Washington, DC, November 11, 2025 --  

America and China are both great at wasteful spending, but go about it very different ways.

The 10 minute stroll from Washington's Union Station to the U.S. Capitol feature sidewalks jammed with staffers and lobbyists in business suits. Many of these pedestrians arrived in crowded, slow-moving trains whose tracks are century-old relics of America's industrial revolution.

As the staffers reach their offices, they will help re-open America's dysfunctional federal government, authorized in 2024 to spend $6.8 trillion and now carrying over $38 trillion in debt.¹ Of these massive numbers, a paltry $4 billion ($0.004 trillion) was allocated to the California high speed rail project (since blocked by the Trump administration)². Some longer-distance riders got a brief taste of high speed rail before trains had to slow down on the older tracks on the approach to Union Station.

Things look very different in Urumqi, China -- 6600 miles away from Washington's Union Station. The 10-year-old high speed train station lies on the outskirts of the city, at the far Western end of China's longest single high speed rail line which now spans a total of 50,000 kilometers nationwide.³

Yet China's impressive system is massively overbuilt and deep in debt. Seats on high speed trains to Urumqi are mostly empty. Like most provincial high speed routes, services between Urumqi and Lanzhou are highly unprofitable. China State Railway Group has amassed nearly $1 trillion in debt and reports tenuous profitability only on the back of slow freight rail which subsidizes the money-losing and empty high speed passenger rail lines.⁴

The Trump administration perceives high speed rail as a wasteful boondoggle. To China's communist government, high speed rail is an aspirational goal and not about profits. Communists have the latitude to steam roll over opposing property owners along the railroad right of way, imprison environmental activists, and demand re-writes of damning cost benefit analyses. It is no shocker that an authoritarian system can get things done that a democracy cannot.

The end result might look impressive taking a high speed train from Beijing to Shanghai (the rough equivalent to America's Boston to Washington corridor), but less so if you go on all those other underused routes. And as China's high-speed rail infrastructure begins to surpass the two decade mark, wear and tear and aging concrete will cause the system to degrade. We will soon see how the aging infrastructure holds up when built with minimal checks and balances.

America is in no position to be smug. While China has been taking on massive debt to build high speed railways, America has been taking on even more massive debt to hand out entitlements to its citizens while keeping taxes too low to cover them. Americans typically use the extra cash (whether it comes from government Social Security checks, from income tax refund checks, or from retained income) to buy fancy cars, flashy clothes, and consumer products they don't really need.

Which is a bigger waste of money? An unused high speed rail line to Urumqi or a rapidly depreciating F-150 pickup in the driveway used largely for suburban commuting? Tough call.

But given America's $300 billion trade deficit with China, its a good bet that China getting the better end of the deal today in its wasteful spending competition with America. Much of Americans' debt-driven consumer spending ends up going to China to buy crap on Temu or from Chinese Sellers on Amazon. AI chips aside, precious little Chinese infrastructure spending is going to American vendors.

That said, America is far richer than China and can afford to be more wasteful with its money -- at least for the near term. That is at least some solace for Americans worried about new irresponsible government handouts under discussion as Congress works toward a government reopening. As the drunken sailors reconvene at the Capitol, Americans must continue to dream that sober heads will prevail before it is too late.

Notes:

1. PBS, U.S. Hits $38 Trillion in Debt, After the Fastest Accumulation of $1 Trillion Outside of the Pandemic, October 23, 2025

2. Associated Press, Trump Administration Pulls $4 Billion in Federal Funding for California’s Bullet Train Project, July 17, 2025

3. South China Morning Post, China’s High-Speed Rail Network On Track to Breach 50,000 KM Milestone in 2025, January 2, 2025

4. China Railway's Debt Climbs Higher Even as Profits Recover, May 8, 2025