Elected officials in Washington finally seem to get it that something must be done to reduce federal spending. Last week, House Republicans unveiled a plan to cut $74 billion from President Obama’s budget request for this year, and members of the Republican Study Committee have proposed an even more ambitious plan to cut $2.5 trillion over the next decade. Members of both parties in the Senate are eyeing plans for long-term deficit reduction.
Even President Obama, in his 2011 State of the Union address, confessed that “we have to confront the fact that our government spends more than it takes in. That is not sustainable.” The big question left is whether the President’s fiscal year 2012 budget, which he will release next week, will embody the fiscally responsible choices he admits we need.
So far, it doesn’t look like it. Yesterday, Vice President Joe Biden and Transportation Secretary Ray LaHood unveiled the President’s plan to invest an additional $53 billion in high-speed rail over the next six years. The stimulus already provided $8 billion in funding, followed by $2.5 billion added by Secretary LaHood. According to The Washington Post, the total price tag of the scheme would weigh in at $600 billion over 20 years.
The President’s obstinate commitment to high-speed rail reflects a complete and utter neglect to take deficit reduction seriously. Heritage’s Ronald Utt writes that a high-speed rail program would create “perpetual massive government subsidies and larger budget deficits” and “additional burdens imposed on hard-pressed state governments, which will be required to match the perpetual federal subsidies to build the system.”
Funding has already been rejected by new governors in Wisconsin and Ohio, who campaigned against the costly projects, which would initially receive partial funding from Washington but would ultimately place a heavy burden on both federal and state taxpayers. Said Florida Governor Rick Scott:
“Over the last few years, Florida accepted one time hand-outs from the federal government. Those temporary resources allowed state and local governments to spend beyond their means. … There was never any reason to think that Florida taxpayers could afford to continue that higher level of spending once the federal hand-outs were gone.”
Despite its cost, high-speed rail will be ineffective at achieving its goals, if Europe’s experiences are any indicator. High-speed rail is expected to reduce auto and air travel, but in Europe, the trend is actually the opposite: Despite huge government subsidies, travelers are opting more and more to take non-subsidized and less expensive forms of travel.
Per capita spending on rail alone in six European countries was comparable to the United States’ entire transportation budget, yet, says Utt, “these countries received a poor return on their money given that more than 90 percent of passengers in these countries chose other travel modes—mostly auto—despite the subsidies.” Moreover, Utt cites the U.S. Department of Transportation’s Inspector General’s finding that reducing travel time between major East Coast cities by 30 minutes would cost $14 billion but only reduce auto transportation by less than 1 percent.
Experiences around the globe show that high-speed rail is unsustainable and requires large and perpetual government subsidies. The gains of high-speed rail would be minimal, affecting only a small portion of the population. The United States simply cannot afford such a project right now. If President Obama is serious about investing in America’s future, he should focus on cutting existing programs that are unaffordable and inefficient rather than adding another to their ranks.