Even NY Times Doubtful About California Boondoggles

by Warner Todd Huston | December 10, 2011 11:36 am

You know a government project is headed for disaster when even the New York Times becomes skeptical about it.

In a recent article[1], the “newspaper of record” interviewed several public officials, transportation experts and historians who raise “serious objections” about the viability of California’s High-Speed Rail project — a project created by a ballot initiative.

Each critic cites cost overruns, inflated ridership projections and questionable travel routes as reasons why this transportation project a ballot measure funded by taxpayers is going to cost billions more than expected — and literally create a road to nowhere. This revelation comes at a time when the state is already facing financial Armageddon.

“…several experts suggested that the train would never attract the promised ridership…” the article said. “Low ridership would undercut the economic and environmental benefits that are part of the argument for the project.”

Worse, those tasked with planning and running the new high-speed rail project are scheming instead of planning. One of the serious questions about this project is where the construction is set to begin. The first leg is being started in an area of low population density among people who have little interest in using the railway.

One might think this a mistake. Why not start the project where it will have the most immediate return in money? Why not start it in the high population areas where some cash flow might be realized sooner? Wouldn’t that make more sense financially? Well, it would if making money was actually a goal of the new California High-Speed Rail Authority[2] created by a ballot initiative.

Here is where the scheming comes in (my bold for emphasis).

The authority said it chose the relatively remote section in the Central Valley as the first leg to be built, even though few people there are looking to use a railroad, so that construction could begin next year and meet deadlines for using federal money. But critics suggest that the real motivation was to get the spur in place, calculating that future legislatures would not be able to abandon the project before it reached major population centers.

So, instead of looking to make financial sense of this project, the government planners are really only interested in making sure the government spigot keeps pouring funds in to their project. Like all government boondoggles, making good capitalist decisions is not a goal.

There are other boondoggle ballot measures that California has to deal with, of course. Given its new-found scrutiny for wasteful government spending, the New York Times ought to take a look at a ballot measure up for vote next June. The California Cancer Research Act, for instance, is little else but a $1 billion tax-hike[3] in disguise, with about $130 million of new annual spending on buildings, facilities and more government employees which will go on year after year regardless of whether California can afford it or not. The California Cancer Research Act would create a whole new bureaucracy to duplicate existing programs, adding new cost burdens to a state that it definitely can’t afford it.

Decades of boondoggle projects have pushed California to the financial brink. If California wants to try something truly radical, it should focus on paying for the things it already has on the books for a change before going off on new spending sprees like cancer research and high-speed rail projects no one wants.