A year ago, during his State of the Union address, U.S. President Barack Obama set a goal for a national high-speed rail (HSR) network : 85 percent of the country’s population would have access to HSR within 25 years. One year later, that goal seems wildly optimistic.
Within a month of Obama’s speech, Florida Governor Rick Scott joined the governors of Ohio and Wisconsin (all Republicans) in rejecting HSR funds that had been targeted for his state. He, like many critics of HSR, argued that the project was too costly during a time of economic crisis and the risks would outweigh the benefits. Then, earlier this month, California’s HSR effort appeared to run out of steam. The California High-Speed Rail Peer Review Group, an independent body created by the California High-Speed Rail Authority to advise on the proposed system, released a report that detailed numerous concerns about the project’s overall funding plan and the lack of a fully vetted business plan. In the end, the report concludes that too many flaws and financial unknowns exist in the plans, representing “an immense financial risk” to the state of California. The report might well kill the prospects for a true HSR project in the United States for the foreseeable future.
So, why did Obama’s signature infrastructure project meet such a quick demise ? While each project has its own reasons for failure, the Obama administration also made a critical tactical error in the way it awarded funds. Instead of identifying and investing in one promising project, the administration allocated $10 billion ($8 billion from the American Recovery and Reinvestment Act and $2 billion from appropriations) to 13 HSR projects in 31 states to foster the development of a national HSR network all at once. Additional federal funds for the network (approximately $43 billion according to Obama’s plan) were to be secured through the annual appropriations processes. The administration’s strategy appears to have been to hope the initial federal investments would spur even more substantial state and local investments in HSR, especially in a number of swing states, leading to the creation of a national network. At current estimates, a national HSR network could cost hundreds of billions of dollars — the California system alone is projected at $98 billion. With dramatic budget cuts looming, a slow economic recovery, and a toxic political environment, this strategy is not viable.
The lack of significant progress on HSR is unfortunate. A well-planned and smartly operated HSR system can be transformational for cities, helping them to maintain or improve quality of life and enhance economic competitiveness in the global economy. At one level, HSR facilitates intercity travel, fosters regionalism, and can enhance regional economic viability. At another level, as populations and densities are projected to rise in America’s large urban regions, new and better mobility alternatives will be imperative to meet a host of associated challenges. When integrated intelligently with other modes of transportation into the urban fabric, HSR can help stimulate the development of economically vibrant corridors and station stops.
A better approach to start up a national HSR network in the United States can be found in Spain. Over the past two decades, Spain has created the longest HSR network in Europe. However, AVE, the Spanish network, began with a single project, the Madrid-Seville line, which proved itself for more than 10 years before significant expansion occurred. The line, averaging 185 mph, cut the 300-mile trip time by more than half between the two cities, significantly decreasing the automobile and air travel between them but increasing the number of individual trips. Equally compelling, existing businesses near AVE stations have reported significant benefits from the investments in infrastructure. None of this is to say that Spanish HSR has been perfect — the Spanish government ultimately may have over-invested. But if the Obama administration chooses to revisit HSR, a more effective strategy would be to start small, be focused, invest smartly, and allow HSR to prove itself, which could put aspirations for a national HSR rail network back on track.