On July 16, the Trump administration “terminated approximately $4 billion in unspent federal funding for California’s High Speed Rail Boondoggle. After 16 years and roughly $15 billion spent, not one high-speed track has been laid by the California High-Speed Rail Authority (CHSRA).” Bullet train bosses were quick to respond.
“Canceling these grants without cause isn’t just wrong, it’s illegal,” claimed CEO Ian Choudri, threatening a lawsuit. For Governor Gavin Newsom, “Trump wants to hand China the future and abandon the Central Valley. We won’t let him. With projects like the Texas high-speed rail failing to take off, we are miles ahead of others. We’re now in the track-laying phase and building America’s only high-speed rail. California is putting all options on the table to fight this illegal action.”
That invites a look at what Newsom and rail bosses are not telling the people. Consider the reports of former California State Auditor Elaine Howle on the rail project’s contracting and cost-control practices. (RELATED: California’s Elaine Howle — DOGE Before DOGE Was Cool)
CHSRA’s “flawed decision making” and “poor contract management” have contributed to “billions of dollars in cost overruns for completing the system.” Construction began in October 2013 despite the fact that “the Authority had not acquired sufficient land for building, had not determined how it would relocate utility systems, and had not obtained agreements with external stakeholders.” These unmitigated risks “contributed to $600 million in cost overruns,” and CHSRA officials “cannot demonstrate that the large amounts it has spent on its contracts have been necessary or appropriate.” (RELATED: Jerry Brown Still Backs Bankrupt Bullet Train)
As Howle also noted, California’s “noncompetitive request,” for $3 million, “did not provide a valid reason why this vendor alone could meet the state’s needs.” Approving “a noncompetitive request that could have been competitively bid” potentially resulted in “the state not receiving the best value.”
In 2019, as Katy Grimes of the California Globe reported, “thousands of pages of public records were removed from the California High Speed Rail Authority website.” Materials stripped from the site included business plans, financial reports from 2008-2014, board meeting minutes, and change orders. Rail bosses claimed they were only trying to make the website compliant with the Americans with Disabilities Act (ADA), but Californians had cause to wonder. (RELATED: Trump Pumps Brakes on California High Speed Rail)
By that year, more than a decade after the first bond issue, the vaunted bullet train had yet to carry a single passenger. On the other hand, CHSRA boasted a Sacramento headquarters and three regional offices. That worked well for bureaucrats and board member Lynn Schenk, a former member of Congress and chief of staff for California Governor Gray Davis.
As the Los Angeles Times explained, the high-speed rail plan called for 36 miles of tunnels through mountains north of Los Angeles, “the most ambitious tunneling project in the nation’s history” through a maze of earthquake faults and fractured rock formations. Other tunnels along the proposed route bring the total to more than 70 miles. This was supposed to be completed by 2022, but it wasn’t.
As UCLA economist Lee Ohanian noted in 2023, California’s rail project was “perhaps the greatest infrastructure failure in the history of the country.” There was “no path to completion for the fantasy rail system” and “the only reasonable decision is to end a project that should never have begun.” In effect, the Trump administration has now made that decision by nixing the $4 billion.
In response, Gov. Newsom mentioned none of the waste, poor management, no-bid contracts, and cost overruns cited by auditor Elaine Howle, California’s one-woman DOGE squad, along with journalists and economists at state think tanks. Most bizarre was the governor’s claim that “Trump wants to hand China the future.”
This is the state that rejected federal funding and hired a Chinese company to build the new span of the Bay Bridge, using Chinese steel and Chinese labor. The bridge came in 10 years late, $5 billion over budget, and riddled with safety issues. At this writing, no reports that China will provide funding to finish California’s high-speed rail project.
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Lloyd Billingsley is a policy fellow at the Independent Institute in Oakland, Calif.