Coyote Blog

Megan McArdle has a great WaPo article and tweet storm on high-speed rail in the US.  In it she focuses on issues of distance and infrastructure barriers we have.

One thing she left out is that the US rail system is optimized for freight, vs. European and Japanese systems that are optimized for passengers (it is hard to do both well with the same network).  The US situation is actually better, much better, for energy conservation.  I wrote in detail about this before:

First, consider the last time you were on a passenger train.  Add up the weight of all the folks in your car.  Do you think they weighed more or less than the car itself?  Unless you were packed into a subway train with Japanese sumo wrestlers, the answer is that the weight of the car dwarfs that of the passengers it is carrying.    The average Amtrak passenger car apparently weighs about 65 tons (my guess is a high speed rail car weighs more).  The capacity of a coach is 70-80 passengers, which at an average adult weight of 140 pounds yields a maximum passenger weight per car of 5.6 tons.  This means that just 8% of the fuel in a passenger train is being used to move people -- the rest goes into moving the train itself.

Now consider a freight train.  The typical car weight 25-30 tons empty and can carry between 70 and 120 tons of cargo.  This means that 70-80% of the fuel in a freight train is being used to move the cargo.

This is another case of short-sighted analysis that looks only at the seen rather than the unseen.  Coastal elites take trips to Europe and see the beautiful high-speed trains and in turn never spend a moment thinking about freight trains.  So they fixate on beautiful sexy passenger trains rather than thinking about the system holistically.  I titled a Forbes article I wrote on the effect as "Shifting Capital from the Productive to the Sexy."

PS-  I am a train buff and have a whole room of my house filled with a model railroad, so I don't knee-jerk hate on rail.  I have ridden European high-speed rail many times so I am familiar with the product.  The London-Paris segment is great, and I have ridden the French TGV from Paris to Marseilles and the Italian line from Milan to Florence.  What's not to love as a tourist -- we don't pay for them and they provide good service between the city centers of tourist destinations.   But if you look at those trains they really have a ton of expensive infrastructure carrying not very many people over relatively (for the US) short distances.

I write this because after I criticized infrastructure triumphalism in Joel Epstein's article at Huffpo, he wrote me a one line retort: "You should get out of the country more often."  LOL, if you had to enshrine a hall of fame of sneering coastal elite dismissive comments of critics, this would have to be on the list.  I tried to follow up with him and ask him if he would have the US adopt China's infrastructure construction practices if the cost was adopting China's environmental and accountability standards, but I did not get a response.

A reader sent me a link to this Vox article on streetcars.  What I thought was interesting is just how weak the case for streetcars is, even when made by folks are are presumably sympathetic to them.  This page is entitled "Why do cities want streeetcars."  The arguments are:

• Tourists like them, because you can't get lost like you can on buses.  My response is, "so what."  Unless you are one of a very few unique cities, tourists are a trivial percentage of transit riders anyway.  Why build a huge system just to serve out-of-town visitors?  I would add that many of these same cities (e.g. Las Vegas) considering streetcars are the same ones banning Uber, which tourists REALLY love.
• Developers like them.  Ahh, now we are getting somewhere.  So they are corporate welfare?  But not so fast, they are not even very good corporate welfare.  Because most of the studies they cite are total BS, of the same quality as studies that say sports stadium construction spurs all sorts of business.  In fact, most cities have linked huge tax abatement and subsidy programs to their streetcars, such that the development you get with the subsidy and the streetcar is about what you would expect from the subsidies alone.  Reminds me of the old joke that mimicked cereal commercials: "As part of a breakfast with juice, toast, and milk, Trix cereal has all the nutrition of juice, toast, and milk."
• Good for the environment.  But even Vox asks, "as compared to what."  Since they are generally an alternative buses, as compared to buses that have little environmental advantage and often are worse (they have a lot more weight to drag around when empty).
• The Obama Administration likes them.  LOL, that's a recommendation?  When you read the text, what they actually say is that mayors like the fact that the Obama Administration likes them, for it means the Feds will throw lots of Federal money at these projects to help mayors look good using other peoples' money
• Jobs.  This is hilarious Keynesianism, trying to make the fact that streetcars are 10-100x more expensive than buses some sort of positive.  Because they are more inefficient, they employ more people!  One could make the exact same argument for banning mechanical harvesters and going back to scythes.   Left unquestioned, as Bastiat would tell us, is how many people that money would have employed if it had not been seized by the government for streetcar use.
• Je ne sais quoi.  I kid you not, that is their final argument, that streetcars add that special something to a neighborhood.  In my mind, this is Vox's way of saying the same thing I did the other day -- that the streetcar's appeal is primarily based on class, in that middle and upper class folks don't want to ride on a bus with the masses.   The streetcar feels more upscale than buses.   The poor of course, for whom public transit is most vital, don't want to pay 10 times more for sexiness.  Oh, and watch this video of Washington streetcars blocking traffic and crunching parked cars and tell me what it is adding to the neighborhood.

Every argument I have ever been in on streetcars always boils down to something like "well, all the cool kids like them."  Once, after defending the US approach to rail (vs. Europe and Japan) as (correctly) focusing on productivity vs. sexiness, having gone into a lot of detail on the economics of freight vs. passengers, I got a one sentence answer from Joel Epstein of the HuffPo:  “You should get out of the country more often.”  That was it -- the cool cosmopolitan kids who vacation in Gstaad but never would be caught dead driving across Nebraska were all against me.

When it comes to high speed rail, the Left tends to have a Santa Clause mentality.   They want the rail, but refuse to even discuss its costs vs. benefits, as if it is going to be dropped in place by Santa Clause.

I have actually had pro-high-speed rail writers call me a dinosaur for taking a cost-benefit approach.  After a reasoned article on why our rail system, with its focus on freight, makes more sense than China and Europe's focus on high speed passenger rail, Joel Epstein wrote me that I should get out of the country more, as if I am some backwoods rube that would just swoon if I saw a nifty bullet train.  For the record, my actual experience on a high-speed rail train in Europe confirmed that it was a nice experience (I knew it would be) and that it was a financial mess, as my son and I were the only passengers in my car.  I would be all for HSR if Santa Clause dropped in down from the North Pole, but it costs a lot of real money.

How much money?  Well take the system in China that Friedman and Epstein and many others have begged the US to emulate:

The rail ministry that builds and operates the trains has an incredible 2.1 million employees, more than the number of civilians employed by the entire U.S. government. Moreover, the ministry is in debt to the tune of 2.1 trillion yuan ($326 billion), about 5 percent of the country’s GDP.

What is it about intellectuals that seem to, generation after generation, fall in love with totalitarian regimes because of their grand and triumphal projects?  Whether it was the trains running on time in Italy, or the Moscow subways, or now high-speed rail lines in China, western dupes constantly fall for the lure of the great pyramid without seeing the diversion of resources and loss of liberty that went into building it.  First it was Thomas Friedman, and now its Joel Epstein in the Huffpo, eulogizing China.    These are the same folks who tried, disastrously, to emulate Mussolini's "forward-thinking" economic regime in the National Industrial Recovery Act.    These are the same folks who wanted to emulate MITI's management of the Japanese economy (which drove them right into a 20-year recession).  These are the same folks who oohed and ahhed over the multi-billion dollar Beijing Olympics venues while ignoring the air that was unbreathable.  These are the same folks who actually believed the one Cuban health clinic in Sicko actually represented the standard of care received by average citizens.  To outsiders, the costs of these triumphal programs are often not visible, at least not until years or decades later when the rubes have moved on to new man crushes.

Epstein, like Friedman, seems to think that the US is somehow being left behind by China because its government builds much more stuff.  We are "asleep."  Well, I have a big clue for him.  Most of the great progress in this country was built when the government was asleep.  The railroads, the steel industry, the auto industry, the computer industry  -  all were built by individuals when the government was at best uninvolved and at worst fighting their progress at every step.

Epstein in particular thinks we need to build more trains.  This is exactly the kind of gauzy non-fact-based wishful thinking that makes me extremely pleased that Epstein in fact does not have the dictatorial powers he longs for.   High speed rail is a terrible investment, a black hole for pouring away money, that has little net impact on efficiency or pollution.   But rail is a powerful example because it demonstrates exactly how this bias for high-profile triumphal projects causes people to miss the obvious.

Which is this:  The US rail system, unlike nearly every other system in the world, was built (mostly) by private individuals with private capital.  It is operated privately, and runs without taxpayer subsidies.    And, it is by far the greatest rail system in the world.  It has by far the cheapest rates in the world (1/2 of China's, 1/8 of Germany's).  But here is the real key:  it is almost all freight.

As a percentage, far more freight moves in the US by rail (vs. truck) than almost any other country in the world.  Europe is not even close.

(source)

You see, passenger rail is sexy and pretty and visible.  You can build grand stations and entertain visiting dignitaries on your high-speed trains.  This is why statist governments have invested so much in passenger rail -- not to be more efficient, but to awe their citizens and foreign observers.

But there is little efficiency improvement in moving passengers by rail vs. other modes.   Most of the energy consumed goes into hauling not the passengers themselves, but the weight of increasingly plush rail cars.  Trains have to be really, really full all the time to make an energy savings for high-speed rail vs. cars or even planes, and they seldom are full.  I had a lovely trip on the high speed rail last summer between London and Paris and back through the Chunnel -- especially nice because my son and I had the rail car entirely to ourselves both ways.

The real efficiency comes from moving freight.  More of the total energy budget is used moving the actual freight rather than the cars themselves.  Freight is far more efficient to move by rail than by road, but only the US moves a substantial amount of its freight by rail.    One reasons for this is that freight and high-speed passenger traffic have a variety of problems sharing the same rails, so systems that are optimized for one tend to struggle serving the other.

Freight is boring and un-sexy.  Its not a government function in the US.  So intellectuals tend to ignore it, even though it is the far more important, from and energy and environmental standpoint, portion of transport to put on the rails.  In fact, the US would actually probably have even a higher rail modal percentage if the US government had not enforced a regulatory regime (until the Staggers Act) that favored trucks over rail.   If the government really had been asleep the last century, we would be further along.

The US has not been "asleep"  -- at least the private individuals who drive progress have not.  We have had huge revolutions in transportation over the last decades during the same period that European nations were sinking billions of dollars into pretty high-speed passenger rails systems for wealthy business travelers.   One such revolution has been containerization, invented here in the US and quickly spreading around the world.  Containerization has revolutionized shipping, speeding schedules and reducing costs (and all the while every improvement step was fought by the US and certain local governments).  To the extent American businesses are not investing today, it has more to do with regime uncertainty, not knowing what new taxes or restrictions are coming next from Congress, than any lack of vision.

I would argue that the US has the world's largest commitment to rail where it really matters.  But that is what private actors do, make investments that actually make sense rather than just gain one prestige (anyone know the most recent company Warren Buffet has bought?)  The greens should be demanding that the world emulate us, rather than the other way around.  But the lure of shiny bullet trains and grand passenger concourses will always cause folks like Epstein to swoon.

Update #2: The author Joel Epstein emailed me a response to this post.  I will give it to you in its entirety:  "You should get out of the country more often."  Wow, he played the provincial American card on me.  Except that I have been to about 20 countries, from Singapore to Argentina to Hungary.  Besides, I really don't understand what the hell he means by this in the context of my post, except as a bid for some sort of intellectual superiority.   Anyone else understand?

Postscript

Boring, but environmentally friendly and cost-effective:

Sexy, but environmentally useless (at best) and tremendously costly:

So, explain to me what drives these guys investment thinking.  Can it be anything but triumphalism?

Update: Energy use comparison of passenger modes. Note how close rail transit and cars, both at average occupancies, are in this analysis.  The differences in freight are much larger: