U.S. Capitol - Illustration by Emily Metcalf
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Illustration by Emily Metcalf

THE FEDS WANT TO TAKE YOUR CAR! Randal O’Toole’s transportation newsletter



Some House Republicans have indicated they will support the Senate transportation reauthorization bill if it includes a mandate to approve the Keystone pipeline. Until this week, conference committee talks over the bill appeared to have broken down, with Senate Democrats resorting to calling House Republicans a “bunch of radicals,” militants,” “extremists,” and “fanatics” for holding out for a fiscally conservative bill.

Early this week, however, House Speaker John Boehner and Senate President Harry Reid began meeting to try and smooth out their differences, which appears to have revived the talks. The latest (and ninth) extension to the 2005 “SAFTEA-LU” reauthorization (which itself was two years late) expires on June 30, so they don’t have much time to reach an agreement.

According to House Transportation Committee Chair John Mica, the main differences are the Keystone pipeline (which the House bill supports but the Senate bill does not), environmental streamlining, and new programs created by the Senate bill which House Republicans, who want to reduce rather than increase federal transportation programs, oppose.

A bigger reason why fiscal conservatives oppose a compromise was suggested by New Jersey Representative Scott Garrett, who wants to devolve federal programs to the states. “Where is the upside” to a compromise, he asked the Wall Street Journal. “If we get a good majority in the Senate and win the White House, we will be on a very strong platform to do things we need to do.”

The Senate wants to pass just a two-year extension to the existing law, and since 2012 is the first year, the bill will expire in about 15 months, giving the next Congress a chance to rewrite the law next year anyway. What worries fiscal conservatives is all the new programs in the Senate bill, which will be much harder to kill once they are started. So conservatives such as Garrett would rather extend the current law a few months at a time than pass the Senate bill, which is 1,674 pages long and probably includes numerous programs that hardly anyone has discovered because few have bothered to read the whole thing.

The upside to passing a 15-month extension is that the current law mandates spending floors out of the highway trust fund that are greater than gas tax and other revenues to that fund. A 15-month extension would remove the floors and allow the appropriations committees to spend no more, or even less, than the revenues (though there is no guarantee they will do that). But fiscal conservatives such as Garrett presumably believe that the trade-off of a few billions in deficit spending now in order to get far less spending after next year will be worth it. That will all depend, of course, on the results of the November election.

However, passing a bill that includes the many new Senate programs in exchange for a Keystone pipeline mandate would be a poor trade-off, especially considering that the pipeline is only peripherally related to federal transportation spending. Fiscal conservatives should be very wary of whatever compromise results from the current talks.

Wall Street Journal on Republican strategy:
The Hill on Boehner-Reid talks:
The Hill on Keystone mandate:


My two recent reports on streetcars illustrate why we need to reform federal transportation funding. “The Great Streetcar Conspiracy,” from Cato, reveals that streetcar advocates deceptively claim that streetcars generate economic development, when in fact it is other subsidies, including tax-increment financing TIF, that have stimulated that development.

In Portland, Oregon, for example, where a streetcar line passed through a TIF district that received $500 million in subsidies, developers invested $1.3 billion, but when the streetcar line served a neighborhood of about the same area that received no subsidies, developers invested only $17.6 million. While this shows it was the subsidies, not the streetcar, that led to the new development, other cities that want to build streetcars still claim that streetcars “catalyze” economic development.

“The Streetcar Scam,” published by the MacIver Institute in Wisconsin, analyses a proposal to build a new streetcar line in Milwaukee. The paper shows that buses can move more people than streetcars at a far lower cost.

The Obama administration has proposed to change the rules for funding transit projects to de-emphasize “cost effectiveness” and instead base grants on “livability,” “multi-modalism,” and “environmental justice.” We know that, in the administration’s eyes, “livability” means “living without cars,” and “multi-modalism” means transit. But what does “environmental justice” mean?

The Washington Times answered that question in a series of recent articles: it means giving power to federal bureaucrats to do whatever they want. Or, as the Times put it, “The marriage of environmentalism and civil rights has created a perfect storm of regulatory power that has the potential to control or kill any project anywhere in the United States.”

Streetcars supposedly promote “economic development,” meaning gentrification of blighted areas. How environmentally just is it to use federal dollars to push low-income people out of their homes in order to attract yuppies who want to live in redeveloped urban neighborhoods? How environmentally just is it to spend transit dollars on expensive rail lines aimed at getting middle-class people out of their cars while reducing spending on bus service to low-income neighborhoods that already have fewer cars per capita?

The real reason cities want to build streetcars is that the Obama administration wants to fund them, so cities eager to get federal dollars at any cost apply for federal streetcar grants. Streetcars are neither environmentally superior nor just to low-income families, but that is irrelevant to an administration that is focused more on fads than on reality. Congress should remove New Starts and Small Starts from whatever reauthorization bill that it passes.

The Great Streetcar Conspiracy:
The Streetcar Scam:
Proposed new rules:
Cato comments on proposed new rules:
The Washington Times on environmental justice
Part 1:
Part 2:
Part 3:


Secretary of Immobility Ray LaHood, who has said he plans to leave office at the end of the year even if Obama is re-elected, has announced that he will spend his last few months in office visiting states he has never been to before. Specifically, after returning from Hawaii (and Guam), he plans to go to Idaho, Mississippi, Montana, South Dakota, and Wyoming.

These states are not exactly hotbeds of transportation controversies that need the watchful eye of a transportation secretary. But LaHood’s goal is to say that he has been to all 50 states. After he leaves office, he expects to have some “wonderful opportunities” in the private sector, though I have to wonder what kind of opportunities await a bumbling political has-been who betrayed his party’s principles in order to unconditionally support a president of the opposite party. If all he wants to do is go on vacation, he should leave office now and not travel at taxpayers’ expense.

Wonderful opportunities:
Tour plans: