Friday, January 30, 2009

Help is on the way -- not

As the stimulus package comes into focus, we see the inevitable pork fattening. How could it be otherwise? The WSJ has cited the realization of a "40-Year Wish List".

Wendell Cox has focussed on more money for public transit. He notes:

The economic stimulus bill that recently passed the House included $12 billion in spending on public transit. When Republican Rep. Jeff Flake attempted to cut nearly a billion going to Amtrak and intercity-rail service, House Democrats quashed the effort and condemned opponents of transit spending. According to the Wall Street Journal, “They have been urging a big boost in spending after the number of riders on Amtrak and many mass-transit lines surged to record levels last year. They have argued that bolstering rail and bus service helps create ‘green’ jobs and gives consumers environmentally friendly transportation choices.”

Transit is enjoying a resurgence of popularity, or more accurately hype. We have been reminded, most recently by Democrats in the House, that as gas prices were rising and driving declining, that transit ridership was growing strongly. Yet, the reality is that transit captured no more than 3 percent of the decline in urban driving. Strong growth rates on an insignificant base produce insignificant increases (barely 1.5 percent of urban travel in the United States is on transit) and outside New York, the number is below 1.0 percent. Record ridership of this kind shouldn’t be rewarded with new spending, nor should we fall for the canard that it’s an effective way to have an environmental impact.

There are some very smart people who claim that desperate measures are called for. But desperate measures can also make matters worse. Printing money to finance questionable projects that enrich lobbyists, empower bureaucrats and entrench politicians is surely not a promising signal to investors here or abroad.