The President's Vision for High Speed Rail

A high speed rail train in Japan

Buzz over the COP-15 conference in Copenhagen is increasing. There is much talk of pessimism over a comprehensive deal getting done. The United States recently made bilateral deals with China and India, the number one and four emitters of greenhouse gasses in the world. The President also stated that the United States will be reducing its emissions by seventeen percent by 2020. While it is a modest commitment, and half of what a number of European nations will have done since Kyoto, there is still the question of how exactly the United States will accomplish that goal. While much of our emissions come energy use by buildings, energy that is largely derived from coal, the transportation sector makes up roughly 33% of emissions in the United States. There is so much talk of making changes in the transportation sector through hybrid cars, hydrogen and electric car technologies that are not yet ready for mass consumption, and even more off-shore drilling so that we do not have to rely on unstable and expensive supplies of foreign oil to power our vehicles. Where did the discussion on instituting high speed rail in the United States go? It seems to have disappeared from the agenda. Even the Department of Transportation seems to admit this, as it watches Russia put service online between Moscow and St. Petersburg.

While the technology has existed for decades and been instituted successfully in Europe, the United States has continued to rely on petroleum for over 95% of its energy needs in the transportation sector instead of the increasingly clean energy from the grid. This number has remained virtually unchanged since the 1970s even though use of petroleum has declined substantially in all other sectors. Within transportation there is the distinction of passenger and freight. One third of freight transportation is conducted by rail, among the highest figures in the world. This system is reliable, effective and allows for lesser emissions than transporting goods by air, sea or worst of all, eighteen-wheeler. Our passenger rail system, on the other hand, makes up a miniscule percentage of means of transportation in large part because Amtrak has been a gigantic failure.

Run by the National Passenger Railroad Corporation and run by the government, its system has no accountability. Amtrak represents a natural monopoly, and anyone with an elementary school education can understand that this results in no incentives to improve price, efficiency or innovate. The result is trains that run at a fraction of the speed of those in Europe and Japan, huge losses in operating costs and constant needs for government bailout because it represents the only viable alternative to air travel in some instances. Even its Acela service on the Northeast Corridor (Boston through Washington D.C.), an attempt at high speed rail, failed miserably. While the trains can run at 150 MPH, by using existing tracks unlike Japan’s Shinkansen and France’s TGV, poor infrastructure means they only average half that. In Japan, the Shinkansen was reaching speeds of 130MPH in 1964 and today the TGV can average 170MPH for the duration of a journey. Inefficiency and high costs have made Acela service prohibitive.

There are a few realities of high speed rail that any attempt at creating the proper infrastructure in the United States must understand. First is that the idea of a profitable national rail system is a myth. Why would anyone want to go from New York to Chicago or from Houston to Las Vegas or Los Angeles by rail when it’s cheaper and exponentially faster to travel by air. Yet, travel along the Northeast Corridor, from New York to Washington D.C. by air is expensive because of the fixed costs in airline tickets, and the airports for these cities, JFK and Dulles being the largest, are out of the way of the city centers. Furthermore the process of checking in and leaving an airport can add hours to your journey. A train, leaving from Pennsylvania Station in New York and traveling to Union Station in Washington DC at an average speed of 175MPH can be forty-five minutes faster than air travel and three to four hours faster than driving. There demand for high speed rail service is limited to travel between large cities that are less than five hundred miles apart – places that are too close to fly to but too far to drive. The issue is there is currently no comparable service, showing the potential for profit based on the competitive advantage that high speed rail provides in this market in terms of time saved.

There are other issues to implementing a successful high speed rail system. The total cost of implementing a high speed rail system in areas that show potential for profitability could cost the government $100 billion to $500 billion total, depending on whose cost estimate you believe. The issue then becomes whether this investment will reduce carbon emissions and then whether it will be debt-neutral. In order to save energy and reduce carbon emissions and break even, trains must be filled at least to seventy percent capacity. Pricing tickets to reach this level of capacity can require heavy government subsidies. This is why I believe that a public-private partnership, similar to that in the United Kingdom, will be necessary for success. The government will own the tracks, but should contract regional companies to own and operate trains and pay to use these systems of tracks. If a company fails, the government can find a new private partner. With a system based on this model, high speed rail can be a worthy investment. Ridership in Japan is currently 300 million and it is 100 million in France. Creating a system that people want to use can be done.

If we are to make high speed rail a part of our nation’s clean energy strategy, jobs at home must be part of the plan. If we are to invest as much as $500 billion in such a system, this money simply must be invested back into the American economy. We cannot seek out French or Japanese companies to build our trains, or even for parts. We must use American innovation to develop the appropriate technology and build the system entirely within the United States if we are to enjoy the full multiplier effect of the stimulus that this investment will provide. As logical as this may sound, it is far too easy to use the manufacturing power of companies in foreign countries that have already successfully built such trains. We must also build tracks dedicated to high speed rail, something the Obama plan has not committed to doing. Trains cannot reach even close to the average speeds they are capable of otherwise.

The other issue is that by taking cars off the road and planes out of the sky, we are putting more pressure on an already inefficient energy grid that uses a great deal of coal to supply its power. A concurrent investment in nuclear, wind and solar infrastructure as well as conservation within buildings and a high-tech energy grid will make the most of the emissions saved by a national high speed rail system. Trains that are near capacity will emit less than half of what the equivalent number of cars or planes would emit, but emissions can be reduced to zero if the energy supplied is clean and sustainable. France, for example, relies on nuclear energy for much of its power and thus its comprehensive high speed rail system emits next to nothing. How much longer will we look up to the French?

There are many wrong ways to institute high speed rail and I only support the investment if the issues I brought up in this column are addressed. I am not optimistic that our current political system can produce a plan that will do the right thing, but I hope I have convinced you of the potential this technology has to help fulfill our proposed commitment of reducing emissions by seventeen percent by 2020.

For more an even deeper look, check out this fantastic post on The Upward Society Blog.