Is the US ready for high speed rail? If The NorthEast Maglev (TNEM) gets its way, a solid demonstration project between Baltimore and Washington might be built sometime in the future for an undisclosed amount of money. The project is hardly scoped out yet, but the promise of being able to rocket between the cities at over 300 mph (500 kph) has attracted attention – and $5B in potential backing from the Central Japan Railway, the Bank of Japan, and the Japanese government. It’s a good downpayment on the guesstimated $10-15B the line will take.

How serious is this proposal? The government of Japan would love to start exporting some of its best technology, and it’s hard to pass up that kind of dough. And if TNEM gets their way, it’ll go on from there on a 240 mile line from Washington to New York, making the trip in just one hour. How much will that cost? The guesstimate of $100B is such a round number that you know it’s vague. But it’s a tantalizing worth investigating for a lot of reasons – and the money would come from private investors, not any government.

A maglev train coming out of Pudong International Airport, Shanghai

As we’ve noted before, infrastructure improvements have a big payoff in jobs and income. A huge project like this would employ construction workers in the short term and provide big gains in efficiency in the long run. It would directly compete with airlines, of course, but given that airlines are constantly running at the bleeding edge of, well, bleeding cash they seem like a terrible way to get around a big nation like this.

One thing they don’t teach you in economics – sometimes the supply and demand curves don’t intersect.

While the prospect of a one hour commute between New York and Washington is tantalizing, there is much more potential beyond simply moving people around. A train can carry freight, which is to say bigger packages than the ones we are already used to having arrive from mail order outlets in 2-3 days by priority mail. With modern computer sorting containers can be loaded and unloaded in a very short time.

Regardless of the cost, a line from New York to Los Angeles has the potential to unite the nation in a way not seen since the 1869 transcontinental railroad. If the cost scaled, it might run as much as $1T, but it would probably be cheaper than that. And at this speed it means that any size shipment could be sent overnight to anywhere in the US at very low cost. The benefit for US based manufacturing is enormous, and would counter the cheap labor found overseas.

Make what you want, when you need it – and get it right to your door cheaply.

Think of it as the ultimate in Just In Time delivery.  You want a custom product, made just to your specs?  No matter what it is, we’ll get it to you fast and cheap.  The economies of scale start to melt away when the customer and the manufacturer are united.  The internet did that for the ordering process – fast, cheap shipment would finish the job at the other end.

For all these reasons, a grander project that could include financing in part from the governments of Japan and the US is a very good idea all around. If the price tag for this sounds steep, keep in mind that the cost of wars in Iraq and Afghanistan is around $6T, which would probably be enough to create at least a huge part of the backbone of a system.

Is the US ready for 300 mph trains? The short answer is yes, especially if the tab (or the lion’s share of it) is picked up by private investors. A real revolution in travel may be coming, and soon.

It starts with a demonstration project that runs from Baltimore to Washington in 15 minutes. It should end with a nation where anything can go anywhere overnight. The possibilities are breathtaking. Let’s do what we can to make this work.