In Defense of High-Speed Passenger Rail

On July 23, two bullet trains collided in Wenzhou, China, killing at least 40 people. This tragedy prompted a rare apology from the governing Chinese Communist Party, and drew international criticism of high speed rail as a whole. For some observers, China’s high speed rail system symbolized the overreach of a nation in an unsustainable economic bubble, and the bureaucracy that has made the system both expensive and dangerous.

Others have questioned the economic feasibility of passenger rail in general, noting that in the United States, only the Amtrak line from Boston to Washington is profitable. According to this criticism, the United States – unlike Europe, Japan, and China – is very sparsely populated, which means that there will simply never be enough passengers to make the system profitable. In recent months, the prospect of a high speed rail network in the United States has been pilloried from the right and left alike. In California, the only serious high-speed rail project in the country has been criticized as wasteful spending by a state that is already in dire fiscal straits.

In a scathing review, The Economist claims that high-speed passenger rail could ruin America’s envy-of-the-world freight train system, with which it would most likely share its tracks. Having worked in logistics myself, I am sympathetic to The Economist’s concerns. But this isn’t a good argument against high-speed passenger rail; on the contrary, it is a reason to invest more, in order to build a separate network for passenger trains which can travel at much higher speeds.

What of the argument that the United States is too sparsely populated for passenger trains to ever be a profitable mode of transportation? After all, it’s undeniably true that large cities in the United States are much farther apart than large cities elsewhere, and therefore fewer people will want to use the trains. My response to these arguments is that the critics are using the wrong metric. Why must high-speed passenger rail systems be profitable in the first place? We have a terrific Interstate Highway System which, with the exception of a few toll roads, generates no revenue whatsoever. Yet almost no one suggests that the Interstate Highway System was a bad investment for the United States.

Fine, say the critics, but since we have such a great highway system why do we need trains? America is a nation that loves to drive. But a passenger rail system would not be in competition with highways, if it is designed correctly. Relatively few people choose to use highways for long-distance travel between major cities anyway, opting for air travel. Some critics point to the slow passenger lines that currently exist and how unpopular they are, suggesting that high-speed passenger lines would be an even bigger waste of money. But this criticism loses sight of what makes such a system appealing in the first place: Slow passenger rail systems are disliked by travelers precisely because they are slow; they offer neither the speed of air travel nor the independence of highways.

Finally we come to the standard libertarian criticism of public expenditures: Why should the government invest in a high-speed rail system at all? Airport congestion imposes economic costs on society: wasted time in airport terminals, delayed business meetings, and people choosing to drive instead of fly (which causes more highway congestion and traffic fatalities). Since the public is indirectly footing the bill for these problems anyway, why not redirect the money to high-speed rail, which would actually relieve some of the airport congestion by taking some of the customers?

The United States needs a high-speed passenger rail system. After years of neglect, America’s infrastructure is rated only the 16th best in the world. As air travel becomes evermore unpleasant and congested, high speed rail will become a necessity for traveling between cities. By the middle of this century, the United States can have an incredibly efficient three-tier travel system: For short-distance travel (less than 50 miles), we would have our Interstate Highway System complemented by a network of intelligent self-driving cars. For medium-distance travel (50-500 miles), we would have a network of high-speed rail, which would pick up and drop off passengers near the center of large cities. For long-distance travel (more than 500 miles), we would have our airports, which would be much more efficient due to the fact that there would be fewer passengers clogging the system with short-haul flights that would be better addressed by trains.

High-speed rail is not some trivial boondoggle to be mocked for its unprofitability; it is the central public transit challenge of the 21st century. If the United States begins the undertaking now with the same commitment which President Dwight Eisenhower brought to the Interstate Highway System 55 years ago, it can have a state of the art network of passenger trains by the middle of the century. Neither technology nor economics is an obstacle; only the political will stands in the way.

The Democratic Threshold

In the wake of the collapse of the Soviet Union, futurist and political economist Francis Fukuyama wrote a book in 1992 entitled The End of History and the Last Man, in which he theorized that nearly all nations would soon become liberal democracies. Since all competing global ideologies had been defeated, Fukuyama felt that it was only logical that the people of all nations would soon demand freedom from their leaders and live in peace happily ever after – the end of history. Since 9/11, Fukuyama’s predictions have frequently been derided and ridiculed for such a spectacularly inaccurate and overly-optimistic view of the future.

In light of the democratic revolts currently spreading across the Arab world, Fukuyama’s theory merits reexamination. Was he wrong, or just a few decades premature? Is liberal democracy the inevitable final stage of development, and if so, what kind of conditions are necessary for it to thrive? It’s easy to get swept up in the excitement of the moment – the collapse of communism must have been just as exhilarating to democrats as the (possible) collapse of Arab autocracy is today – but we must bear in mind that the crystal ball is always murky. It is unclear how far the current wave of revolutions will spread, or what the ultimate outcome will be. Charting “the end of history” based on recent current events is never a good idea.

Fortunately, we need not make wide-eyed predictions based upon what we wish were true. There is plenty of statistical data to analyze. The relationship between the economic success of a nation and its level of democracy is very strong. Nearly all countries with a GDP per capita (adjusted for purchasing power parity) of at least $10,000 are at least partially democratic, with the vast majority being full-fledged democracies, as measured by The Economist’s Democracy Index. However, the statistics don’t show us which is the cause and which the effect. Does an affluent society make people more willing to demand their democratic freedoms, or does democracy bring about affluence? There have been many autocracies which have grown their economies very quickly – South Korea in the 1970s, Chile in the 1980s, and China today – but they always seem to democratize around the same time they become wealthy. This suggests to me that an economically empowered people are more likely to demand democratic empowerment; and just as importantly, governments are likely to accede to their demands. In my view, a GDP per capita of $10,000 is a Democratic Threshold. No nation can economically develop past this level without transitioning to at least partial democracy.

But there is one group of countries that is a large exception to this rule. Nate Silver at FiveThirtyEight and Thomas Friedman at Foreign Policy Magazine have both pointed out the toxic effect that oil has on democracy. Indeed, the statistics bear this out. With the exception of Norway and the Netherlands, every oil-rich country (where oil exports account for at least 5% of GDP) is much less democratic than other countries at the same level of development without oil. Qatar may have a higher GDP per capita than the United States, but it is far less democratic. Oil breeds corruption and autocracy.

Taking oil-rich countries out of the mix, I have charted the relationship between democracy and economic development:

A few autocracies are nearing the $10,000 GDP per capita Democratic Threshold. A few others including China are not there yet, but are growing so fast that they will most likely reach it within a decade. Some countries have not reached the Democratic Threshold, but score far lower on The Economist’s Democracy Index than one would expect, given their GDP per capita. Nations falling into these categories are the ones best primed for some serious progress toward democracy. What countries would those be?

Country	GDP per capita (PPP)	Democracy Index	Expected DI	Democracy Deficit
Tunisia	$9,500	2.79	6.15	-3.36
North Korea	$1,800	1.08	4.43	-3.35
Uzbekistan	$3,100	1.74	4.99	-3.25
China	$7,400	3.14	5.89	-2.75
Djibouti	$2,800	2.20	4.89	-2.69
Cuba	$9,900	3.52	6.19	-2.67
Egypt	$6,200	3.07	5.71	-2.64
Laos	$2,400	2.10	4.73	-2.63
Swaziland	$4,500	2.90	5.38	-2.48
Burma	$1,100	1.77	3.92	-2.15
Vietnam	$3,100	2.94	4.99	-2.05
Tajikistan	$2,000	2.51	4.54	-2.03
Guinea-Bissau	$1,100	1.99	3.92	-1.93
Jordan	$5,300	3.74	5.55	-1.81
Fiji	$4,300	3.62	5.33	-1.71

(Disclaimer: Obviously I’m not saying that these countries are all poised to become liberal democracies overnight, merely that there is the potential for substantial progress. North Korea, for example, has set the democratic bar so low that even modest efforts toward democracy would be a major step forward.)

The three Arab states on this list – Tunisia, Egypt, and Jordan – are in the midst of serious challenges to their authority. It’s no coincidence that these three countries, and not other Arab states, are the epicenter of the protests. As I write this, Tunisians have successfully deposed their dictator in the Jasmine Revolution. Egyptian President Hosni Mubarak has declared he will not seek reelection this fall, although his prospects of remaining in power even that long look pretty bleak. Jordan’s enlightened King Abdullah has just dismissed his government and has wisely pledged to institute immediate democratic reforms.

The other countries on this list are an assortment of communist holdouts, rogue nations, and states dominated by a larger power. If China becomes democratic, for example, it could send shockwaves throughout the region and lead to the collapse of North Korea, Burma, and authoritarian regimes throughout Africa, which depend on China for their survival.

Fukuyama’s theory seems to be supported by the statistical evidence - liberal democracy is indeed the end of history. Once countries surpass the Democratic Threshold – approximately $10,000 GDP per capita – they almost invariably develop some form of democracy. Those that make a conscious decision to keep their people impoverished may be less likely to transition to democracy, but economic stagnation can lead to other forms of revolt due to public dissatisfaction. This leads to a paradox for authoritarian governments: They will quickly fall out of favor with the public if they can’t produce a strong economy, but prosperity will ultimately lead to their downfall in the longer term.

I can’t say that I agree with some of Fukuyama’s idealistic, neoconservative foreign policy recommendations for spreading democracy, but I do agree with his idea of “democratic determinism.” Countries without oil are ultimately destined to become democracies as they become wealthy. And even the petro-states have hope. As soon as the world transitions to alternative sources of energy, their economies will no longer be strangled by oil and it will no longer serve as a drag on their freedom. Democracy is coming to a country near you. It’s only a matter of time until we reach the end of history.

PREDICTIONS:

By 2013 – Cuba has made substantial progress toward democracy relative to where it stood at the beginning of 2011.

By 2016 – Tunisia, Egypt, and Jordan have made substantial progress toward democracy relative to where they stood at the beginning of 2011.

By 2018 – China has made substantial progress toward democracy relative to where it stood at the beginning of 2011.