Project chairman: 'We have certainly hit a snag with all the difficulties of the coronavirus.'
By D Magazine•
Construction for a high-speed train that will zip between Dallas and Houston at more than 200 miles per hour is still in the works. But with costs estimating almost $20 billion more than initially planned, Texas Central might need the help of stimulus money.
In a recent letter to Texas State Sen. Robert Nichols, Texas Central’s Chairman (and an investor), Drayton McLane, Jr. said the project is seeking funds outside of private equity, saying, “we have certainly hit a snag with all the difficulties of the coronavirus.” The letter was obtained by the Dallas Business Journal.
The company laid off 28 employees in March, and the Global Financial Markets hit a low, too, leaving its upcoming recovery—or lack thereof— to determine the verdict: Will the train need a stimulus fund?
Aside from exploring funding from government loan vehicles—including Railroad Rehabilitation & Improvement Financing and Transportation Infrastructure Finance and Innovation Act—Texas Central may tap into government loans. According to Texas Central CEO Carlos Aguilar, the company has not applied for funding through the CARES Act.
“We feel that between Japanese government funding and the monies we hope to receive from President Trump’s infrastructure stimulus through the Department of Transportation, along with private equity that the project still has a great opportunity, is viable and can be construction-ready this year,” McLane added in his letter.
The project will create an estimated $36 billion in economic benefits statewide over the next 25 years, according to a news release. Texas Central anticipated it also would create 10,000 direct jobs per year during peak construction and 1,500 permanent jobs when fully operational.
Early on, Texas Central said the bullet train would be privately funded—an idea that has drawn skepticism since inception, along with its ability to be profitable.
In 2017, Peter Simek wrote a D Magazine article titled Has the Texas Central Bullet Train Gone Off the Rails? In it, he points to Travis Korson, a senior fellow with Frontiers of Freedom, a conservative Washington think tank, who didn’t believe then that the numbers made sense and that its growing budget and inflated ridership projects suggest the privately funded rail project may not be profitable. (Click here to read it)
At the time, proposed construction costs had ballooned from $10 billion to $16 billion. Currently, on Texas Central’s website, it says the system will cost more than $12 billion to construct.
In response to recent news about the potential need for stimulus money, State Representative Ben Leman, District 13, issued the following statement:
“We also were told the project would be privately financed, yet now it is revealed Texas Central is seeking taxpayer stimulus money to build it. To publicly promote to the media, to elected officials, and worst of all to the citizens of Texas the cost of the project as $20 billion when they know it to be more than $30 billion and that the project would be privately financed while they ‘hope to receive from President Trump’s infrastructure stimulus through the Department of Transportation’ to build it just reveals their true character and intentions about this project”
Aguilar told the DBJ that the $30 billion figure was “a conservative estimate of ‘all in’ numbers.”
The train’s still on the tracks toward its construction, though, as the company hit a breakthrough in an essential legal ruling just one month ago: The Thirteenth Court of Appeals ruled Texas Central and its subsidiary Integrated Texas Logistics as legal railroads.
The decision reversed a previous one made in the 87th district of Leon County. Designating the project as a legal railroad is almost as powerful as what happens next. All railroads have the right of eminent domain, which means that Texas Central can acquire all the land it needs. Project opponents are appealing the decision to the Texas Supreme Court.
In response, Aquilar said the “decision confirms our status as an operating railroad and allows us to continue moving forward with our permitting process and all of our other design, engineering, and land acquisition efforts.”
Public policy intended to make layoffs less painful actually made layoffs cheaper and more common.
Why has the labor market contracted so much and why does it remain depressed? Major subsidies and regulations intended to help the poor and unemployed were changed in more than a dozen ways—and although these policies were advertised as employment-expanding, the fact is that they reduced incentives for people to work and for businesses to hire.
You probably heard about the emergency-assistance program for the long-term unemployed that ended only a few months ago after running for almost six years. But there is also the food-stamp program. It got a new name and replaced the stamps with debit cards. Participants are no longer required to seek work and are not asked to demonstrate that they have no wealth. Essentially, any unmarried person can get food stamps while out of work and can stay on the program indefinitely. Continue reading
On Feb. 17, 2009, President Obama promised the sun and the moon and the stars. That was the day, five years ago, when he signed the $800 billion “American Recovery and Reinvestment Act.” President Modesty called it “the most sweeping economic recovery package in our history.” He promised “unprecedented transparency and accountability.” He claimed the spending would lift “two million Americans from poverty.” Ready for the reality smackdown?
The actual cost of the $800 billion pork-laden stimulus has ballooned to nearly $2 trillion. At the time of the law’s signing, the unemployment rate hovered near 8 percent. Obama’s egghead economists projected that the jobless rate would never rise above 8 percent and would plunge to 5 percent by December 2013. The actual jobless rate in January was 6.6 percent, with an abysmal labor force participation rate of 63 percent (a teeny uptick from December, but still at a four-decade low). Continue reading
“Will we, before it is too late, use the vitality and the magic of the marketplace to save this way of life, or will we one day face our children, and our children’s children when they ask us where we were and what we were doing on the day that freedom was lost?”
by Scott L. Vanatter
Before he was elected president Ronald Reagan delivered a series of speeches on various aspects of the American experience. He focused on core principles: our founding, our freedoms, our economy, and especially and repeatedly on the great promise of our being the Shining City on the Hill.
Thirty-five years ago this month, on November 10, 1977 , the future president spoke at the Ludwig Von Mises Memorial Lecture at Hillsdale College, Michigan. His remarks were titled, “What Ever Happened to Free Enterprise.” Continue reading
by Andrew Stiles
President Barack Obama appears to be doubling down on his policies of using taxpayer money to finance green energy investments despite an increasingly spotty track record.
“We’ve got to control our own energy, you know, not only oil and natural gas, which we’ve been investing in, but also, we’ve got to make sure we’re building the energy source of the future, not just thinking about next year, but 10 years from now, 20 years from now,” he said during Tuesday night’s presidential debate. “That’s why we’ve invested in solar and wind and biofuels, energy-efficient cars.” Continue reading
Let’s fact check President Barack Obama’s debate statements. He spent a lot of time since the first debate and during the second debate complaining that what Gov. Mitt Romney said wasn’t true. Yet, the facts do not support Obama’s claims. Here is the proof on Obama’s poor record on truthfulness during the second debate:
The attack in Libya — a terrorist attack? Or a spontaneous protest that got out of hand because of an offensive internet video?
On the issue of Libya, Obama said, that the day after the Sept. 11, 2012 attack on the American Consulate in Benghazi, “I stood in the Rose Garden and I told the American people and the world that we are going to find out exactly what happened. That this was an act of terror and I also said that we’re going to hunt down those who committed this crime.”
Romney challenged Obama’s characterization that he had identified the Benghazi attack as terrorism on day one. Obama doubled down. Just as Romney was about the snare Obama in his lie, the the moderator erroneously sided with Obama and claimed that he had identified the attack as terrorism. After the debate, the moderator admitted that she was wrong and that Romney was correct. But let’s not rely on her retraction and correction, let’s go straight to the record. Continue reading
by Victor Davis Hanson
The Obama narrative is that he inherited the worst mess in memory and has been stymied ever since by a partisan Congress — while everything from new ATM technology to the Japanese tsunami conspired against him. But how true are those claims?
Barack Obama entered office with an approval rating of over 70 percent. John McCain’s campaign had been anemic and almost at times seemed as if it was designed to lose nobly to the nation’s first African-American presidential nominee. Continue reading
Every American voter is approaching a critical decision. Of the two presidential candidates before us, who is best suited to lead our nation through the next four years?
The answer to that question is a simple test: can they ignite economic growth? The economic crisis we face is our greatest threat, affecting every American. For investors – and today over half of Americans are investors in some form – this issue is particularly pressing as it impacts not just their financial situation today, but also their retirement and other long-term goals. Economic growth is the only ingredient that will help pull the country out of its present funk and allow us to solve our pressing issues. Continue reading
During the debate, Vice President made history by surpassing Al Gore for bad, boorish, and rude behavior. He laughed uncontrollably, signed, groaned, and laughed some more and engaged in generally childish antics throughout the debate. Biden’s rude and unprofessional behavior overshadowed the substance of what he said.
But as bizarre and unbalanced as his behavior was during the debate, the substance of what he actually said was perhaps the most troubling. Here are a short list of several of the most obviously false things that Biden said:
1. Afghanistan and Iraq: Biden accused Rep. Paul Ryan of putting two wars on the “credit card” and then bragged that he voted against both of them because he understood America could not afford them. “I was there, I voted against them,” Biden said. “I said, no, we can’t afford that.” But the truth is Sen. Biden voted for the Afghanistan resolution on Sept. 14, 2001 the Iraq resolution on October 11, 2002. It takes some brass to tell whoppers like this one! Continue reading
Lack of Desire, Knowledge and Confidence
by Scott L. Vanatter
Why was Obama just not that into it (the debate)? Three possible reasons include a lack of desire, a lack of knowledge of basic economic principles, and being intimidated by Romney’s real world expertise.
Obama sounded so disjointed in the first debate that mainstream media supporters such as Chris Matthews and Andrew Sullivan nearly had an emotional breakdown on camera and online. They are only two who wondered aloud why Obama seemed so incoherent. Obama’s bizarre manner that night almost resembled the infamous beauty pageant contestant of a few years ago or the reporter who had a mini-stroke on camera, so rambling were some of his answers. Surely in the next debate, Obama will up his game. At least he will appear to want to debate. Continue reading
We knew Mitt Romney would be prepared — his campaign has had him doing only one rally per day most days, spending hours and hours on debate prep. From watching the primaries, we knew Romney would come out and be aggressive and generally look good, but we have also seen Romney be stiff, or awkward, or turn to the moderator when attacked. Not tonight.
The “zingers” line appeared to be a bit of chaff; Romney did offer a few good lines — “You don’t pick the winners and losers, you just pick the losers,” “trickle-down government” — but he never seemed to force them or shoehorn them into lines. Continue reading
We already knew that the economy is sluggish and in trouble. But now we learn that the economy is far weaker than previously understood. But that is not the only unflattering truth that has come to light. Our foreign policy and national security are also in far worse shape than we understood even a few weeks ago.
It isn’t just that job growth isn’t even keeping up with population growth. It isn’t just that the Federal Reserve has effectively thrown in the towel and admitted that there is no recovery. Continue reading
“Name a single thing that has improved under [Obama’s] rule….
“Almost the entirety of the Muslim world is now rioting against an American president who promised that his olive branches to Muslims would secure peace….
“Domestically, our debt has increased by 50 percent in just four years, by some $5 trillion, with not a single observable benefit from the spending. Our bond rating already has been downgraded….
President Barack Obama and Vice President Joe Biden never miss a chance to tell us that the economy is moving in the right direction. They claim they need more time to pull the nation out of the recession that began in 2008.
There are several problems with this line of argument. First, Obama said he would solve this problem in his first term and cut the deficit in half. He told us if he didn’t solve the problem, he would be a one-term president. Second, Obama ran for office knowing the economy was bad and he won because he convinced more voters that he would fix it. Obama got everything he wanted in his first two years because he had a compliant Democrat Congress. He spent hundreds of billions of dollars in stimulus and bailouts. The only verifiable result is massive debt that saddles the economy and slows future growth. Third, the biggest problem with claiming that Obama is moving us forward is that it is not true. In fact, things are getting worse. Continue reading
Nearly two years after the introduction of the path-breaking plug-in hybrid, GM is still losing as much as $49,000 on each Volt it builds, according to estimates provided to Reuters by industry analysts and manufacturing experts.
Cheap Volt lease offers meant to drive more customers to Chevy showrooms this summer may have pushed that loss even higher. There are some Americans paying just $5,050 to drive around for two years in a vehicle that cost as much as $89,000 to produce. Continue reading