You have to respect the courage of California's state leaders to make a major long term investment in high speed rail during a time of deep and ongoing fiscal deficits at the local, state and national level. The NY Times reports here. I must admit that I side with the Republicans on this issue. Peter Gordon's recent blog post eloquently traces out the issues. I would like to add a few points.
1. How much will this high speed rail really cost? This is a random variable that the current governor will not be around to know the final answer. I may never learn the answer either!
2. A high speed rail train will offer some externality benefits. Has any economist quantified these? How much less traffic congestion will there be? How much less GHG emissions will there be? What is the social benefits of these increments? Could these benefits add up to match the billions of dollars of costs?
3. Who will really enjoy the benefits of HSR? The answer is geographical locations that are currently far from San Fran and LA that will now become suburbs of these cities. You should buy land now in the areas where the train will stop. You will be the winner from HSR.
4. How much Federal $ will California collect to pay for this train?
Note that each of these simple points are unknowns. But, when add up the uncertainty here you'd have to be a real risk lover to justify this project. Everyone in California should have to watch the Simpsons' Monorail episode one more time.
