This past Tuesday, Amtrak proposed to spend more than $100 billion increasing the top speeds of trains in its Boston-to-Washington corridor from 150 to 220 miles per hour. In August, Secretary of Transportation Ray LaHood estimated that President Obama's proposal to extend high-speed rail to other parts of the country will cost at least $500 billion.
No one knows where this money will come from, but President Obama argues that we need to spend it because high-speed rail will have a "transformative effect" on the American economy. In fact, all it will do is drag the economy down.
The history of transportation shows that we adopt new technologies when they are faster, more convenient, and less expensive than the technologies they replace. High-speed rail is slower than flying, less convenient than driving, and far more expensive than either one. As a result, it will never serve more than a few marginal travelers.
New transportation technologies have a truly transformative effect when they not only replace older technologies but also increase total mobility. Intercity passenger trains, electric streetcars, and mass-produced automobiles offered their customers thousands of miles per year of new mobility. This gave people access to jobs, resources, and opportunities that were previously unavailable.
At an inflation-adjusted cost of about $450 billion paid out of highway user fees, the Interstate Highway System, to which high-speed rail is sometimes compared, provides more than 4,000 miles of passenger travel for every American, miles that Americans were not traveling before the system was built. By comparison, a $600 billion expenditure on high-speed rail will provide, at best, around 300 miles of travel per person.
More to the point, most of that travel will not be new travel, but merely a substitute for driving, flying, or other existing forms of travel. The California High-Speed Rail Authority predicts that 98% of its customers will shift from driving or flying. Florida predicts that 96% of the people using its high-speed train will switch from driving.
Almost no new travel means almost no transformative effect. Few people will use high-speed rail or urban rail transit to access new markets, resources, or jobs. Merely substituting rail for other modes will be extremely expensive.
Amtrak brags that its high-speed Acela between Boston and Washington covers its operating costs, though not its capital costs. It does so, however, only by collecting fares of about 75 cents per passenger mile. By comparison, airline fares average only 13 cents a passenger mile, and intercity buses (which, Amtrak doesn't want you to know, carry about three times as many passengers between Boston and Washington as the Acela) are even less expensive.
According to the Bureau of Economic Analysis, Americans spent about $950 billion on driving in 2008. This allowed us to travel, says the Federal Highway Administration, more than 2.7 trillion vehicle miles, for an average cost of about 35 cents per vehicle mile. Since the California High-Speed Rail Authority estimates cars in intercity travel carry an average of 2.4 people, the average cost is less than 15 cents a passenger mile.
Subsidizing the urban elite
In short, high-speed rail is more than five times more expensive than any of the alternatives. Since most high-speed rail stations will be in downtowns, the main users will be downtown workers such as lawyers, bankers, and government officials. Yet less than 8% of American jobs are in central city downtowns, meaning all Americans will subsidize trains used by only a small urban elite.
High-speed trains in Europe and Asia may be a boon to American tourists, but they haven't proved transformational in those regions either. France and Japan have the world's most extensive high-speed rail networks, yet their average residents ride the high-speed trains less than 400 miles a year.
Personally, I love trains and it would be nice to think we were rich enough to build a high-speed rail network that few people will ever use. But we are not. The Obama administration would do better by making our existing transportation systems safer and more effective.