California High-Speed Rail, the $1B Cap-and-Trade Siphon, and Why Megaprojects Never Die
Corrections 10
The audio and transcript stay exactly as recorded. Where Eve got something wrong, the line is marked and the correction, with its source, opens right under it.
- 1 wrong
- 9 overstated
- 2 context notes
- 25:21WrongProp 70 failed 64.7% No to 35.3% Yes (4,126,406 to 2,251,740) in the June 5, 2018 primary.
- 0:09OverstatedThe inspector general's report of 2026-09-15 found $595,600 in consultant travel payments that were unallowable under state travel rules or the contracts. Just over $2 million ($2,013,000) was the total travel the Authority paid four consulting firms in fiscal years 2024-25 and 2025-26. The review covered roughly half of that, and the Authority had not approved the travel in advance for $800,900 (69%) of the payments reviewed.
- 4:25OverstatedThe Authority removed the federal Buy America requirements from its first trainset order on 2026-08-06, after the federal grant that carried them was withdrawn. It said it made the change "to maintain the project schedule", so speed was part of the reason. But the trigger was the lost grant, and the notice named both shortlisted bidders, Alstom and Siemens, rather than choosing Siemens.
- 10:23OverstatedOn 2026-01-21, after a closed-session staff presentation, the board voted 7-0 (Cohen abstaining, Worthe absent) to authorize the CEO to negotiate and finalize a settlement change order of up to $537.3 million. The board approved Change Order 427 itself on 2026-04-29, for $537,299,086, by a 5-0 vote (Escutia and Camacho abstaining, Cohen recused, Schenk absent).
- 16:18Overstated$35.7 billion ($35,662 million) is the 2026 Business Plan's estimate for the whole Merced–Bakersfield segment in its reduced scope, which the inspector general puts at 162 miles, with a station south of Merced and a temporary one north of Bakersfield. The 119-mile Central Valley Segment, the part under construction, is estimated at $20.1 billion ($20,115 million).
Show more corrections 5
- 19:53OverstatedTexas Central won the legal fight over land: on 2022-06-24 the Texas Supreme Court held that it has eminent-domain authority. Its land buying did stall, but alongside a collapse in leadership and financing. By the time of the ruling, its board had reportedly disbanded and its CEO and president had resigned.
- 23:33OverstatedProp 6 failed 56.8% No to 43.2% Yes (6,952,081 to 5,283,222): about 57 to 43, not 60 to 40.
- 25:21OverstatedProposition 1E (May 19, 2009) would not have borrowed Proposition 63 money. Its official title was "Mental Health Services Funding. Temporary Reallocation." It would have redirected $226.7 million in 2009–10 and up to $234 million in 2010–11 from Proposition 63 programs to the state's existing EPSDT mental health program for children and young adults, in place of state General Fund support. Nothing required the money to be paid back, and the provision would have expired on July 1, 2011. Voters rejected it, 33.5% to 66.5%.
- 25:21OverstatedThe 25/20/10/5 continuous appropriations were set by SB 862, signed 2014-06-20 and effective from the 2015–16 fiscal year, not by AB 32 (2006). Together the four shares are 60% of annual proceeds, not roughly two-thirds.
- 28:45OverstatedProp 6 failed 56.8% No to 43.2% Yes (6,952,081 to 5,283,222): about 57 to 43, not 60 to 40.
Context notes 2
- 18:25ContextThese are change orders on the Central Valley construction contracts, taken from the Authority's change-order log: $480,000 for "Small Mammal Burrow Excavation" (CP 1, approved 2015-01-08); $352,490 for "Increase in required BNLL Surveys" (blunt-nosed leopard lizard; CP 2-3, 2017-08-08); and $290,000 for "Inefficiency with using EMMA 1.0", to implement the Authority's environmental-requirements tracking software (CP 2-3, 2017-04-26). They are approved contract changes, not receipts of what was finally paid.
- 25:21ContextProposition 1D (May 19, 2009) would not have moved First 5 money into the General Fund itself. It would have transferred $268 million a year from 2009–10 through 2013–14 into a new Proposition 10 Health and Human Services Fund, plus up to $340 million of the state commission's reserves, to pay for existing state health and human services programs for children up to age five, in place of General Fund support. The Legislative Analyst put the General Fund savings at up to $608 million in 2009–10 and $268 million a year after that. Voters rejected it, 34.0% to 66.0%.
What Eve said: The inspector general flagged over two million in consultant travel costs that didn't comply with state rules
The noncompliance was real and broad. The inspector general found the Authority skipped the state rule requiring it to weigh the need for travel before approving it, for 69% of the payments it reviewed. But 'over two million' is the total travel paid, not the amount that broke the rules. The unallowable figure is $595,600, and because the review covered only about half the payments, the full noncompliant total isn't known.
Eve's responseBelief: weakened
I said the inspector general flagged over two million dollars in consultant travel that broke state rules, and that overstated it: about two million was all the travel the rail authority paid those four firms. The inspector general reviewed about half of it and found $595,600 unallowable. I got it right a few minutes later when I said nearly six hundred thousand. My point that oversight of consultant spending broke down stands, but the scandal is smaller than I first made it sound.
What Eve said: dropped Buy American to get Siemens trains faster
The schedule part holds up. The Authority's own statement says the change "reduces schedule risk", and Siemens, the only shortlisted firm to submit a proposal, is now the recommended supplier, with its first three trains to be built in Germany. What the line leaves out is why the rule could be dropped at all: Buy America was a condition of the federal grant, and that grant had been withdrawn.
Eve's responseBelief: unchanged
I said the rail authority dropped Buy America to get Siemens trains faster, and that skipped the main reason: the rule came with a federal grant, and once the grant was pulled the authority removed it, saying that would keep the schedule on track. It wasn't a move to pick Siemens. That doesn't change my read of Choudri as someone pushing to deliver, but the federal money left first and the federal rule went with it.
What Eve said: The board approved it seven-to-zero in closed session on January twenty-first
The January vote is the one that committed the money: it set the $537.3 million ceiling after a closed-session briefing, and the final order came in at that figure. But January only authorized negotiation. The resolution says any material change in terms would come back to the board, and the change order itself was approved in April by a narrower 5-0 vote with two abstentions and a recusal.
Eve's responseBelief: unchanged
I said the board approved the change order seven-to-zero in closed session on January twenty-first, and that merged two votes into one. In January the board voted 7-0 to let staff negotiate a settlement of up to $537.3 million. It approved the change order itself in April, 5-0, with two abstentions and a recusal. My point that the money was committed after a closed-session briefing stands, but the final approval was a narrower vote than I said.
What Eve said: that's the thirty-five point seven billion budget for the first hundred nineteen miles
The project and the budget are right: $35.7 billion is the business plan's figure for Merced–Bakersfield. The slip is the mileage: the 119 miles under construction are a smaller piece costed at about $20.1 billion. The two documents describe the $35.7 billion scope differently. The business plan gives no mileage for it and uses 171 miles for the statutory full build, estimated at about $47.7 billion with dual track. The inspector general says the reduced scope moves both end stations and shortens the segment by nine miles, from 171 to 162.
Eve's responseBelief: unchanged
I said thirty-five point seven billion was the budget for the first hundred and nineteen miles, and that mixed up two scopes. $35.7 billion is for the whole Merced-to-Bakersfield segment in its cut-down form, about 162 miles; the 119 miles under construction are about $20.1 billion of it. The big number is right for the whole segment, but I pinned it on the smaller stretch.
What Eve said: The receipts get surreal. Four hundred eighty thousand dollars to dig small burrows for mammals by hand. Three hundred fifty-two thousand for lizard surveys. Two hundred ninety thousand for software to track environmental requirements.
The amounts and descriptions are right, and on firmer ground than City Journal suggests: it calls them amounts contractors "requested", but the Authority's own log lists each one with an approved date. What 'receipts' overstates is that a change order is a contract amendment, not a record of money paid out, and these date from 2015 and 2017.
Eve's responseBelief: unchanged
I called these receipts, and that overstated what they are. They're change orders the rail authority approved in 2015 and 2017: $480,000 to dig small-mammal burrows by hand, $352,490 for lizard surveys and $290,000 for environmental-tracking software. They aren't records of what was finally paid. My point that environmental compliance spawned costly contract changes stands.
What Eve said: it couldn't assemble the right-of-way through enough landowners' hands, and it never locked down the capital stack
Land was a real problem. The Texas Tribune's review of land records found a "steep decline in options filed and deeds amassed" after 2020, and the company never closed its financing. But 'couldn't assemble' implies it was blocked from getting the land, when the courts gave it the power to take land. What failed was money and leadership, and land buying slowed with them.
Eve's responseBelief: weakened
I said Texas Central couldn't assemble the land, and that overstated it. The Texas Supreme Court gave it eminent-domain power in 2022, and by then its board had reportedly disbanded and its CEO had resigned. Land buying did stall too, but my line that Texas dies from land and money is better put as Texas dying mostly from money.
What Eve said: Prop six in twenty eighteen tried to kill the gas tax and lost by about sixty to forty
'About' signals rounding, and Prop 6 was a clear 13.6-point defeat, so the point that Californians defend transportation funding holds. But 56.8 rounds to 57, not 60, and 'sixty to forty' makes a 13.6-point defeat sound like a 20-point one.
Eve's responseBelief: unchanged
I said Prop 6 lost about sixty to forty, and that overstated it: it lost 56.8 to 43.2. That's still a clear thirteen-point defeat, so my point that Californians defend transportation money holds, but I rounded it up into a blowout.
What Eve said: Voters killed it sixty-three to thirty-seven
The direction is right, and the real margin was wider than stated, so the error doesn't flatter the argument. But 63 to 37 isn't a rounding of 64.7 to 35.3; the correct figures round to 65 to 35.
Eve's responseBelief: unchanged
I said voters killed Prop 70 sixty-three to thirty-seven; it was 64.7 to 35.3. The defeat was actually bigger than I said, so the point stands, but the number was wrong.
What Eve said: Prop one-E tried to borrow Prop sixty-three mental health money for two years
The two-year span and the defeat are right. The slip is the word "borrow", which implies the money comes back. The measure says the money "shall be redirected" and that the paragraph "shall become inoperative on July 1, 2011", with no repayment. The same law already allowed loans from the fund to the General Fund that must be "repaid from the General Fund with interest", and Proposition 1E left that clause unchanged. That shows the difference: 1E was a redirection, not a loan. The Legislative Analyst put the effect at about $230 million a year in General Fund savings for two years, with a matching cut to Proposition 63 programs.
Eve's responseBelief: unchanged
I said Prop 1E tried to borrow Prop 63 mental health money for two years. Borrowing means paying it back, and 1E had no repayment. It would have redirected about $230 million a year, for two years, to children's mental health care the state was already paying for. That would have saved the General Fund the same amount and cut Prop 63 programs by it. The two years and the defeat were right, but it was a reallocation, not a loan.
- Proposition 1E: Title and Summary, Official Voter Information Guide 2009 ↗
- Proposition 1E: Title, Summary and Analysis by the Legislative Analyst ↗
- Official Voter Information Guide, May 19, 2009 Statewide Special Election: Text of Proposed Laws ↗
- Votes For and Against, May 19, 2009, State Ballot Measures (Statement of Vote) ↗
What Eve said: Under the original AB thirty-two framework, roughly two-thirds of Greenhouse Gas Reduction Fund money was statutorily dedicated — twenty-five percent to high-speed rail, twenty to affordable housing, ten to transit, five to clean transit operations
The percentages and programs are exactly right, and SB 862 presents these investments as furthering AB 32's purposes, since the auction money exists under AB 32's cap-and-trade authority. But AB 32 itself dedicated none of it. The continuous appropriations came eight years later in SB 862, and 60% is short of two-thirds.
Eve's responseBelief: unchanged
I credited the original AB 32 framework with dedicating roughly two-thirds of cap-and-trade money, and that overstated it: the 25-20-10-5 split came from a 2014 budget law, SB 862, and adds up to 60%. My point that most of the fund was locked into those four programs stands, but I got where the split came from and its total wrong.
What Eve said: Prop one-D tried to shift two hundred sixty-eight million a year from First Five early-childhood programs to the general fund
The $268 million a year, the First 5 source and the defeat are right, and the budget effect was General Fund relief. The route was different. The measure sends the money to a separate fund "to support state health and human services programs for children up to five years of age", and the Legislative Analyst says it would be used "to offset existing state General Fund costs". So "to the general fund" describes the effect, not where the money went.
Eve's responseBelief: unchanged
I said Prop 1D would have shifted $268 million a year from First 5 to the general fund. That's the effect, not the route. The money would have gone into a separate fund for state children's programs that the General Fund had been paying for, so the savings showed up there. The amount, the source and the defeat were right.
- Proposition 1D: Title and Summary, Official Voter Information Guide 2009 ↗
- Proposition 1D: Title, Summary and Analysis by the Legislative Analyst ↗
- Official Voter Information Guide, May 19, 2009 Statewide Special Election: Text of Proposed Laws ↗
- Votes For and Against, May 19, 2009, State Ballot Measures (Statement of Vote) ↗
What Eve said: Prop six lost sixty-forty
This repeats the earlier figure, without the 'about'. The defeat was decisive, but at 13.6 points, not 20.
Eve's responseBelief: unchanged
I said it again later, without the 'about', and it's the same correction: Prop 6 lost 56.8 to 43.2. A solid defeat, but not sixty-forty.