June 2011

Yes, rail investments produce jobs and growth!

by Frank Di Giacomo, Publisher

Some of the rhetoric coming out of the mouths of conservative, anti-government politicians these days is no less than astonishing in its ignorance about infrastructure spending. They hold to the myth that high-speed rail spending - or even all rail spending - by government will not create jobs or economic growth. This is part of a larger myth that only non-government actions like private investment are what create private sector jobs and that government simply needs to get out of the way.

Government's role in investment

The truth is that government has always had a role in transportation infrastructure investment, at least from the days of the Roman Empire, and that this transportation investment leads to greater economic growth. It was proven during the Great Depression and again and again with the Interstate Highway System, new major rail and bus transit investments in cities, and with transportation funding in the American Recovery and Reinvestment Act of 2009. According to the U.S. Government Accountability Office and other government reports, transit investments created the most jobs per million dollars spent in that stimulus legislation. The same would hold for high-speed rail.

APTA has just released a new report, called "The Case for Business Investment in High-Speed and Intercity Passenger Rail," which shows that the large investments in high-speed and intercity rail along the lines of what President Obama has proposed just over the next six years will directly and indirectly result in at least partly creating more than 1.3 million jobs. Longer term, it can rejuvenate the U.S. manufacturing industries and help get us off the largest contributor to our trade deficit - oil imports.

Playing politics with our future

Taking the flawed and sometimes completely unsupported conclusions of conservative think tanks, the new House majority forced the administration and Senate to cut rail transit and high-speed rail disproportionately in the recently enacted FY 2011 budget. Unfortunately, the way that Washington works is that this sets a baseline for future investments. Eliminating all FY 2011 dollars for high-speed and intercity rail is therefore more than short-sighted. It sets the stage for an attack on the whole program.

This is playing politics with our economic future in a very important way. We need to remind these members of Congress that 32 states and the District of Columbia are advancing projects with FY 2010 dollars. We also need to remind them that every single one of our major trade competitors is still investing in rail, even while slashing other government spending.

As it has been for more than a century now, urban and regional rapid transit, intercity and future high-speed and passenger rail investments are just that - important investments to create jobs (remember that word?) and help boost the economy.

 


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