Oh, and my first paragraph is sarcastic, in case that was missed. Fraud like that could result in an international incident and would be no different than the criminal organizations that launder their money. We'd have the US laundering it's imports to appear domestic. Talk about a serious incident the first train wreck that results in a bunch of toys with lead paint from China being burned in a blaze of toxic fumes...

That is not an interesting concept, that is a common practice among MNCs. Import the goods at abnormally low prices, do a marginal improvement of the product and further export for standard prices. It artificially boosts the current account surplus of the country so adjusting the data for this branding is necessary to get more accurate info on the real international position of the country. These parts are not even necessary. If you want to get to Chinese market, you export to Hong Kong and then go to China from there, the conditions are better. If you wanted to get to European market as Korean car producer, you built a factory in the EU and imported the parts from South Korea to evade higher tariffs (until the trade agreement signed this July). There's no need to reinvent the wheel.

And thanks me for reminding of the wonderful construct of US federalism.

I think something that has failed to be mention here are the following considerations. First, it would be costly to keep those rails de-iced. Second, this line would make arctic oil drilling much more attractive (with all the consequences that carries with it, both positive and negative). Third, increasing trade between any two countries improves their political relations. Fourth, Canada is not a country, it's the 51st state (j/k).

Overall, I am inclined to agree with stratagos, there are much better ways to spend that kind of money. However, IMHO, best options seem to always get thrown off the rails by small-minded interests or poorly designed legal frameworks. This rail line would be cool, it would generate revenue, but it wouldn't be enough revenue to make it worthwhile. Even if carbon costs are included, I think the difference between sea and rail is not substantial enough to justify the investment. Also, the project would likely fail from lack of funding because it would certainly be seen as "wasteful spending." Please remember that the US has rather let cities flood and bridges collapse than put money into infrastructure. As much as it pains me to say it, the days of grand infrastructural projects, no matter how beneficial, is over. All such spending has been deemed "wasteful" in the minds of too many American voters.

"I believe mine is closer to reality, but I'm certainly not going to spend hours crunching the numbers to prove it."

You wouldn't spend hours on such analysis, one person might very well need several years to do it properly. To start, you have to calculate the economic potential of one of the world's most dynamic regions with the horizon of at least 30 years - the connection is estimated to take 15-20 years to build, you also have to take into account delays thanks to groups like environmentalists and some leeway before you can leave the growth rates constant. If you then estimated the rentability with some DCF technique, you might very well receive a shitty result because it's a textbook example of GIGO issue. At such timescales, you can't ask for much more than a handful of possible scenarios even from cowboys like McKinsey. I can sincerely say that I'm not up to the task.

" if this was going to be such a boon for Russia, they'd offer to fund the tunnel and pay for it themselves."

They are.

http://singularityhub.com/2011/09/15/this-aint-your-ancestors-ice-bridge-%E2%80%93-russia-to-build-tunnel-across-bering-strait/

I mean Russia can't build the track within American borders, but they're still going forward with the planning and development for it.

"Hell, you can't freely transfer goods across state lines..."

This is fundamentally false. The Constitution forbids any taxes or tariffs on interstate commerce. Commerce within the state can be taxed, but nothing can be on the state borders. It may be illegal to own things in certain states, but states can't touch interstate commerce, else the economy would break down. Where did you pull that one from, Draug?

Also, you want to build a rail tunnel in one of the most earthquake prone and volcanically active places in the world? (not sure where on the straight it would be built, but I'm assuming as far south as possible) That sounds marvelous. Tunneling through the 20,000ft tall Alaska range just to get to the west coast of Alaska? Even better idea. I vote that we rethink this one.

Then I wish them all the best. I never claimed it was going to be worthless, just that the benefits are less than the cost would seem to justify

So they aren't formal taxes. they are just called licensing/document fees and such. Trust me, those weigh stations manned by *state* highway patrol officers don't operate for free.

I think were all overlooking the main benefit of rail transportation: you can move your units without a movement point cost to take down that SOB that just crossed the border?

Five musketeers, really? I have a dozen armor units that would like to say hi...

@putin,

"Plus the fact that you'd be able to take a train from NYC all the way to Europe."

Right. Look right now how many people use the train from NYC all the way to LA instead of flying, and now please flesh out the argument that they'd be lining up to sit on a train from NYC to Paris for 250 hours.

I took a 40 hour train ride from Lanzhou to Kunming. If passenger rail opened up across the Bering Strait I'd be on the first train to Uzbekistan.

People go on around the world boat tours. The point is that you can do it.

Mixing passenger and cargo rail on such a route doesn't sound too efficient although I'm no engineer to back it up. Flying over the ocean and then boarding on the pan-asian railroad sounds better.

It would also require a substantial mentality shift for Americans. The culture of international travel is still underdeveloped compared to the rest of rich countries. And I really mean international, not simply long-distance. Americans travelling on vacation in the US cover more distance than international tourists in Europe.

I have to agree with Stratagos, I can't really see how the train line could pay for itself, or at least prove to be more profitable than the next best alternative investment opportunity. I also don't think that its use would prove to be cheaper than standard shipping, given the significantly larger volume of freight that a cargo ship can take compared to a train (even those really long ones).

Worse, the kind of long freight trains that we're all thinking of aren't even going to be high speed, I'm pretty sure high speed cargo trains don't even exist yet and I don't think there's sufficient reason for them to even be developed. Given that most companies have already accepted the much longer amount of time it takes to move things by ship, why would they push for high speed cargo trains? For them the main issue boils down to cost, not speed, and on that I think ships will always win out. The much smaller volume that the train line can accommodate compared to all of the shipping routes between Asia and North America are going to push the cost of using it up and if it's underused then the price is going to drop so low that Russia and the USA won't see a return on investment.

I think $20b could be much better spent elsewhere, perhaps even just on improving shipping technology, making that more efficient, cheaper and environmentally friendly. Hell, you could achieve a much bigger boost to trade just by reducing tariffs.

When did $20 bln (and we're not even paying for it all) become too much to ask for a revolutionary land route between North America & Eurasia? This when people have no problem pissing billions away on space exploration. The cost of shipping via container ships has gone up exponentially, which is why some people are starting to claim that shipping costs are going to completely destroy the long multinational supply chains of globalization if they keep going at this rate.

http://people.hofstra.edu/geotrans/eng/ch8en/conc8en/oilpricecontainers.html

http://en.m.wikipedia.org/wiki/Baltic_Dry_Index

Rates peaked in 2008 and are around 25% of where they used to be

Again, no one is saying its a horrible, disastrous idea - just that the economics don't work.

But I'm sick of repeating myself so I hereby pull the PRATT card and cede the thread to others

Except that North America and Asia are moving towards each other, the rails will have far too many problems for what it is worth.

@putin,

Oh, OK. So you were just saying it would be super cool to be able to do, and not claiming that many people would actually do it (i.e., this was not an argument justifying the expenditure of $20bn on the project, but just saying you hope it went through)?

If so, then I agree that it would be _cool_ to be able to do that.

It would also be cool to dam the Mediterranean, but we won't be doing that soon.

This will happen as soon as it CAN happen. We may have the technological ability to do it, but the economics probably aren't there and the politics sure as hell ain't. Perhaps a post-Putin Russia in cooperation with a united, democratic Korea and a China no longer under Communist Party rule in combination with the United States, Canada, and Japan will be in a position to really develop Northeast Asia and Northwestern North America for this sort of project. Till then it's a pipe dream.

In other words, if leaders Invictus doesn't like are repeatedly raped with a knife and shot in the head, and replaced by compliant puppets.

Minor political differences don't get in the way of big projects like this. Leaders aren't as petty as parochial minded voters.