My brain tells me that the entire Amtrak subsidy should be eliminated. If Amtrak can’t stand on its own, then why should taxpayers subsidize it to such a large extent? There are numerous ways to get across Missouri, including cheap flights and busses for those who don’t drive.

My heart tells me that there is nothing wrong with compromise in politics, and I think the current compromise to fund Amtrak enough to guarantee one trip per day is a good one. In the past, I have argued in support of a limited subsidy for passenger rail service across Missouri. I do believe it is important to have that alternative provided. We subsidize all types of transportation, including cars. There is a public good aspect to having a variety of transportation options available to people.

MODOT released a study several months ago purportedly in support of the service:

The lawmakers set the figure in May, about the time an executive summary of a state-commissioned Cambridge Systematics economic impact study revealed that the four trains each day provide $208 million in annual economic activity, and more than $22 million in tax revenue Missouri would not see if the Runners didn’t run.

I have to be honest here. I don’t believe those numbers; not in the slightest. Like similar studies, this one makes use of exceedingly generous statistics. From the summary of it available online (emphasis added):

Amtrak’s . . . spending in Missouri yields the following direct, indirect and induced economic benefits….

The key words are “indirect” and “induced.” The authors of the study are likely using a robust and flawed multiplier to make assumptions about the tax revenue and economic activity that don’t withstand scrutiny.

Beyond those issues, some of the arguments in favor of a larger subsidy and two trips a day are simply weak (from the St. Louis Post Dispatch article linked at the top of this piece):

Tammy Bruckerhoff, the tourism and economic development director for Hermann, said the line is vitally important to draw tourism to the smaller towns along the route.

There are hundreds of small towns in Missouri. I fail to see why a half dozen of them along the Amtrak route deserve a subsidy for their tourism efforts, which mostly revolve around bacchanalian celebrations of excess (which are awesome, I admit). Do we subsidize Party Cove in Lake of Ozarks? I sure hope not (also, we don’t).

$10 million a year is a generous subsidy to keep Amtrak running in Missouri, and a compromise that I can live with in this debate. A larger subsidy is not warranted. There is no evidence that two trains per day in each direction will accomplish anything more than spending another $2.5 million (at least) in taxpayer money. You can’t wish market demand out of thin air, whether it’s for a trolley, a streetcar, high-speed rail, or Amtrak.

The post Brain Versus Heart on Amtrak in Missouri appeared first on Show-Me Institute.

Inflation has reared its ugly head again—hitting a 30-year high of 6.2 percent, which is more than triple the Federal Reserve’s definition of stable prices. Unfortunately, the wayward policies that have contributed to soaring prices, pervasive shortages, and sputtering growth are not going away. In fact, they are poised to get a whole lot worse.

President Biden signed the first of two giant spending bills into law on Nov. 15. That was the $1 trillion “Infrastructure Investment and Jobs Act.” The second bill is the administration’s proposed Build Back Better Act, passed by the U.S. House of Representatives a few days later and now pending before the Senate.

Taken together, we are looking at a potential tsunami of bad policymaking. Let us count the ways the two pieces of legislation threaten our nation’s freedom and prosperity:

#1. The infrastructure act is only partially about infrastructure as most people think of it. For example, the law spends only $110 billion on fixing roads and bridges—barely putting a dent in the maintenance backlog—while Amtrak alone will get 60 percent as much as all of America’s bridges and roads combined. Yes, that Amtrak—the one that has consistently run operating losses almost every year for the past 50 years. Tens of billions of additional dollars will go into public transportation even though only five percent of Americans rely on public transit in commuting to work.

#2. Also under the infrastructure act, the government says it will make “the largest investment in clean energy transmission and grid in American history,” and it calls for “building thousands of miles of new resilient transmission lines to facilitate the expansion of renewables and clean energy.” Wind and solar have been lavishly supported for decades, but still only account for 11 percent of U.S. electrical power generation, and their actual role is much less than that because they are intermittent. Does anyone seriously think they can come anywhere close to replacing gas and coal as the primary source of 60 percent of electrical power generation and be equally cheap, reliable, and easy to use?

#3. Then, too, as part of the green energy component of the “infrastructure” plan, the federal government will mastermind the building of a network of 500,000 electric vehicle charging stations, thereby not only putting taxpayer money at risk, but also putting the federal government in the position of picking winners and losers among America’s small-town communities through its choice of where to put those stations. The survival of local communities may soon depend increasingly on Washington, D.C.’s whims.

#4. The proposed Build Back Better Act would permanently and dramatically expand the welfare state and abolish work requirements as a condition for receiving aid. There would be some “free money” for taxpayers at all levels of income. The wealthy would get theirs in the form of expanded state and local tax (aka SALT) deductibility. The top current deduction of $10,000 isn’t much for a top-one-percenter living in an expensive house in a spendthrift, high-tax state like California or New York. Build Back Better includes an eightfold expansion of the maximum SALT deduction to $80,000. The typical taxpayer would get no benefit, while top earners would receive an average windfall of nearly $23,000. The Build Back Better Act would also permanently enshrine the Biden administration’s reimagined Child Care Tax Credit, which would allow a family to receive thousands of dollars a year ($3,600 per child under age 6 and $3,000 per child at 17 and under) in government cash with zero earned income and no expectation whatsoever of anyone having to seek a job.

#5. Adjusted for a lot of gimmickry, a close reading of the bill shows that it would result in nearly three trillion dollars in cumulative budget deficits over the next decade. Claims that the bill will not add a dime to deficits and debt are entirely spurious.

To sum up, what we have here is an overarching vision for transforming America. It would concentrate more decision-making power in the hands of the central government. And it would turn what has been a society of producers, workers, and investors into a society of people and institutions (including unions, businesses, schools, and an enlarged army of social workers and activists) whose livelihoods depend on what government gives them.

The post Commentary: A Tsunami of Bad Policy appeared first on Show-Me Institute.

And I’m not the only one. According to a new study, intercity bus routes carried more than 60 million passengers in 2015, more than twice Amtrak’s total. And passenger levels have been growing fast. In 2008, total intercity bus passengers were only around 45 million. That means that in just seven years (tough times for other transportation services), long-distance bus passenger levels grew by 36%. That vast majority of the growth is in express services, like Megabus, which went from serving 2.3 million passengers in 2008 to 11.6 million passengers in 2015.

Why someone might opt to use Megabus or other express services is easy to understand. Compared to flying, it may take much longer, but the bus is considerably cheaper.  Compared to the Amtrak, travel times can be near equivalent. And in terms of cost, despite massive subsidies for rail, taking the bus is still generally cheaper than riding the train:

Megabus and companies like it have upped the game for intercity bus travel. Not only do they provide competition to air and rail services, but they have also forced legacy services like Greyhound to match their speed and onboard amenities. In the end, it’s market innovation creating benefits for travelers in Missouri and across the country. 

The post Intercity Bus Service on the Rise in Missouri, Nationally appeared first on Show-Me Institute.

                However, government bodies are not the only institutions that pay little or no real property tax in the city. Nonprofit groups such as hospitals, schools, and religious institutions are exempt from property taxation by state law. In Saint Louis City, nonprofit groups own almost 15% of the city’s total property and account for more than 7% of the city’s total land valuation, as the map below shows:

The largest parcels owned by nonprofits are cemeteries. However, some of the most valuable nonprofit properties are in the center of the city, where Washington University, BJC Healthcare, and Saint Louis University have campuses. These hospitals and schools (or eds and meds) are some of the largest employers in Saint Louis and have combined property assessments of over $150 million (3.3% of the city’s total). Aside from well-known hospitals and schools, Saint Louis City is also dotted with thousands of nonprofit (and partially government) organizations that are exempt from property taxes. These include arts foundations, museums, clinics, business associations, and even Amtrak. Altogether, property-owning nonprofits, both large and small, remove a sizable and valuable portion of the city’s property tax base.

Look for my next post on this issue, which will explore the effects of tax breaks on Saint Louis City’s real property tax base. 

Note: The Show-Me Institute is also a nonprofit based in Saint Louis City. However, the Institute does not own real property, and therefore it does not receive real property tax exemptions. 

The post Saint Louis Property Taxes, Part 2: The Nonprofits appeared first on Show-Me Institute.

In a couple of weeks’ time, incoming college freshmen will get their first taste of independence. But with independence comes responsibility, and right about now parents are giving familiar advice on how to handle life without a safety net: Study for class. Eat healthy. Spend smart (read: don’t spend your rent money on pizza and beer). Most freshmen will find their footing, eventually. Some never really do, especially when it comes to budgeting properly.

But unrepentant spendthrifts should not feel so bad, because many of Missouri’s top policy makers never figured out how to spend smart, either.

A handful of state and Saint Louis officials want to spend close to $400 million of public money on a new football stadium in downtown Saint Louis in an effort to keep the Rams from moving to Los Angeles. Not only is Saint Louis’s existing NFL stadium, the Edward Jones Dome, a mere 20 years old, but virtually every economist who has studied the issue has found that NFL stadiums are a bad place to invest public dollars. They do not generate economic growth, spur urban revitalization, or greatly increase tax revenue.

Unfortunately for Missouri residents, the way Saint Louis funds its football stadiums makes this much more than a local or regional issue. Statewide residents already covered half the cost of Saint Louis’s Edward Jones Dome. In fact, the state is still paying $12 million annually on that stadium’s debt. One could be forgiven for thinking that Missouri taxpayers deserve a break from funding entertainment venues in Saint Louis City, especially when tangible economic benefits are so unlikely. But that’s not the case. Quite to the contrary, state taxpayers will be expected to cover more of the stadium costs than they did last time, with total state support topping $300 million—about three quarters of the total subsidy. That money will come straight from Missouri’s general revenue.

However, even as Missouri and the City of Saint Louis prepare to spend lavishly, yet again, on pro sports, every level of government claims it is broke. We are told how courthouses are crumbling. How highways are deteriorating. How the schools are underfunded. How the state parks have a $400 million maintenance backlog. How Missouri’s Amtrak routes need $32 million in upgrades to continue running. Even Saint Louis City officials claim that core departments like fire protection and police are short of cash.

When it comes to basic government services, there’s never any money in the budget. Residents instead have to vote on tax increases, or else. But when Saint Louis’s NFL status is threatened, hundreds of millions of dollars are suddenly available. As for a vote, that’s restricted to those who will vote “yes.” At the state level, it’s likely that the decision of the governor alone will be sufficient to authorize spending more than $300 million, and he is spearheading the stadium effort.

Right now, Missouri’s leaders sound a lot like college students calling their parents because they can’t afford groceries. And they’re making that call from a noisy bar in Cancun. It’s true—some people never learn to spend responsibly, whether they are freshmen or officials. Then again, most of the time, that’s because no one ever makes them.

The post Missouri Needs to Learn to Prioritize Spending appeared first on Show-Me Institute.

Amtrak currently serves three routes in Missouri: the River Runner, the Southwest Chief, and the Texas Eagle. The Missouri River Runner runs entirely within in the state of Missouri (and is primarily subsidized by the state), while the Southwest Chief and the Texas Eagle are long-haul routes that make only a couple of stops each in Missouri. Amtrak has in the past garnered a fairly negative reputation. In most parts of the country, Amtrak has few riders, low levels of service, and large subsidy requirements. However, in the last decade inter-city passenger rail has seen large ridership growth in Missouri and elsewhere, although recently that growth has slowed:

Much of the increase is due to capital investments that have improved Amtrak’s previously notorious on-time performance. Unfortunately, while passenger levels have increased, all the routes that serve Missouri still operate deeply in the red. In 2014, the River Runner was able to generate more than $5 million in revenue. However, in the same year state subsidies to the service topped $8 million. That’s a $42 state subsidy per rider, more than the cost of a standard ticket.

The long-haul routes perform even worse, with the Southwest Chief requiring federal subsidies of $177 per passenger. The implementation of PTC on Amtrak routes will greatly add to this red ink. In fact, Kansas City Terminal (KTC) has estimated that improvements will cost $32 million in the Kansas City area alone. Statewide, the costs could be tens of millions more.

As of today, there is no agreement on who will pay for PTC improvements. The obvious candidate is the federal government, but Congress has been reticent to increase funding for Amtrak. Some policymakers want to push the costs of PTC onto the profitable freight rail industry, for the reason that they own the tracks. But freight rail companies are balking, because as they rightfully point out, they only need these immediate upgrades because Amtrak operates on their rails.

Missouri taxpayers will likely have to pick up some of the costs of upgrades, especially for the state-funded River Runner, or risk losing service. Perhaps it’s time for Missouri residents to give Amtrak subsidies another thought. With profitable inter-city bus and airline service, passenger rail is a redundancy. That’s all well and good if passengers are willing to pay for it, but they are clearly not, at least as it’s currently run. If the choice comes down to large state payments for PTC implementation and cutting Amtrak loose, residents should choose carefully.  

The post Positive Train Control Creates Doubts for Amtrak in Missouri appeared first on Show-Me Institute.

While a detailed plan has yet to surface, it is certain that any passenger rail extension from Jefferson City to Camden County would be incredibly expensive. How expensive? The distance from Jefferson City to Camden County is more than 50 miles, and new rail construction can cost up to $25 million per mile, more if they need to acquire right-of-way or build new bridges. Even simple rehabilitation of existing track can be very expensive, as the Missouri Department of Transportation’s (MoDOT) recent $48 million expenditure to improve 10 miles of track demonstrates.

What would be the demand for this line? The Missouri River runner, which connects major Missouri population centers along the Missouri River, has had difficulty gaining passengers and runs a significant operating deficit ($8 million to $9 million per year). If a link between Saint Louis, Jefferson City, and Kansas City has insufficient demand to cover costs, what are the chances for a rail line that simply connects Jefferson City to Camden County?

To get a sense of the ridiculousness of the project, consider how one might go about using this rail line. If one were planning to go from Saint Louis to the Lake of the Ozarks via this route, there would be two options. First would be to drive to Jefferson City, get out of the car, and take the rail the last 50 miles. The second option would be to go to the St. Louis Civic Center, catch one of the two daily River Runner trains to Jefferson City, and then transfer to the rail line. With both options, given the spread out nature of the Lake of the Ozarks, it is likely that anyone taking the train would have to rent a car upon arrival. It is immediately obvious that no one would consider this a reasonable transportation solution; the only market would be rail enthusiasts.

This rail project demonstrates the folly of using a sales tax to pay for transportation in Missouri. When users of highways are the ones paying for highways, the amount available to spend on new construction and maintenance is controlled by underlying demand for those assets. When everyone pays a sales tax for anything that can be called transportation, the money gets spent on politically popular projects, regardless of feasibility or demand. So it goes that if the sales tax passes, shoppers in Saint Louis will fund an empty train to Camden County.

The post Lake Of The Ozarks To Waste Sales Tax Monies On Passenger Rail appeared first on Show-Me Institute.

Eating inside a cargo container sounds even less appealing than Choo-choo Chewies. (Unless it means I get to hang out with the Boxcar Children.)

As difficult as it may be to believe, there is a new project in Saint Louis that could make dining in cargo trendy and charming. Washington University in St. Louis and the City of Saint Louis named Bistro Box, “a small business incubator that transforms surplus cargo containers into a compact restaurant and culinary destination,” as one of the finalists in Washington University’s Sustainable Land Lab competition.

The Sustainable Land Lab competition invites teams to design innovative projects that transform vacant lots into assets. The City of Saint Louis owns more than 8,000 vacant lots that are just sitting there, deteriorating and underutilized. Show-Me Institute policy analysts have offered suggestions in the past about how the city can work to get more of those lots back into productive use. The Sustainable Land Lab competition is a great method to put these vacant parcels in the spotlight, and proves that innovators and entrepreneurs have exciting ideas to utilize this vacant land.

This is the first year of the competition. I hope that it will be successful in transforming vacant land and will shift the way Saint Louis treats that land. The best outcome of this project is that it would not only help improve blighted areas of the city, but encourage others to take on similar projects. Revitalization lies in the hands of eager residents who care about the community. In the past, the Saint Louis Land Reutilization Authority (LRA) has not been willing to allow development to occur organically, preferring to hold land for development that the agency chooses. But the government cannot predict what will be the best use of the land (remember Pruitt-Igoe?), nor will it come up with the most creative solutions.

Anything — including eating train-track chicken in an abandoned cargo container — is preferable to the city holding the land for decades.

The post Transforming Vacant Land appeared first on Show-Me Institute.

If you think it is ludicrous that the construction of a single rail line across central Missouri could account for 7 percent of the state’s entire labor force, well, you are correct. But absurd estimates like this are typical for high-speed rail proposals. In 2008, California voters approved bonds to support a high-speed rail proposal that was estimated to cost $43 billion. Now, before any construction has started, the cost is estimated at $98 billion. Seriously, though, what is $55 billion when you are talking about the ability to ride a fast train?

But back to MoDOT. In their defense (although this hardly qualifies as a “defense”), MoDOT officials did not put much original thought into the 208,000 jobs projection. They just applied a federal transportation department formula to the estimated $8 billion cost of the project and came out with that figure. Never mind that the formula counts the same job multiple times, assumes that every job in transportation “induces” two jobs elsewhere, and has been thoroughly discredited. What matters is that the number sounds great.

There are other outlandish claims in the same document. On page 10, we learn that Missourians will use high-speed rail to commute to work. Even though the new system will just go 110 mph at its peak (not dramatically faster than the current system); will only stop in Saint Louis, Kansas City, and perhaps Jefferson City; and a trip across the state will still take four hours at best, Missourians will apparently use it to commute to work each day.

On page 21, we get a detailed account of the supposed environmental benefits of high-speed rail, but absolutely no consideration to the environmental harms of an unnecessary $8 billion construction project. This is an example of government seeing all benefits, and no costs.

The proposed high-speed rail line will connect Chicago, Saint Louis, and Kansas City, and likely the two state capitals in between. Other than people who are terrified to fly, please find me someone in Kansas City who is going to take high-speed rail to Chicago — which will still take about 8 hours — when they can fly there on Southwest Airlines for approximately the same price in 1 hour and 20 minutes?

Megabus and similar companies are perfectly capable of serving existing inter-city travel needs without public tax dollars. Megabus will take you from Saint Louis to Kansas City in 4 1/2 hours, for $34 (often less via promotions). That $34 is less than Amtrak is likely to charge for high-speed rail service, and exists now without spending $8 billion on construction and millions more each year on subsidies. If your mission is to ensure people have safe and affordable travel options, mission accomplished. If your true mission is to spend government money in pursuit of political aims, I guess it isn’t.

High-speed rail is a high-cost luxury built to serve a demand that does not exist. Like many other large transit projects, the price for it is so high that advocates can only generate support by intentionally underestimating the cost and downplaying the future subsidies. California officials deserve credit for their more honest cost revision of $98 billion, but they are still claiming that high-speed rail will not require a subsidy once it is operating. The large majority of high-speed rail systems around the world require a subsidy, and California will not be any different. The few systems that do break even connect some of the most heavily populated parts of the world. Considering that California is intentionally starting its system by connecting Fresno and Bakersfield — some of the less-populated parts of the state — the assertion that it will break even is dizzying.

Missouri would be much better off sticking with its original plan to spend far less money making smart, engineering-based upgrades to our current passenger rail system. The market demand for high-speed rail is a myth. The private sector is perfectly capable of providing affordable and safe inter-city travel via buses. The amount of jobs high-speed rail creates is false and misleading. Saint Louis and Kansas City are not Tokyo or New York, and the $8 billion project would require enormous annual operating subsidies in the future. This proposal is a high-speed path to fiscal disaster.

David Stokes is a policy analyst at the Show-Me Institute, which promotes market solutions for Missouri Public Policy.

The post High-Speed Rail in Missouri Is Snapshot of Government Delusions appeared first on Show-Me Institute.

But the core of it is getting major cities within two or three hours of each other. So, St. Louis to Chicago within three hours — with completely new infrastructure the entire way, it’s possible you get it down under two.

But you know what? The entire project currently underway in Illinois is based on implementing a 4-hour trip each way (at best). We are spending billions to knock a little more than an hour off of the current Amtrak route, and supporters of it are intentionally downplaying that.

Later in the interview, Harnish gives a great little aside downplaying safety of cars and claiming, by insinuation, that trains are safer.

. . . if you believe that our strength and unique identity is tied to the ability to risk your life everyday in a car . . .

OK, so we risk our lives everyday in a car. Would we not risk them in a train? Now, I am not saying passenger trains are unsafe — they are indeed safe. But if you compare them to cars, there are more fatalities on passenger rail than in motor vehicles per passenger mile. According to the latest data, passenger cars have 0.9 fatalities and 83 injuries per 100 million passenger miles. Passenger rail has 2.9 fatalities and 1,226 injuries per 100 million passenger miles. So they are both safe, but let’s not pretend passenger rail is safer.

High-speed rail is to transportation policy what ethanol is to agriculture policy. They are both high-cost jokes designed to please limited constituent groups (corn farmers, unions, Keynesian economists) which would not exist if markets made these choices instead of politicians. (High-speed rail on the eastern seaboard may pass the market test, and thanks to John Combest for the link.)

The post High-Speed Rail Supporters Are Just Making Things Up appeared first on Show-Me Institute.

Last weekend, I traveled to Chicago to see some college friends and visit Wrigley for the first time. I thought about driving, but that would have set me back about $100 in gas. I thought about flying, but airfare to Chicago was running above $250. I thought about Amtrak, but that would have set me back about $60 roundtrip.

Instead, I took Megabus to and from Chicago for a total of $21 roundtrip. That cost you, the taxpayer, next to nothing because private commercial buses receive an average federal subsidy of $0.10 per passenger per trip. Amtrak, on the other hand, receives an average federal subsidy of $57.04 per passenger per trip.

I personally don’t think subsidies are necessary and would willingly pay an extra 10 cents for my bus fare if federal subsidies were discontinued. Compared to Amtrak subsidies, however, the cost to taxpayers is negligible.

Through federal subsidies, intercity buses are partly exempt from the federal diesel fuel tax, paying 7.4 cents per gallon instead of 24.3 cents. Assuming that the bus got 4 miles to the gallon on the 300 mile trip to Chicago, Megabus would have paid $18.23 in tax to the federal government, but because of the subsidy, the company only paid $5.55. The company still paid the full state tax on fuel.

Commercial buses are a great example of the private sector stepping in to satisfy a demand that benefits consumers with a negligible burden on taxpayers.

I had an excellent trip because of Megabus. But next time I go to Wrigley, I better not see that silly white flag.

The post Visiting the Friendly Confines of Wrigley Field appeared first on Show-Me Institute.

Maybe you believe that high-speed rail will make money for Amtrak — in which case, I have a bridge over the Missouri River to sell you. Randal O’Toole has written extensively on this issue, particularly in a study about the implications of high-speed rail for Missouri published by the Show-Me Institute. The Missouri Department of Transportation (MoDOT) had an earlier plan to pursue a much smaller amount of money, which would allow it to implement engineering-based improvements to the current Amtrak route. That was much better policy. It involved a (comparatively) reasonable amount of money to make direct improvements to an existing system. The new proposal to go full-bore for high-speed rail across Missouri is a decision that I believe the state will quickly and seriously regret.

Unless, of course, we don’t get the funding at all, which would be terrific.

The post Off the Track appeared first on Show-Me Institute.

To the honorable members of this committee:

Thank you for the opportunity to address you briefly today. Last week, the Show-Me Institute released a study by Randal O’Toole, a senior fellow with the Cato Institute, titled, “Why Missouri Taxpayers Should Not Build High-Speed Rail.” I have provided copies of the study, along with the accompanying briefing paper and op-ed, to all of you. O’Toole’s study provides thorough documentation about why it would be a tremendous fiscal policy mistake to invest our taxpayer dollars in high-speed rail.

First, however, I want to clarify the focus of his paper. O’Toole’s study discusses the 8,500-mile high-speed rail plan proposed for the United States by the Federal Railroad Administration. This plan includes a corridor from Chicago to Saint Louis to Kansas City. I emphasize, though, that O’Toole’s study does not address the ongoing improvements to the current Saint Louis–to–Kansas City Amtrak route that were recommended in the 2007 report “Missouri Freight and Passenger Rail Capacity Analysis,” prepared by the Missouri Transportation Institute and the Missouri Department of Transportation — even though MoDOT plans to undertake several of the improvements recommended in that report by applying for federal stimulus funding designated for “high-speed rail.” I believe that the improvements recommended in that report — especially the three primary proposals that were planned even before the stimulus package was approved — would be much more cost-effective in improving Missouri’s rail service, without committing the state to the types of enormous long-term costs and subsidies that a new high-speed rail system would entail.

In 2004, the Midwest Regional Rail Initiative, a pro-rail group, estimated that it would cost slightly less than $1 billion to upgrade the tracks from Saint Louis to Kansas City and purchase the new equipment to allow for moderate-speed trains with a top speed of 110 mph, compared to the current top speed of 79 mph. Those projected costs have certainly increased since then, even though they consider the capital cost alone. The figure leaves out cost overruns, operating expenses, repair and maintenance, and more. The burden for those additional costs would fall on the state of Missouri and its taxpayers — not the federal government.

Ultimately, all this money would be spent for trains that would travel only marginally faster than the current trains. For Missouri to build true high-speed rail — the type that American tourists ride in Europe at 150 mph — would cost Missouri taxpayers billions more, all to serve the small percentage of the population that uses passenger rail. At the proposed top speed of 110 mph, a trip from Kansas City to Chicago that travels through Saint Louis would be, at best, about an eight-hour trip. A traveler could take a flight from Kansas City to Chicago lasting one hour and 20 minutes for roughly the same price. Does anyone really think that many travelers will choose high-speed rail for this trip?

Using 2025 ridership projections from the pro-rail Center For Clean Air Policy and population projections from the Census Bureau, Randal O’Toole has calculated that even if the proposed FRA high-speed rail plan were fully constructed, the average Missourian would take a round trip on it only once every six years. How can it be wise for Missouri to invest billions of dollars to construct something that will serve the average resident only twice per decade?

O’Toole’s study documents the extremely large costs and very questionable benefits that a significant investment in high-speed rail would bring Missouri. I encourage you all to consider its conclusions carefully as you move forward with discussions of these long-term proposals. Thank you for your time, and I am happy to answer as many questions about Randal O’Toole’s study as I am able.

Related Links

The post Testimony Before the Joint Committee on Transportation Oversight appeared first on Show-Me Institute.

At an inflation-adjusted cost of about $450 billion paid out of highway user fees, the Interstate Highway System, to which high-speed rail is sometimes compared, provides more than 4,000 miles of passenger travel for every American, miles that Americans were not traveling before the system was built. By comparison, a $600 billion expenditure on high-speed rail will provide, at best, around 300 miles of travel per person.
[…]
Amtrak brags that its high-speed Acela between Boston and Washington covers its operating costs, though not its capital costs. It does so, however, only by collecting fares of about 75 cents per passenger mile. By comparison, airline fares average only 13 cents a passenger mile, and intercity buses (which, Amtrak doesn’t want you to know, carry about three times as many passengers between Boston and Washington as the Acela) are even less expensive.

According to the Bureau of Economic Analysis, Americans spent about $950 billion on driving in 2008. This allowed us to travel, says the Federal Highway Administration, more than 2.7 trillion vehicle miles, for an average cost of about 35 cents per vehicle mile. Since the California High-Speed Rail Authority estimates cars in intercity travel carry an average of 2.4 people, the average cost is less than 15 cents a passenger mile.

O’Toole also points out that urban elites are the ones most likely to benefit from high-speed rail travel, because they are more likely to live in the downtown areas where train stations are typically located. The construction of high-speed rail has little to do with the costs and benefits of different modes of travel, and almost everything to do with aesthetic preferences. Unfortunately, aesthetics usually trump economics in the political world.

Back in February, I explained why Saint Louis should not expand the MetroLink light-rail system.

(Blog entry title reference here.)

The post You’ve Been on a Fast Train, and It’s Going Off the Rail appeared first on Show-Me Institute.

1. Missouri’s portion of the rail stimulus is a (comparatively) small amount of tax dollars that DOES NOT commit Missouri to building some new high-speed rail system.
2. The dollars will likely be used in a manner that will bring demonstrable and measurable improvements to our current rail system. Or maybe they won’t, but at least we’ll know if that’s the case and have the ability to test and measure results before we commit to spending more money. So far, the first of these projects (undertaken without stimulus money) has had measurable success in reducing delays and allowing for increased traffic. (I believe strongly that eliminating delays is more important than speeding up the trip.)
3. If the state spends a reasonable amount of money making demonstrable improvements to our current system, that will increase voluntary ridership (it already has) — which will (presumably and hopefully) decrease the required subsidy amount.

It is theoretically sound, but practically unrealistic, to expect that MoDOT would not have applied for stimulus funds and that the state would not have have received any for high-speed rail. MoDOT deserves credit for applying for shovel-ready projects that will improve our current Amtrak service rather than reaching for the fantasy world of bullet trains to Ballwin.

The projects that MoDOT will undertake with this money, and the project they already completed without stimulus funds, are based on engineering — not on delusions of taking the Orient Express at 250 mph. A study completed in 2007 by Mizzou engineers listed the most cost effective ways for MoDOT to improve existing rail service. The study recommended projects, such as the recently completed California (Mo.) rail-siding extension (scroll about two-thirds down the page) that would immediately improve rail service. Those are the projects for which MoDOT received funding, not pie-in-the-sky projects requiring newer, larger, and interminable subsidies.

The nationwide high-speed rail plan as a whole, announced last week, is a sad joke, as aptly described by Chrissy in her recent post. However, Missouri’s part in it is a relative bright spot, and MoDOT deserves commendation for keeping its plans focused — almost as much commendation as that candidate in Illinois who made the Simpsons monorail reference before I did:

“All this money to get from Chicago to St. Louis 45 minutes faster? This isn’t informed public policy, it’s a ‘Simpsons’ episode,” gubernatorial candidate Dan Proft said in a statement.

The post Missouri Can Be Proud of Its High-Speed Rail Allocation appeared first on Show-Me Institute.

California and Florida will receive $2.3 billion and $1.25 billion, respectively, which are the largest single awards. Obama’s home state of Illinois will receive $1.1 billion of this money, which is the third-highest amount. Missouri will receive much less money under this program: “only” $31 million, which equals 0.39% of the allocated funds.

In a recent study for the Show-Me Institute, “Why Missouri Taxpayers Should Not Build High-Speed Rail,” Randal O’Toole demonstrated that the president’s high-speed rail plan would result in high costs and few benefits:

If Missouri decides to build moderate- or high-speed rail, it may be responsible for cost overruns, operating losses, and the costs of replacing and rehabilitating equipment about every 30 years.

O’Toole has written several pieces for the Show-Me Institute about high-speed rail. He has a vision for transportation in Missouri that is more fiscally responsible than President Obama’s:

A better plan would be to use the state’s share of the $8 billion stimulus funds solely for incremental upgrades, such as safer grade crossings, longer track sidings, and signaling systems, that do not obligate state taxpayers to pay future operations and maintenance costs.

Alarmingly, the Obama administration emphasizes that this money is merely a down payment. This means that states, which are already cash-strapped, are left to pick up the rest of cost of these high-speed rail projects. For example, although the the Amtrak route from Chicago to St. Louis stretches 284 miles, the federal grant will cover only the 182-mile segment between Alton and Dwight, which constitutes only 64 percent. Illinois will have to find a way to pay for the rest of the project.

Although I understand that this money will pay for improvements to the existing rail in Missouri, I am concerned that this project will costly and will have low marginal benefits. Taxpayers are paying $31 million to increase the speed of the train that runs between Kansas City and Saint Louis by a mere five miles per hour. However, I will defer the analysis of the Missouri project and how it relates to O’Toole’s study to David Stokes, because he knows much, much more about transportation policy than I do. I look forward to reading his thoughts on this subject.

The post Feds Allocate $8 Million to High-Speed Rail; Missouri Gets a 0.39% Cut appeared first on Show-Me Institute.

Needless to day, this improvement is a far better use of tax money than some dream of high-speed rail that will get someone from Kansas City to Chicago in 7 hours at best, when they can fly there for the same price in 1 hour and 20 minutes.

The post This Is Spending On Rail That I Can Support appeared first on Show-Me Institute.

The Northeast corridor has the highest passenger volume of any Amtrak route, greatly enhancing efficiency. The corridor’s high-speed Acela Express made a profit of about $41 per passenger. The more heavily utilized Northeast Regional lost almost $5 per passenger.

With this excerpt from Randal’s paper:

If trains in the most heavily populated corridor in the United States cannot cover their costs, no other trains will come close.

According to the bipartisan Amtrak Reform Council, Amtrak’s trains between Boston and Washington lost nearly $2.30 per passenger in 2001.

They are almost certainly considering different years, so the fact that the estimates are so close is good evidence for the accuracy of O’Toole’s work (not that more evidence was needed). The study claims (and I’ll accept the claim as true) that the northeast high-speed rail system makes money. Before anyone jumps to the conclusion offered in the article:

Rail planners may decide that spending the funds on high-speed rail makes more sense than slower intercity rail, which the Amtrak numbers show need higher subsidies.

You must read the history of high-speed rail in Japan, which O’Toole thoroughly documents in his paper on high-speed rail for the Show-Me Institute. In Japan, the first high-speed rail system was successful because it connected three cities in one of the most densely populated parts of the world. However, for reasons of politics and more, Japan started building high-speed rail all over the place. None of the other routes were anywhere near as successful as the Tokyo–Osaka–Nagoya route, and the national railroad eventually went into serious financial difficulties. The moral of the story is that just because high-speed rail might work in by far the most densely populated part of the United States does not mean it will work elsewhere.

Hat tip to the Beacon for the original link.

The post Amtrak And Tax Dollars appeared first on Show-Me Institute.

The difference is Pew includes all the costs of running a railroad, like depreciation — that’s wear-and-tear on tracks and trains — and overhead, like the legal and HR departments. Taxpayers pick up those costs too. Amtrak got $1.3 billion in funding last year.

The program even quoted Randall O’Toole, a Cato Institute senior fellow and self-described “Antiplanner”:

Best thing we can do for mass transportation would be to privatize it, let the private operators respond to the market, and then we’ll have a more efficient system that might be attractive to more people.

O’Toole has written several policy studies for the Show-Me Institute on the subject of high speed rail and its free-market alternatives. His most recent, “Why Missouri Taxpayers Should Not Build High-Speed Rail,” was published late last month.

High-speed rail is relevant to Missouri, particularly as officials consider upgrading the tracks from Saint Louis to Kansas City to accommodate high-speed trains. As David Stokes testified before the Joint Committee on Transportation Oversight earlier this month:

For Missouri to build true high-speed rail — the type that American tourists ride in Europe at 150 mph — would cost Missouri taxpayers billions more, all to serve the small percentage of the population that uses passenger rail.

The post The High Cost of High-Speed Rail appeared first on Show-Me Institute.

For the real recent irony here in Missouri, I give you this story in the Kansas City Star. A guy about to be sentenced to prison for embezzling money to pay for a lottery addiction … wait for it … wins the lottery! And just in time for the court to take his winnings to pay most of the restitution. He could pay all of it back if the government didn’t take its bite, which is funny because just a few months ago a friend and I decided that the absolute worst piece anyone at a think tank like ours could ever write would be one arguing that lottery winners should be exempt from income taxation.

Some of you may recall the most tragic example of irony in Missouri (that I can think of) back in 2002, when an international pedestrian safety expert who came to St. Louis for a conference on that issue died when she was run over by a bus. That was horrible irony, which is generally the worst type, as opposed to the “you lucky son-of-a-bitch” irony of the guy who won the lottery.

I recall an attempt last year to find irony on an issue by Show-Me Progress (which is not affiliated with us at all — much to the relief of both parties, I’m sure), but I think they were stretching in their use of the term. Not a lot, but a little.

Have  a nice weekend. And I REALLY hope I don’t turn that last phrase into something ironic by going and dying this weekend and pulling a Pistol Pete Maravich on all of you. (Scroll down to the end of the story if you don’t already know the sort-of-ironic part.) (If Pistol Pete had died upon uttering those words after doing anything other than playing basketball, it would have been just a sad coincidence.) (So, I guess, to be truly ironic, I’d have to die of something related to blogging, like death from carpal tunnel syndrome — which is thankfully unlikely.)

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