Showing posts with label US transport. Show all posts
Showing posts with label US transport. Show all posts

02 November 2010

How to kill a boondoggle

Just say no!

That's what the Governor of New Jersey, Chris Christie, said to a US$11+ billion rail project to build a new line from New Jersey into Manhattan.  A project that was doomed to go over budget, and never make a single cent to contribute towards its capital costs.  He essentially cancelled the project because New Jersey couldn't afford it, although he would have let it proceed had the Federal Government been willing to cover any cost overruns.  There was a 90% certainty that it would have exceeded previous budget estimates of US$9.8 billion, with the highest end estimate being US$13.7 billion.

He wants to use money that had been planned for the project to fix up the state's badly maintained roads and bridges, and refused to increase fuel tax to pay for it.   However that's another story, of state managed roads that are falling apart because of mismanagement and pork barrelling from the past. 

If there was so much demand for rail travel, then fares could go up to generate net revenues to pay for it, yet fares don't pay enough to run the existing services (and yes, the roads to Manhatten from New Jersey ARE already priced, although not particularly efficiently). 

Know any other boondoggles that need someone to say no to them?

22 April 2009

Obama's boondoggle of "fast rail"

The Obama Administration is pouring US$13 billion of money into developing a high speed passenger rail system. Sounds great doesn't it? Obama talked of how countries like Japan and France have been doing it for decades, but the US hasn't, and it is about time that it did.

Sadly this money is going to be wasted, and it isn't going to deliver anything remotely like a high speed rail system for the USA. Why?

The USA is vastly different from France, Japan, Italy, South Korea and other countries with high speed rail systems for one obvious point - size! Japan has profitably developed high speed rail because it has tens of millions of people living very short distances down densely packed corridors. With the exception of the Boston-New York-Washington DC Northeast Corridor, the distances in the US are too vast for rail to begin to compete with aviation for travel time. That rail route in itself is profitable, but sadly under the Federal Government owned AMTRAK is milked to cross subsidise other politically driven routes.

Obama's money will be bad money after bad. It wont build any high speed rail routes because it isn't enough money. The money will go to improve existing lines, at best upgrading lines as fast as the Northeast Corridor, which is nothing like lines in Japan and France. Speeds in Japan and France are In the US it is 145 km/h, in France it is 320 km/h, in Japan 300km/h. High speed rail in the US is slower than most main lines in the UK, which are at least at 160 km/h and typically faster.

Obama has basically lied that this money will deliver the US high speed rail like in those countries. A country that is far bigger will get trains less than half the speed of the countries where high speed rail works. It isn't enough money, and what it will do is next to nothing.

More importantly, rail can never be competitive with aviation over medium to long distances, and the diversity of origin/destination patterns means it wont be useful over short distances in most cases. Obama wont set it free to be profitable and slash all of the politically driven loss making routes that excite far too many members of Congress.

In short, he's wasting money on a feel good project, lying about what it will deliver and pretending it will make any noticeable change in the US economy or the environmental impacts of transport.

It's not change - it's the same failed policy of the Carter Administration on transport.

I'll leave to Sam Staley of the Reason Foundation to explain further. As Randall O'Toole says "Taxpayers and politicians should be wary of any transportation projects that cannot be paid for out of user fees."

Aucklanders are about to get something just like that.

27 February 2008

Bush administration goes forward - on roads anyway

Whilst many pundits decry the Bush Administration as a “disaster” as if it were self evident, it is clear to me that in the field of transport, it is light years ahead of past administrations of both colours.

The current Transportation Secretary Mary Peters (and her last significant predecessor, Norm Mineta) have both made the very clear and blunt points – the status quo doesn’t work. Environmentalists may be surprised that the Bush administration is strongly supportive of road pricing, instead of ongoing politically driven funding of roads and public transport.
Some of the best points she made at a recent meeting of Governors at the White House were:

“in the era of a government mandated monopoly in telecommunications and price controls you'd get a recording: "I'm sorry all circuits are busy. Please try again later." "Your call couldn’t go through the system for the same reason your car can’t get through rush hour – poor pricing," Peters said.”

That's the fundamental point. People put up with chronic traffic congestion roads, but wouldn't with other infrastructure - and it is due to lack of pricing and poor quality investment - those are both due to government's running roads in the same old Soviet era way. She also points out that throwing taxpayer money at the problem hasn't worked:
"The failings of federal tax and earmark programs she said are highlighted by the 300% increase in traffic congestion in the past 25 years while spending on roads and transit is doubling every ten years."

Think also about healthcare, how throwing money at that simply isn't working either. None of this should be a surprise.
"There is no greater symptom of failure than the fact that Americans simply don’t support putting more money into this broken system. Poll after poll shows strong opposition to traditional fuel taxes. The public ranks gas taxes as among the least fair taxes at the federal, state and local levels. And they are rightfully suspicious that higher taxes will (not) translate into more efficient transportation systems."

Quite right too. Fuel taxes are charges for buying fuel, not buying road use. While New Zealand has only just moved to spend all central government fuel taxes on transport (note this includes public transport, walking and cycling infrastructure), the temptation during hard times will always be to use it for general revenue.

"More and more people are seeing that direct charges offer a better deal for taxpayers than increasing dependence on dysfunctional sources like federal gasoline taxes. This simple but powerful technology unlocks enormous new opportunities for communities BOTH to attract new investment capital AND to manage congestion through variable prices."

So let the private sector in and the market mechanism of price in. Letting them both do it removes the political albatross that doing either wont work well. London's congestion charge is severely hamstrung by the political agenda of Ken Livingstone which gives a significant portion of London traffic a discount or exemption, but also earmarks the money for a lot of buses, many of which carry few people.

Hopefully her initiatives to set free private capital for investment in highways at the federal and state levels, set free the price mechanism for charging for highway use, ending "earmarked" pork barrel funding for roads and getting better results from what federal spending that remains will not be jeopardised by the games of Obama, McCain and Clinton. I am not optimistic, but these baby steps are all in the right direction, and are worth watching. It also shows there is a bit of free market thinking in the Bush administration after all.