Canada’s economy is on the rocks.The ongoing tariff war has wracked the manufacturing sector, while Canada’s soft embargo on expanding the ability to export oil and gas products prevents the energy sector from filling the economic void. Subsidies for everything from battery plants to edible cricket farms have produced nothing more than a list of business failures, while the national debt explodes.To address all this, the economic wizard Mark Carney has decided that what the nation must do is sink close to $100 billion into a publicly owned high-speed rail project to service the Laurentian corridor in Eastern Canada. The insanity of this notion beggars belief, yet the Liberals, along with their stalwart supporters in legacy media, have circled the wagons and are in full campaign mode, pushing the alleged merits of a high-speed rail line.Proponents of the line can’t pretend there isn’t a model of a North American high-speed project to examine before diving into one in Canada. California began its high-speed rail odyssey in 2008. It was to run between Los Angeles and San Francisco at a cost of about $35 billion USD to build. They anticipated it would be operational by 2020. With over 20 million people living along the 800 km corridor, surely it could be a viable route for a high-speed rail line, right?.After nearly 20 years and billions spent, not a single mile of track is operational on the California line yet. The budget has exploded to over $126 billion for phase 1, and they hope it may be operational by 2040. In short, it has been a catastrophe, and due to the government clinging to the sunk-cost fallacy, we will be able to watch this slow-motion train wreck for decades to come.The Canadian plan is even more ambitious than the California one. The intent is to build 1,000 km of high-speed rail through regions with far less population density than California. They will be forced to try and get it built in adverse Canadian weather, and they believe it could be done for a cost 23% lower than the current California line projections, and to be finished by the 2040s.Look at the rather modest light rail transit expansion of the Ontario Line. A mere 15.5 km of line was to be built with a projected cost of $10.9 billion in 2019, and it was projected to be completed by 2027. The cost in a mere seven years has nearly tripled, and the completion date has been pushed into the 2030s. Just think of what these people will do with a high-speed rail megaproject.Proponents of high-speed rail like to point to European and Asian models as examples to follow, but it isn’t an apples-to-apples comparison by any measure. First of all, the population densities aren’t even comparable. European and Asian cities are massive and close together, which creates demand and feasibility. Even in the Laurentian corridor, Canada comes nowhere close to the densities of Europe and Asia. .Then there is the vehicle culture. In Canada, over 80% of citizens own a private vehicle. In Europe, only 56% do, and the number is even lower in most of Asia. People in Canada won’t forgo their vehicle use in the millions just because they have access to a high-speed rail option whenever that may come.The ongoing subsidies will be massive even if the project ever becomes complete. If the costs of the line and its maintenance are to be recovered, the tickets will have to cost hundreds of dollars each, and it will take over a century if people were willing to pay that much. What’s more likely is that the government will just raise taxes on the rest of the country to subsidize the ticket prices for their Laurentian line.The economic benefits of such a line are negligible. It won’t be transporting freight, and with modern communication methods, people don’t need to commute as they used to. The tourism demand between the cities serviced is small, and the novelty of the line itself won’t draw more of them.The Liberal government likes spending announcements, and it likes mega-projects which will provide contracts and jobs for their friends for decades to come, whether the projects are ever completed or not. Perhaps Canada should just institute a direct fund with a budget of a few billion per year that the Liberals can legally transfer to their cronies. It would be abhorrent, but still would be cheaper than going through the motions of building a high-speed rail line and may be more effective for economic stimulation.One doesn’t need to be Nostradamus to foresee the disaster the high-speed rail line will become. It’s just going to be a matter of how much will be blown and for how long before fiscal reality forces the project to be formally ended.
