Sunday, January 25, 2009

When You Ride Alone, You Ride With Larry?

A number of recent blog posts as well as Peter DeFazio in an interview with Rachel Maddow have pointed blame for the reduction in rail funding in the stimulus package at the Obama folks and more directly at former treasury secretary and Obama advisor Larry Summers. It's not surprising that he is in favor of tax cuts given his plea for them even before the economic slowdown in 2007. Recently he's become a convert to infrastructure in words alone, but it doesn't seem like the actions are following through. Instead they've put in tax cuts as funding for infrastructure, particularly rail was junked. But as Tom states at Angry Bear:
The underlying problem is that helicoptering money to "consumers" by way of tax cuts or lump-sum grants a la last year's stimulus payments does little or nothing to help satisfy demands that are latent due to incomplete markets. Give me $100 and I can drive to Chicago for the day, not insignificantly because past public infrastructure spending built the roads from here to there. Give everyone in Madison $100 and it still does sod all for extending the Amtrak Hiawatha service, seeing as the city was cut off from such passenger rail network as still exists in the upper Midwest and reconnecting it requires a substantial investment. Maybe in libertarian fantasyland, there are no such things as collective action problems, but elsewhere overcoming them may be considered to be a useful function of government.
As opponents like to say, 90% of people drive, well then we should spend 90% on roads. But its a cycle of spending that causes this to happen. As we've seen in places like Copenhagen, if you build infrastructure to support other modes such as cycling and transit, you will get more and more riders and shift the policies. This is what we did in the 50's in support of the automobile. It was a collective push to increase funding and regulations for that mode that led to its rise. At the time, many felt it was the way of the future, but looking back we know that was completely wrong.

But the issue with the stimulus that continues is the fact that we aren't doing enough and a lot of people don't seem to understand what is "enough". Calling $3 billion adequate is kind of lame, especially given the $250 billion in new projects that are in que as well as the thought that California's high speed rail line would be $40 itself. There is a want for a national high speed rail network, or at least start of work on the key city to city lines that would increase productivity and connectivity. And the excuse that it won't be started fast enough is based on existing FTA and DOT timelines in which transit is suffocated based on underfunding. Another excuse is that we should wait for the next transportation bill. But if we are able to make investments now and write a bill that can fold some of them in, why not do it?

While many will point to the New Deal as a major part of what got us out of the depression, the cap was World War II in which we turned auto plants into tank and plane manufacturers and people saved instead of continuing thier spending. No extra rubber around for new cars, only for the war effort. In fact, this poster reminds us of the lengths people took to save energy and resources. Imagine if in this time period of hardship people were asked to save a little more and come together to build or invest in more of what is needed such as education and technology.

If I were in charge, perhaps I would have an office of infrastructure reconciliation. This means bringing our rail infrastructure up to a current standard and increasing output dramatically, much like China. We'll have to also wait and see on the idea of an infrastructure bank but this is no time to comprimise or seek middle ground as Mr. Summers stated Obama will do. Tax cuts are an idea of the Republicans, thier solution to EVERYTHING over the last 30 years. After a while, there's not much left to cut. Look where that has gotten us. Seems like this is a time to strike forward with big thoughts and ideas.


jon said...

how about issuing an executive order to cut the red tape that delays major infrastructure projects? red tape seems to hardly effect highways and roads but ties up rail and transit projects for decades... the new WES commuter train outside Portland using an existing in-use rail line was approved by the Feds in 2001 and is only opening now. this is BS considering how simple a project this is.

imagine if this red tape was in place for the new deal, all the dams and such that would have had to go through multiple studies and impact statements and applications for funding.

if quick to start projects are desired you'd think projects like modernizing and cleaning the NYC subway stations would be ideal as would track improvements to rail lines particularly the NEC. its ridiculous that these apparently arent shovel ready.

i really do think this stimulus bill will do very little especially now that it is mostly tax cuts. $500 is not enough money to do anything, its not going to pay down much of one's personal debt, its not going to save one's house from foreclosure or enough to live on if youre unemployed. and if youre well off $500 is for the most part pocketchange and one will just save it considering the risky times. we need infrastructure spending on such a large scale that it directly effects and changes how we live and view our country. maybe it is building a national rail system or putting all our entire energy needs in renewable sources of energy or making our education system the top in the world... whatever it is, it needs to be on par with the interstate system, new deal, world war ii war effort and man on the moon in its ambition and far reaching effects.

Morgan Wick said...

It's too bad this blog isn't as heavily read as, say, HuffPo, because this is a must-read!