Can Ontario Catch the Train?

"The concept of a high-speed train between Windsor, Ont., and Quebec City has been studied half a dozen times in the past 20 years. Each time it has seemed irresistible - who doesn't fancy zooming across the landscape in comfort? But it has always needed massive public subsidies to work.

Dalton McGuinty and Jean Charest are deaf to the voice of experience, however. Last week, the premiers of Ontario and Quebec announced a new $2-million study of the high-speed rail corridor to see if it's more feasible than it was in 1995, which was the last time the idea came into bud and then was left to rot on the branch because it would have needed about $13-billion in public funding.

The leaders say times have changed. "Now is the time, especially since we have the responsibility to reduce our greenhouse gases," Mr. McGuinty said. "The context has evolved a lot since the 1980s and 1990s," agreed Mr. Charest.

Indeed, congestion on Highway 401, which traces the spine of the corridor, has worsened and more motor vehicles push up carbon-dioxide emissions. But the situation is not static on other fronts. Fuel prices are going up, vehicles are becoming more fuel-efficient and air fares in the corridor are comparatively cheaper than they were a generation ago. All this makes it difficult to predict the behaviour of travellers.

The 1995 study projected total funding for the corridor at $18.3-billion. But in the past dozen years, development in the Greater Toronto Area has pushed up land prices, which would increase the cost of expropriation. (It's not even certain there would be enough land for a viable corridor.) Who knows what cost the current study will come up with when it is released in a year?

Given these economics and the thin population of the corridor (this isn't densely packed Europe, after all), it seems highly unlikely that the new study will make a business case for private operators. So what if the price tag comes out at, say, $25-billion and Ontario's share of the financing is $5-billion or $6-billion? The McGuinty government's debt level has been rising - it's up $3-billion in the past year - as it makes capital investments. Its debt-to-GDP ratio is declining, but it is also contemplating a $27-billion nuclear program and is facing a $100-billion infrastructure deficit. Can it afford to take on a rail line, too?"