In a column for the Los Angeles Business Journal, Reason's Adam Summers writes:
Californians are being asked to consider a $10 billion bond measure to build a high-speed rail system, but the proposal is critically flawed and should give voters serious pause, especially in the current economic climate.
Proposition 1A would authorize $9.95 billion in general obligation bonds to start building an 800-mile high-speed rail system linking Southern California with the Bay Area and Sacramento, including the backbone Los Angeles-San Francisco segment. There are crucial questions about the financing of the project, however. For starters, where will the rest of the money come from?
The $10 billion bond would cover less than one-quarter of the projected $45 billion project cost. Proponents hope that they will be able to coax one-third of the cost ($15 billion) from the federal government, which has budget problems of its own and is currently struggling with a planned $700 billion bank bailout and a possible $25 billion bailout of the auto industry. The remainder (about $20 billion) is supposed to come from the private sector, and there is similarly no guarantee that this money will ever materialize. Furthermore, a business plan that the California High-Speed Rail Authority (CHSRA) was required by law to submit by September 1 still has not been completed, and, conveniently enough, apparently won't be available until after the election.
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