BY BECKY FENGER | JANUARY 18, 2012

A lesson for Arizona

Becky Fenger Fenger PointingLast Saturday, Wall Street Journal columnist Kimberley Strassel gave a shout out to California Governor Jerry Brown for his honesty in admitting that he is going to use a big chunk of a carbon-emissions tax to pay down his state's debt. This is telling. Until now, supporters of the tax insisted the tax burden was solely to better the environment and not for revenue enhancement. They've just been busted.

The staggering debt in that state makes it all the more amazing that the California High-Speed Rail Authority is pushing ahead with plans for one of the nation's most ambitious bullet trains.

President Barack Obama is hell-bent to spend billions we don't have on such projects. Ohio and Florida have wisely said, "No, thanks," but California likes to throw caution to the wind. The system would run from downtown San Francisco to the Los Angeles area. Estimates put the cost of the system at $34 billion when it was originally proposed. But new, more honest figures put the bill at nearly $100 billion! A plan to stretch out construction by 13 years allows inflation to drive up the cost.

Although the Los Angeles Times reported the bad news, their editorial board still is pushing to build the albatross. Worse, the Mercury News reported two months ago that California's Legislative Analyst's Office questioned the legality of launching a high-speed train and warned that starting construction on the rail line next year could be a $6 billion waste of tax funds at the expense of social services, education and other transportation projects.

Backers hope to build a segment from Fresno to Bakersfield for $6.3 billion (too short for bullet train service), even though they don't have a dedicated source of revenue to go any further. This is a ploy used by light rail pushers. Get that shovel in the ground with any sort of starter segment so they can justify future extensions in the name of protecting the original bad investment.

The fact that the United States is broke and may in the not so distant future, as predicted by some analysts, default on our debts is reason enough to be leery of counting on federal funds for rail projects.

Investor's Business Daily points out that the one-way fare between Los Angeles and San Francisco would be $81 in today's dollars, whereas plenty of flights between the two cities, with a two-week advanced purchase, cost $139 round trip. Critics further this point by emphasizing the advantages air travel and cars have over the trains that are set to be used, arguing its usefulness will be minimal, says the investment magazine. Sobering thoughts.
Even more sobering is the high-speed rail news out of China not long ago in Caixin Weekly, the country's leading English-language business magazine. Putting aside the derailment of a bullet train on July 23 that killed 40 people, the critical article reports on faulty construction in a race to go faster. Officials there are accused of hiding the true costs of the project.

According to the article, summarized by The Heartland Institute, even the Communist government is troubled by the level of corruption involved. (Gadzooks!) The first section of high-speed rail cost nearly twice projections. Two months after its 2010 opening, the high-speed line from Beijing to Fuzhou closed for lack of passengers. The displacement of traditional rail service, it warned, could "cause social instability." Some Chinese say the great leap for fast-track construction could eventually bring down China's entire banking system. (Are you listening, Obama?)

One doesn't hear shiny stories about China's fabulous bullet trains in our mainstream media so much after the derailment, but there have been articles in Arizona's paper of record touting a line from Phoenix to Las Vegas, Nevada, or "the Golden Triangle of a high-speed rail system that moves passengers at 150 to 220 miles per hour between major stops in Phoenix, Los Angeles and Las Vegas." Golden, my foot.

Seldom if ever do taxpayers get to know the full costs of a rail system when voting on a project. There are no estimated annual costs for actual operation or maintenance. Nor are pay benefits for employees included. That might frighten the voters.

I am reminded of an e-mail U.S. Senator John McCain sent me some years ago in which he claimed that rail projects always come in "on time and on budget." (He's such a kidder.)