On April 29, (President of Argentina) Cristina Kirchner signed the contract to build a “Bullet Train” from Buenos Aires to Cordoba in the amount of US$3,900 million ($3.9 billion).

The problems are evident. The two more obvious are:

1. All the available information regarding the construction of similar systems indicates that the project cannot be completed under US$12,000 million ($12 billion), that is more than three times the amount agreed upon in the contract.

What gives?

Anybody that has been involved in multimillion-dollar engineering projects knows the answer: “Contingencies and Engineering Changes.” These would take care not only of the difference in the real cost, but also of the “overruns” that would cover the multimillion-dollar graft that we can expect in a project of this magnitude.
Who benefits?

The European company that will build the system — it knows how to play this game — and of course, all the “grafters.” You can make your own list, starting with the more corrupt.

2. The Argentine society would not be in an economical position to pay the real operating costs, which in any self-sustained commercial operation should be covered by the price of the tickets. Based on actual operational cost experiences in Europe and Asia and in the “Operational Cost Study for the Los Angeles-St. Francisco High Speed Rail Project,” prepared by the California HSR Authority Commission, the price of the ticket would be at least 50 percent of the cost of an equivalent air ticket. Example: The cost of the one-way ticket on the new Madrid-Barcelona High Speed Train is US$200 or about US$400 round trip.

Therefore, if the “Bullet Train” ever gets to be in operation, the ticket prices would have to be subsidized by the government, hence increasing the public debt.

And this in a country that cannot operate the increasingly deteriorating railroads and rolling stock of old-fashioned trains.

I cry for thee, Argentina ...