Why Ed Glaeser is Wrong

From the Infrastructurist:

Over the past month, economist Ed Glaeser has explored the benefits of high-speed rail inan occasional series over at the New York Times website. To put it mildly, his reception in the blogosphere has been wretched. Ryan Avent at Streetsblog has been a particularly devastating critic, picking apart Glaeser’s analysis strand by and strand and characterizing the overall effort as “daft and indefensible.”

But what’s been missing thus far is a numbers-based rebuttal of Glaeser’s “back-of-envelope calculations.” He figures three categories of benefits from high speed rail: travel (for example, fewer car accidents and reduced highway congestion), environmental (lower carbon emissions than car or plane travel, etc.), and improved land use (the rail project encouraging denser, more walkable cities, etc.). Through this combination of factors, Gleaser examines a hypothetical HSR link between Dallas and Houston and calculates annual benefits of $158 million. Not bad perhaps, but they pale in comparison to annual costs of $648 million. The gap between costs and benefits–an annual loss to society of $500 million–would seem to be so huge as to kill the prospect of US high speed rail in its cradle.

That may even to have been Glaeser’s intent in writing the series. The problem is that–through a sorry mix of omission, oversimplification, distortion, and deficiency–his calculations bear no relation to the effects he is claiming to consider. So it’s important to show that “the numbers” do not at all undermine the viability of HSR in the US, even outside the northeast and California. In fact, they tend to support it.

By populating his model with a better set of assumptions, we hope to show how badly the economist missed the mark even on his handpicked example of an HSR link between Houston and Dallas. In reality, a well-designed high speed intercity rail project between the two largest cities in Lone Star State would likely produce a net economic benefit–not at all the white elephant Glaeser suggests. In this more comprehensive model that takes into account trivialities like regional population growth and a reality-based route, the annual benefits total $840 million compared with construction and maintenance costs of $810 million. Which is to say, our numbers show that HSR pays for itself rather handily.

And this would be early in the lifecycle of the system, with those benefits likely to grow in future decades.

I highly recommend reading the full article over at the Infrastructurist. Mega kudos to them for their work on this!