Glaeser Goes Out With a Whimper

For those just tuning in, economist Ed Glaeser has been writing a four-part series on the potential costs and benefits of high-speed rail at the New York Times‘ Economix blog. He began three weeks ago with an introduction. The following week he addressed direct costs and benefits from a hypothetical line, and last week he attempted to gauge the environmental benefits of high-speed rail construction.

The whole of the analysis has been highly flawed (see my earlier criticisms here and here). It is overly simplistic, excludes important variables, and relies on faulty assumptions.

Glaeser has quite nearly admitted as much, arguing that he chose the hypothetical Dallas-Houston route — which is not in the administration’s plan for a high-speed network — in order "to avoid giving the impression that this
back-of-the-envelope calculation represents a complete evaluation of
any actual proposed route."

But it doesn’t take a close read to see that Glaeser wishes to demonstrate that rail investments do not make economic sense. He has not been particularly charitable in acknowledging the shortcomings of his work, and he has therefore left his readers with a very misleading picture of the probable outcome of construction of a high-speed rail system.

I have continued to hold out hope that he’ll improve his analysis along the way, but as of today we have the final chapter — on high-speed rail’s potential reshaping of the American economy — and it, too, is embarrassingly bad.

In his earlier posts, Glaeser did not take population growth into account — a rather large failing while analyzing a piece of infrastructure we can expect to last for decades. This time around he aims to defuse this criticism by writing:

These numbers suggest that costs will exceed benefits each year by $524
million if the rail line has 1.5 million customers, and by $401 million
if the region’s rail demand has a huge rate of growth and attracts
three million riders.

It’s worth recalling where those numbers come from. To arrive at 1.5 million, Glaeser took the current population of the Dallas and Houston metro areas and generated a ridership estimate using the population-to-ridership ratio for the Northeastern Corridor and then dividing by two (to take into account the lower density of the Texas cities).

Looking at the numbers that way, it becomes clear that you don’t need anything crazy to happen to get to three million riders. Take expected population growth and partial convergence toward rates of transit ridership seen in the Northeast (or in California, for that matter) and you get there in no time.

Why might rates of transit ridership increase? Both Dallas and Houston are rapidly adding to their transit networks. One might also take into account demographic changes and expected changes in energy and congestion costs, but Glaeser pretends these matters are of no importance and doesn’t bother to explain why he has opted to omit them from his analysis.

And as I mentioned before, Glaeser does a poor job estimating direct benefits to rail riders. Using a standard business airline fare and the time saved by flying rather than driving, one gets a more accurate picture of the value of a likely rider’s time. Using that more accurate figure, rail’s benefits roughly equal its costs even if one accepts Glaeser’s 1.5 million rider estimate.

Continuing, Glaeser says high-speed rail investments probably won’t make for good stimulus, given that construction wouldn’t take place quickly. As I’ve pointed out before, that’s all well and good if you believe that the American economy will be at full employment within a year or so. If you think, as Fed economists do, that full employment may not return for a decade or more, then the stimulus argument in favor of rail grows quite a bit stronger.

What about the potential for high-speed rail to revitalize struggling regions? Glaeser notes that there are good historical examples of infrastructure investment boosting regional economic fortunes, but, he says, these may not apply to the case of high-speed rail. Why not?

Well, because Buffalo is too far from New York to bring any significant competitive advantage over flying. And Philadelphia should be a beneficiary of the Acela, he says, but falling population in that city suggests that it isn’t.

There are many things wrong with this argumentation. One is that Glaeser’s own method for comparing rail versus flight times shows that rail from Buffalo to New York City still produces a nice time advantage. Take a 90 minute flight time, add the hour early one has to arrive at the airport and 36 minutes of travel time to and from airports, and you get a little over three hours for flying to two and a half for the train. That’s not nothing.

Glaeser also waves off the utility of a Toronto to Buffalo line based on the inconvenience of crossing the border, but flyers and drivers must also deal with a border delay, so it’s not clear why that’s a big deal.

Meanwhile, the blithe use of population change in Philadelphia as a proxy for economic benefit is a little silly. For one thing, it would seem to ignore actual trends. Since 2000, the rate of population decline in the city of Philadelphia has sharply diminished.

From 2000 to 2001, the city’s population declined by 15,000. From 2003 to 2004, by contrast, population fell by just over 7,000. And from 2007 to 2008, Philadelphia lost a mere 1,200 people.

Just using Glaeser’s fly-by-night statistical methods, it seems as though the introduction of the Acela has in fact materially slowed population decline in Philadelphia. And obviously there are other variables which show that Philadelphia has enjoyed a serious economic rebound over the last decade.

A bigger failure is that Glaeser doesn’t consider the value of bringing Buffalo closer together with other Midwestern metropolitan areas. The value of economic interactions between metropolitan economies is a function of the size of the urban economies and the distance between them.

Lowering the time and cost of intercity travel between struggling Midwestern cities should effectively allow those places to lever up the size of their metropolitan economies. Intercity commerce should increase, leading to improved economic conditions.

Glaeser next turns to whether rail investment might change land-use patterns within cities. He says that there is unlikely to be much in the way of a shift from suburb to city, citing this paper by Nathaniel Baum-Snow and Matthew Kahn.

They find that transit use declined from 1970 to 2000, largely due to suburbanization. Millions of people moved from places where there was transit to places where there wasn’t transit, and so transit’s share of trips declined.

What does this tell us about transit’s ability to guide land use? I suppose it says that the presence of transit can’t reverse a wave of depopulation driven forward by failing city finances, desegregation, urban riots, and so on. I suppose it says that if people are moving to suburbs and suburbs are overwhelmingly served by road infrastructure, then transit’s mode share will fall.

But what it also suggests is that land use isn’t simply an endogenous factor responding to changes in household tastes and wealth. Rather, it’s a function of deliberate government policy.

If one builds a transit system and surrounds the stations with parking, then no, transit will not do very much to shift land uses. If one builds a rail line between cities that do not allow dense, mixed-use development patterns, well then those patterns won’t emerge, it’s safe to say.

So an important question to ask is how land use patterns have shifted after construction of rail or transit, in places where governments have facilitated a shift. And I think there can be little question that the answer to such a question is very different than the one arrived at by Mr Baum-Snow and Mr Kahn.

This is also a message that has resonated with many city governments in recent years. Increasingly, changes in land-use are being specifically targeted as a potential benefit from new infrastructure construction. Governments are learning. Economists may not be.

At any rate, Glaeser reveals the extent of his short-sightedness by concluding (charitably, in his view) that rail might lead 100,000 suburbanites to move to the city in both Dallas and Houston, generating some $30 million in gains.

But this is all wrong. The question is not whether high-speed rail will lead some number of suburban residents to pick up and move to the city (although demographic shifts suggest that is likely to happen).

Dallas and Houston will each add a million or more people in the next two decades. America will probably grow by 130 million people between now and 2050. These people will, in all likelihood, live somewhere.

Where they live will be a function of the infrastructure that we build. I suspect that even Glaeser will agree that had the United States developed the Eisenhower high-speed rail network rather than the Eisenhower interstate highway system, our urban geography would be significantly different today.

If we build no new transportation capacity, then existing infrastructure will rapidly become choked, adding to the potential benefits to be had from building rail.

If we instead build new highway and airport capacity, then that will influence future development patterns and mode share. I challenge Glaeser to demonstrate that that future is greener and better off economically than one in which rail is built.

This is the principle shortcoming of Glaeser’s analysis — that it fails to take into consideration the alternatives.

I believe that increasing metropolitan congestion, rising energy costs, changing demographics, and new transit investments will generate a shift in housing and transportation preferences in coming decades. I think it’s wise to accommodate this shift by building high-speed rail.

Glaeser seems to believe that in coming decades congestion costs will cease rising; otherwise he’d build future increases into his model. He seems to think that the addition of over 100 million new Americans need not lead to any new infrastructure investment; otherwise he’d compare the economic benefits and life-cycle emissions of rail investments to alternative investment plans.

I think those beliefs are daft and indefensible. And four posts into his high-speed rail series, Glaeser hasn’t given any of us reason to think that his analysis is worth taking seriously.

  • How is it that a capable marginalist economist looses his capacity to engage in marginalist analysis when he is writing for the New York Times?

    Within the scope of a given system of supporting institutions, there are urban cores of sufficient density to support a substantial share of local public transport based on local origins and destinations. Beyond the margin of that core are areas in a low-share trap where the coverage and service frequency to maintain a higher mode share cost too much for the patronage it attracts.

    A HSR station out in the extra-marginal fringe will increase the destinations available to every local transport route connecting to that HSR station. The HSR station supported by new local transport routes to take advantage of the new destinations available via the HSR station is therefore not like a new suburban cul-de-sac, to be evaluated as the center of a small bedroom community of HSR commuters … it offers the opportunity to increase frequency and coverage of local transport between multiple TOD development opportunity sites all connected to the HSR station.

    And when you dig into it, the time distribution of the marginal increase in ridership given by an outer suburban HSR to local transport in that area is even better in terms of marginal revenue and marginal costs, as the morning peak demand for HSR commuting leads the local peak while the evening peak demand for HSR commuting trails the evening peak, spreading the footprint of high occupancy trips in the day, while the HSR also offers the prospect of additional off-peak patronage.

    For an outer suburban transit authority with one hour peaks and half hour shoulders and a 14 hour, 7am to 9pm service day, that is two hours of peak demand, two hours of shoulder, and ten hours of off-peak at low frequencies and load factor. An outer suburban HSR station could easily push that up to two hour peaks and hour long shoulders, for four hours of peak demand, four hours of shoulder, and of course higher load factors for off-peak services synchronized to through HSR stops.

    It may even be possible for an area with shift work to expand the service day to start before first shift and end after the end of second shift, with additional support from early train departures and late train arrivals.

    All of these are incremental response to the changing balance of travel costs and benefits with or without an HSR station in an outer suburban area.

    Yet Ed Glaeser, who I cannot believe for a second would subscribe to the proposition “people will be impervious to changes in the costs and benefits that face them when they make a transport choice” does, in fact, render his fictitious version of the Houston metro area and the Dallas / Fort Worth metroplex impervious, by the simple expedient of ignoring the marginal trade-offs in his analysis.

  • Danny

    Why are you so harsh on him? He is writing for the New York Times…not the Journal of Infrastructure Systems. His calculations are kept simple for a very good reason: Readership.

    If you want to debate minutiae (which your criticisms fall into), you should contact him directly, and who knows, he might actually respond to you. But trying to get him to explain every assumption he makes in a NYT blog is not reasonable.

  • Jason

    Great response to what have to conclude is an ideological hatchet piece against rail. Ed Glaeser’s motivation is clear. he is a conservative and conservatives don’t “do” transit – that’s for liberals and funny colored people. After reading his post in Economix I checked him out. Mr. Glaeser is a senior fellow at the Manhattan Institute. Yes that organization – the one opposed to health care reform and denies global warming.

    The problem is that you have ideologically driven experts who hide behind a science like economics to justify there biased world view. Our economic crisis was directly caused by free market ideologues opposed to any regulation or oversight – yet I’m sure many of them were highly educated,Ivy-league academics who also happened to be “senior fellows” somewhere as well.

    Look, I really want high speed rail to work and it seems completely justified in terms of economic benefits. However, if there were a persuasive non-ideological case to contradict that assumption then I’d back off. Can I be a “senior fellow” too? It doesn’t seem that hard.

  • Nick

    I never understood why conservative economists took a disliking to rail. Roads are completely subsidized. There’s no way to have a free market transportation network, because the ability to acquire right-of-ways is beyond any private organization in scale and legal power.

    Remember that any argument against rail will always ignore network benefits. The initiating costs of a new rail line will always be the highest compared to their payoffs. As more of the system gets built, the places you can go with it increase exponentially, along with the number of people connected by it.

  • Allan

    Glaeser clearly states where the 1.5 million passengers came from and it wasn’t nearly as complicated as you wrote here … “I estimated that if the rail link had the same ridership as all airlines now connecting the two cities (1.5 million), then annual costs would exceed the direct benefits to riders by $546 million.”

    Randy – “What about the potential for high-speed rail to revitalize struggling regions? Glaeser notes that there are good historical examples of infrastructure investment boosting regional economic fortunes, but, he says, these may not apply to the case of high-speed rail. Why not?”

    This is pretty simple. In the 1850s, the only competition that rail had was riverboats and stage coaches. Rail was clearly superior to these modes in most cases. Nowadays there are paved roads, interstates, cars, air travel … Even if HSR doubled or even tripled the number of people in the US using rail, it would still be insignificant in comparison to other modes of travel.

    Randy – “… had the United States developed the Eisenhower high-speed rail network rather than the Eisenhower interstate highway system, our urban geography would be significantly different today.”

    Wow, this statement shows a complete lack of knowledge of history. First of all, there were already trains running at 130 mph back in the heyday of passenger rail but that didn’t prevent people from switching to air travel and personal cars.

    Second, a national highway system already existed prior to the interstate system, so it isn’t like we weren’t already connected.

    Third, the interstate system was conceived and justified as a way for mass evacuation of cities during a time when there was a real possibility of a nuclear war being waged. Rail could not then nor now handle that amount of people.

    Fourth, the interstate system was completely funded by gas taxes. One of the biggest myths that I continuely see is that highways and interstates are subsidized. What the pro-rail folks often do, incorrectly, is lump the local roads with the highways and cry, “See! Roads are subsidized too!”

    Not only that, but money from the gas tax is siphoned off to subsidize transit. So one of the first reactions will be, “If the roads need a subsidy then let’s start by returning the money given to transit to the road fund.”

    Now, as for whether the gas tax covers the highways, I checked one of the more liberal states in the Union … Massachusetts. Here is a quote from their website about the MA Highway Fund: The Fund pays all transportation-related expenses, including debt service on bonds issued for transportation purposes. The fund finances highway maintenance and safety services and the state’s share of federally sponsored highway projects as required. http://transportation.blog.state.ma.us/blog/2009/02/current-gas-tax-where-does-it-go.html

    Hmmm, the Fund pays ALL transportation-related expenses …

    I know that TN has raided the Road Fund in the past to balance the state’s general budget. Earlier this year (’09), there were committee meetings to discuss how to spend the money in the Fund … nothing about a Fund shortage.

    Randy – “I believe that increasing metropolitan congestion, rising energy costs, changing demographics, and new transit investments will generate a shift in housing and transportation preferences in coming decades. I think it’s wise to accommodate this shift by building high-speed rail.”

    Technology is rapidly developing, some of it is already available, for intelligent vehicles and intelligent highways that could make a significant impact on congestion. Until then, simple things like coordinating traffic signals can make life a lot easier.

    I suspect by the time that any HSR line is built that hybrids and electric vehicles will dominate the auto scene and thus eliminating the perceived benefit of rail on energy usage.

    Finally, most people like having a house with a yard and not living in “high density” projects like rats. Oddly enough, it was the streetcar that began kicked off suburbia. Trying to shoehorn people back into the city and “high density” will fail miserably.

    HSR is an expensive boondoggle. If you want to go fast then build a maglev. Otherwise, you can get more bang for the buck by HPR (High Performance Rail … 90-100 mph) by upgrading current tracks. Let’s focus on building a national rail network rather than expensive HSR.

  • Martin Hunt

    “Glaeser also waves off the utility of a Toronto to Buffalo line based on the inconvenience of crossing the border, but flyers and drivers must also deal with a border delay, so it’s not clear why that’s a big deal.”

    European trains have been crossing borders with passport/custom checks for decades and it is no big deal.

    The Eurostar service which I often use between London-Paris, London-Brussels is far easier and convenient than the airlines were (almost no planes fly these routes anymore) and proves that international high speed services can work – even with immigration and custom checks.

    A New York – Buffalo – Toronto service should certainly be feasible and most likely a long term profitable project.

  • Allan

    Martin, the only reason that crossing border has become a big deal is due to Homeland Security. I have lots of Canadian (and European) friends and they hate crossing the border.

    NAFTA was supposed have moved us to more EU like situation but 9-11 killed that as far as people movement.

  • Allen: “HSR is an expensive boondoggle. If you want to go fast then build a maglev. Otherwise, you can get more bang for the buck by HPR (High Performance Rail … 90-100 mph) by upgrading current tracks. Let’s focus on building a national rail network rather than expensive HSR.

    Your argument requires redefining the meaning of “HSR” in the actual policy that these pieces are attacking.

    There is no 90-100mph tier. Upgraded level crossings allow the conventional mainline speed limit to be upgraded to 110mph. That is the Emerging HSR tier. Further upgrades and grade separations and signal upgrades (which limits the sharing of the track by existing heavy freight rail, and so normally requires building new track in existing ROW) allows the conventional mainline speed limit to be upgraded to the Regional HSR limit at 125mph. Above 125mph requires all in-cab signaling, superelevations incompatible with slower speed traffice and all grade separation, which allows the top tier Express HSR that can take full advantage of the latest bullet train technology of up to 220mph in present day service.

    Glaeser justified his selection of Dallas/Houston by reference to the tran-Missouri line and the Dallas/OK both in various stages of planning … but completely ignores that fact that neither of these are Express HSR corridors.

    And that is why his analysis is fundamentally dishonest. Either the potential ridership of Dallas/Houston is substantially higher than 1.5m, or else it would not have any serious hope of gaining funding as an Express HSR corridor and would have to be developed as an Emerging HSR or Regional HSR corridor.

    Given that the same kind of central cost estimate from his GAO source gives $8m/mile for an Emerging HSR corridor versus the $40m/mile for Express HSR, he is either massively inflating the capital cost of the project or massive understating the benefit. Its either a corridor with a potential ridership of far more than 1.5m, or else its a corridor that would be built at roughly 1/5 the cost.

  • Allan

    Bruce – “Glaeser justified his selection of Dallas/Houston by reference to the tran-Missouri line and the Dallas/OK both in various stages of planning … but completely ignores that fact that neither of these are Express HSR corridors.”

    He expressedly picked a hypothetical corridor. He even so stated. Nothing disingenious here.

    Current speed limits on most tracks are 79 mph even the trains are themselves are capable of going faster. This is a limitation due mainly to sigalling and grade crossings. I used to simply refer to 90-110 as “fast” but I have recently begun to see it referred to as HPR in order to distinguish it from “true HSR” which require new, grade-separated tracks as you mentioned.

    HSR is much more expensive than HPR. Thus the beginning of new terms whether it is “fast”, HPR, or “emerging HSR”, there needs to be another term in order to avoid the confusion of the associated costs.

    I’ll go back and read all of his articles to see if he too has fallen prey to the confusion.

    Regardless, I am aware of the difference in costs … which is why I favor HPR over HSR.

  • “He expressedly picked a hypothetical corridor. He even so stated. Nothing disingenious here.” And he explicitly makes it an Express HSR corridor. No room for ambiguity there, when he gives

    AND HE EXPLICITLY DEFENDS IT BY COMPARISON TO PROJECTS THAT ARE AT OR BELOW THE LEVEL OF EMERGING HSR CORRIDORS AND THEREFORE FACE NOTHING LIKE EXPRESS HSR COSTS.

    THAT is the disingenious step. THAT is where it stops being misleading by OMISSION and steps over the line into being misleading by COMMISSION.

    “I have recently begun to see it referred to as HPR in order to distinguish it from “true HSR” which require new, grade-separated tracks as you mentioned.”

    Clearly those are efforts to foster confusion about the present policy. “True HSR” is a term used to smear the 110mph and 125mph tiers by distracting attention from the question of whether they provide cost-efficient transport choices to whether they set speed records.

    “HPR” is a term previously used to refer to Emerging HSR and Regional HSR, before the Department of Transport clarified the confusion, and that would now be used primarily to confuse the issue and make people think that the current policy does not, in fact, provide support for these approached to provide the US with higher speed passenger rail service than it has today.

    Fundamentally, Ed Glaeser’s series is a critique of a hypothetical corridor that, if the hypotheses were correct, would never get funded as Express HSR, to be used to showing that “Express HSR costs too much”. That is, of course, either dishonest or uninformed, depending on whether Ed Glaeser is well aware that the current policy would only fund an Emerging HSR corridor at those levels of ridership.

    And that oversimplification, “Express HSR costs too much” is exactly how we see that Ed Glaeser’s analysis is intended to be used, as, for instance, in the last entry in Ed Morris’ companion HSR attack series.

    Regarding “prefering” one over the other, it is as silly to prefer Emerging HSR over Express HSR as it is to prefer Light Rail over Buses. The best one is the capital efficient solution to address the transport task at hand.

    For example, in the California case, the transport markets that are outside the core 100 mile to 300 mile transport markets of Emerging and Regional HSR and inside the core 200 mile to 500 mile transport markets of Express HSR includes the LA Basin to the Bay. And the capital cost of Emerging HSR corridors would not, in fact, be 1/5 as much, because there is still the problem of providing efficient alignments between both the Bay and the LA Basin and the Central Valley. With Express HSR costing perhaps twice as much, and with four times the ridership potential or more, and given the high cost of the alternative means of providing that inter-regional transport capacity, there is a very strong case for Express HSR.

    Similarly, with Ed Glaeser’s hypothetical alignment, it seems to be in an alternate version of Texas where there is no alternate alignment connecting Houston to College Station, Fort Hood and Temple while sharing half the capital cost of the corridor with a San Antonio / Austin to Dallas alignment – in an analysis that hinges on high capital costs and low ridership, he ignores the present effort that cuts the capital cost and boosts the ridership.

    But if the T-Bone alignment also falls short of the mark, that doesn’t prove anything in general about “HSR being too expensive”, it just proves that its not place for the most expensive tier of HSR.

  • Allen: “Fourth, the interstate system was completely funded by gas taxes.

    But not completely funded by gas taxes on gasoline used on the interstate system. Gas taxes paid for local driving cross-subsidizes Interstate, National, State, County and Township highway spending, and then state and local income and sales taxes fund the local roads for those cars to drive on.

    And that is just capital costs … free parking is often simply expropriated from property owners with minimum parking requirements, for a subsidy even larger than the subsidy to road maintenance. A substantial share of all policing costs are car related – auto theft, criminal driving – a share of emergency room capacity across the country is required to cope with auto accidents.

    And that is before getting to the external costs of oil dependency and CO2 emissions, none of which are reflected in the taxes on driving, since the gas taxes are not even sufficient to cover the roadworks portion of the capital costs of the motor transport system.

  • Allan

    BruceMcF – “But not completely funded by gas taxes on gasoline used on the interstate system. Gas taxes paid for local driving cross-subsidizes Interstate, National, State, County and Township highway spending, and then state and local income and sales taxes fund the local roads for those cars to drive on.”

    Huh? Let me see if I can straighten out and understand your argument. … “But not completely funded by gas taxes on gasoline used on the interstate system.” … This is a non sequitur argument since the interstate system didn’t exist and therefore could not be funded by “gas taxes on gasoline used on the interstate system.” Aside from that, gasoline used is fungible, therefore one cannot just tax the “gasoline used on the interstate system.” Thus, every gallon sold has a federal tax at a minimum and usually a state tax. There may be a local tax (not in my area). The money from the federal tax did indeed fund the construction of the interstate system.

    It is also incorrect to lump the funds for local streets in with funds for state highways and federal interstates. Different buckets. In my case, local streets are paid for by property taxes. Federal funds aren’t used unless it is part of a transit project so then federal gas taxes are used for mass transit and not roads.

    “… free parking is often simply expropriated from property owners with minimum parking requirements …” Are you talking about businesses? The only spaces forced onto businesses are those for handicap parking. A business usually wants lots of parking!

    “A substantial share of all policing costs are car related – auto theft, criminal driving …”

    As a former cop, I can say this is totally false. Unless it was a slow night, I did less than one traffic stop per hour. And you want to know why we did most of our traffic stops? Because it was the easist way to get the required entry on our log every hour. BTW, most of our arrests came from discovering an outstanding warrant on the driver.

    “And that is before getting to the external costs of oil dependency and CO2 emissions …”

    Since I am a hardcore AGW skeptic, CO2 emissions are not a factor. As for oil dependency, hybrids, PHEVs, and EVs will do more to end our dependency on foreign oil than trains or transit ever will.

  • Allan

    BruceMcF – “And he explicitly makes it an Express HSR corridor. No room for ambiguity there, when he gives

    AND HE EXPLICITLY DEFENDS IT BY COMPARISON TO PROJECTS THAT ARE AT OR BELOW THE LEVEL OF EMERGING HSR CORRIDORS AND THEREFORE FACE NOTHING LIKE EXPRESS HSR COSTS.”

    Again … huh? He clearly states it is a hypothetical route so as to “avoid giving the impression that this back-of-the-envelope calculation represents a complete evaluation of any actual proposed route.”

    He uses numbers from other existing or proposed routes in order to find numbers to use in his calculations for his hypothethical route. Nothing disingenious here.

    The way to refute his argument is to take the same process and apply it to an existing proposal to see if it make economic sense. I think that in most, not all, cases it won’t. In most cases … again, not all cases … you will get more bang for the buck by upgrading existing tracks to handle 90-100 mph trains.

  • Graham Katz

    To clarify (for Alan what BruceMcF is saying) It is true that the interstate highways were paid for out federal gasoline taxes. It is also true that only a fraction of auto travel is made on interstates (even today it is only about 25% – and of course it was nearly none when interstate construction was begun). Most cars drive most of their miles on local roads. But the vast majority of gas tax money (90% or so) goes to pay for highways. Local roads are paid for by local taxes, not gas taxes. So local drivers (most of us most of the time) ‘subsidize’ highway drivers (some of us some of the time).

    There are many points that can by made about these facts, but the one relevant here is this:

    Intercity passenger rail transportation was historically decimated by competition from cars and highways – partially because of the distortions of the above noted subsidy. While rail travelers paid the the full costs of the intercity trip in their ticket prices (including the cost of the rail), car drivers did not (or rather, they had already paid for the costs associated with building the highway out of the gas taxes they had paid on local trips). So any discussion of the economics of intercity rail travel (including HSR) has to take into account the implicit cross-subsidy that intercity auto traffic has.

  • garyg

    Graham Katz,

    So local drivers (most of us most of the time) ‘subsidize’ highway drivers (some of us some of the time).

    Please substantiate this claim with links to actual data.

  • Steven

    Allan,

    “One of the biggest myths that I continuely see is that highways and interstates are subsidized. What the pro-rail folks often do, incorrectly, is lump the local roads with the highways and cry, “See! Roads are subsidized too!”

    And why wouldn’t you lump the local roads with the highways? Interstates and highways would be completely useless without local roads to drive on once you get to the bottom of the offramp.

  • Jay

    “Fourth, the interstate system was completely funded by gas taxes. One of the biggest myths that I continuely see is that highways and interstates are subsidized.”

    If highways are completely funded by the gas tax, why is the Highway Trust Fund broke? $15 billion has been transferred from the General Fund to the Highway Trust Fund in the last two years alone.

    If you look at historical data on road spending you’ll see that over the last century between 20% and 70% of the total funds spent on automobile based transportation have come from property and income taxes.

    http://www.fhwa.dot.gov/ohim/summary95/section4.html

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Toward a Positive Argument for High-Speed Rail

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In recent weeks, I’ve been busily making what you might call a negative argument for high-speed rail — pointing out the many ways in which arguments against HSR are deficient. That’s all well and good, but positive cases for HSR need to be made, as well. Now, others have already begun to do this. California […]