Wednesday, February 9, 2011

High-Speed Rail System

The Obama administration wants to invest $53 billion in high-speed and intercity rail service in the next six years.The current administration believes this plan to spend billions on a vast high-speed-rail network is important to keep the United States competitive with world markets that already use the technology. I wonder how this rail system would impact the automotive industry. I am sure that it would hurt car sales as many people might be able to eliminate owning a car. It may also affect concrete and steel businesses and other manufacturers of materials used to build roads. I wonder about the affect it would have on the businesses alongside the roads that are used to being busy because of the daily traffic driving by. I think that our national debt is also too high to even consider spending that much money on something that may potentially bankrupt the auto makers. The estimated cost for this system would be $600 billion over the next 20 years. Where would money come from to improve and maintain our existing roads? Or would they become a low priority in comparison to spending money on the high- speed rail system? Maybe it would be a better idea to let private industry invest in this project. Amtrack has been successful in the public transportation industry. Maybe they should be doing this project instead of the government.


  1. All interesting points, but wouldn't there be some significant benefit to our economy by building the rail as well. How many jobs would be created by building, maintaining and running the new rail system? Wouldn't this be a large injection into the economy?

    Also, I have a feeling that the American culture would not give up enough cars to bankrupt any auto maker. Also not many people only travel only from city to city so few would be able to eliminate the need for a vehicle. Finally, this is not a new idea so if private industry was able to fill this need don't you think they would have already?

  2. Why would paying down the debt greatly or even paying it off be beneficial or detrimental to the economy? Don’t think politically use economic reasoning.

  3. To Smith...
    I know that a government debt is different that a household debt. We all have been taught that it is never wise to buy things that you cannot afford. We have heard stories of huge burdens people have when they are enslaved by their debt. It ruins marriages and leads to desperate measures. I think because of this we assume that a government in debt may lead to serious acts of desperation too. Government debt is different. Some deficient spending is probably necessary to stimulate the economy, but record deficits like we have now could burden future generations. Eventually the money has to be repaid which most likely will come from higher taxes which nobody wants to pay.

  4. To Kern:
    If this high speed rail system was going be a long term money maker, private industries probably would have already invested. So it may be an indicator that it would not be a good investment and would lose billions of dollars. I think the government should be careful about spending this much money on something that could be a money pit. Why does the government have to spend billions of dollars on something no one else thinks will be profitable? That’s a good point, Kern, that people would still buy cars because Americans do love the freedom that owning a car gives us. They may still own a car, but use it less (if they were actually using the speed rail) so their car would last longer and they would not have to buy a new one as often.