Last week, the Trump administration fulfilled yet another promise when it canceled nearly $1 billion in taxpayer funding for California’s high-speed rail project between Los Angeles and San Francisco. In the midst of yet another infamous Infrastructure Week, this announcement was an important development in the effort to ensure that when it comes to the allocation of public resources, taxpayers aren’t on the hook for unrealistic boondoggles that both violate private property rights and provide a nonexistent return on investment.
The use of public resources in public rail projects is not inherently inappropriate. These investments, however, must be subject to serious scrutiny given the amount of money that backers seek for direct subsidies, loan guarantees, and ongoing financial support from taxpayers. At the end of its life this year, the California rail effort was projected to cost nearly $100 billion by the time it was completed in 2033, three times the original projections.
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