The California high-speed rail project remains stalled 18 years after voters approved a 9.95 billion USD bond package in 2008 with a promise of completion by 2020. The first segment in the San Joaquin Valley — connecting stations near Merced to a station near Bakersfield — currently consists only of bare concrete pillars, with no tracks and no trains. CBS's 60 Minutes recently interviewed project officials and exposed their confusion when asked when the project would be finished.
The latest business plan estimates the cost of connecting San Francisco with the Los Angeles area at 126 billion USD by 2040. The Legislative Analyst's Office criticized this plan for failing to meet cost transparency requirements under state law. To continue construction, the project must pledge revenue from the cap-and-invest program — approximately 1 billion USD annually — as collateral for borrowing.
Budget has swollen from 9.95 billion to 126 billion USD — yet not a single meter of track is operational.
Analysis
The California high-speed rail project is a classic lesson in the gap between political promises and the state's management capacity.
In 1869, the U.S. transcontinental railroad was completed in exactly six years — during the Civil War, without modern machinery or digital technology. California in 2008 promised to complete the project in 12 years with 21st-century technology, but 18 years later — after billions of dollars spent — not a single meter of track is operational.
The budget has ballooned from the initial 9.95 billion USD bond to an estimated 126 billion USD for the full San Francisco to Los Angeles line, more than 12 times the original amount. This is not the first time a massive California infrastructure project has seen costs spiral out of control — the Bay Bridge East Span also experienced multiple cost overruns — but the high-speed rail exceeds them all.
Governor Newsom publicly expressed doubts about the project twice, in 2014 and 2019, before pivoting to become a promoter. This shift reflects political pressure from construction unions rather than genuine belief in feasibility. With borrowing costs pledged against cap-and-invest revenues through 2045, future generations of California voters will continue to pay the price for the 2008 decision.
Diaspora Impact
Vietnamese-American real estate investors in Southern California — particularly concentrated in Orange County, the San Gabriel Valley, and the Inland Empire — should closely monitor the project's progress. The high-speed rail line, if completed, would increase property values around future stations in Burbank and Los Angeles, but with the 2040 target becoming increasingly uncertain and costs escalating to 126 billion USD, the investment risk based on this infrastructure is very high.
Vietnamese-American taxpayers in California — a community estimated at over 600,000 people according to 2020 census data — are also directly affected: revenue from the cap-and-invest program, which was originally intended to fund climate and community benefit programs, will be pledged to the rail project through 2045, shrinking the budget for other priorities.