I can: starve the beast — no more money! ?

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  47. Isn’t it odd that CA boasts the most ridiculously expensive mass transit project in the country, and the most cost effective mass transit system ever attempted, at the same moment? If the BC gets close to cost, and digging speed goals, doesn’t have to buy/condemn right of way except where terminals reach the surface, and is immune to weather, both in terms of damage to the system, but bad weather making travel difficult. and dangerous, anyone building new highways, or rail lines should reconsider.

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  48. It always seemed like a feel-good giveaway to a select group of landowners and contractors. The French TGV is is not. If it made economic sense there was plenty of traditional transportation entities that would have tried over the years. The rise of the self driving car even lessens the value. This boondoggle gave birth to the hyper-loop idea, which is a good idea for connecting exurbs to cities (think of a 15 minute elevator ride) but is not comfortable enough for most for the 45 min LA <->SF trip (compare to plane – even out of awful LAX).

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  49. I think Pelosi and the Federal Democrats gain nothing by expending political capital for this. It is doomed. They already have California. Trying to get gifts to California costs them votes in actual contested states.

    Pelosi is corrupt but she is shrewd

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  50. There are some in California’s government who are hoping for a big Trump-Pelosi infrastructure deal to save them. Those people need to have blood tests for drug or alcohol abuse.

    Why? For holding that expectation for the deal or because those crooks have reason to hope for it? Logic dictates that all the wasted money in graft and patronage that has been spent and they hope will continue to be spent makes the latter to be quite logical for them.

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