LaHood’s Legacy

Best known for admitting to the National Press Club that the Obama administration wants to "coerce people out of their cars," Secretary of Transportation Ray LaHood has announced his plans to leave office as soon as a replacement can be found. Aside from an admirable emphasis on transportation safety, the main legacy he leaves behind is a record of wild spending on ridiculous projects that do little to improve transportation but do much to add to the nation's debt.

Much of that spending came out of the 2009 stimulus bill. Prior to the stimulus bill, a Bush (II) administration rule required that most spending on transit projects meet certain measures of "cost effectiveness." Streetcars, for example, had to be cost-effective relative to buses, which they never are, so no streetcar projects could be funded. The stimulus money was exempt from these rules, so LaHood immediately gave funds to Atlanta, Cincinnati, Dallas, and Tuscon for new streetcar lines. LaHood then announced that he was rescinding the Bush rule, an action that was formally completed on January 9 of this year.

Similarly, at the request of the Obama administration, the stimulus bill included $8 billion for so-called high-speed rail projects. But most of the projects funded are anything but high speed. Vermont, for example, spent $52 million speeding up a New York-to-Burlington train to an average of 38 miles per hour. Washington State is spending $590 million speeding up a Portland-to-Seattle train from an average of 53.4 to 56.1 miles per hour.

The main criteria for elibility for these funds was not whether a project was worthwhile but whether the environmental documentation had been written. Florida, for example, had written an environmental impact statement for high-speed rail that concluded that the environmental costs exceeded the benefits, but LaHood was happy to give the state $2.4 billion to build it anyway until the state had second thoughts.

As a result, cities and states all over the country are scrambling to write environmental impact statements for all sorts of inane projects so they will be ready the next time the floodgates of federal spending open. Reconnecting America, a pro-transit group, has cataloged more than 600 transit plans under way in more than 100 metro areas. These include 125 streetcar projects in at least 50 cities which may now be eligible for funding now that the Bush cost-effectiveness requirement has been eliminated.

Altogether, the nearly 500 projects for which costs have been estimated would require more than $250 billion in capital expenditures, which rail advocates lament mean that it would take more than 100 years of federal funding at the current rate to fund them all.

It never occurs to LaHood and other supporters of these expensive projects that their pie-in-the-sky dreams in the face of limited funding is a sign these projects really aren't worthwhile. For example, numbers projected by streetcar proponents indicate that 6- to 8-mph streetcars trundling through our downtowns would carry about 60 passenger miles a day for every million dollars of capital investment. Light rail is a little better at 120 miles.

This table shows the estimated capital cost per mile of various types of transit projects identified by Reconnecting America. "Rapid bus" is Reconnecting America's term for fast, frequent bus service with limited stops on existing roads; "bus-rapid transit" is Reconnecting America's term for similar bus service on dedicated roads. The daily passenger miles per million dollars of capital cost is a measure of cost-effectiveness calculated by multiplying projected daily trips for each mode times the average length of trips by that mode (1.75 miles for streetcars; 4 miles for bus; 5 for light and heavy rail; and 20 miles for commuter rail) and dividing by the capital cost. The last row, representing the Interstate Highway System, is offered for the sake of comparison.

By comparison, the Interstate Highway System, which cost about $450 billion in today's dollars, provides something like 8,000 passenger miles of passenger travel (not to mention several thousand ton miles of freight movement) per day for every million dollars of that investment. On the equity side, interstate highways were paid for entirely out of gas taxes and other highway user fees, while transit capital costs, maintenance costs, and most operating costs must be paid by people who rarely if ever ride transit.

To make matters worse, rail transit projects saddle cities with costly infrastructure burdens that have forced many transit agencies to cannibalize their bus systems to maintain. The Federal Transit Administration estimates that existing rail transit systems suffer a $60 billion maintenance backlog today and that they are declining faster than cities can restore them. This led a frustrated FTA Administrator Peter Rogoff to ask transit agencies, "if you can't afford to operate the system you have, why does it make sense for us to partner in your expansion?"

For LaHood, however, cost effectiveness, equity, and financial sustainability were irrelevant; instead, his goal was "livability," by which he meant living without a car. But considering that 92 percent of Americans do live with a car, and live much better because they have a car, LaHood's goal effectively represented a reduction in the standard of living for most people.

Unfortunately, the planning process that LaHood promoted contains seeds of self-fulfulling prophecy. Cities typically pay millions of dollars to outside contractors to write the environmental impact statements. Since contractors know that if projects are funded they are likely to get some of those funds for engineering and design work, they freely contribute some of their profits from the environmental process to promoting the projects. The environmental review also include a public involvement process that gives rail advocates a tool to organize support.

LaHood was only a symptom of the problem inherent with any federal funding for what should be state or local programs: there will always be a clamor for "free" federal money. But his credibility as the token Republican in the Obama cabinet gave a bit more legitimacy to this process. His replacement could be an even more extreme supporter of these programs, but it is hard to imagine that he or she will be able to do any worse damage to our cities and our economy than LaHood has already done.