Comments on: Overstating the Benefits of Passenger Rail http://www.buckeyeinstitute.org/blog/2009/09/15/overstating-the-benefits-of-passenger-rail/ Up To The Minute Analysis Of Ohio Public Policy Fri, 30 Oct 2009 15:34:40 -0400 http://wordpress.org/?v=2.8.1 hourly 1 By: Marc Kilmer http://www.buckeyeinstitute.org/blog/2009/09/15/overstating-the-benefits-of-passenger-rail/comment-page-1/#comment-4999 Marc Kilmer Tue, 15 Sep 2009 21:22:37 +0000 http://www.buckeyeinstitute.org/blog/?p=4469#comment-4999 As you say, the presence of federal incentives for passenger rail (or the related high-speed rail) complicates the picture. However, I still feel that these rail projects will be such a boondoggle that Ohio would be better off just refusing to participate. Even with the federal subsidies, rail will still require state subsidies. It's likely these subsidies will be larger than state policymakers are currently projecting. Accepting the federal money will obligate the state to spend a lot of money down the road. Since the benefits of passenger rail are fairly minimal, even if the feds subsidize most of the cost, I don't see it being a good trade-off for the state. As you say, the presence of federal incentives for passenger rail (or the related high-speed rail) complicates the picture. However, I still feel that these rail projects will be such a boondoggle that Ohio would be better off just refusing to participate. Even with the federal subsidies, rail will still require state subsidies. It’s likely these subsidies will be larger than state policymakers are currently projecting. Accepting the federal money will obligate the state to spend a lot of money down the road. Since the benefits of passenger rail are fairly minimal, even if the feds subsidize most of the cost, I don’t see it being a good trade-off for the state.

]]> By: token liberal http://www.buckeyeinstitute.org/blog/2009/09/15/overstating-the-benefits-of-passenger-rail/comment-page-1/#comment-4998 token liberal Tue, 15 Sep 2009 20:38:23 +0000 http://www.buckeyeinstitute.org/blog/?p=4469#comment-4998 Marc: As you know from some of my prior comments, I share your skepticism regarding the value of spending billions for trains. However, I have been wondering lately what the proper question is for state officials at this point. The feds have already ponied up $8 billion, and I suspect there will be more to come over the next few years. So if I were an Ohio official, it’s too late for me to worry about the general concept. In effect, that train has left the station :) . The question for Ohio is, if the feds are going to spend billions on this, what is the effect on Ohio if we sit it out? If a bunch of nearby states participate, and a new rail network is built that largely excludes Ohio, have we hurt Ohio more than if we saved our money now? The analogous situation is states that compete with other states by luring businesses with tax incentives. Sure, all the states would be better off if none of them did it, but once it starts, they all pretty much have to participate. I’m not entirely sure of the answer, but it seems like a harder question. Marc:

As you know from some of my prior comments, I share your skepticism regarding the value of spending billions for trains. However, I have been wondering lately what the proper question is for state officials at this point.

The feds have already ponied up $8 billion, and I suspect there will be more to come over the next few years. So if I were an Ohio official, it’s too late for me to worry about the general concept. In effect, that train has left the station :) .

The question for Ohio is, if the feds are going to spend billions on this, what is the effect on Ohio if we sit it out? If a bunch of nearby states participate, and a new rail network is built that largely excludes Ohio, have we hurt Ohio more than if we saved our money now?

The analogous situation is states that compete with other states by luring businesses with tax incentives. Sure, all the states would be better off if none of them did it, but once it starts, they all pretty much have to participate.

I’m not entirely sure of the answer, but it seems like a harder question.

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