20.12.11

HIGH-SPEED RAIL AS MAKE-WORK?

A Bloomberg report suggests that faster passenger trains in the megalopolises should not be politically controversial.
Because of its ingenious scope, neither the airlines nor the auto industry contested the plan. It targeted corridors among major cities that are too far apart to drive, but too close to make flying worth the time and hassle of trudging through airport security: Chicago, Detroit, St. Louis and Milwaukee, for example, or Atlanta, Charlotte, Birmingham and New Orleans. Although trains wouldn’t compete with planes between New York and Los Angeles or, for that matter, Chicago, the plan would put high-speed rail within the reach of 80 percent of Americans.
We know the potential for the Milwaukee, St. Louis, and Upper Midwest routes generally.  We disagree with the article's case for spending on faster passenger trains as part of an economic stimulus.
The weak economy only increases the urgency. Interest rates are at historic lows, real estate values remain depressed, private sector spending is stagnant, and unemployment is stuck around 9 percent. There could hardly be a better time to borrow billions of dollars to buy up land for train rights-of-way and to create high-paying jobs in engineering, manufacturing and construction.

When Florida’s Republican governor, Rick Scott, returned $2.4 billion in federal rail funds last year, he also expunged about 17,000 construction jobs in one of the most depressed areas of his state. The Florida corridor, which could have linked Orlando to Tampa as early as 2014, was projected to return an operating profit of $10 million in its first year alone.
Interest rates are low, and Treasuries, despite the deficit, are perceived by investors as safer than European or Latin American government bonds.  There still is a marginal efficiency of capital, and in the case of Passenger Rail, some of the investments are relatively cheap.  Modify the Interstate Commerce Commission orders governing passenger train speeds, retime the road crossing signals (although the use of public money to build road underpasses or overpasses at crossings of major railroads does make sense) then replace the P-79 speed indicators away from city limits with P-110 signs, and away you go.  But if somebody wanted to put the public money into a new fleet of passenger stock, including successors to the Beaver Tail, Tip Top Tap, and Super Dome, I won't object.

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