Trains to Nowhere: A Government Spending Problem

From New York to California, the government manages to mess up transportation.

When Democrats and Republicans agree, I get nervous. It often means that they agree to grab my wallet.

Both parties now agree that we don't have extra budget money lying around, but both say government does need to spend more on "infrastructure."

Even conservatives want more spent on roads and mass transit.

The reason, advocates claim, is that infrastructure, unlike most government spending, has a "multiplier effect"—it creates new wealth by doing things like speeding up travel.

Well, it might.

Advocates also point out something that seems obvious to them: Infrastructure is a job that must be done by government. Who else would launch big projects like the New York City subway system? Subways are what Big Government supporters call a "public good."

They are important to many people, but there's no way that business would build subways or run them, they argue. Subways lose billions of dollars. Entrepreneurs would never invest in subway cars or dig subway tunnels—there's no profit in that.

But often what we "obviously know" … is not so.

Most of New York's subways were actually built by private companies. Few New Yorkers even know that. Private companies dug the first tunnels and ran the trains for about 40 years. But when they wanted to raise the fare to a dime, the politicians said they had to "protect" the public. Government took over the system, saying only "public ownership" could guarantee affordable fares.

But government doesn't do anything well. Under government management, profit disappeared and the fare rose well beyond the inflation-adjusted equivalent of what the private companies had wanted to charge.

Now, politicians want you to buy them new trains. Who wouldn't like a shiny new train? The Obama administration gave your money to California politicians who want to build a 200-m.p.h. train to take people from Los Angeles to San Francisco. Somehow, in the tradition of political boondoggles everywhere, the train that politicians actually approved doesn't yet come close to either city. It starts, and ends, "in the boondocks," says Reason magazine's Adrian Moore.

"I live in a little mountain town called Tehachapi," he says. "It's in the middle of nowhere, 50 miles to the nearest Walmart … the high-speed rail line in California comes right through my town. This thing is like the boondoggle of boondoggles."

When I confronted train advocate Dennis Lytton about that, he said, "They're starting high-speed rail in the middle of the state because that's where you can build it fast."

He also said, "Private investors will be part of the mix." But when I asked if any have invested so far, he said, "Not at this time."

People who spend their own money know better.

Lytton also claimed that California's Amtrak trains are "packed." So we investigated that claim. It turns out to be far from the truth. On average, California's Amtrak trains are one third full.

Government planning leads to transit systems that lose money on every passenger, airports where there are few passengers or planes and bridges to nowhere.

America does need mass transit. Three hundred million people need to go places. Roads are congested. Who will provide it when government drives transit entrepreneurs out of the business?

Well, instead of building giant rail projects in the boondocks, how about letting people ride buses?

Buses, privately owned buses, are now the fastest growing mass transit in America. Buses are much cheaper than trains. Amtrak charges about $150 to ride from New York to D.C. Buses charge less than $20. And buses don't require new land seizure through eminent domain. Buses aren't locked into straight-line routes. They go where people go. And when people move, buses, unlike trains, change routes.

Let services be paid for by the people who use them and built by people who put potential profits on the line. Otherwise, politicians will take us for a ride.