This story appeared on Calmatters
California may soon face a sunk cost argument for the Central Valley portion of the bullet train project. With costs soaring and the merits of high-speed rail heavily debated, some economics experts argue that state officials should invest those resources elsewhere.
California is well acquainted with transformative construction: think Oroville Dam, the Bay Bridge and the Arroyo Seco Parkway (also known as the Pasadena Freeway).
The state is once again in charge of the nation’s biggest public works project, a 171-mile high-speed rail line between Bakersfield and Merced – the “starter” portion of the long-sought bullet train linking Los Angeles and San Francisco.
It’s safe to say that few people need to travel 200 mph between Bakersfield and Merced. This will surely lead to the public facing a classic sunk cost argument: Now that we’ve spent at least $23 billion to lay tracks in the Central Valley, it would be a waste not to connect Bakersfield to Los Angeles and Merced to San Francisco, right?
The estimated total cost for the 500-mile system is $113 billion.
Put another way, the state is attempting to create a non-transformative project that is nevertheless too big to fail. The California High-Speed Rail Authority will surely ask for more money to keep building well into the next decade.
Indeed, leaving bullet trains unconnected to California’s major population centers would seem bizarre. But is a fast train more important than addressing the state’s existential challenges?
Consider what’s occurring just a few miles from the construction sites. Prior to the recent storms, orchards were drying up, towns were without drinking water, aquifers were shrinking, and the State Water Project was drastically restricting deliveries to Southern California. While the storms may cause a temporary reprieve, the state faces enormous long-term water issues.
Instead of spending an additional $100 billion or more to drill rail tunnels through seismically active mountains and disrupt communities, the state should embark on a massive public works effort to meet its water needs. Advances in stormwater capture and recycling hold great promise. Los Angeles could meet 70% of its water needs locally by 2035 if enough investment is made in recycling and cleaning up its groundwater basins. Repairing and replacing leaky pipes, conservation, desalination and replumbing the state project are other pieces of a resilient, drought-resistant water system for California.
When voters approved a $10 billion bond issue in 2008 to help build the full rail line, the cost was estimated at $33 billion with completion by 2020. If the project started fresh today with a $113 billion price tag, would voters still support it?
Even the much-touted climate benefits of the bullet train are losing luster. California now mandates that every vehicle sold in the state must be electric by 2035. So if the bullet train is running by then, it would be replacing car trips that don’t produce greenhouse gas emissions. It might get some people out of planes, but the carbon impact will likely be less than envisioned as more fuel-efficient jets – possibly using biofuels – come online.
Meanwhile, construction itself will have produced plenty of pollution on its own.
For now, there is no clear source of funding for building north of Merced and south of Bakersfield. But many powerful political forces – led by construction companies, unions and Valley cities – will push to complete the 500-mile system.
It will take considerable courage to stand against all that, and in effect argue that the state should not be throwing good money after bad. After all, $100 billion is a lot of good money.
As for the future of an isolated bullet train in the Central Valley, maybe it can still be useful locally. But state leaders should not continue to sacrifice resources needed for essential, existential challenges on a project that no one really needs.