California Leaders Call for HSR Funding to Create Jobs

This is a welcome letter:

In an effort to deal with California's spiraling unemployment rate, Gov. Schwarzenegger and the state's two senators, Barbara Boxer and Dianne Feinstein, sent a letter Monday to President Obama urging funding of the state's high-speed rail project and improvements in its intercity rail service.

They urged Obama to fund the projects through federal stimulus funds, the $787 billion American Recovery and Reinvestment Act.

"With unemployment in California reaching 12.5 percent – the highest unemployment rate in nearly 70 years – the impact of providing 130,000 construction-related jobs statewide cannot be understated," the letter said.

As talk ramps up of a "second stimulus" in the form of a job creation bill, and as the jobs crisis continues to worsen, high speed rail funding becomes all that much more important to California and the nation's economic recovery. California simply cannot have recovery without jobs in sustainable infrastructure, and we aren't going to have a long-lasting recovery if we don't start moving away from oil dependence. And the nation as a whole cannot have meaningful economic recovery if California, a major part of the national economy, is lagging behind and mired in high unemployment.

Given that over $50 billion in HSR funding applications were submitted to the FRA for only $8 billion in available funds - all of it for projects meeting the federal guidelines of being "shovel ready" by September 2012 - the Obama Administration and the Congress ought to strongly consider fully funding every HSR application as part of its job creation efforts. There's no reason states should be fighting against each other for that money, since many of the states applying have significant job creation needs of their own.

UPDATE: The complete letter:

November 23, 2009

The President
The White House
Washington, DC 20500

Dear Mr. President,

We write in strong support of California’s applications for high-speed and intercity rail funding through the American Recovery and Reinvestment Act (ARRA). California has led the nation in its commitment to creating a statewide high-speed rail system.

Our state has been a leader and innovator in addressing environmental and transportation challenges on a national level. Last November, California voters approved nearly $9 billion in state bonds for high-speed rail construction, far outpacing other states’ efforts to secure local and state funding for these projects. California has completed design and planning for the nearly 800-mile system and made significant progress on the environmental review, making our state uniquely qualified to employ federal funding quickly.

California’s high-speed rail applications have broad support across the state, with backing from leading business, environmental and labor leaders. The California Chamber of Commerce, the Labor Federation of California and the Sierra Club have all endorsed California’s applications for funding. The success of California’s high-speed rail system is enormously important to our state. High-speed rail will help ease congestion and improve air quality. With unemployment in California reaching 12.5 percent – the highest unemployment rate in nearly 70 years – the impact of providing 130,000 construction-related jobs statewide cannot be understated.

We appreciate your attention to the needs of California and thank you for your commitment to this important issue. We stand ready to work with your administration in the coming years to ensure that high-speed rail has the resources necessary to continue to be a national priority.

Sincerely,

Barbara Boxer
Dianne Feinstein
Arnold Schwarzenegger

Good framing, good letter. Kudos to all three for writing this.

Deal for LA Rail Car Factory Falls Through

by Rafael

AnsaldoBreda is an Italian manufacturer of passenger rolling stock, with a portfolio covering light rail, subways, standard speed and high speed products. SPCR radio reports that the company has walked away from a $300 million order for 100 light rail cars for Los Angeles MTA. In spite of earlier assurances, in the end the Italians were not willing to sign up to stiff penalties in the event of late delivery. It is now likely that the authority will have to execute an open tender process after all, which in the long run may well prove the best possible outcome.

What's Past is Prologue

In 2003, LAMTA awarded AnsaldoBreda a contract to build a new fleet of 50 model P2550 light rail cars with options for 2 x 50 more, in spite of delivery delays on two previous contracts. Evidently, third time is not the charm, as the company is late yet again - by three years, no less. The units already delivered are almost 6,000 lbs overweight, which means they cannot be used on certain lines.

Nevertheless, Mayor Villaraigosa pressed for these options to be exercised in a no-bid follow-on contract, with the understanding that the company set up a factory in LA and also move its corporate headquarters there. An LAEDC report dated March 2009 confidently forecast 535 manufacturing jobs and summarized that "in total, AnsaldoBreda will sustain continuing economic activity worth $368.5 million in economic output and 2,240 FTE jobs in Los Angeles County with estimated annual earnings of $91.1 million." Rumor has it the factory was to be built by an outfit headed up by the former chief deputy mayor.

Critics point out that this level of fresh employment could only be sustained with an annual output of 75 units, which would require additional orders from other US transit agencies. However, in addition its history with LAMTA, the manufacturer is now also several years late on unrelated orders from Denmark and the Benelux. The latter are for V250 "Albatross" high speed trainsets. Nomen est omen, though in all fairness the latter project has been hamstrung by factors beyond the company's control. Given AnsaldoBreda's global track record of missed deadlines, LAEDC's implied forecast that it would become a major player in the US rail car manufacturing industry was perhaps more pious hope than realistic expectation. After all, the company's assembly plant in Pittsburg never grew to the originally intended size, either.

Note that the deal that just fell through would have been ineligible for federal co-funding because the current surface transportation bill contains a five-year deadline for exercising options on existing contracts.

Plan B: Go Fish

With the passage of Measure R last year, LAMTA's needs have anyhow expanded to a total of around 200 cars for both subway and light rail in addition to refurbishment of the existing fleet. The increased size of the deal means the authority now has a much better chance of attracting bids from major players in the rail transit vehicle industry, some of whom also have high speed trains in their portfolio. Names mentioned in the radio interview: Siemens Mobility, Bombardier Transportation and Kinkisharyo, though this list was not meant to be exhaustive.

In principle, a fresh order would be eligible for federal co-funding in the context of even the current surface transportation bill, though that is already being extended for 90 days at a time because the Obama administration has decided to postpone discussion of the next one. Whichever bill would apply, there are long-standing FTA rules against federal co-funding if a tender process is skewed in favor of bidders who offer to set up a local manufacturing facility. Nevertheless, in order to help the Mayor save face, LAMTA intends to write just such a skew into the rules for the upcoming tender. That means sticking with the strictly local funding model in the (forlorn?) hope that USDOT will redirect its generosity to other component projects of Measure R so it ends up a wash.

For reference, Siemens Mobility already has a light rail assembly plant in Sacramento. Bombardier Transportation has rail maintenance facilities in Southern California and is also present other US states. Patentes Talgo S.A. is present in Washington state and is setting up a factory in Wisconsin.

Potential Implications for California HSR

While LAMTA has no formal authority whatsoever over vendor selection for the California HSR project, Los Angeles does wield significant clout in Sacramento. Don't be surprised if Mayor Villaraigosa attempts to sweeten the pot by dropping heavy hints regarding possible follow-on business from CHSRA to encourage bidders to set up shop in his city.

Like it or not, industrial policy - i.e. manufacturing job creation/retention - has been a factor in vendor selection in many HSR projects all over the world, especially for the prestigious initial order. I suspect CHSRA's role in vendor selection may therefore end up limited to the technical and commercial pre-qualification of a shortlist, though neither the Governor nor the legislature have said so publicly.

New Pro-HSR Group Forms on Peninsula

As reported in the SF Business Times on Friday (subscription req'd for whole article) a new pro-HSR group has been formed on the Peninsula. The Alliance for Sustainable Transit and Jobs is comprised of some of the Bay Area's heaviest hitters, including representatives of the largest businesses in the region. They don't yet have a website, but that doesn't really matter right now; these groups have already been very active behind the scenes in lobbying for high speed rail, and their coming together as a formal organization portends much greater public visibility. From the article:

Countering critics of high-speed rail along the Peninsula, business and labor groups have banded together to support the approximately $8 billion section between San Francisco and San Jose.

The Alliance for Sustainable Transit and Jobs “was formed in response to recent community outbursts regarding the high-speed rail route through the Peninsula cities and the forthcoming lawsuits, political posturing and other blocking maneuvers,” according to a flyer promoting the group, which will be based in the Belmont offices of the San Mateo County Economic Development Association.

In addition to SAMCEDA, business groups in the alliance include the San Francisco Chamber of Commerce, Bay Area Council, Silicon Valley Leadership Group and the chambers in San Mateo and Redwood City. Labor groups in San Francisco, Santa Clara County and San Mateo County are members.

“We’re coming from the point of view of what (high-speed rail) might bring to the Peninsula” in terms of jobs and other economic boosts, said Rosanne Foust, a SAMCEDA vice president and Redwood City mayor.

The Bay Area Council is of particular importance here. 60 years ago they came together to promote regional mobility in the wake of the transportation crisis the World War II boom created; out of their early proposals came the system we know as BART. While they didn't design the system itself, they helped get it launched and built, and look to do the same with HSR. Their member list reads like a who's who of Bay Area businesses, including companies like Chevron and Google; their executive committee includes representatives from Wells Fargo, Clorox, Bank of America, even Janet Yellin, president of the San Francisco Federal Reserve Bank. Similarly, the Silicon Valley Leadership Group includes similar (and even some of the same) companies, as does the SF Chamber of Commerce. Clearly, this is a serious effort to promote high speed rail and counter the distortions and NIMBY attacks on HSR on the Peninsula.

Of course, it's not the case that just because a bunch of large corporations say HSR is a good thing, we should just do as they say. In this case, though, the interests of the Bay Area's largest employers match those of working people and families living in the Bay Area and on the Peninsula, clear majorities of whom showed their own support for HSR by voting for Prop 1A last fall.

Having talked with some BAC staff about HSR, they made it clear that for their member companies, sustainable transportation is a very high priority. California is in a severe economic crisis, part of a global recession. When the global economy recovers, multinational corporations will look for places to invest. And it won't necessarily be California, especially if we are burdened with a transportation system that gets gridlocked during times of growth and is dependent on oil, a commodity whose costs are definitely going rise. Those companies want to invest in the Bay Area, but are saying that high speed rail needs to be part of the equation, part of the recovery, if they are going to make long-term plans for the region.

Again, there's nothing to say that the Bay Area should do something just because their largest employers recommend it. But that does place the burden on HSR deniers and NIMBYs to explain to people - especially people on the Peninsula, many of whom depend on the companies represented by the organizations that have formed this new pro-HSR group - where jobs and economic growth are going to come from without high speed trains. The answer is likely to be an assumption that the conditions of the late 20th century will just somehow magically continue indefinitely into the future, and that answer will likely not mention that the current economic crisis was caused by an overreliance on late 20th century sources of growth (sprawl, oil, finance capitalism).

Most Peninsula NIMBYs are those who were the "winners" of the late 20th century economy, those who own property near the tracks and prefer to maintain that asset value at the expense of the economic prosperity of others. Presumably they don't think they have any need of HSR, such is their economic security, but since HSR might possibly in some alternate universe threaten their property values, they're going to fight it tooth and nail. Even if that causes long-term economic distress for the region.

Even those who might not want California's 21st century economy to be dominated by a handful of large corporations can find value in high speed rail. HSR will create a green dividend that makes capital available for new entrepreneurial ventures by reducing spending on oil-based transportation. The hundreds of thousands of jobs HSR will create will produce more buyers of local businesses' products, more tax money for local governments to improve quality of life, and the trains themselves will enable Peninsula residents to have a broader spectrum of job opportunities and mobility that a 21st century economy requires.

In short, HSR offers opportunities for businesses big and small, for workers young and old, for cities along the tracks and those that aren't. The Alliance for Sustainable Transit and Jobs, along with truly grassroots groups like Californians for High Speed Rail, will help give voice to those on the Peninsula who so far have been drowned out or ignored by the loud but few NIMBYs.

Two Very Different Op-Eds

This week the debate over high speed rail - which, bizarrely, we're still having even after California voters approved Prop 1A a year ago - returns to the opinion pages of two of California's most prominent newspapers. Two op-eds examine the project and reach very different conclusions about the project's value to the state. First up is Daniel Curtin, president of the California Conference of Carpenters, writing in the San Francisco Chronicle:

California voters know we must change to meet the environmental challenges we face. They realize that every passenger who travels these sleek trains will reduce greenhouse-gas emissions that auto or air travel would have spewed into the atmosphere. They know that 800 miles of high-speed rail will reduce congestion between urban centers and encourage low-polluting urban in-fill development....

On high-speed rail, California leads the nation and San Francisco leads the state. An intermodal transit station, the Transbay Transit Center, is ready to break ground. Some 8,000 construction jobs will be directly created by the project and tens of thousands of jobs will be generated from the economic activity, according to plan documents. In a state with more than 12 percent unemployment and a city with just more than 10 percent of its workforce out of work, this will provide a desperately needed economic stimulus...

Just as the New Deal-inspired Oakland-San Francisco Bay Bridge served as an economic bridge from the Great Depression to a prosperous future, so will the Transbay Transit Center and high-speed rail be our generation's transportation corridor from economic adversity to a greener, more prosperous future.

There are two ways one can read this op-ed, and they are not mutually exclusive. The first is as a call to support the economic stimulus value of high speed rail. In this deep recession, where California's unemployment rate is higher than it's been for 60 years, we can use any job we can get. Especially 8,000 construction jobs on just the TBT alone.

And that takes us to the second reading of the op-ed, which is as an argument for the Transbay Terminal project as being a fundamental piece of the high speed rail project. Quentin Kopp is still pushing alternatives to the current location of the TBT train box, and we keep hearing rumors that Kopp doesn't want the TBT to happen at all (rumors which he has denied to me). As the decision on HSR stimulus funds nears, it makes sense for TBT supporters to push out op-eds like this extolling the virtues of the project, including the badly needed jobs it would create.

Not everyone things jobs are important in a state experiencing at least a 12.2% unemployment rate. Dan Walters, who writes on state politics at the Sacramento Bee, writes today that we should "take bullet train claims with a grain of salt". As you'll see, it's Walters' column that requires the salt:

Ironically – or perhaps prophetically – the California High Speed Rail Authority's Web site bolsters the economic viability of a proposed statewide bullet train system by quoting an official of Lehman Brothers....

If nothing else, the fact that the rail authority is still quoting defunct and disgraced Lehman Brothers about financing the bullet train should make us skeptical that the system will materialize during the lifetime of any Californian now breathing, or that it would generate all the economic and social wonderfulness its advocates are claiming.

This is a ridiculous and misleading line of attack. If Lehman Brothers had collapsed because of its work supporting high speed rail, then Walters might have a point. But it didn't. As Andrew Ross Sorkin at the New York Times explained yesterday, Lehman's collapse was due to a CEO, Dick Fuld, who wasn't skilled at negotiating these kind of deals, and due to the Bush Administration's willingness to let Lehman fail.

None of that undermines the work Lehman staff did on high speed rail. Specifically, Lehman told the CHSRA that the project could "leverage significant private participation." There is every reason to believe this is still the case. Global money still seeks a safe return on investment, and as the CHSRA found in 2008 when they solicited statements of interest, at least 40 companies showed their desire to participate in the project.

The case for private investment remains solid. Every HSR route around the world has generated an operating profit. As oil prices rise, ridership will as well, as SNCF argued last month. Obviously the exact amount of money CHSRA can expect from the private sector will depend on credit and economic conditions, but it is still reasonable and plausible to expect that some investment will materialize.

Walters doesn't stop there:

Such skepticism is especially warranted now that Gov. Arnold Schwarzenegger and other promoters, having persuaded voters to pass a $9.95 billion bond issue that California can ill afford, are asking the Obama administration for half of the federal money set aside for high-speed rail – nearly $5 billion.

Even if the feds come through with that kind of dough, which is highly unlikely, it would be less than half of the federal funds that California needs. It would also fall well short of the $40 billion or more it would take to link San Diego, Los Angeles, San Francisco, Sacramento and points in between with 200-mph trains.

This is just plain wrong. The White House has repeatedly said California will receive a large share of the HSR stimulus funds. It is entirely possible we will indeed receive nearly $5 billion from the feds. Even $3 billion would be a substantial sum.

Does it fall well short of the $40 billion total to build both phase 1 and 2 of the project? (Note how Walters throws in the Sacramento and SD extensions, which will not be built until about 2030, to make HSR seem more costly.) Yes. And that's why President Obama and the Congress are looking at long-term funding of HSR. Right now there is the battle over the $4 billion in HSR funding for 2010 going on in the US Senate. The stalled Transportation Bill is likely to include a permanent HSR funding solution once it is finally passed and signed. Walters doesn't give the reader any of this information, which makes it obvious that CA is quite likely to get the federal money it needs to build the project.

Schwarzenegger et al. are asserting that private investors would put up about half of the total cost. They also contend that the system could operate at a profit without subsidies, based on rosy ridership assumptions.

Well, if that's what Arnold is claiming, Arnold is indeed wrong. I've never heard CHSRA suggest private investors would contribute more than 25% of the cost.

As to operating at a profit, here again Walters is simply wrong. The Acela generates operating surpluses, as do all other HSR projects around the world. And of course, neither California's freeways nor its airports operate at a profit without subsidies (and in fact, freeways aren't expected to operate at a profit, period).

Then there are the assumed economic benefits that would accrue. Building the system obviously would create some direct design and construction jobs and at least some ongoing jobs for operation. But the rail authority has bootstrapped that direct benefit into upward of a half-million additional jobs that would be created, it's said, simply by the economic activity generated by having a new transportation system in place.

The "economic activity" claim is a projection subject to quite a lot of change up or down in the future, but it IS based on legitimate studies. Further, it is based on the proven concept that mass transit creates a Green Dividend - economic activity generated through the reallocation of money previously spent on oil. It may not be as high as 450,000. But at this rate, in a state facing high unemployment for many years to come, even something that falls 50% of that goal is still well worth building.

Grandiosely, authority board member Rod Diridon Sr. of San Jose contends that the project "will generate 600,000 construction-related jobs … and another 450,000 transportation-related permanent jobs, providing a long-term stimulus to the California economy."

The claim appears to be way overblown. But even if true, it would represent a tiny portion of California's economy decades hence. There are about 18 million Californians in the work force now. In 2030, when the bullet train is projected to become operational, 450,000 permanent jobs would represent less than 2 percent of needed employment – if, indeed, they ever appear.

Walters doesn't give any evidence or explanation as to why the claim is "way overblown" - meaning Walters' own statement is baseless. But even if he were right, does he really believe California can afford to pass on even 2% of needed employment? Walters is writing as if it were 1998, when the economy was booming and jobs were plentiful. Here in 2009, it's clear that we are not in a position to turn down jobs like this, especially when the estimates run into the hundreds of thousands for both short-term and long-term employment.

Ultimately Dan Walters shows himself to once again be a leading apostle of the notion that the California of the 20th century, dependent on sprawl and oil, is somehow still a viable basis for economic prosperity here in the 21st century. To believe that, you have to believe that the current recession either isn't happening, or is an acceptable cost of doing business. Most Californians don't see it that way. That's why they approved the high speed rail project, and that's why it's going to get built.

California's going to get those jobs, whether Dan Walters wants them or not.

LA Times: Put CA First In Line for HSR Stimulus Funds

There seems to be a growing consensus that when it comes to doling out federal HSR stimulus money, California should get the lion's share. Earlier this summer The Business Insider suggested CA get "all" the HSR funds, arguing that if the money was spread too thin, nothing would actually get built and we thus wouldn't have much to show for the stimulus spending, whereas giving it "all" to California would help produce an actual bullet train.

Now the state's largest newspaper has joined in the "give it to California" chorus, with this editorial in today's LA Times:

Last November, voters passed a bond measure(2008) approving $9.95 billion to fund a high-speed train line from San Diego to Sacramento. They couldn't have known it then, but the timing was fortuitous. Months later, as part of the stimulus package, Congress dedicated $8 billion to pay for high-speed rail projects across the country. California is the only state where voters have already approved funding for a bullet train, and it has the most state-of-the-art proposal, with the most planning work completed, in the nation. Because the funding is meant to stimulate the economy as quickly as possible, officials at the Federal Railroad Administration are expected to give priority to applicants that can start hammering rail spikes soon. So when the California High-Speed Rail Authority submitted its application on Friday, it had powerful arguments on its side.

First off, I am really pleased to see the Times connecting the Yes vote on Prop 1A to economic stimulus. This blog repeatedly framed Prop 1A in precisely those terms last fall, and it is one of the chief reasons for building high speed rail. While we can and should debate the best way to build that train, we cannot let ourselves forget the broader context - an economy in tatters, with even former Fed chair Alan Greenspan, chief architect of the wrecked economy, predicting 10% unemployment before much longer. California desperately needs jobs, and HSR is a damn good way to provide it.

The Times goes on:

The authority is applying for $4.7 billion of the $8-billion federal pot, yet there will be heavy political pressure to spread the money across a broad geographical region rather than giving so much to a single state. Even so, there are strong reasons to award California an outsized share.

It is undeniably parochial for The Times to argue that Washington should send tax money to California for a project that would boost the local economy. But nobody has to take our word that the Golden State should be first in line. In addition to the timing considerations, there is the important matter of ridership -- for the rail program to be successful, it should focus on projects that can move the most people. America 2050, a Washington-based public planning think tank, studied regions with the highest potential ridership for high-speed rail, ranking them by city pairs (routes between two cities). A line connecting New York and Washington was ranked the highest, but three of the top 10 city pairs would be connected by California's bullet train, including L.A. to San Francisco, San Diego and San Jose. If federal officials want the most bang for their stimulus buck, they should look west.

Actually, I don't think it is parochial at all. California is 1/10th of the nation's population, and is responsible for 13% of its GDP. We are a major part of the national, even the global economy. If California does not have an economic recovery, neither will the nation as a whole.

And one reason for California's crisis is, as the Observer noted in a long article today, a fatal dependence on sprawl. For California to have a truly lasting economy recovery, we will need to provide transportation solutions that encourage urban density, reduce dependence on oil, and provide a Green Dividend (economic growth through reallocation of money previously spent on oil).

In short, if the US is going to have economic growth in the coming decade, California must have growth and recovery. And if California is going to have growth and recovery, California needs to build high speed rail to reshape the way we move people around, and how we pay for doing so.

So if anything, the LA Times editorial, while generally excellent and welcome, is actually understating the case. California ought to expect to get much of the federal HSR stimulus - not just for our own sake, but for the nation's sake as well.

From Russia With Love

Is California's high speed rail future on display in Russia? According to Siemens and the New York Times the answer just might be "yes":

Siemens’s new train — the Sapsan, Russian for peregrine falcon — is a candidate for the high-speed link planned between San Francisco and Los Angeles that may open in 2020. Alstom, the maker of the French TGV trains, and Bombardier are also contenders. Japanese bullet train designs by Hitachi, which are lighter but less secure in a low-speed crash, the only type of collisions survivable, are another option.

The technological breakthrough of the Sapsan is that the train has no locomotive. Instead, electric motors are attached to wheels all along the train cars, as on some subway trains. (Passengers sit in the first car too.) Its top operating speed is 217 miles an hour, though in tests this model has reached 255 miles an hour, or about half the cruising speed of some jet airplanes.

For now, though the Sapsan will only be traveling at about 150mph over Russia's dilapidated rails.

Siemens is aggressively pursuing the US market, particularly us Californians:

The United States “is a developing country in terms of rail,” Ansgar Brockmeyer, head of public transit business for Siemens, said in an interview aboard the Russian test train, as wooden country homes and birch forests flickered by outside the window. “We are seeing it as a huge opportunity.”

To position itself to compete in the United States, Siemens has placed employees from its high-speed train division at its Sacramento factory, which produces city trams.

California desperately needs jobs like those that would be created building high speed trainsets in Sacramento. Opponents of HSR argue that the risk of a "boondoggle" is greater than the value of the jobs that would be created - 160,000 for the construction of the project, and 450,000 ongoing jobs, according to CHSRA estimates. I have a very difficult time believing that to be the case, especially when California faces the highest unemployment since the end of World War II.

But back to Russia (for a moment). Jaunted, a "pop culture travel blog," wondered if this was a case of "the space race race moving to the rails." It would be nice if we could move past Cold War metaphors when comparing the US to Russia, but clearly the space race was an iconic era in the 20th century, where international rivalry produced major human accomplishments that might not otherwise have gotten done. And as much as I support space exploration, it is undeniable that HSR provides more immediate and tangible benefits than putting a man on the moon.

What really matters is that nations like Russia, Poland and others are recognizing that having a high speed rail network is essential to their future economic prosperity. The US is not immune, despite what those who refuse to admit that the transportation models of the 20th century no longer work would have us believe.

I don't have any plans to be in Russia anytime soon, but if I did, I'd take time to ride the Sapsan.

Labor Day Open Thread

In keeping with the spirit of the holiday, it's worth keeping in mind that HSR in California is projected to create 160,000 construction jobs and 450,000 permanent jobs. Even if you quibble with the numbers, it's worth considering that California desperately needs new jobs, and anything that can produce long-term sustainable growth and employment should be embraced. The current recession has reversed all the job gains of the 2000s - fewer people are employed in California in July 2009 than in January 2000, which is an even more worrisome stat when you consider that we have 3 million more people living here than we did at the beginning of the decade.

Job creation has to be one of the state's top priorities. The best kind of jobs program during a severe economic contraction is exactly what we did during the Great Depression - put people to work building long-term infrastructure. In the 1930s that meant dams and bridges. In the 2000s and 2010s that will mean, among other things, high speed rail.

This isn't going to be cheap. But does anyone have a better idea of how to create jobs? Or are we just going to give up and not try to produce economic recovery at all, just wallow in misery and refuse to undertake proven efforts to address the problem? Especially given that almost all observers expect unemployment to remain high for some time, it is vital that we use government to create as many jobs as possible. The up-front costs are sizable, but they will be repaid many times over during the rest of the century, and as I've repeatedly pointed out, it's a lot cheaper than doing nothing.

Glaeser's Final HSR Attack - For Now

Edward Glaeser published the fourth and final entry in his anti-HSR series at the New York Times' Economix Blog. Glaeser suggests he will come back to the topic before long, to address the criticism of his flawed use of a Dallas-Houston HSR line (which, although being planned by Texas is not one of the current federal HSR corridors). In this entry, Glaeser chose to attack the argument that HSR would help spur greater urban density and limit sprawl:

A third possible benefit of rail is environmental. Can high-speed rail bring people closer to city centers and thereby reduce carbon emissions?

My work with Matthew Kahn on the greenness of cities suggests that each household that moves from Houston suburbs to the central city reduces carbon emissions and creates $164 of global-warming-related benefits each year. Each household that switches from suburb to city in Dallas creates $133 of benefits annually. Those benefits represent both reduced electricity usage (associated with smaller urban homes) and reduced driving.

But there is little evidence documenting that rail has strong positive effects on land use.

Glaeser, however, doesn't actually explain this supposed lack of evidence. His examples, MARTA in Atlanta and BART here in California, are limited. Glaeser says BART has had some positive effect on density, but "the effects are still modest." What Glaeser doesn't understand is that the Bay Area has a series of anti-density zoning rules in the most dense and favorable areas near BART stations - as anyone who's witnessed the battles in Berkeley over downtown development can tell you. Without those restrictions we might well have seen much more TOD along the BART corridor.

Of greater absurdity is Glaeser's lame attempt to argue that HSR wouldn't cause urban growth by looking at Eastern cities, making claims that are unsupported by the evidence:

Philadelphia is the more natural beneficiary of high-speed rail access to Manhattan; there are already people who live in Philadelphia and commute to New York. Yet even in this most propitious setting, the coming of Acela seems to have had little impact on the population decline of Philadelphia or growth of Wilmington. Perhaps the absence of any trend break in population growth around 2000 just reflects the incremental nature of the Acela investment, but there is little here to bring confidence that rail lines revitalize cities.

Ryan Avent continues his thorough demolition of Glaeser's arguments, including a refutation of the above nonsense:

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.

The rest of Avent's post is worth reading in its entirety. Avent closes with a point that is worth remembering for the inevitable moments when we see Glaeser's work repeated:

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.

And that is the core problem with Glaeser's approach. He didn't consider the alternative costs, including the cost of doing nothing. He did not assess the benefits of the jobs HSR will create, or the role of the trains in creating new transportation patterns that can enable new kinds of economic growth over many decades. Glaeser's posts consistently and arbitrarily used a set of factors that gave readers a limited and incomplete sense of how HSR will actually play out in context. It would be nice if the NYT would give space to someone like Ryan Avent who can explain the benefits of HSR with respect to the evidence. Apparently that's too much to ask.

What's Up At The New York Times?

That's the question Ryan Avent is asking in the wake of the Times' blog attacks on HSR:

The New York Times has now turned loose writers at two of its economics blogs to make weak arguments against the construction of high-speed rail lines.

I have been following Ed Glaeser's attempt to do a back-of-the-envelope assessment of the costs and benefits of a hypothetical rail line (catch up here and here). Now, Freakonomics' Eric Morris seems to want to get in on the act, via a lame post comparing the effects of high-speed rail with the fruits of "cash for clunkers."

Let me just begin by pointing out how utterly ridiculous this comparison is. The Obama administration's vision for high-speed rail essentially involves a multi-decade effort to significantly upgrade transportation infrastructure along several of the country's most economically important metropolitan corridors.

"Cash for clunkers," on the other hand, is a $3 billion, roughly two-month program of automobile purchase incentives.

Avent goes on to explain his quite sound reasoning as to why it is totally absurd to compare these two programs. "Cash for clunkers" is a program that is designed to produce immediate economic stimulus through the sales of a few thousand cars, offering the possibility of some extremely minor environmental benefits. HSR is a long-term restructuring of intercity and interregional passenger transportation, a permanent piece of infrastructure whose benefits will be with us for many decades to come - just as the Golden Gate Bridge and Shasta Dam are still providing us with economic activity 70 years later.

Both programs are valuable, but for utterly different reasons. To compare them is to confuse them - and to confuse the reader.

Avent also pointed out that both Glaeser and Morris's anti-HSR work consistently downplays the impact of global warming on the US economy:

I'm led by this to believe that Morris does not actually understand how global warming works -- that it is due to the slow accumulation of greenhouse gases in the atmosphere over time. The only way we'll ever feel any greenhouse savings from any policy is over a considerable amount of time, which is why wonks discuss carbon reductions in terms of what we might be able to accomplish by 2020 or 2050.

Does Morris think that next year will be cooler thanks to "cash for clunkers"? I certainly hope not.

What Avent is identifying here is that these two economists, Glaeser and Morris, are not offering an assessment of the long-term needs of the US economy and transportation system. Economics as a field of study particularly suffers from a belief that acting on global warming is of less importance than providing economic growth. It's a false dichotomy - HSR is a perfect example of how one can do both at the same time - but it is what the New York Times has given its blogs over to promoting in recent weeks.

American economic policy, and much of American economic thinking, have become dominated by near-term concerns. The next month, the next quarter, the next year. Maybe the next four years if you're lucky. Longer-term policy is rarely discussed in the economic press and while it may get some ink among academic economists, the writing we see many economists offer for public consumption treats long-term infrastructure spending as wasteful, unnecessary, or both.

Hence the ingrown biases and flawed methodologies of both the Glaeser and Morris posts. HSR doesn't make sense in a short-term time frame. We all know that. Keynes may have noted that in the long run we're all dead, but many of us have quite a long way to continue running. It makes sense that we will want to secure sustainable economic prosperity and work to solve those broader forces that challenge that, such as global warming.

For the last 30 years US economic policy has emphasized the short over the long, the next few years over the next few decades. Even though the New Deal provided the basis for long-term growth and unprecedented national prosperity, that kind of big-picture economic policy work has been eschewed for a debate over how to best float the next asset bubble. 30 years of short-term fixes and neglect of the long-term strategy has produced a series of ever greater bubbles and successively more catastrophic results of that bubble's inevitable burst.

HSR pencils out when the full context is assessed. The fact that the NYT bloggers so persistently refuse to provide that context suggests they believe it is important to ensure HSR does not come out well in their writing. Avent again:

This exercise is, as best I can tell, an effort to show that investments in high-speed rail are not worthwhile, from an economic or environmental standpoint, based on extremely pared down models and faulty assumptions, with the goal of influencing how their readers view the high-speed rail initiative.

It's simply irresponsible. Times readers deserve to be better informed.

I have no idea why the Times has chosen to not provide better information to its readers. But that is what they have done. As we in California know, this is par for the course. In 2008 reporters frequently repeated the largely baseless criticisms of HSR and ignored or downplayed its more proven benefits. They share the right's skepticism of government programs, and while we all want government to be closely watchdogged - including those governments involved with the HSR project - there's a difference between honest oversight and a stacked deck.

The New York Times, when it comes to HSR, is playing with a stacked deck. But at least we in the blogs know how to identify which are the marked cards.

Edward Glaeser Continues His Assault on HSR

Part 3 of Harvard economist Edward Glaeser's series on HSR costs and benefits is up at the New York Times' Economix Blog. This week's entry focuses on the environmental impact of trains, and "other social benefits" that are rather nebulously defined. Parts of his entry are less objectionable than in the past, but overall Glaeser's approach to HSR, based on an arbitrarily limited set of factors, continues to produce anti-HSR conclusions that lead me to wonder if that was his goal all along.

Before getting into the meat of his analysis, Glaeser took a moment to defend himself against criticism, including from this blog, about his choice of a Dallas-Houston HSR route:

As in the previous two posts, I focus on a mythical 240-mile-line between Houston and Dallas, which was chosen to avoid giving the impression that this back-of-the-envelope calculation represents a complete evaluation of any actual proposed route. (The Texas route will be certainly far less attractive than high-speed rail in the Northeast Corridor, but it is not inherently less reasonable than the proposed high-speed rail routes across Missouri or between Dallas and Oklahoma City.)

This is a totally misleading comparison. It's not Texas vs. the NEC, or even Missouri vs. the NEC. Although the blog post is headed with an image of a California high speed train, Glaeser never once mentions the California route. Nor does he mention the other federal HSR corridors, many of which connect cities with denser populations than the Sunbelt cities he insists on examining. Glaeser's entire argument is basically an examination of Texas HSR, and not of the actual national HSR plan. So his entire exercise is somewhat suspect in my mind.

Glaeser's focus is on carbon emissions, and here he isn't quite wrong:

If I assume, relatively arbitrarily, that one-half of the rail riders used to take cars and one-half used to take planes, and that there is no extra travel generated by the rail line, then each 240-mile train trip eliminates 113 pounds of carbon dioxide for each passenger in our atmosphere. These estimates suggest that trains are green, which differs from the studies, which include the emissions from building the rail system, cited by Eric Morris at Freakonomics.

Which confirms some of what we have been saying on this blog for quite some time. The CHSRA's own studies have predicted that 12 billion pounds of carbon emissions per year would be eliminated. Obviously one can and should debate those numbers, but that's pretty compelling stuff, and it's good that Gleaser understands the role HSR can play in reducing emissions.

Glaeser doesn't stop here. I think it is a sound concept to try and place the reduced emissions in a broader context. But Glaeser hasn't really done this in an effective way:

Combining reduced carbon emissions, reduced congestion and reduced traffic mortality provides an extra $21.63 million worth of benefits a year from the rail line, which increases the $102 million benefit minus operating costs figure from last week to $124 million, which is still far less than the $648 million estimated cost per year of building and maintaining the infrastructure.

The environmental and mortality benefits of rail are real, but the magnitude of the social benefits from switching modes seems is quite small relative to the cost of the system.

I'll let someone else check the numbers here. What bugs me is that yet again Glaeser assesses this on its own. What of the cost of doing nothing? How much savings would the trains be over the costs of building new roads and airports to handle any increased demand?

Also left unstated are the other economic benefits of rail. What of the jobs it creates? And the tax revenues those jobs create? What of the green dividend - the new economic activity created by freeing people from congestion and oil dependence?

Once again Glaeser fails on this. He uses an unrepresentative HSR line and assesses it outside the full context, without discussing the true costs and the true benefits.

Note: I am currently in Pittsburgh, PA for the Netroots Nation meeting of progressive bloggers. My posting may be a bit sporadic, but I hope to keep up with the one-a-day ideal.

Yesterday was a travel day for most attendees, as it was for me, and thunderstorms caused major delays at airports here in the northeastern US. Some were stuck on their landed planes, sitting at the gate, unable to deplane because of the possibility of lightning striking the metal jetway. Friends of mine who came to Pittsburgh from nearby eastern cities frequently remarked how much easier this would have been had there been a high speed train available - one that can operate in a thunderstorm.

Now Is The Perfect Time To Build A Railroad

What do the Golden Gate Bridge, Shasta Dam, and the Central Valley Water Project have in common? They are all products of the Great Depression. At a time when both California and the federal government were strapped for cash and suffering the effects of a major economic downturn, government decided to use infrastructure projects to provide economic recovery in both the short and the long term. Each project continues to provide economic activity 70 years later. Each has paid for itself many times over.

Last fall we spent a lot of time on this blog debunking the New Hoovers who claimed that now was the wrong time to build high speed rail - that despite the clearly successful model of the big 1930s infrastructure projects, California should embrace austerity and follow a different path, even in spite of the need and economic benefit of high speed trains. Here in the summer of 2009 we find that this attitude persists. However, as the enormous scale of the recession has become undeniable, the New Hoovers have had to find another reason to argue against infrastructure projects. As Dan Walters shows in the Sacramento Bee today, the state budget mess is providing the new excuse for New Hooverism:

Is this the time to launch construction of a high-speed railroad line between Northern and Southern California that will cost at least $40 billion, much of it from bonds to be repaid from a state budget that's already gushing red ink?

Yes, say its fervent advocates, contending that a bullet train, similar to those in Europe and Japan, will reduce air and auto congestion, reduce greenhouse gases and generate many billions of dollars in economic benefits.

Walters doesn't give his opponents or HSR much credit. He ignores the effect of those "many billions of dollars in economic benefits" - does he think that the state of California or its budget can afford to turn down the jobs and tax dollars that come from the HSR project? Construction workers' pay is taxed, as is their spending. HSR saves travelers time and money, creating a Green Dividend that fuels economic growth through the savings that sustainable mass transportation creates.

Instead he seems to be arguing from an embrace of misery. His preferred solution to the economic crisis appears to be lowered horizons and mass suffering. To Walters, the budget crisis means that all plans and projects that would spend money must be shelved. Presumably they'll await economic recovery, but that recovery will not occur without those infrastructure projects. Since the phrase "economic recovery" appears to be banned in Sacramento, among both politicians and the media that cover them, it isn't surprising that Walters embraces misery for misery's sake. Suffering and pain will somehow produce recovery - that's the neo-Hooverite model that Walters espouses in his column.

Most of Walters' column is devoted to rather weak attacks on the HSR project that suggest he is simply not very familiar with the key details of the project:

Bullet train advocates have been touting California as qualifying for a significant portion of the $8 billion set aside in federal stimulus money for transit because of the bond issue.

Recently, however, the feds decided to place the Los Angeles-Las Vegas high-speed route promoted by Nevada interests, including Senate Majority Leader Harry Reid, in the California system. It raises the specter that huge sums would be spent to make it easier for Californians to spend money in Las Vegas casinos.

In fact, the LA-Vegas HSR project does not appear eligible for HSR stimulus money. Nevada's application for stimulus funds was limited to $1 billion to study maglev from Primm to the Las Vegas Strip, a project that Senator Reid no longer supports. Secretary of Transportation Ray LaHood has repeatedly stated the SF-LA HSR route is the most likely to receive HSR stimulus funds.

The criticism continues, however, questioning both whether a high-speed rail system makes transportation and economic sense and the route adopted by the California High-Speed Rail Authority, especially running trains over the unpopulated Pacheco Pass between San Jose and the Central Valley....Meanwhile, opposition to the Pacheco Pass route appears to be growing because it would mean routing trains down the bucolic San Francisco Peninsula between San Francisco and San Jose. The alternative would be to run trains over the Altamont Pass along Interstate 580 into the Stockton-Tracy area, a more heavily traveled commuter corridor.

But since the alternative route, over Altamont Pass, would have bypassed San Jose entirely, the Pacheco route actually has far more people living along it than Altamont. The fact that nobody lives in the Pacheco Pass itself is actually an argument FOR that alignment, as it means fewer stops for a train whose purpose is to whisk travelers from the Bay Area to Southern California in the shortest amount of time possible. If the goal was to design a commuter railroad, then Altamont would indeed be a preferable choice - which is exactly why the California High Speed Rail Authority plans to develop Altamont as a high speed corridor.

Environmental activists in Palo Alto are complaining about the impact on their city and, somewhat mysteriously, language appeared in still-pending revisions to the 2009-10 state budget that makes allocation of $139 million in high-speed rail planning funds contingent on "alternative alignments" being considered. Advocates of the Pacheco Pass route consider that to be a poison pill and will try to get it removed before a final budget is enacted, if that ever occurs.

Peninsula NIMBYs are a nuisance to the project, and are putting their own personal aesthetic values in alliance with neo-Hooverism in order to block economic recovery. Their opposition is unsurprising and annoying, but it's not a reason to doubt the economic value of the project.

While $9 billion of the voter-approved bond issue is to be used for the system, if and when it is ever built, the remaining $995 million can be spent on local mass transit systems on the assumption that they will improve access to high-speed rail.

There is a suspicion among those who chart the erratic course taken by the bullet train project that when push comes to shove, its only tangible fruit will be those local projects.

Only someone who has paid just passing attention to the HSR project would consider its course "erratic" - the CHSRA is well along the path of finalizing environmental documents, determining the project-level design, and has already built working relationships with the leading HSR experts around the world. Winning voter support for the project AND the $10 billion in bonds it needs to get started was no small accomplishment. And with President Barack Obama and most of the Congress on board, HSR is far from a pipe dream. It is a real plan with a bright and viable future.

But it's understandable why those who have chosen to deny the future would choose to deny the value and viability of the HSR project. For people like Dan Walters, the state's economic and budget crisis means we must lower our horizons and suffer until somehow, apparently through magic, we have economic recovery. For the rest of us, who believe economic recovery is desirable and that it can be produced through infrastructure as it was 70 years ago, the high speed rail project is a necessary part of the project to rebuild California. It's a shame Dan Walters, who has spoken so insightfully in other venues about the need to rebuild California's broken political system, chooses to eschew vision and planning in favor of a morose neo-Hooverism.

Our predecessors did not listen to that kind of talk when planning the Golden Gate Bridge or the Central Valley Project. Nor should we.

Private Sector Still Interested in HSR

by Robert Cruickshank

Although some still seem to believe that the recession and state budget problems make HSR undesirable, that view isn't held by some of the most important figures - Secretary of Transportation Ray LaHood (who at least in his public statements has turned out to be WAY better than I ever imagined) and the companies that would build and operate high speed rail in the US. The recession is bad, is likely to persist for some time, and runs a very real risk of taking another downward lurch. But as this Reuters article makes clear, there is still demand and capacity out there to build HSR:

Transportation Secretary Ray LaHood, speaking to policy experts and reporters, said rail would be a strong opportunity for outside participation with the Obama administration taking early steps financially and politically to advance new train corridors to compete with short-haul air and highway travel.

"Companies involved in (overseas) high speed rail are in the U.S. right now," LaHood said, noting that several states are vying for a piece of an $8 billion downpayment in federal rail funding from February's economic stimulus package.

"I think you'll see private investment in high speed rail -- from Europe and Asia, not just the U.S.," he said.

LaHood also said broadband expansion would be a good bet for private interests but was less optimistic about attracting near-term investment from outside government in U.S. road projects due to recession.

This is quite significant - not only because it suggests that HSR demand is robust, but that there is more interest in funding it than in funding roads. The fact that Ray LaHood is picking up on this suggests that the Obama Administration is aware of this and might be willing to plan its transportation priorities accordingly (although first they'll need to resolve the battle over the Transportation Bill, subject of tomorrow's post).

LaHood is joined by industry leaders such as Alstom and SNCF in this assessment:

Hitachi and Kawasaki Heavy Industries are leading train manufacturers.

Leading global players also include Canada's Bombardier, Germany's Siemens and France's Alstom....

Alstom's U.S. president, Pierre Gauthier, told Reuters in an interview the company concentrates on providing trains and signal systems but would not preclude other forms of investment in U.S. rail if a market develops.

"When you have this and good service, I think Europe has shown that people use this a lot," Gauthier said.

One of the key questions being asked right now as we look at the wreckage of the global economy is what will drive growth that can get us out of this crisis? Mass transit, including high speed rail, is obviously part of the answer. Neither California nor the US can afford to fall behind yet again. We wasted the prosperity of the 1980s and 1990s on more freeways and kicked high speed rail down the road. Now that we are in an economic crisis brought on partly by that failure to embrace sustainable transportation, we would be fools to miss a chance to use HSR to both rebuild our economy and put it on a much more sustainable and prosperous long-term footing.

Richard Florida on HSR, Mega-Regions, and Our Economic Future

Over at The Atlantic, economic geographer Richard Florida has been writing about the economic impact of high speed rail. He believes HSR is a centerpiece of the long-term shift in America's economy - specifically in where economic activity is going to be concentrated. In a March 2009 article he argued that "mega-regions" would emerge from this recession as the location of most economic growth. Just as the "Long Depression" of 1873-1896 shifted the industrial economy from smaller towns like Rochester, NY and Lowell, Mass. to big cities like Chicago and New York, just as the Great Depression eventually produced a shift to suburbs, and as the 1970s stagflation produced a shift to the Sunbelt, the current crisis will accelerate a shift to 11 US "mega-regions". Two of them, "NorCal" and "SoCal", are here in the Golden State - and both are laid out exactly along the proposed HSR route.

The key insight of Florida's argument is that "mega-region" is more expansive than what we currently consider to be a "region." He argues that new technologies and proximity to dynamic economic centers will produce a new geography of growth:

New periods of geographic expansion require new systems of infrastructure. Ever since the days of the canals, the early railroad, and streetcar suburbs, we've seen how infrastructure and transportation systems work to spur new patterns economic and regional development. The streetcar expanded the boundaries of the late 19th and early 20th century city, while the railroad moved goods and people between them. The automobile enabled workers to move to the suburbs and undertake far greater commutes, expanding the geographic landscape still further.

Mega-regions, if they are to function as integrated economic units, require better, more effective, and faster ways move goods, people, and ideas. High-speed rail accomplishes that, and it also provides a framework for future in-fill development along its corridors. Just as development filled-in along the early street-car lines and the post-war highways, high-speed rail will encourage denser, more compact, and concentrated development with growth filling in along its routes over time. Spain's new high-speed rail link between Barcelona and Madrid not only massively reduced commuting times between these two great Spanish cities, according to a recent New York Times report, it has also helped revitalize several declining locations along the line.

What exactly does this mean for California? It means the integration of Modesto, Merced, Fresno and Bakersfield into either the NorCal or SoCal mega-region. Someone can work in Silicon Valley and live in Merced. Now, you might argue "that happens already." But there's a key difference using HSR - faster commutes at a lower cost. Freed from dependence on oil, workers will carry more take-home pay and can invigorate the economies of Central Valley cities. And companies that want to take advantage of the "knowledge economy" using the "creative class" of workers that Florida emphasizes can relocate to one of these mega-region towns, like Fresno, and attract workers from what we now consider to be a "reverse commute".

Already I'm sure this is setting off some folks' sprawl alarms. But as I have consistently argued before on this blog, there's no real reason that revitalizing Fresno or Bakersfield has to mean sprawl at all. HSR stations will themselves encourage greater urban densities. And sprawl itself was a product of the 20th century economic conditions that are dying, and in whose death the mega-region is emerging as the basis of future growth. Sprawl requires cheap oil, cheap credit and favorable land use laws. We're pretty much done with the first, done with the second (even when the credit crunch is over, credit will never again be as cheap as it was in the late 20th century), and laws like AB 32 and SB 375 are changing the third component.

Today Florida expands upon this point, responding to a point Seeking Alpha made about the resurgence of Baltimore and Philadelphia thanks to HSR, enabling those cities to tap into the prosperity and creativity of Washington DC and NYC:

Mega-region hubs are becoming more economically central to our spiky world. There's no getting around this. Chicago has in effect sucked up scads of economic functions that used to be done by other second- and third-tier Midwest cities. On the east coast, Baltimore and Philadelphia and, yes, Washington, D.C. have prospered because of transit connections, including relatively fast rail, which has allowed them to grow by hiving off pieces of economic activity attracted into the world city orbit of New York.

What we are seeing is the further deepening of the spatial division of labor: Suburbia is being stretched in a process of ever more intensive and expansive geographic development.

There's a lesson there for the industrial Midwest and for other regions of the country, North America, and the world. Those places that positon themselves for this new era of spiky, geographic growth and which have the infrastructure that connects them to major centers will prosper, while those that do not will likely fall behind even further.

In short, Florida helps us provide a very clearly argued explanation of exactly how high speed rail is vital to California's economic future. Whereas some in this state delude themselves that the 20th century model of automobile dependence and sprawl can still somehow produce growth, Florida says that is a recipe for turning California into Michigan - too deeply locked into an economic geography that is no longer able to provide economic growth.

California has to change if we are to thrive and prosper in the 21st century. High speed rail is an indispensible component of that shift.

Merced Steps Up

This is one good way to proactively shape the impact of HSR on your community:

Merced renewed its support for California's high-speed rail system Monday with a plan to join a financially backed committee that will lobby on the city's behalf as the project moves forward.

Rail system planners have selected Merced to have a downtown station. Castle Commerce Center may be a maintenance hub for the entire system, creating hundreds of jobs in the county....

The Greater Merced High-Speed Rail Committee, a group of citizens, formed to support the project. Now that it's looking more likely that 220-mph trains will zip across the state, it's asked city and county governments to increase their support by giving cash and having elected leaders join its ranks.

The Board of Supervisors pledged $40,000 to do a study on whether it'd be possible to create a maintenance hub at Castle Commerce Center.

While there was some discussion about whether a maintenance hub should be built in the middle section of the line the last time this subject came up (I think this would be a good idea) the overall point is that Merced, like Fresno and San Francisco, is actively trying to plan for HSR to have a maximum positive impact on their own. When it comes time for the CHSRA to decided where a maintenance hub will go, Merced will be able to offer a plan that has been publicly vetted. That can only help matters.

Let's hope more cities take the proactive approach when it comes to HSR. It's an opportunity, not a threat.

Merced County Approves Castle Area HSR Study

Rafael has long called for Castle Airport in Atwater, just outside Merced, to become a relief airport for the Bay Area by using HSR to bring passengers to and from the airport. While not exactly endorsing that specific plan, Merced County has approved a study of putting an HSR maintenance facility at Castle:

Merced County leaders junked their contract with the private investment firm that had been pegged to transform Castle Commerce Center into a thriving economic hub.

In another move aimed to stimulate the local economy, supervisors authorized money to be spent to show that the Castle center could work as a maintenance hub for the statewide high-speed rail project....

Plans to build a 700-mile passenger rail system that would connect Los Angeles to the Bay Area were first proposed more than a decade ago. With the November approval of a $10 billion bond measure to pay for the first phase of the project, it now appears it may actually be built.

On Tuesday the Board of Supervisors voted to revive the county's dormant High Speed Rail Citizens' Committee and spend $40,000 to prepare a feasibility study on building a train maintenance hub at Castle.

County officials hope both moves will help convince the state's high-speed rail board that Castle is the right choice for the hub. Several nearby counties are also vying for the designation.

On its face this seems like a very smart move for Merced County. Turning an old airport facility into an exurban office and service hub is no longer a viable economic proposition. The Merced region will soon have a glut of office and light manufacturing space, if it doesn't already. An HSR maintenance facility, however, would provide long-term green jobs for Merced County, the kind of economic base that the San Joaquin Valley desperately needs.

I'll let the more technically minded among us debate the practicalities of putting an HSR maintenance facility at Castle. From a political and economic perspective it seems like a sound concept, and could leave open the possibility of developing Castle Airport in the way Rafael has long advocated.

So I like this move by Merced County. The San Joaquin Valley governments, particularly Fresno, have been especially proactive in looking at how to make HSR work well for their economy, their landscape, and their residents. It's exactly the kind of sensible planning work that HSR ought to be encouraging around the state.

Hey Arnold

The governator has a rather hypocritical op-ed in Newsweek on the importance of infrastructure to economic stimulus and recovery. Here are some quick excerpts:

America has failed to invest in its infrastructure for the past 50 years, and the bill is coming due. The situation is reminiscent of the ancient Roman Empire, which grew strong because of its advanced aqueduct system, but which fell into decline when that feat of engineering tumbled into disrepair. We're in danger of repeating that history, but it's not too late to fix the problem if we take decisive action now....

None of this makes sense in America. It doesn't make sense that in the greatest country on Earth we still rely on trains that go the same speed as they did 100 years ago, so our shipping times and commutes are longer than other countries....

In 2008 alone in California, we've committed more than $10 billion dollars in infrastructure investment, which will create at least 200,000 jobs over the life of that investment. And when our state unemployment rate has broken 8 percent, that kind of investment has a profound effect.

That last bit is a reference to Proposition 1A and high speed rail, although it'd have been nice had Arnold actually said that openly. But that's a quibble compared to the hypocrisy of this article.

Why do I say hypocrisy? I fully agree with everything I just quoted. The problem is this is another example of our governor's penchant for greenwashing - go tell the national media how awesome you are but back at home, help destroy the state.

You see, despite Arnold's claims to be an infrastructure builder, he has instead helped create a state budget crisis so severe that earlier this week the Pooled Money Investment Board voted to halt ALL infrastructure projects in California - immediately. 200,000 workers face unemployment as early as January 1.

Arnold could have avoided this had he agreed to a Democratic budget plan sent to him by the Legislature yesterday. Instead he announced his intention to veto the solution and consign the state to another indefinite deficit.

The state's bond ratings are plummeting fast, but worse, without infrastructure projects in the works, it's going to be very difficult to attract federal matching funds in Obama's emerging stimulus package. If this budget mess - for which Arnold bears the primary responsibility right now - continues then it may become difficult for us to get HSR funds from Congress in 2009. It'll become all too easy for HSR deniers to argue we don't deserve or can't even use the matching funds.

Arnold's hypocrisy knows no bounds.

Biden Calls for Rail Investment

At today's National Governor's Association meeting Joe Biden took the chance to call for investment in high speed rail as both economic stimulus and environmental action. Video thanks to Matt Yglesias and Think Progress:

There’s a reason when you turned on the olympics to watch them this past summer, you saw mag-lev trains going over 200 miles an hour in supposedly a third world country [i.e., China] in terms of its economy, blowing into town, dealing with environmental problems they have as well as transporting people in a way that we don’t even come close to being able to do. And as Barack has pointed out, and Jon Corzine knows, I may have a bit of a pro-rail bias. I think think of the jobs we can create in both construction and innovation if we make similarly bold investments here in the United States as well as the environmental payoff that flows from that kind of investment.

We should fast-track funding for the thousands of ready-to-go projects across the country that can quickly put people back to work and lay the foundation for long-term growth.

In the longer term, we are calling for the creation of a new National Infrastructure Reinvestment Bank that will help us make the investments we need to build a 21st century transportation system – while creating jobs and taking the politics out of infrastructure spending. And it has the added benefit of making American business more competitive in the world.

Biden - or Vice President for SUPERTRAIN as Atrios calls him - is playing exactly the role we expected he would, an influential voice for high speed rail projects. Even though he does not have a formal policy role he has an important role in shaping the debate over the place of rail in our country's economic and transportation policy. Biden's remarks were carried live by CNN and are getting a lot of interest on the blogs, which can drive more coverage.

It would be wonderful if Biden had some influence over Obama's transportation appointments. But what's even more likely is Biden playing a major role in shepherding Obama's stimulus package through the Senate, which will hopefully include "fast track funding" for rail projects of the kind Biden described.

In any case, the Obama/Biden administration is already looking great for high speed rail. It's going to be up to us to make sure Congress comes through in 2009.

PS: BruceMcF has a great post at Daily Kos about coast to coast electric rail, riffing off of Rafael's Rapid Rail post from the weekend and Biden's comments today. Bruce's post is not about HSR per se - that's coming in a future article - but it is a good overview of how a tiered and electrified rail system could be rolled out on a nationwide basis. Worth the read.

UPDATE: The Christian Science Monitor has some more details on the NGA meeting and high speed rail:

California Gov. Arnold Schwarzenegger (R) noted that his state already pledged $42 billion of state money in 2006 to rebuild roads, bridges, and highways, as well as to build a high-speed rail system.

"We hope that is an inspiration to the federal government and the Obama administration to do the same thing nationwide," he said. The California Legislature "also [just] approved an additional $10 million in high-speed rail, which I think is another important thing, because I think there's no reason we in America should be traveling at the same speed as we did 100 years ago."

Obviously the "$10 million" figure is either a misquote or a flub from the Governator. Of far more significance was Chief of Staff-to-be Rahm Emanuel's comments on HSR and infrastructure spending:

In talking with reporters after the meeting, Obama's pick for chief of staff, Rahm Emanuel, noted that some of the infrastructure projects under discuss involve advances in technology. "Some [governors] talked about what I would call the infrastructure for a 21st-century economy: medical [information technology], broadband. A lot of the infrastructure was around green technology, some on ... high-speed rail [and] mass transit," Mr. Emanuel said, according to a pool report.

Of course, Emanuel did not explicitly commit to helping fund HSR. But he clearly understands that it's high on the agenda and its inclusion in his list along with other goals Obama has already committed to is a very positive sign.

Fast Tracking Infrastructure Stimulus

Former LA Times reporter and author Bill Boyarsky writes in today's Times about the value of public works as economic stimulus - and the barriers to their swift completion. After mentioning the passage of Prop 1A and LA's Measure R, Boyarsky goes on to write:

The Depression projects were built in a hurry, driven by economic need. Will the new crop also be put on a fast track?...

In recent years, neighborhood organizations have fought many such projects and unrestricted development. They, along with environmental groups, have pushed politicians to adopt regulations to protect the environment. Some of their objections were valid. But over the years, great projects have been stopped or stalled.

These regulations are necessary to not just securing the public interest and environmental protection, but they also help ensure that projects get built in the best way possible. At least that's the intention. It's not the rules themselves that slow construction but the lack of bureaucratic funding to help the permit reviews get done quickly and thoroughly.

The best way to ensure this process is expedited - so that the stimulus effects of infrastructure like high speed rail arrive quickly when they're most needed - is to get up-front funding. Arnold Schwarzenegger's preference, to bypass environmental reviews for infrastructure stimulus, is neither sound nor necessary and would probably just delay projects as it makes lawsuits much more likely. But if agencies like the CHSRA were given adequate funding to finish all engineering and environmental reviews quickly, then actual construction could begin that much sooner.

Boyarsky also writes about the rise of NIMBYism. Obviously that is something which will impact the HSR project - already Atherton and Menlo Park have sued the CHSRA on essentially NIMBY grounds, even though Menlo Park voters actually supported Prop 1A. Prop 1A got a considerable margin of victory and the local rail proposals in the North Bay, Santa Clara County and LA County received over 2/3 support, all of which indicate that there is a massive amount of support in California for passenger rail infrastructure projects. That will help overcome NIMBY objections.

So will a clear explanation of the economic value and necessity of these projects. Californians want these projects built - why should a few objectors along the route hold it up indefinitely?

The stick has to be matched with a carrot, however. The CHSRA needs to start working as soon as possible with communities along the route to finalize design and hold public meetings to explain to the public what is going to happen and allow the public to provide their input. An open process that welcomes public involvement is by far the best way to ensure that public support for the project is sustained. It also has the political benefit of isolating the more stubborn NIMBYs.

Some decisions will not be easy - Menlo Park comes to mind. But the sooner a public process begins, the more likely it is that the process can proceed smoothly to completion, saving time and money. For that public process to be as effective as possible, the CHSRA is likely to need lead time and staffing support that a greater infrastructure stimulus package can provide.

Boyarsky's article also describes the social and cultural impact of infrastructure projects during the Depression:

Historian Kevin Starr, in his book, "Endangered Dreams: The Great Depression in California," wrote of "the power of public works ... as therapy for a battered economy -- and symbol of shared identity and purpose ... millions experienced the healing symbolism of collective action in a time of great social crisis."...

And there should be some appreciation of the historical significance, even the majesty, of the task. During the Depression, the unemployed got real jobs building the schools, bridges, libraries, dams, highways, city halls and courthouses we use today. The water that supports Southern California was delivered through the labor of workers on Hoover Dam on the Colorado River. Or, as Woody Guthrie wrote of another Depression-era dam on another river, Grand Coulee on the Columbia, "Your power is turning our darkness to dawn. So roll on, Columbia, roll on."

Guthrie was in the employ of the Bonneville Power Administration when he wrote Roll On Columbia, Roll On. Dorothea Lange was in the employ of the Farm Security Administration when she took her famous photos. The CHSRA has done something similar in 21st century media with the NC3D animations. I hope they will continue to appreciate the power of the visual image as the project unfolds.

I know we do. In early 2009 this blog will undertake a photo and video trip of Phase I of the HSR route from SF to Anaheim. The high speed rail project is going to be one of the most transformative projects this state has ever seen. We're going to ensure it gets the social and cultural profile it deserves, in addition to the political and financial support it requires.

"Building Out of Economic Chaos"

The Washington Independent, an online news source, has been running a 3-part series on a new economic stimulus package being considered in Congress and one of their entries is Building Out of Economic Chaos, making the point that infrastructure stimulus is a necessary part of getting this country back on its feet.

Democratic leaders appear more and more confident they can win the fight over a large stimulus bill. Infrastructure funding — which could replace thousands of local jobs lost in the downturn — seems increasingly to be driving the debate.

“There is a backlog,” said Rep. James Oberstar (D-Minn.), chairman of the Transportation and Infrastructure Committee. “There is a demand. There is a hunger. There is a need to invest. Our cities are crying out.”

The lame-duck Bush Administration, composed of new Hoovers, blocked a House infrastructure spending bill in September. But Democrats are going to try again, riding the wave of a successful November election and armed with arguments that undermine the deniers:

“Infrastructure spending is never an effective means to create rapid stimulus,” the White House proclaimed in its veto threat.

Yet many state and local officials argue that a great number of projects could begin almost immediately. Corzine, for example, said that New Jersey has roughly $1.5 billion in projects ready to start within 90 days. Jerry E. Abramson, mayor of Louisville, said the city has $250 million in unfunded infrastructure initiatives set to go within 120 days. Nationwide, state transportation departments have more than 3,000 projects, totaling $17.9 billion, ready to launch within 90 days, according to a survey conducted by the American Assn. of State Highway and Transportation Officials.

In addition, many economists say the current recession will last long enough that the timeline criticism is irrelevant. “That argument has no force now,” Paul Krugman, the Nobel prize-winning economist, wrote in his Oct. 16 New York Times column, “since the chances that this slump will be over anytime soon are virtually nil. So let’s get those projects rolling.”

On that theme, economists point out that labor markets rebound from economic slumps far more slowly than other indicators. During the recession of 2001, for example, it took 30 months for unemployment to bottom out, according to John Irons, policy director at the Economic Policy Institute. Four years passed before employment rates rose above pre-recession levels, he added.

California High Speed Rail is just such a project that could begin very quickly with federal stimulus. Of course, we will not receive that money unless we pass Proposition 1A.

California has a clear choice on Tuesday. Either we slide deeper into recession and abandon tried and true solutions to revive our economy, or we pass Prop 1A and start the long road back to prosperity.

Your choice, California.

Zombie Lies

I had hoped we'd dealt with this when it popped up at Daily Kos yesterday - the commenters there gave it a thorough smackdown - but unfortunately it's appeared across the blogosphere today, helped by the credulous and fundamentally uninformed Kevin Drum (I still don't understand why Mother Jones would hire a moderate to blog for them) who reproduced "it" on his site today.

"It" is an email being peddled by the daughter of James Mills offering criticism of Prop 1A. Mills is another one of these "rail supporters" who are offering truthiness and outright lies to try and convince people Prop 1A is a bad idea. To the uninformed masses - which unfortunately include some bloggers - anyone who claims to have rail credentials apparently is given the benefit of the doubt when we who actually understand rail policy know that James Mills, Richard Tolmach, Wendell Cox, and Joseph Vranich are fundamentally anti-rail.

Mills and Tolmach co-authored an HSR denier op-ed in the San Francisco Chronicle earlier this month. I gave it the usual thorough deconstruction here on the blog when it appeared, although I focused my fire on Tolmach, since I'd never heard of James Mills. Now Mills' daughter is circulating Mills' own arguments to the bloggers, and some of the more gullible bloggers, like Kevin Drum, have taken the bait. As a result Ezra Klein and now Atrios are discussing its contents.

So, time to try and kill the Zombie Lies.

The email starts like this:

I am passing on an analysis of California's Prop 1A ballot initiative from one of the leading experts and advocates of mass transit in the state of California, James Mills.

Mills' daughter writes:

I'd like to suggest you vote "No" on Proposition 1A, the "Safe Reliable High-Speed Passenger Train Bond Act," on the basis of the following insider, expert information: my dad says it's a bad idea.

My father, James Mills, spent his entire career in the California state legislature (1961-1983) working to promote public transportation in the state. He was President pro Tem of the Senate for a decade. He was chairman of the Amtrak board under president Carter. Since retiring he has worked as a consultant on transit issues, and in the 1990's he served on the High Speed Rail Commission for the State of California . My dad is hard-core in favor of rail. If he says a proposal to fund a rail project is no good, then that proposal has to be a real turkey.

Notice the sleight of hand here. James Mills is not a well-known figure even in California political circles. His specific policy positions are completely unknown. But just like the notoriously anti-transit Wendell Cox, and the equally anti-rail Joseph Vranich, Mills trades on a 30-year old association with Amtrak to try and gain credibility when he passes on flawed HSR denials. The last sentence is designed to solidify the assumed expertise of Mills, but to me it just sets off alarm bells.

Which are justified when we read the specific objections:

1. Prop 1A raises about ten billion dollars in a bond issue. This is a down-payment on a project which was estimated in 2006 to cost 45 billion dollars but will probably cost more if it is ever built. Remaining funding will be sought from the federal government (10-15 billion) and private investors (15-20 billion).

Notice that, as always, no specific reason is given as to "probably cost more". It is blind speculation. No specific figure of cost overruns is given either. Lacking those details or underlying explanations this claim lacks credibility. Rail projects around the country, including LA's Metro Gold Line extension, have been delivered on time and on budget in recent years.

Further, and this is ironic, that $45 billion is the figure for the ENTIRE system - which in point #5 Mills claims is unplanned.

2. The federal government has never invested any amount even close to $10 billlion in a transit project.

The federal government had never spent $700 billion on a bank bailout either. Before 1971 they'd never operated passenger trains. Before 1956 they'd never spent hundreds of billions on freeways. Shall we go on?

But we have better evidence. John Kerry and Johnny Isakson are working on a bill to provide about $10 billion for HSR projects around the nation. Both Barack Obama and Joe Biden are strong supporters of HSR and want to fund it.

3. If private investment were found, the bill says that investors would make money NOT from a the profit of the transit system, but from a percentage of ticket sales. In other words, the profit of investors is guaranteed, regardless of the operating costs of the system. The Legislative Analyst estimates that the OPERATING AND MAINTENANCE COSTS of the system will be one billion per year -- the State of California will cover any deficit not covered by ticket sales. It is rare for a public transit system to run in the black: normally, not all costs of the system will be covered from the fare box.

This is a bit misleading. As I understand it from what Rod Diridon explained today, those same investors also have to satisfy their own bond to the state/CHSRA and a "franchise fee" to the same. That's quite a bit different than saying "their profit is guaranteed" - a misleading statement designed to imply that California is going to be left holding the bag while private investors light cigars with our money.

This claim also misleads Californians on the Legislative Analyst's estimate - she has said the $1 billion figure is a worst-case scenario.

And of course, it is not rare for high speed rail systems to run in the black. In fact, they ALL run in the black. Every last one. In France the TGVs are so profitable they subsidize other slower rail services. SNCF had so much money they actually gave some to the French treasury earlier this year.

4. Premises on projected ridership are false. The only high-speed rail system in the US is Amtrak's "Acela" service between NY-Washington and NY-Boston. This system is well established and serves large population centers with excellent public transportation tie-ins to feed it such as subways, and they carry 3 million riders a year. The French have the best high-speed rail system in the world, and their busiest line is Paris to Lyon, again large cities with major subway systems, and it carries perhaps 15 million riders a year. In contrast, proponents of Prop 1A rely on a projection of 100 million riders per year between Los Angeles and San Francisco, a figure provided by a paid consultant that happened to be Lehman Brothers. This projection of patronage is a fantasy.

This paragraph is full of outright lies. Yes, lies.

First, Acela is not true HSR and is much slower than our system will be. Anyone trying to compare the Acela to CA HSR either does not understand Acela or is deliberately misleading readers. It does not speak very well of James Mills' vaunted "rail knowledge."

Second, these arguments about ridership come directly from the oil company funded Reason Foundation. It is a libertarian lies being passed off as fact. Those ridership claims - specifically about Paris-Lyon - are complete nonsense. We thoroughly debunked the "not enough riders" claim last month. The key portion of our mythbusting:

Cox-Vranich's [the Reason Foundation study] ridership figures are wildly inaccurate. Using C-V's preferred measure, JR Central reported 2007 ridership of 80 million passenger km per Shinkansen route km (44.5 billion passenger km / 552 km route). In the "high" scenario, CA HSRA is forecasting roughly 27 million passenger km per HSR route km (30 billion passenger km / 1,120 km route). So C-V's claim that CA HSRA is using numbers higher than those achieved on any other system in the world is absurdly false - in fact, CA HSRA's numbers are only 1/3rd of what has been previously achieved.

JR Central's Shinkansen is the densest ridership in the world. A more informative comparison would be the TGV or the new Taiwan HSR (THSR). We don't have passenger-km ridership for those lines, but we can compute passengers per route-km. The TGV Paris Southeast (PSE) line gets 45k passengers per route-km (20 million pax / 448 route-km) while the THSR gets 101k passengers per route-km (34 million pax / 335 route-km). CA HSR is forecasting a high of 80k passengers per route-km in 2030, or around 56k passengers per route-km at today's populations. This is slightly above TGV PSE but well below THSR. It does not seem unreasonable since the LA Metro Area is larger than Paris Metro Area or the Taipei Metro Area. And more importantly, the SF Bay Area is twice as large as the Kaoshiung Metro Area and four times as large as the Lyon Metro Area.

On to the fifth and final lie, which is the most ridiculous of them all:

5. Promises of future extension to Sacramento, Orange County and San Diego are empty in that no concrete plan of any kind is offered other than the unrealistic plan for a Los Angeles-San Francisco line.

Mills is just showing off his ignorance here. Prop 1A would fund a line from SF to Anaheim - which, last time I checked, was still in Orange County. SD and Sacramento plans are in existence in full detail and can be found at the California High Speed Rail Authority website.

It's worth closing by reminding people of the big picture here. High speed rail will create badly needed green jobs and economic stimulus while providing Californians with sustainable transportation that reduces dependence on oil and cuts carbon emissions. It is supported by virtually the entire California progressive community.

It is being opposed by the Howard Jarvis Association and the Reason Foundation. The former are the keepers of the right-wing flame here in California. The latter are a group of rabid anti-government nuts who are funded by oil companies and other leading right-wing foundations. They have been using an ignorant and pliant media to push out their "omg boondoggle not enough riders" nonsense over the last six weeks or so.

It would be a shame for folks in the blogosphere - folks who usually know better - than to repeat the high speed rail version of the "Obama is a Muslim" email.