Wednesday, January 21, 2009

Why the Transit Stimulus Fight Matters

NOTE: We've moved! Visit us at the California High Speed Rail Blog.

Over at Grist Ryan Avent looks at the politics of the stimulus and makes some interesting conclusions about what this could mean for projects like high speed rail:

Think all news is bad news during this epic recession of ours? Think again -- over the past three months, real wages have increased 23 percent, an enormous gain. At a crucial period for many working families, paychecks are going a lot farther than they did back in the summer.

The explanation is simple: wages are flat, prices are down. The labor market operates on a bit of a lag, so while the recession affected oil demand and prices very quickly, layoffs and falling wages are emerging more slowly. Eventually, the weak economy will catch up to workers (those who still have jobs), and spending power will decline.

But this is important to remember given the trends of the past decade. When economies are growing, oil prices rise. This means that even while wages are growing, it's difficult for consumer spending power to keep up, unless we reduce the intensity of oil in our economy.

It's a point I've repeatedly made - oil prices have declined only because of the weakening economy. When the economy grows again, oil prices will rise again and eat into wages, jeopardizing the recovery. To break that cycle we must move away from oil. High speed rail is a key part of that overall strategy, which is why it and other forms of mass transit must be included in the stimulus.

Avent goes further to talk about the politics of the stimulus:

The lack of transit spending is unquestionably political, and not logistical, in nature.

The possibility remains that the Congressional leadership and the Obama administration are waiting for the 2009 transportation bill overhaul to adjust spending priorities, and indeed, that vote will be hugely important for the future of the nation's infrastructure. There may also be scope for funding in Obama's energy bill. But there is reason for concern here.

The security of our economy and our environment depend upon a sea change in transportation planning. That transit and rail were so easily sacrificed in stimulus negotiations should send us a message -- now is no time for transit supporters to ease up on their legislators. We'll need to fight until the money is in the pipeline.

Emphasis mine. The story is that transit funding WAS in the stimulus until someone either in Nancy Pelosi, Harry Reid, or Barack Obama's office took it out. All three have at one point or another expressed commitment to support HSR and mass transit, so this goes to prove Avent's point - that we have not yet won a victory for sustainable transportation in Washington DC, and that we must continue the fight to ensure that we do win. Otherwise transit and HSR funding might get thrown overboard again in the name of political expediency. We must show our leaders that it is actually costly for them to do so.

UPDATE: Elana Schor at Talking Points Memo explains that mass transit and passenger rail got the shaft in order to make room for more tax cuts, quoting Oberstar:

The reason for the reduction in overall funding -- we took money out of Amtrak and out of aviation; we took money out of the Corps of Engineers, reduced the water infrastructure program, the drinking water and the wastewater treatment facilities and sewer lines, reduced that from $14 billion to roughly $9 billion -- was the tax cut initiative that had to be paid for in some way by keeping the entire package in the range of $850 billion.

Stupid. Just stupid. Tax cuts do not grow the economy; in this environment they will be put in the bank either as savings or as debt service. If they felt that strongly about cutting down infrastructure projects to pay for tax cuts (which is already poor policymaking) then roads and not rail should have been the target.

What this shows is that the new leadership in DC - in both the Congress and the White House - are not committed to mass transit and passenger rail when the going gets tough. Just because it's easy to say on the campaign trail shouldn't mean it's easy to abandon once in power.


Anonymous said...

Thankfully there was a NY Times article with a somewhat pro-rail funding viewpoint published a few days ago. More high-profile articles and coverage like this would definitely help our cause.

Rafael said...

It's possible that politicians took transit out of the stimulus package because they know there is broad bipartisan support for funding it in the regular budget. However, it would be naive to assume that is the case.

It would really help if the Obamatons provided some clarity for their spending priorities over the next four years. By defintion, a stimulus package is an emergency measure, not a substitute for strategic investment in energy-efficient infrastructure. Right now, the two are being conflated in a huge single bill that is being rushed through, which is a Very Bad Idea (tm).

For our part, we need to hammer home the message that electric trains are the only viable technology for delivering a large number of intercity passenger-miles without consuming a drop of crude oil.

Also, affordable electric cars will always have very limited range on grid electricity, so electric intercity trains are an excellent complement. Folding electric bicycles and bike paths would complete the mix.

In the 21st century, transit isn't just about providing transportation capacity in crowded cities and for those who cannot afford to own a car. Rather, the focus must shift to electric modes of transportation, specifically to structurally destroy demand for oil-based fuels. In the US, the transportation sector consumes 2/3 of all oil, a share that is rising as other sectors switch to natural gas and other fuels.

Transportation, energy and environmental policy objectives are inherently linked. It's time to stop pretending they aren't.

Alon Levy said...

I have no idea where the 23% annual increase figure comes from. The BLS says the median nominal increase from Q4 of 2007 to Q4 of 2008 was 4%, whereas the CPI rose 1.6%.

Rafael said...

Washington being what it is, there is also the possibility that the Obama team deliberately increased tax relief at the expense of transit to give Congressional Democrats a way to put their imprimatur on the package without grossly inflating its overall scope.

IIRC, something similar - albeit on a much smaller scale - was done when NASA administrators responded to demands for budget cuts by axing a repair mission to the Hubble space telescope. They knew full well the scientific community would cry foul and gambled that Congress would sneak it back in without cutting any of the less popular projects.

@ Alon Levy -

perhaps someone dropped a decimal point: 4%-1.6% = 2.4%, which is close to 2.3%, not 23%.

bossyman15 said...

now i'm starting to dislike obama.

He was the best for the job but if even he couldn't do the job then I guess no one will.

I hate america.

bossyman15 said...

i just sent email on about this.

you all should do the same!

Tony D. said...

Perhaps my view is to simplistic. Prop. 1A passed and we now have a Democratic Administration, along with Dem. Majorities. Prior to the economic collapse in September 08, there was talk on this site and others about potential federal funds for HSR. The emergency stimulus package did not even exist prior to 9/08. Yet, because HSR and other transit projects aren't included in the emergency stimulus, the "sky is now falling" on our high-speed dreams.

Obama has been in office now for a whole two-days...PATIENCE PEOPLE! Don't get me wrong, I'd love to have HSR tomorrow and dedicated funds in the emergency stimulus. And yes, we should fight for more transit federal funds. But to say that you dislike Obama and that he has failed us is ridiculous.

Let's all be patient, do what's necessary to obtain fed funds in the future and consider what could have been...McCain gets elected and Prop. 1A fails.

Anonymous said...

I agree with TonyD..Our project is long term..Obama will be OUT of office before full service starts.
We need Kerrys bill to pass and be fully funded..if not then we might need to worry. hopefully we will get money this year from the Amtrak
funding bill HST section.
What we need to worry about is right here in Sac with our budget shows and not being even able to spend 29 million for planning

Rubber Toe said...

Here is a link to send an e-mail to Nancy Pelosi requesting that more than 25% of the stimulus be applied to transit:

Taylor Weston Hickem said...

Chicken or the Egg . . .

As I understand it, the idea is provide alternate door-to-door transit solutions for Americans (Californians) so that they do not feel so dependent on more dangerous and environmentally hazardous transit solutions (cars).

It seems that there are several ways of using the stimulus on transit infrastructure to gain the necessary political support for a nation-wide overhaul of the entire rail transit system.

But which way would use the least amount of taxpayer money and result in the greatest increase in political support?

Could the strategy be to first work on the long-haul trips - between cities - where people use cars, and replace them with HSR?

Then, in the hopes that ridership will rise, and force a fundamental change in US transit culture, the population will demand more government funds devoted towards filling in the missing links - Inner City Metros and other light-rail systems, combined with HSR, to make a network of door-to-door solutions across the US.


Would you do it the other way around?

Focus on the Inner city light rail projects, which are typically cheaper, and then hope that the resulting increased ridership would create the political momentum necessary to get public funding for the long-haul connections, to complete the door-to-door rail network.

Why would the former be more effective than the latter ?

Or are there other advantages HSR has over light-rail and other sustainable transit solutions ?

Alon Levy said...

Taylor, HSR and light rail aren't competing with each other. HSR competes with short-haul airlines and sometimes highways; light rail competes with buses and cars.

Taylor Weston Hickem said...

Hey, Alon

thanks for the reply

- True

light-rail and HSR would not appear to compete much for customers.

I was referring more to how they may compete for capital funds from public projects focused on improving US transit infrastructure.

Has the Obama administration designated HSR as a separate initiative?


Has it always been references within the broader context of a focus on renewable technology and sustainable transport solutions ?

Rafael said...

@ TWH -

so far, Obama appears more concerned about generating and distribution capacity for renewable electricity for general-purpose use, because of the jobs (=votes) it will bring.

So far, the Obama administration has only paid lip service to the notion that it is the consumption of oil - more than any other fossil fuel - that the US needs to curb, primarily for long-term geopolitical reasons. Around 2/3 of all oil is consumed in the transportation sector.

Obama's advocacy of electric cars also appears to be motivated primarily by the notion that the production of advanced lithium iron phosphate batteries will create jobs. He conveniently glosses over the sad but true fact that no-one is going to pay an extra $10,000+ for a car that can drive only the first 40 miles on grid electricity as long as gasoline costs less than $2/gallon. At today's prices, it would take well over a decade to recoup the incremental investment, too long to be worthwhile for all but a few hardcore altruists.

The implied pious hope is that oil prices will shoot back up once the recovery gets going and create a market for the (partially) electric vehicles car makers will bring to market in the 2010-2012 time frame. If oil prices only inch up, e.g. because the global recovery is very uneven, the domestic auto industry may well go belly up before 2015 even if it is nursed through the current lean times by a series of subsidy grants.

It's actually quite irresponsible of Obama not to ensure sufficiently high prices for on-road fuels by shifting taxation from general sales to those of gasoline and diesel. Moreover, it's risky to bet the farm on near-term advances in battery technology. Clean diesel and CNG should be fostered as back-up strategies, because biodiesel/BTL and biomethane/SNG are easier to produce than cellulosic ethanol.

By contrast, electric train technology is readily available. The political impediment is that actually using them requires a lifestyle change that voters in sprawling cities built around the motor car may not be willing to make. There are two exceptions:

- rush hour commuting (which otherwise involves participating in a traffic jam), and

- medium-distance intercity travel, for which passengers currently have to travel to an airport (or else spend many hours driving).

Local connecting transit increases HSR ridership but it's not essential to getting started. Politically, HSR is more popular because it doesn't require public funding beyond the construction of the network's starter line.