High-Speed Rail Is Good for Business

[M II A II R II K]

Forget the Environment, High-Speed Rail Is Good for Business


April 8th, 2011

By Morgan Clendaniel

Read More: http://www.fastcompany.com/1745448/high-speed-rail-forget-the-environment-its-good-for-business

PDF Report: http://www.apta.com/resources/reportsandpublications/Documents/HSRPub_final.pdf


Since the elections in November, newly elected Republican governors have been falling over themselves to return federal funding earmarked for high-speed rail. Their rationale is that once the rail project is built, the state will be the one bearing the operating cost while the trains lose money because no one is riding them. A new report says that this strategy is going to backfire: High-speed rail can be a huge driver of jobs and economic growth, and the government has already committed to at least $10 billion worth of spending, with plans for tens of billions more in the coming years.

The report, "The Case for Business Investment in High-Speed and Intercity Passenger Rail" by the American Public Transportation Association finds that in addition to the obvious, but temporary, construction jobs, the benefits ripple out throughout an economy. Most importantly, for each $1 billion spent on train construction, 24,000 permanent jobs are created. That's a mere $41,667 per job, which looks downright cheap when you're staring down 9% unemployment.

The California High-Speed Rail Authority estimates that building a high-speed rail link between L.A. and San Francisco would result in 600,000 construction jobs and 450,000 permanent new jobs. There are currently 2.2 million unemployed people in the state; high-speed rail would halve its unemployment rate. Here is how high-speed rail would affect some major American cities, to the tune of billions of dollars in economic growth and new wages.

The concern with high-speed rail, as explained by the governors in states like Wisconsin and Florida is that no one will ride it. And while rail ridership is at an all-time high, it's a fair worry. Amtrak has trouble making ends meet. But what they're forgetting is that people don't want to ride trains not because they hate trains, but because trains aren't that fast. If you make the trains faster, people will ride them.

.....

 

[gweed123]

When you're dealing with Republicans, facts are irrelevant. "Obama is a socialist. Socialism is evil. He is proposing high-speed rail. Therefore high-speed rail must be socialist. Therefore high-speed rail is evil."

 

[drum118]

The Republicans, including the TEA Party, see all types of rail projects as evil, as it takes away from the cars and roads they love. This includes LRTs, commuter rail and Amtrak.

Now, if you want BRT and buses, they fall all over themself in finding money for them.

 

[M II A II R II K]

This case and point could be used to prompt the creation of such lines faster like with that 401 and Highway 20 corridor, and also include an Ottawa diversion. To compete with airlines and make sure the train actually travels at high speed for the majority of the trip.

 

[Hipster Duck]

Now, if you want BRT and buses, they fall all over themself in finding money for them.

You must be joking.

 

[Markster]

There should be a big change in the Republican position on HSR once the new Atlas Shrugged movie comes out!

 

[Mapleson]

Those economic numbers are too high level to have any serious meaning. How many of those thousands of jobs created are part of the cost of operating the railroad?

Passenger HSR is a red herring. What North America needs to cut costs is Freight HSR. Even at 1000 km/h it'd take 10 hours to go coast to coast.

 

[MisterF]

This case and point could be used to prompt the creation of such lines faster like with that 401 and Highway 20 corridor, and also include an Ottawa diversion. To compete with airlines and make sure the train actually travels at high speed for the majority of the trip.

Ottawa would be on the mainline, not a diversion. And not all trains would stop in Ottawa, so the time added to a trip to Montreal is marginal.

Those economic numbers are too high level to have any serious meaning. How many of those thousands of jobs created are part of the cost of operating the railroad?

Passenger HSR is a red herring. What North America needs to cut costs is Freight HSR. Even at 1000 km/h it'd take 10 hours to go coast to coast.

Nobody's proposing coast to coast HSR. Speaking of red herrings....

 

[Mapleson]

Ottawa would be on the mainline, not a diversion. And not all trains would stop in Ottawa, so the time added to a trip to Montreal is marginal.

Nobody's proposing coast to coast HSR. Speaking of red herrings....

Anything less is not a network, just piecemeal showpieces. Chicago to Montreal is a heavy freight corridor. Unless we can shift that off the roads, HSR is not going to make things significantly better. At best, it hopes to beat out local airlines like Porter for short haul flights. Passenger rail is not profitable in North America, no matter what speed it goes.

 

[Hipster Duck]

Passenger rail is not profitable in North America, no matter what speed it goes.

Acela generates a profit of $41/passenger.

 

[dowlingm]

Wind projects in Republican strongholds like N Dakota succeed because they are sold as displacing foreign oil. What Amtrak need to do is extend electrification if they want to really go for that argument.

 

[Mapleson]

Acela generates a profit of $41/passenger.

That's like saying the TTC made a profit last year because it required a lower operating subsidy. In 2002 congress gave up on Amtrak ever become self-sustaining and removed that requirement from it. That's not even getting into the seperate debt servicing charges or capital budget.

 

[reaperexpress]

Anything less is not a network, just piecemeal showpieces. Chicago to Montreal is a heavy freight corridor. Unless we can shift that off the roads, HSR is not going to make things significantly better. At best, it hopes to beat out local airlines like Porter for short haul flights. Passenger rail is not profitable in North America, no matter what speed it goes.

You do realize that HSR is not independent of regular rail, right? It's just trains that run faster on better track. If HSR suddenly appeared in the QC-W corridor tomorrow, it would make absolutely no difference in terms of VIA being a "network".

That's like saying the TTC made a profit last year because it required a lower operating subsidy. In 2002 congress gave up on Amtrak ever become self-sustaining and removed that requirement from it. That's not even getting into the seperate debt servicing charges or capital budget.

No it's nothing even remotely like that. The parallel would be saying that some TTC route turned in a profit, which would likely be a true statement (though it's a bit harder to measure on the TTC because they don't really know who is paying for what).

You said passenger rail cannot be profitable, which was proven false. The point is that profitability is possible, so the fact that there are also unprofitable routes is irrelevant.

 

[Woodbridge_Heights]

Those economic numbers are too high level to have any serious meaning. How many of those thousands of jobs created are part of the cost of operating the railroad?

Passenger HSR is a red herring. What North America needs to cut costs is Freight HSR. Even at 1000 km/h it'd take 10 hours to go coast to coast.

We have a thread on here claiming that a 37 mile LRT results in ~$10 billion in economic activity with little question of it's validity and yet we question the validity of this claim???

I mean question the numbers if you like but how can a single LRT network generate twice the economic activity of a HSR network connecting multiple 1 million+ cities, and question the HSR numbers as being inflated.

 

[sjc]

Most importantly, for each $1 billion spent on train construction, 24,000 permanent jobs are created. That's a mere $41,667 per job,

... and takes a $1 billion out of the private-sector economy, driving down private-sector employment.

Each $1 billion the government spends on train constructions means either $1 billion more in taxes and/or $1 billion more in government debt (and future interest payments).

If you assume that a government job is better and more productive than a private sector one (since you don't have the profits to think of and provides long term job security), then I suppose this is a good investment.

EDIT: Wouldn't we get better service between Toronto, Montreal and Ottawa if we took these billions and invest them in better transit to/from the airports, improving/expanding the airports, building new airports and buying planes for the airlines? The tens of billions mentioned in the article might go a long way.