Matt Yglesias

Freight Rail’s Anti-Trust Exemption

An alert industry observer brought to my attention legislation by Senator Herb Kohl (D-WI) aimed at revoking the anti-trust exemption the freight rail industry currently enjoys. I don’t want to claim to be an expert on all the ins-and-outs of this but my understanding is that this would be a mistake and that it’s good that Jay Rockefeller (D-WV) has switched sides and is now joining Sens. Kay Bailey Hutchison, Frank Lautenberg, and John Thune in opposing this.

One of the reasons the rail situation in the United States has gotten so bad is because of a lot of infighting between the freight rail people and the passenger rail and transit people. More recently, however, the OneRail coalition has come together, which recognizes that rail advocates of all kinds have a great deal in common and can best advance their goals working together. A strong freight rail industry can and should be an important part of America’s transportation network, both because of its own intrinsic benefits (this is a very energy efficient way of moving stuff) and also as part of building a rail system that’s robust enough to also support viable passenger traffic. The fact that rail shipping rates are rising reflects the fact that rail is an appealing option under present conditions. It looks to me like an argument for increasing freight rail capacity not for harsher regulations.

Politico’s David Rogers Catches Republicans Lying About High-Speed Rail, Won’t Call Them Liars

David Rogers has a piece in Politico that offers a nice summary of the recovery plan’s actual high-speed rail provisions and the direct role of the White House in securing them:

The $787.2 billion economic recovery bill — to be signed by President Barack Obama on Tuesday — dedicates $8 billion to high-speed rail, most of which was added in the final closed-door bargaining at the instigation of White House chief of staff Rahm Emanuel. [...] The same Maine and Pennsylvania Republican moderates who had criticized Obama’s school construction initiative were more accepting of the rail funds, since the Northeast corridor has a major stake in more improvements. To help pay for the added cost, a business tax break — providing a five-year carry back for net operating losses — was narrowed to keep the focus more on smaller firms with receipts of less than $15 million.

Needless to say, this reality is at odds with the made-up story conservatives have been telling all weekend about $8 billion being earmarked for a train to Las Vegas. And Rogers, as we’ll see, knows what the truth is, knows what conservatives have been saying, and knows that the two are different things, but he can’t quite seem to describe what’s happening with regular English words:

At the same time, conservative Republicans seemed almost blind to Obama’s role. Instead, in their campaign to find pork barrel projects in the stimulus bill, they painted the whole funding as a scheme by Senate Majority Leader Harry Reid on behalf of Las Vegas interests seeking a rail link to Los Angeles. “Sin City to Tomorrow Land” was one description.

Here is Rep. Candice S. Miller (R-Mich.) explaining her vote against the bill Friday despite the benefits to her home state: “Michigan is a state of about 10 million people, and we are the hardest hit, as I said, by this economy. And yet we are expected to get approximately $7 billion from this bill. And apparently the Senate majority leader has earmarked $8 billion for a rail system from Las Vegas to Los Angeles? You have got to be kidding. You have got to be kidding.”

Rep Miller wasn’t “explaining” anything, she was lying to her constituents. Nor were conservatives running a “campaign to find pork barrel projects int he stimulus bill” they were inventing fictional projects. Nor were obscure House backbenchers like Miller running a rogue operation here. House Minority Leader John Boehner led the charge on peddling this lie, and Senator Jim Demint was on the case as well.

Vegas Baby, Vegas!

Some curious logic from Jim DeMint’s office:

The President has a point that taxpayer money should not be used to pay for Wall Street fat cats to fly to Las Vegas but why is it okay for taxpayer money to be used to help pay for Hollywood elites to get there on a fancy gambling train? And why are we subsidizing leisure in a stimulus bill rather than encouraging work and greater productivity?

Several points. One — there’s no such provision in the bill. Two — there are two million people in the Las Vegas metro area, so it’s not as if taking the train to gamble is the only conceivable use of such a route. Three — lots of people go from L.A. to Las Vegas, it’s not an “elites only” option. I would refer Senator DeMint’s staff to this well-known scene from Swingers:

The larger rhetorical theme here seems to be that DeMint believes there should be no infrastructure projects of any sort in Southern California because any such project would, per se, be a taxpayer subsidy to “Hollywood elites.” It’s a pretty repugnant sentiment. For whatever reason, conservatives are constantly allowed to get away with this business of summarily dismissing vast regions of the country as unworthy and never get called on it. But this sort of thing is leading the movement on a direct (albeit, non-rail) route to a Dixie-only ghetto.

High-Speed Rail in the Stimulus

Good news for people who like fast trains as it seems a significant amount of high speed rail funds made it into the stimulus:

And while many initiatives were scaled back as Congress and the White House sought to cut the overall cost, there were some surprise increases, including a quadrupling of money for high-speed rail projects to $8 billion.

The White House pushed for the added money in the final rapid-fire negotiations, seeing it as a tangible way to create jobs and benefit different parts of the country. It also added a futuristic element to legislation that has been criticized as lacking forward vision.

I’m glad to see this happen, though it’s still the case that my first, second, and third preferences for transportation funding in the stimulus would have been money for mass transit system operating costs. The really good news about this is that my understanding is that the President took a personal interest in this provision, which is crucial because building-out an HSR network in such a big country would require a lot of followthrough.

Meanwhile, it seems that Harry Reid was talking about this provision and mentioned the idea that a high-speed rail corridor from Los Angeles to Las Vegas might be eligible for some of the money. That’s true. It’s also, I think, a pretty good idea. But some conservatives have decided to portray this as Reid sneaking a special “high speed rail to Las Vegas” provision into the stimulus package. There is no such provision and he did no such thing. The United States has many metropolitan areas and no true high-speed rail corridors. Consequently there are a lot of plausible city pairs and corridors that could benefit from these measures. My guess would be that the folks best-positioned to take advantage of this would be in California where they’ve already got the HSR ball rolling. Pennsylvania also has an actively ongoing initiative to upgrade service to Pittsburgh and Ed Rendell puts a high priority on this sort of thing and Arlen Specter was a pivotal Senator in pulling the deal together, so they might benefit.

Rail in the Stimulus

Rep Peter DeFazio has authored an amendment that would increase the level of rail funding in the stimulus bill. It’s an excellent idea. Funds for highway repairs are a fine use of stimulus money, but insofar as we’re investing in new transportation capabilities we ought to be investing in what we don’t have enough of—mass transit and intercity rail—while fixing up our vast, but crumbling, road network. Right now the amendment is being bottled up by the Rules Committee, so if you happen to live in a district of one of the members you have a special obligation to get in touch with their office and offer your opinion. But even if DeFazio wins there, there’s still the small matter of the actual vote so even if your member isn’t on Rules, it’s never too early.

Meanwhile, The Hill reports on the promising development—the creation of a new broad-based pro-rail coalition that includes all the key stakeholders:

The newly minted OneRail coalition markets itself as a first time assembly of disparate groups representing commuter rail lines, freight rail lines, public transportation and the environment. [...] Several trade and issue advocacy groups are part of OneRail, including the Natural Resources Defense Council, Amtrak, the American Short Line & Regional Railroad Association, the Association of American Railroads, and the Surface Transportation Policy Partnership.

The group will be working on the stimulus package but also, and in my view more importantly, on the reauthorization of the big transportation bill.

Vote for SUPERTRAINs

Increased rail funding is doing very well on a Change.gov list of ideas the public would like to see the President-elect embrace. Obviously, I don’t think this website is actually going to determine Obama administration policy. But you’re bound to wind up with an administration that contains some rail advocates, and it’s helpful to give those folks every possible piece of leverage they can find, so it’s worth clicking over and voting.

The High-Speed Rail Stimulus?

John Judis has an article expressing skepticism that Barack Obama’s stimulus is of the right size and nature to meet our present challenges that winds up touching on a subject near and dear to my heart—high-speed rail:

One area that is ripe for such investment–and that is not, from what I have seen, a declared priority of the Obama administration–is high-speed rail. Amtrak’s Acela trains–the closest thing we have to one–average less than 100 mph between Washington D.C. and Boston, whereas trains in Western Europe and Japan go more than twice as fast. Many of them also run on electricity. They would be the most energy-efficient and quickest means of getting between places like Boston and New York, or Los Angeles and San Francisco. But they would require a massive investment. For instance, installing high-speed rail in the Northeast corridor could cost about $32 billion, while California’s high-speed rail system would require up to $40 billion. A system that would address the other areas of the country could easily raise the cost to the hundreds of billions. The House transportation and infrastructure committee has currently proposed $5 billion in stimulus funds for intercity rail–not even a down payment on what it would cost to convert the U.S. to high-speed rail.

Investing in high-speed rails would be very expensive, but unlike tax cuts–the benefits of which can be siphoned off in the purchase of imported goods–the money spent would go directly to reviving American industry and improving the country’s trade balance. That doesn’t just mean jobs creating dedicated tracks or new rail stations: Though the U.S. abandoned train manufacturing decades ago to the French, Germans, Canadians, and Japanese, this kind of production could be undertaken by our ailing auto companies or aircraft companies–if the federal and state governments were to place orders. And building trains that would run on electricity would be a paradigmatic example of the “green jobs” that Obama often touts.

Like Special Agent Mulder, I want to believe in this. In particular, I do believe that it would be a good idea to make these kind of investments. But I also know that many people hear about the idea of spending $40 billion in California and $32 billion in the Northeast and maybe comparable amounts to build HSR systems in Florida and the rust belt and they start to blanche. So now that all of a sudden there’s broad political consensus in favor of adding a few hundred billion dollars to the deficit, I really want to put my hand up and say “hey! look over here! some productive infrastructure investments we should make!”

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Ask The Mineshaft

Bruce Bartlett has a very nice summary of Keynes’ thinking on liquidity traps and the need for stimulation:

What Keynes figured out is that when conditions such as these exist, the federal government must step in to raise spending in the economy and thereby increase velocity. This means running a budget deficit, but that is only part of the solution [...] Keynes argued that the only thing that will really work is if the federal government uses its resources to purchase goods and services. It must buy “stuff”–concrete, computers, paper, glass, steel–anything as long as it is tangible. In other words, the government must spend the way households do, by buying things. It must also employ labor, because much of what people spend money on today is in the form of services [...]

At this point, Federal Reserve policy will become effective again. As prices and interest rates rise, the liquidity trap disappears and money begins circulating more rapidly; i.e., velocity increases. This is what ends an economic crisis. Unfortunately, it was not until World War II that the federal government spent enough on real resources–because they were needed for the war effort–to make Keynes’ theory work in practice. [...]

For what it’s worth, Keynes didn’t know what to do in this situation, either. He suggested building pyramids and burying bank notes in deep mine shafts that had been filled in. As people tried to dig up the money, they would be forced to employ labor and purchase equipment that would raise spending and thereby growth. In the end, it took the greatest war in history to make Keynes’ theory work.

I think that mine idea is pretty clever. But obviously the better answer is SUPERTRAINS. In particular, whenever I start prattling on about high-speed rail, people point out that it would cost an ongodly sum of money. But in our current crisis, one of our main problems is a lack of non-ridiculous ideas about things to spend money on. For example, it turns out that the total cost of “ready to go” infrastructure projects in this country is valued at tens of billions of dollars rather than the necessary hundreds of billions. That’s because planning was done in the old “how will we find the money” world. At the moment, we’re in a weird “how will we find things to spend money on” world. Under the circumstances, one thing I’d be doing if I were president is dedicating a small slice of the 2009 stimulus making sure that we get a big and absurdly expensive list of high speed rail projects “ready to go” in some sense by 2010. Hopefully, by then the economy will be back on the path to recovery in which case interest rates will be back at a level where we don’t necessarily want to engage in huge gargantuan deficit spending. In that case, most of those plans will have to be shelved. But if not, some can roll forward.

Biden Makes the Case for Rail

Joe Biden is best known for his experience in foreign policy issues, but I’ve long been most excited by the possibility that his strong pro-rail views may have influence in an administration certain to be dominated (like all administrations) by people who don’t care about transportation policy. This morning at the National Governor’s Association, Biden took the opportunity to talk a bit about the virtues of investing in rail:

There’s a reason when you turned on the olympics to watch them this past summer, you saw mag-lev trains going over 200 miles an hour in supposedly a third world country [i.e., China] in terms of its economy, blowing into town, dealing with environmental problems they have as well as transporting people in a way that we don’t even come close to being able to do. And as Barack has pointed out, and John Corzine knows, I may have a bit of a pro-rail bias. I think think of the jobs we can create in both construction and innovation if we make similarly bold investments here in the United States as well as the environmental payoff that flows from that kind of investment.

Of course it’s not just a question of jobs we create directly through rail construction, it’s also the prospects of greater long-term growth through more efficient use of space and energy resources that should get us excited. But good for Biden — hopefully he’ll have some influence as the key transportation policy jobs get filled.

Midwest HSR?

If you were willing to spend tens of billions of dollars on aid to auto companies, that would help people living in the rust belt. But by the same token, if you agreed to buy tens of billions of dollars worth of cereal that would also help the Michigan economy. Or what if you spent it on this:

High-speed rail could cut travel time between Detroit and Washington from nine hours to three — just a smidge longer than the train ride from Washington to New York, from downtown to downtown. And you’d never have to take your shoes off, unless you wanted to. High-speed rail would also cut a five-hour drive from Detroit to Chicago to just over an hour. Detroit to Cleveland? Just under and hour. Detroit to Pittsburgh? About an hour and a half.

High-speed rail would, in other words, turn Rust Belt distances into northeast corridor distances, while also shifting the Rust Belt closer to the northeast corridor. It would increase the return to doing business in every city in the region. It would be the Erie Canal and the original railroads on steroids.

And here’s the thing — California is estimating that its 800-mile high-speed rail network will cost it about $45 billion over twenty or so years. The actual cost will probably be higher than that, and a Midwest network would be larger and therefore more expensive, but the total cost is in the same ballpark as the $50 billion in aid automakers are begging for (which wouldn’t even be spread out over a period of years).

I think after what’s just been done for Citigroup, nobody — myself included — has much of a leg to stand on in opposing giveaways to car companies or anyone else. But it’s still the case that money could be better spent on public investments that would both directly create demand for industrial products and also build productive infrastructure for the future, than simply on covering the operating costs of industrial firms and hoping for the best.

SUPERTRAIN Needed

Transportation for America Communications Director David Goldberg takes to the CAPAF Wonk Room to urge President-Elect Obama to give America a transportation system we can believe in. You can sign the petition here.

Prop 1

Since Kevin Drum’s decided to become a California High-Speed Rail opponent, perhaps I should say more on this. Or, at a minimum, offer some links since Kevin’s post sort of makes it out that this is just some nutty idea being pushed by blogger train enthusiasts:

1. Here’s an endorsement from the LA Times.
2. Here’s one from the San Francisco Chronicle.
3. Here’s one from the San Jose Mercury News.
4. Other endorsements from smaller papers can be found here.
5. The Sierra Club is for it too.

On the idea that ridership estimates are unrealistically optimistic, it seems to me that the sad reality of politics is that it would be irresponsible for advocates of any large-scale infrastructure project to do anything other than present unrealistically optimistic measures. For better or for worse, that’s politics. Similarly, I never really understand the sentiment that Large Infrastructure Project A shouldn’t be done because Large Infrastructure Project B might be better. Sometimes you really do get asked “should we do A or should we do B” in which case, of course, if B is better than A you ought to answer “B.” Similarly, sometimes doing A really does prevent you from doing B — like if A and B would both require the same right of way. But that’s not generally the case, and it’s certainly not the case when you compare a statewide HSR system to a series of different local transit projects. In general, large infrastructure projects should be evaluated on their own merits. If California HSR is worth doing, then it really doesn’t matter if there may be other transit projects that are also worth doing. You do the HSR, and then you start organizing for the other projects. Doing worthwhile infrastructure projects ultimately grows your capacity to do future infrastructure projects.

For example, it seems that when we started building the Interstate Highway System the first projects funded were a stretch of I-70 in Kansas and a stretch of I-44 in Missouri. I seriously doubt that those two were the highest-value projects conceivable or, indeed, anywhere close to being the highest-value projects conceivable. But the goal of the National Interstate and Defense Highways Act of 1956 was, rightly, not to impose some kind of incredibly strict scrutiny to different projects. Rather, the goal was to make money available for a wide variety of worthwhile projects rather than spending decades tied up in arguments about exactly which highway would be the best one.

DHE on McRail

Barack Obama is about as big a rail and transit proponent as we’ve seen in presidential politics for decades. How about John McCain? Well, I was interesting to read these quotes from Doug Holtz-Eakin. Here’s what he said about building the Silver Line to Dulles Airport:

The most important thing that Sen. McCain is going to address, as president, is using transportation dollars more wisely. He has also made a clear commitment for having options on the table for rail.

On the Metro funding bill:

Sen. McCain has been busy campaigning and has missed a lot of votes. I don’t think anything special should be read into that one. The Senator recognizes the importance of the transportation sector to both our economy and our lifestyles and what we need going forward is some performance and accountability in our taxpayer dollars that go into infrastructure.

And on infrastructure in general:

There will be more infrastructure investments going forward — it is an imperative — but they have to be done wisely, and that is the top priority.

I suppose this is a reminder of Doug Holtz-Eakin, the widely respected conservative economist. Unfortunately, I don’t think these relatively mild statements really reflect McCain’s record or his positions very well. McCain has never been an advocate for public transit or rail at the federal level, and neither his economic plan nor his climate change plan say anything about expanded rail service. Indeed, he’s been a longtime opponent of Amtrak funding seeing it as a form of government waste. And of course his proposed across-the-board spending freeze would make it impossible to invest in new infrastructure of any kind.

UPDATE: Also, while Holtz-Eakin is right to say that McCain’s skipped a lot of votes, he actually showed up to vote against WMATA funding contrary to what DHE says.

Death By Trainlessness

Randal Archibald writes for The New York Times about the recent fatal rail crash in LA: “Warning System Could Prevent Train Crashes.” And of course as a rail transit booster, I certainly favor efforts to improve train safety.

Still, it’s worth noting that there won’t be any headlines tomorrow about the car crashes that could have been avoided by building more and better rail networks. We had 37,248 fatal car crashes in 2007. That’s over 100 every day. And yet you don’t see “100 Die Nationwide in Car Crashes” on a daily basis in the headlines. We just take it for granted that most Americans will make almost all of their trips via the most dangerous possible way of getting around. One person dies for about every 415,000 vehicle miles traveled.

The considerable environmental benefits of shifting our transportation infrastructure so that a minority of people would drive radically less and most people would drive somewhat less are so large that the environmental case for such shifts has tended to crowd out other arguments. But in many ways the public health benefits are even more clear cut.

STRONG: Apologies — one fatality for every 415,000 vehicle miles traveled is a ridiculously low figure and implies something like universal death by car accident. There were about three trillion vehicle miles traveled in 2007. Three trillion divided by 37,248 is, unless I’m making another mistake, about 80 million.

Ride the SUPERTRAIN

At last the MSM gets hip to Joe Biden’s potential implications for the SUPERTRAIN. Which is probably as good a time as any to recall that the SUPERTRAIN isn’t just a blogger in-joke. There are some pretty awesome trains out there. Here’s the AVE I took from Madrid to Toledo:

It’s Biden

As you’ve no doubt heard by now, it’s official and Barack Obama’s running mate will be Joe Biden. He wasn’t my favorite choice for the gig, but he was far from my least-favorite choice either. The major pro is that this signals as desire to take the argument to John McCain on national security policy which is a wise decision — the American people deserve to hear a full-spectrum debate about the issues facing the country rather than a positional battle in which one party talks about the economy and the other talks about national security. It’s also the case, as I noted previously, that Biden’s ascendancy augurs well for the SUPERTRAIN even though this aspect of his record isn’t especially well-known or close to the core of his political persona.

Biden also has the lowest net worth of any U.S. Senator. Combined with Barack Obama whose prosperity is a very recent consequence of book sales, it’s definitely a ticket that can argue they have more personal acquaintance with the struggles of middle class American life than John McCain or George Bush or recent Democratic nominees like John Kerry and Al Gore. It also seems to be a pick that the elite media is enthusiastic about, which isn’t necessarily an idea I’m enthusiastic about, but I suppose definitely counts as an asset. Last, moderate Republicans, especially those with a national security orientation, like the pick.

Richard Lugar:

I congratulate Senator Barack Obama on his selection of my friend, Senator Joe Biden, to be his vice-presidential running mate. I have enjoyed for many years the opportunity to work with Joe Biden to bring strong bipartisan support to United States foreign policy.

Chuck Hagel:

Joe Biden is the right partner for Barack Obama. His many years of distinguished service to America, his seasoned judgment and his vast experience in foreign policy and national security will match up well with the unique challenges of the 21st Century. An Obama-Biden ticket is a very impressive and strong team. Biden’s selection is good news for Obama and America.

And of course Biden’s tendency toward gaffes makes this good news for people who need to write about the campaign.

Bidenmania

All DC’s abuzz today with talk of Joe Biden as a Vice Presidential nominee. I think putting someone who voted for the 2002 Iraq AUMF on the ticket may be more politically problematic than people realize — Obama has cited his opposition to that bill as key evidence of his good judgment, but presumably you’d want to put Biden forward as a knowledgeable and experienced foreign policy person, thus setting up a problematic contradiction. But that vote aside, Biden really is someone who’s genuinely knowledgeable about foreign policy questions rather than simply being “strong on defense” or some BS. What’s more, from a Heads in the Sand perspective, picking Biden would signal a clear intention to engage with McCain on national security issues rather than try to dodge away from them, which is definitely a decision I support.

A neglected aspect of the Biden record, however, is that his ascendancy would be excellent news for the SUPERTRAIN. Biden commutes back-and-forth from Delaware to Washington regularly on the Acela, so he appreciates what high-speed rail can do. What’s more, Wilmington recently lost its scheduled air service making Delaware a plane-free state that depends on rail for its connectivity. Biden spends a lot of time on foreign policy and Judiciary Committee business, so he’s not as much of a legislative leader on these topics as his fellow Delawarian Tom Carper, but he’s still one of the best friends rail has in the Senate. Beyond that, Biden’s son sits on the Amtrak board and unlike some of Amtrak’s leadership (which besides Biden is heavily dominated by Republicans) is actually a forceful advocate for Amtrak and for improving rail.