A Rail Boondoggle, Moving at High Speed

In the Washington Post, Robert Samuelson writes about the President's obsession with trains; an obessession which could cost taxpayers billions.

The Obama administration's enthusiasm for high-speed rail is a dispiriting example of government's inability to learn from past mistakes. Since 1971, the federal government has poured almost $35 billion in subsidies into Amtrak with few public benefits. At most, we've gotten negligible reductions -- invisible and statistically insignificant -- in congestion, oil use or greenhouse gases. What's mainly being provided is subsidized transportation for a small sliver of the population. In a country where 140 million people go to work every day, Amtrak has 78,000 daily passengers. A typical trip is subsidized by about $50...

The mythology of high-speed rail is not just misinformed; it's antisocial. Governments at all levels are already overburdened. Compounding the burdens with new wasteful subsidies would squeeze spending for more vital needs -- schools, police and (ironically) mass transit. High-speed rail could divert funds from mass-transit systems that, according to a study by Randal O'Toole of the Cato Institute, have huge maintenance backlogs: $16 billion in Chicago; $17 billion in New York; $12.2 billion in Washington; $5.8 billion in San Francisco. Any high-speed rail system should be financed locally; states should decide their transportation priorities.

In New Hampshire, state bureaucrats are pushing to get as much high-speed rail money as possible, thinking that thousands of Granite Staters will take the train from Concord to Nashua and Boston every morning and evening. Building this boondoggle would put New Hampshire taxpayers on the hook for millions in annual subsidies, meaning we would be responsible for paying a huge price for our neighbor's commute.

The Squandered Stimulus

In the Washington Post, Robert Samuelson writes that the failure of the stimulus package was predictable:

It's not surprising that the much-ballyhooed "economic stimulus" hasn't done much stimulating. President Obama and his aides argue that it's too early to expect startling results. They have a point. A $14 trillion economy won't revive in a nanosecond. But the defects of the $787 billion package go deeper and won't be cured by time. The program crafted by Obama and the Democratic Congress wasn't engineered to maximize its economic impact. It was mostly a political exercise, designed to claim credit for any recovery, shower benefits on favored constituencies and signal support for fashionable causes. (more)

Obama's Risky Debt

Columnist Robert Samuelson writes in the Washington Post about the high costs of President Obama's budget priorities, or lack thereof, calling this budget a "case study in political expediency and economic gambling":

From 2010 to 2019, Obama projects annual deficits totaling $7.1 trillion; that's atop the $1.8 trillion deficit for 2009. By 2019, the ratio of publicly held federal debt to gross domestic product (GDP, or the economy) would reach 70 percent, up from 41 percent in 2008. That would be the highest since 1950 (80 percent). The Congressional Budget Office, using less optimistic economic forecasts, raises these estimates. The 2010-19 deficits would total $9.3 trillion; the debt-to-GDP ratio in 2019 would be 82 percent.

But wait: Even these totals may be understated. By various estimates, Obama's health plan might cost $1.2 trillion over a decade; Obama has budgeted only $635 billion. Next, the huge deficits occur despite a pronounced squeeze of defense spending. From 2008 to 2019, total federal spending would rise 75 percent, but defense spending would increase only 17 percent. Unless foreign threats recede, military spending and deficits might both grow.