The Cost of that New Jersey Tunnel
Amtrak is estimating it will take 10 years and $13.5 billion dollars to complete the New Jersey to New York tunnel it has just proposed, along with improvements between Newark and the tunnel entrance. This project would replace ARC, another tunnel originally expected to cost around $9 billion but with escalating costs due to expected overruns.
But according to Wikipedia, the Pennsylvania Railroad built the existing two track tunnel under the Hudson from New Jersey to New York City, plus the four tracks under the East River from the Sunnyside Yard to New York City, electrified the whole system, and built the original Penn Station from 1903 to 1910 for a fraction of the cost. "The total project cost to the Pennsylvania Railroad for the station and associated tunnels was $114 million (approximately $2.5 billion in 2007 dollars), according to an Interstate Commerce Commission report. (John A. Droege, Passenger Terminals and Trains. New York: McGraw-Hill, 1916) Without tunnel boring machines or any of the construction equipment that has been developed in the past 100 years. THAT IS THE PROBLEM. And by the way, I checked the inflation adjustment, and it is correct. Just $2.5 billion.
You can say construction was more dangerous back then, but diminished danger does not explain this kind of cost increase. You can say that the pay of construction workers has, of course, increased far more than inflation, but that is true as well in every other industry. In every other industry productivity has increased with pay, keeping inflation down relative to wages.
Post new comment