One of the main problems with Lopez’s column is that it follows the common but deeply misleading approach of presenting the issue as the people versus the government, with the newspaper on the side of the people. It’s a convenient fiction, but has the effect of silencing the large number of people who do back the project. Watch how Lopez dismisses HSR supporters:

Readers by the hundreds weighed in after that column. Many of them were still passionate about moving ahead, while others insisted it’s time to give up the dream. And quite a few couldn’t believe Gov. Jerry Brown is still pushing the project despite the state’s staggering financial burdens.

That one short fragment of a sentence – “Many of them were still passionate about moving ahead” – is all that Lopez has to say about HSR supporters and our arguments. He feels a journalistic obligation to note that we exist, but that’s about it. He is clearly throwing in his lot with the skeptics, even though HSR backers marshaled some compelling points he chose to ignore.

Instead Lopez, siding with the critics, gave credence to some absurd ideas that fly in the face of evidence:

I told [CHSRA Board Chairman Dan] Richard I’d heard from lots of readers who worried that we might be investing in a railroad whose technology is outdated, if not obsolete, when it’s finally finished. High-speed, computer-programmed driverless cars are no longer the stuff of science fiction. And then there are cheerleaders for high-speed Maglev trains, a magnetic levitation system that’s already in use in Shanghai, among other places.

So, actually, high-speed driverless cars and long-distance maglev trains remain the stuff of science fiction – nobody has ever made them workable. And the cost of building them is far, far, FAR higher than the cost of building traditional, proven, successful steel wheeled bullet trains. It’s ironic that Lopez can’t bring himself to deal with any of the arguments made by HSR backers, but he treats fanciful and extraordinarily expensive gadgets as some kind of realistic alternative.

But what’s driving Lopez’s skepticism is the same thing that drives every other piece of HSR skepticism: a belief that Californians, unlike everybody else in America and the world, won’t ride bullet trains:

But will enough drivers get out of their cars in 2033, or give up on air travel? Will millions of people who don’t live near a high-speed station, and can’t easily get to one because of heavy traffic and inadequate regional transit, ever ride the bullet?

We know the answers to these questions already, but Lopez simply did not bother to look them up. Drivers are already getting out of their cars. Vehicle miles traveled is in decline. A recent study found that car use in LA has declined by 2% and in SF by 4.8%. Californians are buying less gas. As I explained to Lopez on Thursday, this is part of a long-term shift away from driving that has car companies scared to death – a shift that Lopez hasn’t heard a thing about. Maybe he should go ask people whether they’d rather sit behind the wheel in traffic or sit on a comfortable train seat with their BlackBerry or iPad.

As to getting to a bullet train station, the inconvenience of getting to LAX hasn’t stopped people flying to and from that airport. In fact, LA Union Station will be one of the easiest places to get to for Angelenos, sitting at the center of the region’s transportation network. By 2030 Union Station will be the hub of an extensive rail network.

We don’t know what jet fuel will cost, or how long airport security check-in will take in 2033. High-speed rail folks say the projected cost of a train ticket from Los Angeles to San Francisco — a trip of 2 hours and 40 minutes — will be 83% of the cost of a plane ticket. But like everything else, that’s speculative.

We actually have a pretty good idea of what oil-based fuels will cost in 2033. Oil market analysts, such as those at Deutsche Bank, project the price of oil will have $100/bbl as a floor, with regular spikes well above that amount. Even the $100/bbl floor assumes demand destruction and development of alternatives, such as high speed rail. There is no rational argument anywhere out there that jet fuel costs will come down in the future, but there is a lot of evidence that it will continue to rise.

As to whether people will ride HSR, there’s nothing speculative about that at all. The facts are in and they are clear: people will choose trains over planes when given the choice. Riders have flocked to HSR from planes around the world and in the Northeastern United States. Japan and France, Spain, Russia, Taiwan, even the Amtrak Acela. And California compares favorably to those globally successful routes.

While there may well be reasons to be skeptical of HSR, and reasons to look closely at the project’s price tag, Lopez’s reasons just don’t stand up to scrutiny. In the end he’s just another reporter who refuses to drop his outdates, obsolete preconceptions and look at the world around him, look at the evidence, and draw conclusions based on what he sees rather than what he assumes.

Lopez concludes his article with a strained effort at trying to convince readers he isn’t really biased against HSR:

Some of us who want to be believers need a lot more convincing.

And I’d like to believe Lopez has an open mind about this, but if he continues to pretend that HSR supporters don’t exist, if he continues to ignore the considerable weight of evidence that shows his concerns and assumptions are totally unfounded, then it’s going to be hard to convince me Lopez is anything but a project skeptic.

The LA Times’ Steve Lopez, whose columns I enjoy, sometimes falls into this camp. His column today, Should California bite the bullet on high speed rail?, suffers from the problems of an assumed conservatism and a lack of background on the issue. Lopez’s primary error is ignoring the evidence from both the ridership studies and from around the world showing that California high speed rail will generate high ridership. By instead assuming that it’s doubtful that the train will attract riders, Lopez suffuses his entire approach to the issue with a skepticism that is unwarranted by the evidence:

But when I spoke to rail passengers at Union Station on Monday night, and to air travelers at Burbank on Tuesday morning, I got roughly the same amount of support for high-speed rail as I did criticism of the project. This mirrored my own thinking. I like the concept. I just don’t know if it’s a realistic or even sane idea at the moment, despite Gov. Jerry Brown’s recent cheerleading efforts….

“That much money is obscene,” said Kevin Lundby, a human resources manager who was waiting for a train to get him home to Santa Clarita.

But “if it can support itself” (that’s a very big if), and “if it creates jobs” (which it certainly will, despite disagreements over how many), he’d be willing to at least try taking the train.

In fact, it is NOT a “very big if” whether the train can support itself. It’s actually highly likely that it will be able to do so. It’s not like California is proposing to do something radical and untested. We’ve known for 50 years that high speed rail works. And it turns a profit – in Japan and France, Spain, Russia, Taiwan, even the Amtrak Acela. And California compares favorably to those globally successful routes. In most of these cases, riders have flocked to HSR from planes – including the Acela.

Many HSR critics and opponents are motivated by their belief that nobody will ride trains in California. Those arguments are completely baseless, fly in the face of the available evidence, and should simply not be taken seriously. Amtrak California is setting ridership records. Remember that the independent peer review found the HSR ridership numbers to be sound.

Lopez doesn’t appear to be aware of any of this. I’m guessing he’s only been reading Ralph Vartabedian’s biased and flawed reporting on the project. But if Lopez is serious about getting more public feedback on the project – as he suggests in his column – then he’s going to have to confront these facts that directly challenge his preconceptions.

Lopez also fails to ask what the cost of not building HSR would be. It’s at least the same as the possible $100 billion cost of HSR, is perhaps as high as $170 billion, and that’s before you include the cost of maintenance, of oil, and of lost economic activity because of the rising cost of oil. Lopez quotes someone from Lompoc who actually points out the cost of oil, but it’s tacked on at the end:

Parks, who was on her way to her best friend’s funeral in Omaha, said she thinks our gluttonous oil dependence should be a strong consideration. There’s been much difference of opinion as to how environmentally friendly high-speed electric rail will be versus air travel or auto travel — all vehicles might be electric in 20 years — but Parks’ point goes beyond that. She’s concerned about diminishing supplies of fossil fuel, and the many costs of going after it.

“Someday, we’re going to have to face this,” she said.

Lopez also needs to think through the electric vehicle issue. If the state’s population keeps growing, then even if you somehow convert the entire private automobile fleet to electric vehicles you still have to face the costs of widening freeways to accommodate those vehicles.

Even then, are people going to want to drive? Lopez seems to still be in a 20th century mindset, where driving is seen as the most flexible way to travel. That’s no longer true in the 21st century, since time spent behind the wheel is time spent away from one’s digital device. The great shift away from driving has been under way for some time now. Driving is inconvenient in the age of the iPad and the Blackberry. So too is flying, for that matter. But a high speed train allows you to stay online and connected through the duration of your trip. That’s a big advantage.

At the very end of his column, Lopez invited readers to email him your thoughts on high speed rail. I’ve emailed this post to him. I hope you’ll also share your thoughts – nicely, of course – as to why high speed rail is a very good and a very important thing for California.

In 2011 a Republican House did gut HSR funding, but again this was not the CHSRA’s fault. But in a new report the State Auditor continues to hold the CHSRA responsible for Congress’ failures on funding transportation policy. The result is yet another flawed report from a State Auditor who does not appear to have a strong grasp of transportation funding.

Although the Authority has secured funding for the Initial Construction Section (construction section)—the first portion of the program—the program’s overall financial situation has become increasingly risky, in part because the Authority has not provided viable funding alternatives in the event that its planned funding does not materialize. In its 2012 draft business plan, the Authority more than doubles its cost estimates for phase one of the program, to between $98.1 billion and $117.6 billion. Of this amount, the Authority has secured approximately $12.5 billion to date. The success or failure of the program consequently depends upon the Authority’s ability to obtain between $85.6 billion and $105.1 billion by 2033.

So the Authority gives itself 21 years to get as much as $85 billion from the federal government (although they will need much less – once an Initial Operating Segment is open, private money will step up to the plate). They’ll obviously need money sooner than that, and while this present Congress isn’t likely to give it, this present Congress is not going to last beyond the end of this year. Democrats continue to dominate the generic Congressional polls, a key indicator of their growing chances to reclaim the House in November. So the chances of the Authority getting more federal funding in the near future are not nearly as bleak as critics imagine.

The State Auditor doesn’t explain any of this. Instead they continue to bash the project as “risky”:

In its 2012 draft business plan, the Authority identifies the federal government as by far the largest potential funding source for the program, yet the plan provides few details indicating how the Authority expects to secure this money. Further, the plan does not present viable alternatives in the event that it does not receive significant federal funds. In fact, one of the funding options the Authority characterizes as an alternative is not yet approved for use on high-speed rail projects. Although it is possible that the Authority may obtain the necessary funding to move forward with the program, it risks significant delays or the inability to proceed if it does not.

The problem is that this isn’t unique to high speed rail. Many transportation projects, like BART to San José, rely on getting federal funds that they’re not guaranteed to receive.

But we can make a bigger point. If Republicans prevail in November, winning the Senate and the White House in addition to the House, one could then say that pretty much everything the State of California does is “risky” since federal budget cuts could undermine virtually every service and program currently provided by the state, from schools to parks to roads. The State Auditor isn’t really telling us anything useful here.

Some of the State Auditor’s concerns border on the absurd:

Further, the Authority’s 2012 draft business plan still lacks some key details about the program’s costs and revenues. In particular, only within the business plan’s chapter about funding—more than 100 pages into the plan—does the Authority mention that phase one could cost as much as $117.6 billion, whereas it uses one of its lower cost estimates of $98.5 billion throughout the plan. Moreover, neither of these cost estimates includes phase one’s operating and maintenance costs, yet based on data included in the 2012 draft business plan, we estimate that these costs could total approximately $96.9 billion from 2025 through 2060. The Authority projects that the program’s revenues will cover these costs but it does not include any alternatives if the program does not generate significant profits beginning in its first year of operation. Further, the plan assumes, but does not explicitly articulate, that the State will not receive any profits between 2024 and 2060, because private sector investors will receive all of the program’s net operating profits during these years in return for their investment.

The State Auditor doesn’t examine the rising cost of oil or other globally successful HSR systems (virtually all of them, including the Amtrak Acela, cover their own operating costs), simply assuming that the system will somehow have trouble, unlike all the other HSR systems, in covering its costs. If the State Auditor still thinks gas will be at $4 a gallon 50 years from now they are simply delusional.

As to the state not receiving any profits, well, unfortunately that’s by design. But that isn’t a problem for the HSR project, since Prop 1A mandates that the state not subsidize its operations. That’s a moronic and stupid rule, but it is also a rule the system can meet. If the system covers its own costs, as global evidence suggests it will, then the state faces no obligations and if private sector investors get all the profits, that’s stupid but not necessarily a financial problem from the state’s perspective.

The State Auditor makes their own anti-rail biases clear in the way they attack the ridership studies by innuendo:

The accuracy of the Authority’s estimates of the program’s profits depends upon its ridership projections, which are thus fundamental to private investors’ interest. The ridership model the Authority presents in its 2012 draft business plan assumes an average ticket price of $81 and projects that passengers will take a total of 29 to 43 million annual trips by the completion of phase one. However, when the Authority’s chief executive officer commissioned a ridership review group to independently assess the ridership projections, he handpicked the group’s members, which may call into question the independent nature of their assessment.

OK, this is simply bullshit. If the State Auditor cannot actually find technical fault with the ridership recommendations or the peer review of those numbers, they have no business impugning the peer review group or Roelof van Ark for putting it together. This kind of baseless attack has no place in an official report such as this.

The report goes on to make a number of recommendations regarding contract oversight and those are all well and good. But it is frustrating to see the State Auditor continuing to hold the CHSRA responsible for Congress’ failures, and their unfair attack on the peer review of the ridership numbers is a particularly ridiculous move that shows their inherent biases.

KQED: Proponents say people like you are ignoring the cost of not building the system, because we have to accommodate projected population growth.

White: What will high-speed rail do? It’s not going to take pressure off the roads that are most congested. This is a proposal to shuttle people up and down the San Joaquin Valley, between SF and LA, with some stops in between. They’ve left out Sacramento and San Diego already.

And I don’t think it’s going to be able to compete with airline routes. We have fairly efficient airline transportation between the Bay Area and Los Angeles. I don’t see really what good this is going to do.

Once again, White shows he has a difficult time with the facts. Evidence from this country and from the rest of the globe shows it’s actually airlines that have a hard time competing with HSR, not the other way around. The Acela has over half the rail-air market share on the Northeast Corridor. In Spain, where Barcelona-Madrid had been the world’s busiest air corridor, airlines lost over half their ridership to the AVE high speed train within 2 years of it opening in 2008.

Further, airlines actually want high speed rail, including JetBlue. They point out that air travel from SF to LA isn’t actually very efficient for them. It’s costly to operate, with mid-range and long-range flights actually being more efficient and profitable. Airlines like JetBlue prefer that trains carry the short-haul passengers, opening up more terminal slots for flights.

White continues:

KQED: So what would the right time look like?

White: When Californians are ready to get onto trains. Which they’re not.

It should be built after you take care of the low-hanging fruit. Why not regional transports around SF and LA, projects that will get people off the freeways where they’re the most crowded? I-5 is not pleasant, but I wouldn’t say that it is our major problem in California transportation and that’s all this is going to fix.

Also, this does nothing about trucks. What railways have been good for is freight. That’s what we should be getting off the road. I don’t see passengers as the real problem.

I agree that we need more freight rail and more local rail, no doubt about it. And Los Angeles is building that better local rail, thanks to voter passage of Measure R in 2008 – something White appears to not know about. But as I have consistently argued, this isn’t an either/or issue. We can and must do all these things, including build high speed rail. After all, the days of cheap flights are passing quickly and as oil prices rise – something White does not acknowledge to be a problem – alternatives will be essential.

But more importantly, White’s core contention is that Californians don’t ride trains. This is nonsense. Let’s look at the facts.

The most recent Amtrak California ridership numbers show rapid growth and strong ridership, especially given that these are trains with a top speed of 79 mph but usually average slower than that:

Capitol Corridor (September 2011):
- Ridership: 145,894 riders; +11% vs. September 2010; +8% vs. prior YTD
- Revenue: $2,194,480; +17% vs. September 2010; +12% vs. prior YTD;
- On-Time Performance: 94%; YTD OTP of 95% (again keeping the Capitol Corridor service #1 in the nation).
- System Operating Ratio: 49% YTD vs. 47% in FY10; continued growth in ridership and revenue keep ratio at standard; however, diesel fuel prices remain a budget concern.

The Capitol Corridor route continues to be third busiest route in the country, with ridership at recordbreaking 1.7 million for the last 12 months.
________________________________________________
Pacific Surfliners (September 2011):
- Ridership: 210,528 passengers; +5% vs. September 2010, and +7% ahead of prior YTD
- Ticket Revenue only: +20% vs. September 2010, and +12% vs. prior YTD
- On-time performance for September 2011 73% (YTD FY 2011 on-time
performance: 78%)
__________________________________________________
San Joaquin (September 2011):
- Ridership: 85,736 passengers +19% vs. September 2010, and +9% vs. prior YTD
- Ticket Revenue only: +19% vs. September 2010, and +14% vs. prior YTD
- On-time performance for September 2011: 90% (YTD FY 2011 on-time
performance: 90%)

Still, Amtrak California is an imperfect comparison, given that it is slower, has to share tracks, and doesn’t connect SF to LA. High speed rail around the globe has none of those problems and has much higher ridership levels. California’s HSR system will have high ridership too. And the independent peer review of the ridership proposals found those projections to be sound.

Richard White knows how peer review works. For him to claim nobody will ride the trains and ignore the work of the peer review committee would be like a bunch of transportation planners dismissing White’s pathbreaking book The Middle Ground because they saw a John Wayne western that told them a different story about Native Americans and therefore refuse to believe what White has to say.

White doubles down on his “nobody will ride trains in California” argument:

KQED: In California we seem to have this idea that we can take on huge projects, that we’re almost our own country. Is that changing?

White: Well, look at the big infrastructure projects that have worked in California. The interstate highway system: They had a dedicated revenue source to pay for that, plus a gas tax. The dams have subsidized major agricultural interests — in a very unfair way, I think — but at the same time, they built in a revenue source to pay for it, because dams produce power.

High-speed rail says it will have a revenue source with the passengers paying the fare, but that’s laughable. I don’t think anyone in their right mind thinks fares are going to pay for this.

Um, actually, a LOT of people think the fares will pay for this, just as they do in France, Spain, Russia, and Taiwan – just to name a few. Oh, and the Amtrak Acela is also profitable.

So yes, Richard, we who are in our right minds know that fares can pay for train operations. It’s because we look at the evidence before we make statements.

California also compares favorably to those other HSR routes, but White tries to dismiss this:

KQED: What do you think is the difference between America as opposed to Japan and France, where high-speed rail has been successful?

White: When you take a high-speed rail train in France, from Paris to Lyon, you’ve got an infrastructure of public transportation that gets you to the rail station on time, and when you get off you can simply get on public transportation after. The same goes for Kyoto and Tokyo.
That’s not true of SF and LA.

We are building a high-speed rail network without the public transportation at either end of it. You need that because after the high-speed rail ride, people will have to get back in the car and drive a great deal.

Um, no. SF and LA have decent public transit systems (LA has the second highest ridership bus system in America) and by 2030 it will be even bigger. By that time, when HSR will be complete from the Bay Area to SoCal, Los Angeles Union Station will be the hub of a major rail network:

Click for larger version

Even KQED was incredulous at that argument:

KQED: You say there’s no good public transportation in California, even in a city like San Francisco. Explain.

White: The secret to a good public transportation system is you don’t have a schedule, like in NY and Chicago. You just show up and you know that within 10 or 15 minutes something will come along. When you need a schedule and you miss it and you have to wait 45 minutes or so that’s not a real transportation system. In the Peninsula, bus service is for poor people, because they’re the only ones who are desperate enough to wait an hour for the buses to come along. It would be a joke to try to use public transportation on the Peninsula. We should be creating a structure where these things work.

I’ll be first in line to argue for better bus service. But he seems to ignore Caltrain, which is a very popular service with good ridership levels – especially on the Baby Bullet trains, which are the fast trains with limited stops. Kind of like high speed rail!

But notice what White does here. KQED asks him about SF, where Muni has its problems but is a very extensive system with high levels of ridership from the middle-class as well as the poor. But he doesn’t answer the question about SF, instead shifting the discussion to the Peninsula. He simply evaded the question entirely.

Again, I think White is right to raise flags about the problems that might come with private involvement at public expense. But the rest of his anti-HSR arguments boil down to the usual “nobody rides trains in California” crap that has been thoroughly debunked.

Maybe White needs to take a tour of rail in California. Ride a packed Caltrain, transfer to a packed Muni train, transfer to a packed BART train, then transfer to a packed Capitol Corridor train. Maybe take a nice San Joaquins trip to Bakersfield (and be surprised at how many people are on that) and connect to LA via bus, or take a sold-out Coast Starlight to Southern California. Once at Union Station, take a packed Metro Rail train out to Hollywood, or a packed Metrolink train to Orange County, and a packed Pacific Surfliner train back to LA Union Station.

Maybe then he’ll drop this “nobody will ride trains in California” nonsense?

U.S. Sen. Robert Casey (D., Pa.) has urged the chief executive officer of US Airways Group Inc. to rescind the airline’s fare hike planned for flights between Philadelphia and Pittsburgh in early January, when only US Airways will fly between the two cities.

The Pittsburgh Post-Gazette reported Tuesday that when Southwest Airlines Co. drops its flights between Philadelphia and Pittsburgh on Jan. 8, the price for a US Airways round-trip ticket will jump from $118 plus tax, to $698 plus tax.

Now one might argue that this is an unusual situation, with a single carrier monopolizing a route. Several carriers fly SF-LA. And yet the underlying factors suggest that the SF-LA route won’t see cheap flights forever – and global evidence shows riders will switch to trains anyway if given the option.

In 2008, Southwest’s founder Herb Kelleher suggested that rising fuel prices would eventually force airlines to cut flights:

Herb Kelleher, the iconic co-founder of Southwest Airlines who stepped down as chairman Wednesday, said flying could become something that only business travelers or the affluent can afford, much as it was in the 1950s and ’60s.

“You may see a lot less air service across the United States, and that’s really a shame,” Kelleher said. “We are heading back in that direction.”

The fuel price spike in 2008 led many airlines to cut service serving California airports – Delta reduced its flights from LAX by 13%. The experience taught many airlines that short-haul flights are not necessarily a basis on which to build a profitable airline.

In 2010 JetBlue execs argued that short-haul routes aren’t all that great. From JetBlue CEO Dave Barger:

Q: Do you see nationwide high-speed rail as a threat or complement to the airline industry?

A: It’s a complement. I don’t think we need hundreds of departures every day from the Bay Area to Los Angeles.

And JetBlue COO Rob Maruster:

It was an event filled with charts and maps that drove home how overwhelmed and outdated current air traffic control technology is. One solution [JetBlue COO Rob] Maruster said was obvious is taking airline passengers off some routes, like New York to Boston. “It seems like there’s a mode that might work better for us in that regard. When we see things like high-speed rail going into South Florida, we say OK, that makes sense. But I think this region, with almost 25 million people in the Tri-State area, makes a lot more sense for those kind of things.” Maruster says he’d like to see New York City and federal transportation officials put out a 20 or 30-year vision that addresses how airplanes, trains and other modes of transportation can be put together. He hasn’t seen one yet.

The writing is on the wall. Airlines don’t see a long-term future in short-haul flights. Medium and long-distance routes are where their profits will come from in the future. As fuel prices rise, the short-haul trips will either become too expensive for most people to afford, or too infrequent to be useful.

Of course, we also know that when HSR is offered as an option, it competes very well against short-haul airline routes. In Spain the world’s busiest air corridor, the Madrid-Barcelona route, lost over half its ridership to the AVE high speed train within 2 years of the AVE to Barcelona going online. The Acela carries more than half of the air-rail market on the NEC.

So while folks stuck in the 20th century who refuse to admit the need to change may crow endlessly about cheap Southwest fares between SF and LA, the reality is clear: the era of cheap flights is ending, and in any case people will choose high speed trains anyway.

But that concept falls apart if the LAO provides bad analysis, and especially if it abandons its neutrality and instead tries to make policy. Nobody elected Mac Taylor to govern the State of California, but as Legislative Analyst he has increasingly pushed the LAO to intervene in policy debates that he and the office simply have no place sticking their nose.

Worse, they tend to do it without the benefit of accurate information. That’s especially been their problem when looking at the high speed rail project. Rather than respecting the will of the voters of California, the LAO has waged a consistent effort to attack the project since early 2009, when they first argued for gutting the project. And their attacks are based on flawed evidence. With each baseless attack, they have jeopardized the reputation of the LAO and undermined their ability to give neutral, informed analysis to the elected lawmakers of California.

Earlier this year the LAO wanted to give HSR the Scott Walker treatment, arguing that California should sacrifice jobs and $4 billion in federal stimulus and kill the HSR project. As this blog explained back in May, their analysis was deeply flawed, written largely by an unqualified analyst who had no experience in the topic area.

That unprecedented report generated a strong backlash from legislators, mayors, government watchdogs, and newspapers around the state. The federal government slapped down several of the LAO’s uninformed claims, and Assemblymember Cathleen Galgiani asked a series of questions of the LAO regarding the assembly of that flawed report. I don’t know if the LAO ever did answer these questions, but clearly the May 2011 report did major damage to the LAO’s credibility.

Sadly, the LAO has chosen to double down on their flawed and unprecedented attack on a project approved by the voters of California. You can read their most recent report here. Its tone and word choice are clearly those of project opponents who grudgingly have to admit the project made great strides forward with the 2012 Business Plan, but who keep trying to find reasons to oppose the project. And once again all they do is make themselves look foolish in the process, further undermining the credibility of what once was, and should still be, one of the state government’s most useful agencies.

They include the completely misleading claim that just because massively unpopular House Republicans voted to kill HSR funding for a year, that we can therefore predict the feds will never again fund HSR:

Availability of Funding to Complete a Usable Segment Highly Uncertain. The possible future sources of funding necessary to complete Phase 1 that are identified in the draft business plan are highly speculative. In addition, Congress has approved no funding for high-speed rail projects for the next year. As a result, it is highly uncertain if funding to complete the high-speed rail system will ever materialize.

That last line is just not true. At all. It ignores the fact that President Barack Obama still strongly supports high speed rail funding. So too does Nancy Pelosi, who would return as Speaker if, as polls show, Democrats retake the House. Then again, the LAO is notoriously ignorant of federal issues, as their slapdown by the federal government earlier this year made clear.

The report is also an attempt to fight back against the 2012 Business Plan’s most successful claims:

Alternative Cost Estimate Overstated. The draft business plan compares the estimated $99 billion to $118 billion cost of constructing high-speed rail with an estimated $170 billion cost of adding equivalent capacity to airports and highways. This comparison is very problematic because $170 billion is not what the state would otherwise spend to address the growth in inter-city transportation demand. The HSRA estimates that the high-speed train system would have the capacity to carry 116 million passengers per year but their highest forecasted ridership is significantly less than that amount—44 million rides per year (roughly 40 percent less than capacity).

Huh? They simply claim it won’t cost $170 billion to build alternatives, but don’t provide a shred of evidence to back up that claim. They talk about CHSRA ridership forecasts, but that has nothing to do with the $170 billion alternative cost.

We know, for example, that it will cost $25 billion to widen Highway 99 in the Central Valley – and that’s a 2006 estimate. It’s entirely possible that estimate will have risen by the same amount as the HSR estimate has risen. Extrapolate that cost out through the rest of the state, especially the densely built Bay Area and Southern California, and $170 billion to expand both freeways and airports suddenly seems plausible.

And of course, nowhere in the report – nowhere at all – does the LAO discuss the rising cost of oil.

They also argue from a perspective of false choice and artificial scarcity:

High-Speed Rail’s Priority Over Other Transportation Investments Unproven. As the state’s population increases, demand for both interregional travel and urban travel will grow. It will be necessary to continue to maintain existing infrastructure, fund urban transit options, and use tools to increase the capacity of existing roadways to accommodate these increased travel demands. In light of this, the Legislature should consider where to invest limited state resources.

This is misleading at best. It’s not an either/or decision. California needs to invest in both intercity travel AND urban travel. In fact, they complement each other. And since California remains a rich state, there’s plenty of money available to do both. The LAO ought to be advising the legislature as to what its funding options are and what the possible impact might be, rather than saying “sorry, you are poor and have to pick between priorities.”

In fact, LAO staff went even further down the path of false choice and artificial scarcity in their testimony today:

“You may also have to look at making other cuts to social services programs or education,” and not funding other transportation projects, report co-author Farra Bracht told the Assembly Committee on Transportation.

Let’s be clear: this is bullshit. To the LAO, all HSR brings is debt. They have never once acknowledged the financial benefits to the state of tens of thousands of new jobs. A 2010 US Conference of Mayors report suggested HSR would bring a $10 billion annual green dividend to Los Angeles alone. Statewide, the boost would be even greater.

Not only does the LAO ignore the dividends entirely, they claim negatives might wipe out the benefits – but they don’t come up with anything close to $10 billion in annual green dividends:

Economic Impact Analysis Is Imbalanced. Our preliminary review of the economic analysis in the draft business plan is that it may be incomplete and imbalanced, and therefore portrays the project more favorably than may be warranted. For example, the plan does not estimate economic loses from negative impacts to business from right-of-way acquisition and rail construction activities or from increases in urban traffic congestion around train stations.

Those impacts will be minimal at best. They might hit the tens of millions. They won’t come anywhere close to the tens of billions. Once again it’s clear the LAO is biased against this project.

And of course, the legislature also has many other options open to it to raise revenue to fund social services and education. The notion that HSR would force those things to be cut is a lie, especially since the state is not on the hook for the $98 billion cost.

The LAO is acting as a nakedly political body here, abandoning its role as a neutral and informed analyst to instead try and kill a project it dislikes. By not accurately or honestly assessing the project and its environment, the LAO has not only produced a report that can safely be ignored, they have further damaged their already shaky credibility as an institution. It may be time for major staffing changes at the LAO in order to bring much-needed reforms to that important agency.

But Kopp and Morshed sound decidedly less enthusiastic these days. They still believe high-speed rail is necessary for the state. They stand by the decision to build the initial leg of the system in the Central Valley — a route critics have derided as the “rail to nowhere.” They say it’s a critical piece of the line, and a good place to test the technology.

But they say the plan they envisioned – and that voters approved in 2008 – is not what’s being described by the High Speed Rail Authority today. They’re critical of the so-called “blended approach” that would force high-speed rail trains to share tracks with existing commuter services, like Caltrain, and, at least initially, require customers to make several transfers along the SF-LA route.

These are good questions to raise. KQED spoke with both Kopp and Morshed about these concerns:

What’s your objection to the “blended plan,” which integrates high-speed rail into existing services, like Metrolink and Caltrain?

Kopp: Real high-speed rail, you get on in one place, you get off in another. Making people transfer from one train to another in my opinion is a sure recipe for discouraging ridership. That’s why I fought to have BART into SFO, not a mile and a half away, and that’s proved to be the most successful part of the entire BART system.

You have to be running, as we’ve always predicated, ten trains per hour, in the peak hours of the morning and afternoon to generate the revenue you need so you can function without a government subsidy. It’s certainly not the project which I had in mind and others had in mind. It’s a different kind of system.

There’s even a legal question as to whether this so-called blended system — in other words, starting off with trains from San Francisco to San Jose at a top speed of 125 mph, or probably less than that if you’re using the same tracks Caltrain uses — whether that can be legally done under the provisions of Prop 1A, which was passed by voters in 2008.

I agree with Kopp here conceptually. Forced transfers aren’t ideal, and the blended system on the Peninsula is at best a short-term stopgap as we wait for generational change to occur.

But I’m not sure that the Authority is necessarily abandoning the kind of project that Kopp is talking about. The project was always going to be built in phases. And if revenue service from, say, San José to LA can be inaugurated more quickly then it generates the money and the demand that will be needed to expand the Peninsula rail corridor.

And I don’t agree that the blended system violates Prop 1A. But I am sure someone will litigate that.

According to the plan, the initial route from Fresno to Bakersfield is going to generate positive cash flows, and also attract $11 billion in private investment, which will help get the rest of the system built. Is that realistic?

Morshed: Fresno to Bakersfield is the key connecting piece that you have to build in order to build the rest of it. You don’t have any choice about it. But you have to recognize that there aren’t that many people going between Bakersfield and Merced. That piece was never going to make any money. It just isn’t logical. Who’s going to ride it? And private investors aren’t going to invest in anything that’s not making money.

Kopp: No way. No way. It was clear that that first leg was not for revenue service. It’s for testing trains, obviously. For revenue, you’ve got to [expand the system] to LA or to San Francisco. I am skeptical about private investment until the very end of the completion of the entire first phase, from SF to Anaheim.

I don’t believe that’s what the plan actually says. Fresno to Bakersfield is indeed an Initial Construction Segment for testing trains, essentially. The Initial Operating Segment, for revenue service, would be an extension of the ICS either west to San José or south to the San Fernando Valley.

So, what do you think is going to happen? Should the project be shelved?

Kopp: Absolutely not. Human beings are creative. They’ll come up with some other sources.

You have to take a long historical view. I-5 wasn’t built all at once. But, of course, the interstate highway system had a specific source of money, namely the federal gasoline tax. High-speed rail has got to get, if it can, a specific source of funding: federal or state. I don’t know how much regional sources can contribute. It’s gonna be a long haul. A much longer haul than I originally thought.

Morshed: I believe the same as I did three years ago or ten years ago, that given the growth of the state and our population, and the realities of our transportation needs, California has to build a high-speed network sooner or later.

I’m convinced it’s going to be built. But in which way, I don’t know. And with how many ups and downs, I don’t know. I intentionally haven’t tried to look at the details and second-guess people. Maybe they know something I didn’t know. I hope they do.

Again, these are good points. And Kopp is absolutely right that what’s needed above all else is a dedicated, federal source of funding.

After reading this, I think the main issue is not with the Business Plan itself. Phasing was always going to happen, and a blended system on the Peninsula is workable as a short-term solution. The issue is whether these interim solutions become the sum total of high speed rail itself. I read Kopp and Morshed as being concerned the core concept of HSR – true bullet train service from San Francisco to Los Angeles – is at risk of being abandoned for short-term expediency.

While I do not believe that is happening right now, they are absolutely right to raise that concern. It would be a disaster if high speed rail gets neutered forever due to conditions in 2011 that are temporary.

(Almost missed this from last Friday; thanks to Reality Check for the link.)

Kings County filed a lawsuit Monday against the California High Speed Rail Authority that calls for a permanent injunction against distributing funds from Prop 1A to the construction of the first segment of a statewide high-speed rail system in California.

The suit claims the plan to spend bond money from Prop 1A on the segment that would run from Fresno to Bakersfield does not fulfill the intent of the original proposition that approved the issuance of $9 billion in state bonds.

How exactly would it not fulfill that intent?

Voters never intended Prop 1A bond funds to be used “’preliminarily’ to build a non-electrified, substantially ‘conventional’ rail system, with an electrified HSR system to be constructed at a later period,” according to the text of the suit.

“No such allowance or permission for such a so-called phased system is contained in Prop 1A,” the suit states.

The suit also says the use of bond money for the construction of a rail system that is not electrified, violates the concept of a “true” high-speed rail system and “violates” Prop 1A.

The ballot label of the Safe, Reliable High-Speed Passenger Train Bond Act dated Sept. 2, 2008, does not mention electrification, or any other specific method of fueling the train system. The relevant portion of the text describes improving California’s economy “while reducing air pollution, global warming greenhouse gases, and our dependence on foreign oil, shall $6.95 billion in bonds be issued to establish a clean, efficient high-speed train service,” according to the California’s Secretary of State Office’s website.

At least the Patch reporter, Vanessa Castañeda, included the text from Prop 1A that shows how absurd this suit is. It’s as if the lawyers think they can find a judge that has never heard of the concept of “phasing.” Interstate 5, like almost every other freeway in California, was opened in pieces and completed over the course of many years (decades, in the case of I-5). The funding was for an Interstate Highway System, and a system isn’t built immediately or overnight.

Besides, as the 2012 Business Plan makes clear, a high speed train system that connects SF to LA is exactly the intent, and the Initial Construction Segment from Fresno to Bakersfield is part of how that system gets built.

The Peninsula lawyer who filed the suit for Kings County repeated the usual anti-rail talking points:

Michael J. Brady, a lawyer based in Redwood City who is representing Kings County, says the future of the entire plan is grim. Depletion of $9 billion in funds before completion of the corridor is completed is likely, he said, noting that additional subsidies would be required to complete the segments of the corridors that would end in the Bay Area, and it is not likely that people will want to invest in the plan.

“I don’t think private investors are going to be interested at all,” Brady said. “Practically no high-speed rail system in the world earns a profit. The framework in California is much worse than those of the rest of the world and it’s likely that they would have a huge loss every year.”

This is absurd. It is quite likely that the private sector will want to invest in the plan, just as they have shown interest in other HSR systems around the country and around the globe. The private sector has been consistent that they need to see more federal funding first.

It’s also interesting to see the “no HSR system in the world earns a profit” talking point spread. This is an outright lie. Systems all over the world earn a profit, from Taiwan to Russia to the Amtrak Acela, just to name a few, all turn a profit. I’m tired of that lie going unchallenged by the media when they see it.

The California high speed rail project has done well when facing these ridiculous court challenges. I fully expect a CEQA suit from Kings County as well at some point, but for now I think it is safe to say that this particular frivolous lawsuit is not going to cause any problems for the project.

What do you think? Should we come out in favor of this in Friday’s pages, or opposed to this? Make your best argument, pro or con.

The flippant answer would be to tell them to read all 1,216 posts on this blog since March 2008. But even I wouldn’t want to wade through all that. It’s reasonable to want a short answer.

So, here it is: Like Boulder Dam, the California Aqueduct, and Interstate 5 before it, the high speed rail project is an essential element of getting out of this economic crisis and building lasting prosperity in California. Current infrastructure is not getting the job done, and expanding what we already have would cost significantly more than building HSR. By providing savings on transportation and environmental costs, the HSR project will spur billions in new economic activity that the state desperately needs. HSR has been a proven success everywhere else it has been tried and there is every reason to believe it will succeed here.

We can go into some depth on these points:

• HSR is essential to lasting prosperity in California. The LA Times has supported the project before, and they know as well as anyone that California is changing. In the mid-20th century the state turned to freeways and cars to meet its transportation needs. That may have worked for a while. But with rising oil prices, building transportation alternatives is absolutely necessary to avoid prolonged economic weakness. After all, it’s rising oil prices that helped get us into this economic crisis in the first place.

The numbers speak for themselves:

Unemployment is sky high and showing no signs of coming down:

One big reason for the crisis is the soaring cost of our dependence on oil. California spent 60 years building a transportation system where people had to burn fossil fuels to drive or fly to their destinations, literally ripping out the efficient and electrically-powered rail systems that had fueled growth and prosperity in the state for 100 years before that. Because oil is not a renewable resource, the price will eventually rise as supplies peak and global demand soars. Sure enough, that’s exactly what happened in the last 5 years:

And all the evidence suggests gas prices will keep rising. In 2009 Deutsche Bank came out with this projection of where gas prices are headed:

When gas hit $3/gal in 2006, it burst the housing bubble and sent the state into recession. An economy built on suburban real estate serving long-distance commuters became unaffordable and in some places has literally collapsed. And it’ll keep rising, strangling recovery in the crib.

The effect would be catastrophic for the state’s already weakened economy. The effect of peak oil – the declining rate of new oil discovery combined with ever-increasing global demand – will push prices upward until there is significant demand destruction. There are two ways demand destruction can happen – either we build alternatives to driving and enable people to use mass transit to continue getting around, or people just stop driving with no alternative in place, and economic activity falls dramatically as a result.

• HSR will spur long-term economic activity. We’re not the only generation of Californians to face a profound economic crisis that required substantial change. In the 1930s, we built bridges, dams, and aqueducts even in the face of higher unemployment and a deeper Depression. We did those things because we knew not only would it create immediate jobs (estimates from the California High Speed Rail Authority suggest there could be tens of thousands of jobs created as a result of just the construction alone) but that it would also serve as the basis of long-term prosperity.

And so it has. LA still turns on the lights with electricity generated at Boulder Dam. It eats food grown with water conveyed by the Central Valley Project (a Depression Era project). Its neighbors to the north in SF use the Golden Gate and Bay Bridges to commute and move goods. And infrastructure built in subsequent years, like the California Aqueduct and the interstate freeways, merely added to the long-term economic activity.

But because oil is becoming too expensive, an alternative is needed. High speed rail from SF to LA and Anaheim isn’t the only electric passenger rail we need. But it is an important part of the need.

There are specific ways this works. One is called the green dividend. The concept is simple: money not spent on buying and burning oil is money that is spent on other things in the local economy. Portland’s green dividend is about $2 billion per year.

A 2010 US Conference of Mayors report found Los Angeles alone could reap a green dividend of $10 billion a year from high speed rail – both in the jobs it creates and the spending on oil it would allow to remain in the community, redirected toward more beneficial projects. Statewide that could reach $25 or $30 billion a year.

We also know from global experience that HSR spurs the development of mid-line cities. In California that is crucial, given the sky-high unemployment in the Central Valley. That unemployment costs the state government billions and acts as a drag on the economic potential of the entire state. California’s recovery requires a Central Valley recovery.

HSR can help provide a boost to places like Gilroy, Fresno and Bakersfield. It brings those cities into the globally competitive coastal economy, allowing residents there to get jobs on the coasts and allowing coastal businesses to set up shop inland where land values are cheaper.

• HSR is the fiscally conservative thing to do. Some “fiscal conservatives” think we should just run away from anything with a big price tag, that spending less money is always good. This is delusional. As the charts above show, we know gas prices will rise. So spending more money on oil-based transportation is absurd if there’s a more affordable alternative. And we know that California’s population will continue to grow. So spending $170 billion to expand freeways (which do not pay for themselves) and airports (which are very inefficient) on top of the increased cost of using those systems is also absurd if there’s a cheaper alternative.

I get that people wish we could just make everything that we have right now cheaper. That we could just continue along with the systems we have in place, just make them work again like they used to.

But those days are over. Cheap oil is never coming back. California will never again be able to rely on freeways and airplanes alone as the basis of our transportation system. Our choices now are to either stick with the failing system we have now and pay huge costs as a result, or invest over the next 20 years to lower our costs for the next few generations.

• HSR is a global success. It’s not like California is proposing to do something radical and untested. We’ve known for 50 years that high speed rail works. And it turns a profit – in Japan and France, Spain, Russia, Taiwan, even the Amtrak Acela. And California compares favorably to those globally successful routes.

Many HSR critics and opponents are motivated by their belief that nobody will ride trains in California. Those arguments are completely baseless, fly in the face of the available evidence, and should simply not be taken seriously. Amtrak California is setting ridership records. Remember that the independent peer review found the HSR ridership numbers to be sound.

And of course, the business plan took those numbers and showed, using extraordinarily conservative assumptions, that HSR will turn a profit. Just like every other HSR line around the globe.

• The new business plan shows a sensible path forward. One could look at the above and say “sure, that’s nice, but will THIS plan work?” The new business plan answers that convincingly. It shows how the system will grow from an Initial Construction Segment in the Central Valley to a system carrying passengers from SF to LA. It is a sound, conservative plan.

The LA Times wonders about federal funding. I do too. But it’s not just HSR that Congress is threatening. Under the Republicans, the House of Representatives appears not to want to fund anything of value at all. They don’t want to create jobs. They don’t want to provide health care or teachers or cops.

Republicans won’t control Congress forever. In fact, as soon as January 2013 Nancy Pelosi may be back in the Speaker’s chair. We need federal HSR funding, but the best way to get it is to be persistent. That’s a problem to solve, not a reason to quit.

Ultimately, the LA Times has to decide a few things for themselves. Do they think the status quo of 12% unemployment and nearly $4 gas is working, or that we can and should do better? Do they think California should be a place that builds and innovates, or a place that stagnates while living on past glories? Do they think investing in the future is a good thing or a bad thing?

I can’t answer it for them. All I can do is show them that a better future never comes cheap, but the rewards are substantial. I hope they make the right choices.

They should have been careful what they were wishing for. Because with the 2012 Business Plan, they’ve got it.

The 2012 Business Plan is a huge leap forward for the California HSR project. It is the in-depth, thorough, complete, and clear document that we didn’t realize we needed until we actually sat down and read it. It’s a very different document than the plans that came before, reflecting a great deal of planning and analysis as to how we actually get high speed rail built. It is very conservative in its assumptions – unnecessarily so in some cases – but that was also done to err on the side of caution.

The result is a strong and solid plan that is a game changer for the project. Since 2008 HSR backers have been caught in limbo, between the passage of Prop 1A, a supportive president but a problematic Congress, and the vagaries of both the planning process and the business plan. This plan advances the HSR project in a significant way by showing the path forward, providing a sensible method by which California finally gets true high speed rail and the enormous economic benefits that come with it.

The document itself is 230 pages long, so I’ll have to summarize the key points as best I can.

From what I can tell, the business plan is to leverage the existing state and federal funding to bring in private capital to build an Initial Operating Segment. That segment would begin with the Initial Construction Segment (the Central Valley segment from Merced to Bakersfield) and continue either north to San José or south to the San Fernando Valley. That IOS would be the first revenue-generating HSR service, and the ridiculously conservative ridership estimates show it would be profitable.

The 2012 Business Plan is extremely specific about how that IOS could be funded. From page 132 (same as page 8-4):

Anticipated funding sources to complete the IOS include:

• Federal funding sources including existing programs and potential new programs related to tax credit bonds, reauthorization and others
• State funding from Proposition 1A bonds
• Local funding sources

The IOS will require a mix of funding from federal, state and local sources to support construction in the years 2015 to 2021. Committed funding for this future period is not fully identified. Several potential options exist to fund the completion of an IOS and provide the state with an operating high-speed rail segment.

Following that is a very detailed and long discussion of all the various options. And there is also an acknowledgment of the fact that Congress currently is gripped by an insane mania about deficits, which will eventually pass but for now limits the options for funding in the years 2015 to 2021. Still, it’s an honest and informed discussion.

It is believed by the plan’s authors that the IOS won’t attract much private capital, but once ridership is proven private capital will step up to help complete the rest of the SF-Anaheim section (initially with “blended” service along existing tracks and then later with a full buildout).

This is one of several instances in the plan that strike me as more conservative than is necessary. Private funders were willing to help build the initial operating segment for Florida high speed rail. They even pledged to cover cost overruns. I would suspect that as construction begins on the ICS in the Central Valley, private funders – looking to operate the IOS and pocket some of the revenues – would be willing to come forward and help get the IOS built. Perhaps Governor Jerry Brown and the CHSRA board believe this too, but they are being cautious in this plan, and reasonably so.

One of the truly impressive pieces of the 2012 Business Plan is how it consistently shows the context of HSR – normalizing the project by showing how other infrastructure projects, transit systems and HSR routes operate similarly. For example, I love this from page 110 on ridership:

It is important to be able to consider the ridership projections in context. California’s large population creates tremendous demand for mobility, and the usage levels of the state’s many and diverse transportation systems demonstrates this fact. Some perspective on the ridership projections for California can be gained by comparing the markets that the statewide high-speed rail system will serve with markets being served by systems around the world, as shown in Exhibit 6-17 at the end of this chapter. As shown, the Spanish HSR system serves cities with a combined population of 7.9 million people and has annual ridership of 10 million; the French system serves a combined 15.1 million people and generates 31 million annual riders. California’s system will serve a population base projected to be over 49 million in Full Phase 1. This comparison is not, in and of itself, dispositive, but it uses actual data to show the ridership levels that can be generated from given population levels.

In other words, California’s system compares well to other successful HSR systems around the globe, a point virtually every single HSR critic (hello, Elizabeth) and opponent (how are you doing, Alan) refuses to ever acknowledge.

On that same page the plan compares the projected ridership to the annual ridership of California transit systems. LA Metro’s 2010 ridership is 453 million. SF Muni is 209 million. BART? 108 million. California HSR projections, then, are entirely reasonable.

And under all scenarios, the ridership would be sufficient to generate operating surpluses. That’s even though their ridership assumptions are so conservative they assume Californians will be paying $3.80 for gas in 2033 and that airfares will remain at their 2009 averages of $95. As I showed yesterday, we have plenty of evidence to indicate both costs will be much higher, and therefore HSR ridership will be higher too.

The business plan includes other comparisons, showing how the California Aqueduct, Interstate 5, and other HSR systems around the world were built in phases as money became available. Each had a different business model, but the concept of a phased approach has proved workable in California and around the world. It can work for HSR too.

The deeply conservative nature of this document will make it very difficult for the attacks from folks like Elizabeth Alexis or others to gain much traction. The California High Speed Rail Authority did its homework and then some. With strong backing from Governor Jerry Brown and the state’s business and labor community, it is extremely difficult to imagine that the state legislature will turn against the project now that they have this document in hand. They’re not likely to pay much attention to people who continue to attack this project even after so many of their charges and criticisms have been decisively refuted.

That’s not to say they won’t try. HSR critics and opponents aren’t really motivated by logic or evidence, as we know – they’re motivated either by NIMBYism (consider how many of them live near the Caltrain line) or by an ideological belief that nobody in California will ever ride trains, or in some cases by a combination of the two.

But what we’ve seen since 2008 has been consistent and broad support from the people of California and their legislators for high speed rail. The 2012 Business Plan provides the basis to consolidate that support and get started on construction, with a reasonable and sensible path to providing service from San Francisco to Anaheim by the 2030s. Some people may prefer to continue fighting the future. The rest of us are ready to go out there and build it.