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Comment by andy800 | Hacker News Reader

Hard to see this as anything other than big-time grift.

This is estimated to be a $12B project. $6.5B raised so far: $3B grant and $3.5B in tax-exempt, "private activity" bonds. Does anyone actually think the rest will come from investors? Of course not, the government will see a half-finished project that it supported and provide the funding to finish the job, including the inevitable overruns.

A private company receiving 6.5B (and likely, eventually $12+) of government money... no pressure or expectations to make any profit. Great deal if you can get it!

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Brightline already spent $6 billion in private funds building functional passenger rail from Miami to Orlando [1].

I’m not in support of private companies receiving subsidies, but at least do some research before reacting..

1- https://www.cnbc.com/amp/2023/08/04/how-brightline-is-changi...

I've done plenty of research. The Florida operation is backed by Fortress Investment Group. It is not involved in funding the California-Nevada project. As I've already pointed out, all the money raised so far comes from government sources.

$6.5B to demonstrate it is in fact possible to build HSR on budget and on time in the states and that CAHSR is just run by a consultant mafioso in a trenchcoat sounds like a great deal!

Florida already exists as a "demonstration" project. Regardless, spending $12B just to prove a point is not a wise use of those funds.

florida brightline is just a normal, mostly already existing, railroad

Why not invest? Brightline has done well in Florida.

It lost $192 million in the first 9 months of 2023. $201 million same period of 2022. It also lowered its passenger forecast to Orlando from 7 to 5.5 million.

https://www.palmbeachpost.com/story/news/2024/03/08/brightli...

That's why I believe public infrastructure should be publicly-owned. It's rare to find a profitable metro system...it should be run by the government as a benefit for citizens, not as a business like Brightline.

The EU is doing this right.

The rail infrastructure is publicly owned. But the rail infrastructure is open access that private companies can pay for. As far as I understand you can even have a public carrier but it must bid for access like its private counterparts do.

This has already led to an explosion of high quality high speed rail service in countries like Italy and Spain.

If infrastructure isn't sustainable you're destroying value and making your citizens poorer.

"Not profitable" doesn't mean "unsustainable".

To rephrase, some things are not directly profitable but tend to have outsized profitable effects. E.g., the education budget doesn't directly generate profits, but educated people go on to get good jobs and pay a lot of taxes, refunding the cost of their education by many multiples.

The same goes for roads, highways, and rail. Not directly profitable, but they enable a lot of free movement that boosts the economy and, in turn, taxes.

This video goes into that a bit by studying Florida: https://www.youtube.com/watch?v=dmpyV4Yf8b0

The regulations of rail in the US are slightly perverted (freight rail interests dominate the discussion, usually). The economics of passenger rail in the western US are also difficult when large densities of people are so spread out and the only "primary" reasons for going from A to B are for recreation, not work/industry.

$3.5B in tax-exempt bonds is not $3.5B of government money.

Notorious car-and-luxury-centric city expects citizens to take icky public transit.

Just make one of the cars a party bus.

Having experienced the post-privatization decline of public services a few times I'm of the opinion that public transport, being a societal good, should be publicly funded, publicly owned and funded well. Rail is especially expensive to maintain and profit from. Private companies tend to reduce maintenance to a bare minimum or less in the name of efficiency, resulting in the infrastructure declining whilst profits rise. Then the government steps back in to fund repairs to a critical service, indirectly funding the profits. That's definitely a typical capitalist grift for "too big to fail" companies. For those that don't like public money spent on infrastructure its a not a binary choice of to spend the money or not, it's inevitably when to spend it and how.

This project represents the worst combination: publicly funded but privately owned.

In the UK there was for a while the private finance initiative, where the government contracted private companies to provide services or development. The result, as concluded by the very private business friendly right wing government, was that is was a total waste of money, with no measurable benefit but costing billions extra than if the government had provided services directly.

This. The $12B represents about 0.2% of the total US outlays for FY 2023. People tend to see the big number without considering the rest of public spending. You have to crack an egg to make an omelette. As a result the general population will tend to vote against these kinds of investments and then look back in 50-100 years and wonder why other countries seem to have all of the nice public infrastructure.

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