Thursday, January 5, 2012

The best laid plans of California and eco-nuts

California is still sitting on massive budget deficits, and with a falling muni bond market still hovering over the landscape, now is not the best time to spend cash on a massive boondoggle.  But California has never been known for sound thinking, especially in the fiscal arena, and the power of the eco-nuts to push through a high speed train project is another microcosm of the California fiscal nightmare.

They offered voters a plan and a website with renderings of cool-looking trains. It would connect LA and the Bay Area with extensions to San Diego and Sacramento. The initial stage would be funded with California general obligation bonds and federal dollars. The vast majority would be funded later in some unknown manner. Cost would be $35.7 billion. Voters approved it by referendum (Proposition 1A). That was November 2008.

By November 2011, cost estimates had ballooned to $98.5 billion. Voters realized they’d been had and became restless. The California High-Speed Rail Authority (CHSRA) made a formal request for $2.7 billion—the first tranche of the $9.95 billion in Prop 1A bonds. The federal government would chip in $3.5 billion. It would fund a 130-mile segment of civil works and track between Bakersfield and Fresno in the Central Valley. However, it would lack electrification as well as high-speed train control and communication systems. So it can’t be used as testing ground for high-speed trains. At the most, it might be used by regular diesel trains. –

Progess and attempting to move away from fossil fuels is one thing, but not when you are nearly bankrupt and losing both jobs and industry at alarming rates.  This isn't the 1930's, when WPA projects can be built in a cost efficient manner, but instead it is a time of growing inflation, and progressivism that doesn't realize the money they are spending is limited, and that when people can't find work, they can't be taxed.


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