# CAHSR Could Earn Over $40 Billion in Profit



## CHamilton (Dec 4, 2014)

California High Speed Rail Could Earn the State Over $40 Billion in Profit


----------



## Anderson (Dec 5, 2014)

As odd as it sounds, in this context $40 billion over 100 years is hardly a thundering success. You're basically making all of your profit on the back end.

This isn't to speak ill of the project; this analysis just doesn't come to much in my mind, that's all.


----------



## Tokkyu40 (Dec 5, 2014)

That only averages about $400 million a year, which seems reasonable. That's about what the nearly identical Sanyo Shinkansen earns in profits.
Although we don't have the 20 mile tunnel under the ocean.


----------



## Anderson (Dec 5, 2014)

No, but I think we have a similar amount of tunneling between LA and Bakersfield. We may well have more, depending on the route chosen.


----------



## Devil's Advocate (Dec 5, 2014)

Anderson said:


> As odd as it sounds, in this context $40 billion over 100 years is hardly a thundering success. You're basically making all of your profit on the back end. This isn't to speak ill of the project; this analysis just doesn't come to much in my mind, that's all.


Your complaint only sounds odd because it uses vague undefined criteria, because it lacks any explanation for whatever context you're envisioning, and fails to name even a single project you think is a bigger success from start to finish.


----------



## Anderson (Dec 6, 2014)

Devil's Advocate said:


> Anderson said:
> 
> 
> > As odd as it sounds, in this context $40 billion over 100 years is hardly a thundering success. You're basically making all of your profit on the back end. This isn't to speak ill of the project; this analysis just doesn't come to much in my mind, that's all.
> ...


Ok, here's what I'm saying (and FWIW I meant to add more but forgot to):

The $40 billion number strikes me as being a questionable one to work with insofar as your "profit" is essentially loaded into the far, far end of the timescale. While you may be showing a "profit" in early years due to extended depreciation on the ROW assets (and I'm going to question using a 100-year timeframe on some of that in CA...basically I'd be inclined to assume a shorter timeframe on the grounds that an earthquake is likely to force some major rebuilding on part of the ROW at some point).

The other thing is that, quite frankly, going out to over a 100-year timeframe involves such wildly unpredictable variables that it isn't even funny. Looking back 110 years, you have 1904. In 1904 you still had to connect to a ferry to get into New York, automobiles were toys owned by rich people, etc. I can't say what someone living in 1904 would have guessed at for 2014 looking like, but I'd bet the Pennsy assumed they'd still be running their own trains on what would become the NEC, they'd have their Manhattan terminal (I _think_ that was already being planned around that time; if not, it was at least envisioned), and so on.

A 35-year timespan at least involves reasonable (if often wildly inaccurate) projections and guesstimates. 100 years or more is so far outside of any reasonable policy planning universe, except in the extreme abstract, that it honestly isn't worth doing IMHO. Little errors on a trendline at that point become truly massive...and there's room for more than a little error, especially when you take a lot of water and climate stuff into account.


----------

