I’m not sure the CPI really covers giant dams… The same project today would cost more than $700M. For one thing we’re rather less cavalier about workers dying on the job these days; as I recall the Hoover Dam killed close to one worker a month.
But the labor was pretty cheap.
Quote:
Originally Posted by Alistair
The pyramids probably weren’t all that straightforward.But the labor was pretty cheap.
and there was no EPA back then.
Or OSHA. :)
Yeah, I don’t think you can take a straight inflation adjustment to get the cost of that project.
Who gives a $#@ how much it costs? Real interest rates are near zero. Projects like this are the damn core of a functioning system of money and government. The fact we did challenging, big projects, with risk profiles only government would cover, gave us the advances and technology to build this tunnel. At minimum look at the whole net effect of the project not just some meaningless cost numbers.
The movie Margin Call has really nice scene. Our system of money, currently, is stagnate. We have people sitting around in the high powered, top hierarchy, playing games only to crash like MF Global.
Kick ass movie, Margin Call.
http://www.movieweb.com/movie/margin-call/bridge
But the one moment that really knocked me out took place not on Wall Street, but on a New York City stoop. In the memorable scene, Stanley Tucci, playing an engineer-turned-finanical analyst, talks to Bettany about a bridge he helped build, and the amount of driving time it’s saved the residents of Ohio and West Virginia who use it. (Sample line: “That’s 6,708,240,000 miles that haven’t had to be driven…that’s 134,164,800 hours, or 559,020 days.”) The movie is released in theaters and on demand on October 21; in the meantime, check out the clip below:
http://thinkprogress.org/yglesias/2011/11/04/361184/americas-infrastructure-cost-disaster/
The growing cost estimates for California High-Speed Rail seem designed to embarrass those of us who were enthusiastic about the project. Something to note, based on Alon Levy’s breakdown, is that this isn’t really a case of the initial estimates being wrong. Instead, the two biggest drivers of higher costs are changes to the plan. One set of changes is that because it’s taking the state time to get the money together, the duration of the project is being extended which is pushing costs up. In essence, the project is so expensive that California wants to do it more slowly which is making it even more expensive. Another set of changes is that a lot of post-hoc modifications are being made at the request of local communities who want more segments to be tunnelized or viaducted.
Both of these, I hope people will understand, represent systematic pathologies in the American infrastructure planning process and not something unique about passenger rail. The former, in particular, is maddening. We spend too little on infrastructure in a way that winds up driving up the per-project cost, which winds up driving down the per-dollar utility of infrastructure spending which winds up eating away at public support for infrastructure spending. And the set of cost drivers forced by community opposition would imperil any large scale transportation project. In either case simply shifting the California HSR pot of money into some other project wouldn’t resolve the problem (see Brad Plumer for a full discussion).
100 billion dollars! Amazing. Over a percentage point of GDP, which is by itself shocking, but even better if we use a 50k man-year that is 2,000,000 man years, that figure is so large I simply can’t wrap my head around it. How many man years were put into the interstate system? The Apollo program? The manhattan project?
I honestly don’t understand this and given the numbers involved it is unlikely that any one person could understand the books.
The interstate highway system was 425 billion in 2006 dollars, apparently. If they’re throwing tunnels around yeah, I can see it being 100 billion. From Yglesias’s link:
Update: here is the cost escalation breakdown. It’s overwhelmingly the addition of new features, i.e. tunnels and viaducts, most of which are unnecessary (though one major issue, additional tunnels from Palmdale to LA, is required due to further study showing the need for more environmental protection). For example, Millbrae gets a gratuitous tunnel, previously estimated at $500 million, now estimated at $1.9 billion (p. 20). Unsurprisingly, SF-SJ has the biggest overrun, a factor of 2.5. Hat-tip goes to Clem for noting the extra cost of Millbrae, which I missed looking at just the business plan.
Some interesting bits:
There’s scope creep and there’s scope creep. Sometimes, a project’s costs go up because new features are added that are useful (for example, converting a single-track diesel project into a dual-track electrified light rail, as was done on the LA Blue Line), or that are necessary but were glossed over initially in order to keep cost estimates down. A little bit of the latter kind of scope creep is present in the Central Valley, in the form of more viaducts than originally planned; CARRD’s cost overrun estimate was based entirely on taking CAHSR’s unit costs and applying them to the added features as of 1-2 years ago. But the kind of scope creep we see on the Peninsula is entirely different: they are adding features that are of marginal operational use, and instead exist mainly to reinforce agency turf lines (namely, separation of agencies at San Jose).
To make sure people don’t react to the apparent factor-of-three overrun the way they should – i.e. propose to pull the plug unless costs are scaled down to reasonable levels – the 2012 plan includes higher numbers for the cost of doing nothing, i.e. of expanding freeways and airports to provide the same capacity. It was originally $100 billion, and is now $170 billion. This is less self-serving than it seems: the plan assumes a slower buildout and higher inflation, which accounts for most of the difference.
California’s rail project … will cost less than 0.2 percent of California’s (stagnant) economy over the next 20 years. California is projected to spend about $300 billion on highway infrastructure over the next 20 years.
I’m still optimistic that they could put adults in charge and reduce costs to the original estimate, as they already have in the Central Valley. That is, if the federal government dangles a few billion dollars for the LA-Bakersfield segment and demands even a modicum of accountability, then they will gladly use the money to build a useful initial operable segment and only try to extort the public later. But optimistic and certain are not the same, and it’s an outrage that such a project could cost $65 billion. The tunnel-heavy Shin-Aomori extension of the Tohoku Shinkansen cost $4.6 billion for 82 km, a little more than half the proposed per-km cost of the new business plan – and Japan is a high-construction cost country.
http://www.fresnobee.com/2011/11/05/2604248/high-speed-rail-still-off-track.html
Does anyone really believe the project will make millions in profits?
The business plan portrays a project that will be rolling in money – eventually billions of dollars in profits annually – but only after it begins carrying passengers in 2022.
Plan highlights
Highlights of the California High-Speed Rail Authority’s new business plan, released last week:Cost: Construction cost estimate has tripled since 2008 to $98.5 billion.
Federal funding: Expects $55 billion in federal funds through the project’s completion in 2033. Only $3 billion has been committed so far.
Private funding: Expects $12 billion to $13 billion in qualified tax credit bonds, which would be sold to investors over the next decade, and an additional $11 billion raised directly from investors once trains start running in 2022.
Ridership: Expects to make a profit even if ridership is low. Forecasts 23 million to 34 million riders in 2035.
Source: California High-Speed Rail Authority
High-speed rail story archive Until then, it will depend on billions of dollars every year from congressional leaders, some of whom have labeled it a boondoggle.
The rail authority is proposing to build the project in phases – the same way, the business plan notes, that California built the mammoth State Water Project and Interstate 5 through the Central Valley during the 1960s and '70s.
There is, however, a key difference between those projects and high-speed rail: Those earlier projects had dedicated streams of money that kept engineers and construction crews busy, year after year, decade after decade.
The state will spend all of its current federal grant money on the first 130 miles of track from Bakersfield to Fresno.
Despite the mocking nickname critics have given that link – including “the train to nowhere” – it will have no train. There is no money in the budget for a high-speed train
You would prefer a low usage segment to get a high speed train? Then you’d be coming in here mocking that as the government waste.
There going to build 130 miles of HSR and not put a HST on it for 10+ years. Why not just build a low stop Amtrak system then? And it’s a nice way to sell it to towns as you bulldoze their freeway side business’s.
The whole segment will by 2025? (end of second phase) be HSR.
Putting an actual train on the tracks seems like a pretty critical thing that you should fit into the budget.
There are a host of “systematic pathologies” endemic in every sort of big government project. It is a mental pathology to expect that this time or any time things are going to be different.
If they’re systematic to government, how do they build them so much cheaper with other countries’ governments?
What makes you think its any worse in the US then in other countries? Living in the US, of course the emphasis is on whats happening here. But it doesn’t take much of a search to find overbudget government funded projects pretty much everywhere.
As anyone who works in business can tell you, major projects running seriously over budget is not by any means the exclusive domain of government. Both private and public projects can and do run over budget.
I’m still optimistic that they could put adults in charge and reduce costs to the original estimate, as they already have in the Central Valley. That is, if the federal government dangles a few billion dollars for the LA-Bakersfield segment and demands even a modicum of accountability, then they will gladly use the money to build a useful initial operable segment and only try to extort the public later. But optimistic and certain are not the same, and it’s an outrage that such a project could cost $65 billion. The tunnel-heavy Shin-Aomori extension of the Tohoku Shinkansen cost $4.6 billion for 82 km, a little more than half the proposed per-km cost of the new business plan – and Japan is a high-construction cost country.
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Bump of an old thread, but the 2nd tunnel started construction last year.
http://www.cbbt.com/project-description/
- Construction Cost: $755,987,318
http://www.cbbt.com/tbms/
Cool how it digs and places wall segments at the same time.
5 minute video simulation:
.Dropbox - The Thimble Shoal Channel Tunnel.mp4 - Simplify your life