The true believers in high-speed, high-cost rail got some bad news this week–not that it will dissuade them from admitting this boondoggle will never work, but it was an financial wake-up call. The Wall Street Journal noted
A mere 2% of the carbon emissions credits that the California Air Resources Board (CARB) put up for auction in May were sold. The quarterly auction raised only $10 million of the $500 million that CARB projected. That’s awful news for Democrats in Sacramento who planned to spend the windfall on high-speed rail, housing and electric-car subsidies.
CARB’s auctions kicked off in 2012 with robust demand and have raised nearly $5 billion. But demand has shrunk this year amid regulatory and legal risks. The California Chamber of Commerce has challenged the auctions as an illegal tax that CARB imposed without the constitutionally required two-thirds vote of the legislature.
Cap-and-trade revenues are supposed to fund only projects that reduce emissions, and the state Legislative Analyst’s Office has questioned whether the funding recipients are doing so. For instance, the bullet train will release more carbon over the next three decades.
There have been several studies that arrived at the conclusion that high-cost rail will generate more carbon than it would save even if the grotesquely inflated ridership estimates came true. If you ever hear anyone talking about how green the HSR system will be, please tell them to go do their homework.
Bottom Line: No private money, not much Federal money, much less cap-and-trade money and maybe none if the lawsuit pans out. And for all this, we get to pay an extra 12 cents per gallon of gas for a few decades. Lousy deal.
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