Maybe we should be happy that it is mismanaged-maybe it won't get done.

Good coverage, Gennady. Thanks for such thoroughness.

The rail authority list of shortcomings is enormous. They are arrogant. They are untruthful. They are incompetent. They are procrastinators. They are dishonest. They are politically corrupt. The are financially corrupt. There are other failings that will crop up, but this list is a good start.

This is not my personal opinion only. There is a documented track record substantiated by a number of government agencies, the most recent being the Legislative Analyst's Office, which had issued a prior, equally damning report some time ago. The State Legislature itself has been putting out critical reports since before the 2008 elections. The State Auditor, the State Inspector General and the CHSRA peer review committee have all issued critical reports on the rail authority. And, I'm not citing non-government sources of criticism, only the state government ones.

As it happens, the Inspector General of the US Department of Transportation is also fully aware of this situation and is maintaining a case book and number for this problem, which continues to be under their observation.

There will be considerable further examination of the meaning of the LAO report. Which criticisms are actionable? What possible actions can the Legislature take that are also politically acceptable? At what point will even the most ardent Democratic politicians realize that this project is much more an anchor and much less a sail? There is an embarrassment factor that can easily surface at election time in 2012; will enough candidates understand that and act decisively now, or wait for the facts to hit the fan at the later and more importune time?

Let me say here that I'm not a fan of the current batch of legislation going through the pipeline, or some of the recommendations made by the LAO Report. I'm talking about taking the responsibility for the HSR project out of the hands of the CHSRA Board and turning it over to the CALTRANS/ Department of Transportation. This appears to have great appeal for many who have objected to the rail project, mostly based on the inadequacy of the rail authority. That's not good enough.

For me the reason for rejecting this bureaucratic change is the larger question of whether to build inter-city high-speed rail; should California be doing this at all?

No, is my answer, for a number of reasons.

A. The required development funds will be so staggeringly high that there can be no justification for this project on any cost/benefit basis. The costs to taxpayers will be vast and endless.

B. The state does not need supplementary inter-city passenger transit modalities, especially if they are of the premium, luxury, first-class kind that characterizes high-speed rail. The state should be fixing what's broken, and there's no shortage of infrastructure, including transit, that requires repair or replacement.

C. There are other, far more pressing and worth-while investments that should be made with any available funds, particularly in a state in the present fiscal crisis. Slashing education while funding this project is outrageous. It's also economically stupid.

D. Even with a competent administrative bureaucracy, this is a government project that will serve far too few people for far too much cost, both development costs and operating costs.

E. It is not, in any way, imaginative, strategic, creative, innovative, and in every other regard anything like what America is capable of; see Silicon Valley as an example of that. It will be bought off the shelves of other countries. By the time of its completion, it will be as obsolete as Amtrak is now. Break-through transit technologies will emerge from other countries, not our own. Hence, it's a lousy investment for us, unless we seize the leadership in the transportation technology equivalent of computers.

F. Since it is not a private sector for-profit business like the air carriers, it will require enormous and permanent subsidies even as it serves too few people, and those are the members of the social/economic class that requires the least amount of government support.

For more extensive discussion of high-speed rail and its discontents, see this blog:
Web Link

$67 Billion! Holy cow! That's enough to buy over 2 million Priuses or 1.5 million Chevy Volts. Or use it to provide a 50% subsidy and double those numbers.
Getting that many fuel-efficient cars on the road would go much farther in reducing oil imports & meeting carbon-reduction targets than HSR would in 50 years (I'm guessing).
Not to mention all those jobs that would be created in this country to produce them.
Just to provide an alternative to think about

Martin,

Thank you for being well-informed and willing to express yourself.

Your summary is devastating.

If I may add, there is a broader context: The US is busy degrading the value of its currency through excessive debt. The effects of this process are currently evident at the grocery store and the gas pump. These costs are not going to go down in the near or long term. Peak oil has been passed. It is my maintenance that this is not your normal business cycle variation. Borrowing money for non-productive activities has the long term effect of degrading the dollar and reducing the wealth of all who hold it. This effect impacts the poorest first (part of the credit/debt/inflation plan of the central bank). So effectively what we're talking about is borrowing money now to give to special interests building the infrastructure and enhance the careers of every politician in sight for doing so at the expense of the poor and the rest of us who use dollars.

Plug your analysis behind this and you see why I characterize this project as nothing less than madness.