Politics and the US Economy

[RightField]

1) Too bad you can't show any evidence (other than your partisan opinion rants) that Clinton-era taxes hurt the economy. And of course Republicans controlled the House and Senate during Clinton's second term and they didn't lift a finger to change the tax rate, did they?

2) Stop bitching about Clinton cutting intel spending. Bush and the Repubs had plenty of time to bump it back up prior to 911 but they chose to ignore it. Not only that but they could have come up with a budget during the Clinton years with their preferred level of intel spending. They did control the purse you know.

3) All you're saying is that Republicans slapped hundreds of billions of dollars onto the debt each year. That's not financial discipline. That's called ignoring the debt and growing it. So again, all this "Republican discipline" was nothing more than growing the debt.

The growth during the Clinton years was relatively flat in the period when he increased taxes (1993). The rate of increase was 3.2% and he had the wnd at his back with huge improvements in productivity from computers and internet growth. However, after Newt made him reduce taxes as part of a growth strategy (1996/7) growth in the GDP went up to 4.2%.

When is Obama going to implement growth programs to start the economic recovery? According to average, we should have been at 4% or greater growth within a couple months of his coronation, but his programs have led to retarded growth. Reagan had close to 7% growth within a few months of his "Carter" recession....when are we going to get the big Obama growth, you know the one that comes from hiring a few hundred thousand government employees?

Bush kept a tight grip on discretionary spending and brought the defict down to $172M....Obama's deficits each of the last 3 years has been almost 10 times as high. This year, the Budget office just announced, it is expected to top $1,500M...again, almost 10 times the rate of the last year that the Republicans controlled both the Presidency and the Congress. You remember, back when the unemployment rate was 4.6% and the Dems were complaining about how bad that was.

Again, your points are childish and not worth addressing. I'm going to go read a little and then enjoy my evening with my kids.

Oh, and if you don't like my posts, don't read them. Easy solution. Are you worried that someone might read them and change from a dependent statist to a free-market supporter?

 

[RightField]

Obama needs more "investment" in all sorts of things. After all, we need government to "lead the way" along the lines of the Sputnik response. This vid link below shows a department that got started with "Stimulus" money and now they're looking for additional "investment" because of it's great success so far. Check out it out:

http://www.youtube.com/watch?v=9ZlBUglE6Hc&feature=relmfu

I provided a reference and you didn't even bother to click on it and see what's there. Silly boy. I wouldn't be surprised if this is where you work.

 

[mercury14]

The growth during the Clinton years was relatively flat in the period when he increased taxes (1993). The rate of increase was 3.2% and he had the wnd at his back with huge improvements in productivity from computers and internet growth. However, after Newt made him reduce taxes as part of a growth strategy (1996/7) growth in the GDP when to 4.2%.

When is Obama going to implement growth programs to start the economic recovery? According to average, we should have been at 4% or greater growth within a couple months of his coronation, but his programs have led to retarded growth. Reagan had close to 7% growth within a few months of his "Carter" recession....when are we going to get the big Obama growth, you know the one that comes from hiring a few hundred thousand government employees?

Bush kept a tight grip on discretionary spending and brought the defict down to $172M....Obama's deficits each of the last 3 years has been almost 10 times as high. This year, the Budget office just announced, it is expected to top $1,500M...again, almost 10 times the rate of the last year that the Republicans controlled both the Presidency and the Congress. You remember, back when the unemployment rate was 4.6% and the Dems were complaining about how bad that was.

Again, your points are childish and not worth addressing. I'm going to go read a little and then enjoy my evening with my kids.

Listen, whether the economy waxes or wanes during a given time is far more depenent on other factors than tax rates. Stop insisting that it is.

During Bush's last six months the economy collapsed despite the Bush tax cuts being in place and despite stimulus checks along the way effectively reducing taxes even further. Using your rationale the Bush tax cuts were an abysmal failure because they led us into the Great Recession. Likewise, there was zero job growth during the Bush years despite the Bush tax cuts being in place and despite stimulus checks.

The thing about you is that you consciously decide to put your blinders on depending on what right wing opinion piece you just read. Your tunnel vision is extraordinary. Just like your opinion pieces only discuss a few factors, that's all you insist on considering. You utterly refuse to think outside the confines of what op-ed writers are referring to at the momen.

Do you see now why you're not a thinker? You're a parrot. A spammer. You think what Krauthammer/etc tell you what to think and do not dare go beyond that.

 

[RightField]

Listen, whether the economy waxes or wanes during a given time is far more depenent on other factors than tax rates. Stop insisting that it is.

During Bush's last six months the economy collapsed despite the Bush tax cuts being in place and despite stimulus checks along the way effectively reducing taxes even further. Using your rationale the Bush tax cuts were an abysmal failure because they led us into the Great Recession. Likewise, there was zero job growth during the Bush years despite the Bush tax cuts being in place and despite stimulus checks.

The thing about you is that you consciously decide to put your blinders on depending on what right wing opinion piece you just read. Your tunnel vision is extraordinary. Just like your opinion pieces only discuss a few factors, that's all you insist on considering. You utterly refuse to think outside the confines of what op-ed writers are referring to at the momen.

Do you see now why you're not a thinker? You're a parrot. A spammer. You think what Krauthammer/etc tell you what to think and do not dare go beyond that.

The economy collapsed from the Dems insistance that it was "unfair" that banks put restrictive rules in place like making a determination whether a loan applicant could actually pay back the loan they were asking for. The dems put incentives and laws in place to compell the loaners to make the risky loans and when the loaners still said "No" because they'd get stuck with the bad loans, the dems went ahead and said "I'll guarantee them"....of course, when the loans defaulted and the economy collapsed, the dems pointed to the loaners and said "It's all your fault you greedy pigs" (even though the dems incentivized that behavior and sheilded them from loss). I'll grant that it was a praiseworthy goal to help more Americans realize the "American Dream"...however, they always seem to really screw things up and this time it caused a massive loss of wealth for all of us.

Personally, I do not care what you think. I think that communicating the truth (not your stale and dogmatic repetitions) makes a big difference to our future so I'll post away as much as I want and will feel fine doing it without regard to your opinion. Those fellows you associate with me are great thinkers and I'm pleased to be associated with them.

 

[RightField]

Here you go....from Neil Boortz. He addresses some of your comments about education/funding. I think Neil has some good points and I'm pleased as punch to C&P this article.

WHAT'S WRONG WITH THIS ...
By Neal Boortz @ January 28, 2011

In keeping with our theme of "government always knows best" ... I want you to take a look at these thoughts from David Axelrod.

The president doesn't believe that it is enough simply to cut the budget or reduce the debt or reduce the size of government. In the world in which we live, if we do that and don't educate our citizens and lead the world in that; if we don't innovate; if we don't have kind of basic infrastructure that we need to be competitive, then we're not going to prevail.

And so as we cut, we've got to do it in a responsible way and make sure that we're not cutting those very things that are going to allow us to continue to be a dominant economic force and create opportunity for our people.

Do you have any idea why this quote gets my boxers in a bunch? Here, I'll tell you. It is because David Axelrod is demonstrating the prevailing thought process of many on the left, and many lazy Americans who don't know any better. Axelrod believes that America's greatness comes from government. He believes that without government "investments," we will fail to continue our economic dominance in the world. Where does the free market fit into his picture? What about entrepreneurs? The private marketplace? Private education? None of these have even crossed the mind of a man who already has a solution to all of our problems: government!

While we are the subject of educating our citizens, David Axelrod seems to believe that more money will lead to better government education of our children (the same opinion you share....and that anyone who disagrees with your approach is "anti-education"). I have proven this to be false time and time again - throwing more money at the problem isn't going to solve it. Since the creation of our federal Education Department in 1979, our students have performed steadily worse compared to the rest of the world. You have two things to blame: teachers unions and parents. The teachers unions are to blame because their sole existence is to get more taxpayer benefits for the themselves at the expense of your child's education. The other fault is that of the parents. Parents willingly subject their children to this form of child abuse and brainwashing on a daily basis. Parents have become complacent, thinking it OK to leave their children in the hands of the government and unions and expecting their children to come out as scholars and productive members of society. Wrong. Wrong. Wrong.

Now I will agree with Axelrod on one thing: education is vital to the future of our economy (I agree also). Take a look at these figures ...

Another study suggests that a modest improvement (from a current average of around 500 to 525) over 20 years in an international student assessment of 15-year-olds in the OECD nations -- improvement in reading, math and science literacy -- would mean a $115 trillion increase in these nations' aggregate GDP. Of that, $41 trillion would accrue to America. McKinsey calculated that if U.S. students matched those in Finland, America's economy would have been 9 percent to 16 percent larger in 2008 -- between $1.3 trillion and $2.3 trillion.

Read that again ... read about the economic loss we are suffering because of complacent parenting. More money in the world isn't going to change that. It is a cultural change (not even a new mercedes in every teacher's driveway will make much impact on that). Now THAT'S a tougher discussion to tackle.

 

[RightField]

And this one too....this is very informative. It's directly to your point that government can solve all the problems and that all problems can be fixed by throwing more taxpayer dollars at it - Not. I like Boortz's point above that it's a cultural change that's needed.

Throwing money at schools does not guarantee better education
Published on Sunday, September 12, 2010
Eastern Arizona Courier

I am writing in response to a letter by Susan Breen, the Greenlee County Democratic Party chairman (who ought to identify herself as such when writing letters to the editor) pumping her Democrat candidate for the State Legislature because she "supports education." But what does it mean when she says her candidate supports education? Everyone is in favor of a good education; we disagree on how to get there.

Well, to a liberal Democrat that means only one thing — more money. Will someone please explain why spending more money on schools will magically transform failing schools taught by poor teachers into wonderful beacons of learning? When they say "it's for the children," that money isn't going to the children — it's going to the teachers, the teachers union and the ever-growing army of administrators and "nonclassroom" personnel.

Despite more and more money being thrown at education, schools are producing more kids who can't read, can't think and analyze, who can't pass standardized tests and who increasingly don't graduate. If spending more money on education worked, Washington, D.C., would be the education capitol of the United States instead of the bottom of the barrel since it spends about 50 percent more per child on schooling than almost every other city. So what is the liberal response to this? Continue to do the same thing, only more of it.

It wasn't so long ago that kids were taught in small and even one-room schoolhouses, and some pretty smart people who built this country and accomplished a great deal were raised that way. Even today, home-schooled children do much better on standardized tests and in college.

Do we really need fancy computers and expensive electronic blackboards like the ones that were recently vandalized? A computer won't learn the material for you. What does contribute to actual learning is applying the seat of your pants to the seat of a chair, and, book in hand, figuring out what things mean and how they work, not eliminating competition and telling Johnny how wonderful he is when he adds 2 + 3 and gets 6.

How about getting back to straight mathematics and real English and English literature, not current usage so that kids know what split infinitives and double negatives are and stop using the word "like" three times in every sentence.

They need to teach accurate American and world history, not the leftist version, where America is always the oppressor, and instill love of country instead of political correctness. How about getting rid of disruptive students so others can learn?

Because the actual candidate for this state election would apparently rather have a surrogate, Susan Breen, speak for her, we'll call her candidate Mrs. X. Looking at Mrs. X's Web site, it seems she wants teachers "evaluated according to specific, educationally sound criteria. not a one-time written test," which is bureaucratic B.S. for: "Let us decide who should teach according to warm and fuzzy criteria that you can't decipher and will keep us in good with the teachers unions."

Plenty of other professions use objective testing to assure a minimum level of competence: doctors, dentists, lawyers, architects and engineers. Why not teachers? The answer is the Democratic Party is supported by two pillars: the trial lawyers and teachers unions.

The Democrats give the teachers unions more and more money, and the teachers unions respond in kind by sending tens of millions of dollars back to Democrat candidates every election cycle. It's a very cozy arrangement. So, no, Ms. Breen and her Democrat candidate, we want objective tests to help root out teachers who are unqualified and merit pay to reward excellent teachers and encourage others to upgrade their skills and knowledge.

Other very important changes are the elimination of tenure for teachers, laws against public employee unions, and returning control of the curriculum back to local school boards and away from the Department of Education and the National Education Association (another teachers union).

The Democrats like to point out that Arizona ranks very low on the scale of teacher pay, but taken by itself, the ranking of teacher pay among the states is fairly meaningless. The cost of living varies widely around the country as does the desirability of living in one place versus another. This doesn't mean the schools with the lowest teacher salaries aren't paying enough; it just means you can make more money somewhere else. Is there a mass exodus of teachers from rural Arizona? I haven't heard of anyone making that claim. Are Breen and company trying to tell us that teachers aren't giving their full efforts, but if we pay them more, they will? That would be pretty outrageous.

Most teachers I have known well are kind and dedicated people. Outside of big cities, teaching is a lower-stress, rewarding and secure occupation with three months off a year, and excellent health and secure retirement benefits courtesy of the taxpayer. Teachers take the job knowing all this — it's not a surprise.

And while Breen and her candidate bemoan the $30,000 it costs to keep a prisoner incarcerated for a year, it's much cheaper than having him on the street wreaking havoc with people's lives. It's always amusing to see liberal comentators and writers puzzled and asking why so many are incarcerated when the crime rate is low. They can't connect the dots that the crime rate is low because the bad guys are in jail.

To sum it up, everyone likes and respects the teaching profession, but policing themselves hasn't worked, and there has to be an end to the constant demands for raises in salaries and benefits. The schools owe us a duty to spend our money more wisely and to turn out more educated students at the same time.

Just as those of you who followed a slick and unproven stranger who proclaimed "Hope and Change" in the last election without putting his words in the context of his past radical associations and have now come to regret it, so, too, one ought to consider what this Pied Piper's cry of " I'm for education" really means in the context of her liberal Democratic Party credentials.

As Thomas Sowell says: "It is easy to be wrong and to perisist in being wrong when the costs of being wrong are paid by others."

 

[RightField]

I changed my mind. Go ahead and post on my threads all you want. You make a good foil. Your foolish positions are easily countered and dismissed. Clear thinking is important and your postings let me see what "lazy lefties" are thinking so I can effectively deal with it and bring greater understanding to our nation and it's people. Please, post as much as you'd like.

 

[RightField]

Here's a good C&P from a letter to the editor on Boortz site:

Axlerod and the Prez know that there is a move to eliminate departments such as the Dept of Education. After 80+ billion in additional expenditures over what the states spend, the federal involvement has improved our educational levels/proficiencies not one tenth of a percentage point.

Lousy return on the dollar. BUT the progressives view "success" differently. If they can convince our children that governmental elites can save us, then they have succeeded. They would lose that edge if control is returned to the states

 

[moman75]

Hey....all this trouble is caused by racism. I know this cuz the esteemed Jim Moron (oooops....Moran) said so.

Dipshit!

 

[mercury14]

Reichfield, how many times are you going to inform me that you're done posting for the night? Because you have better things to do or something?

Seems spamming on a porn board was more important than your family after all, eh?

 

[unregistered]

 

[mercury14]

You could always go to bed yourself.

It's early morning here. I'm in Asia, remember?

Besides, I'm on-call and our active duty members decided that tonight would be a good night to try to kill themselves and/or mentally decompesate. Two suicide attempts (one serious), one self-mutilation, one psychotic break, and one incident of domestic violence between dating partners thus far. I'm on my fifth call so it was mostly a non-sleeping night. In a few hours I'm going to have to go in and see these people, so no naps for me either.

 

[RightField]

A Two-Track Plan to Restore Growth
Our economic wounds are self-inflicted. Changing fiscal and monetary policies could make a difference fast..

by JOHN B. TAYLOR

It's been three years since the financial crisis flared up and the recession began. Yet the unemployment rate is still over 9%—double what it was before the recession—and it's been stuck above 9% for 20 consecutive months. Why the extraordinarily high and prolonged unemployment? My research shows that discretionary government interventions—deviations from sound economic principles and policies—have been largely responsible.

Many government interventions occurred before the panic in the fall of 2008, but in the past two years the government doubled down. We have seen an $862 billion stimulus, an increase in federal spending to 25% from 21% of GDP, and a corresponding explosion of federal debt. We have the Fed's unconventional "quantitative easings": purchases of $1.25 trillion of mortgage backed securities and $900 billion of longer-term Treasury bonds. And we have seen hundreds of new regulations in the health and financial sectors.

The one-time stimulus payments to people did not jump-start consumption. The stimulus grants to states did not increase infrastructure spending. Cash for clunkers merely shifted consumption a few months forward. The Fed's purchases did not have a material impact on mortgage interest rates once changes in risks are taken into account. At best these actions had a small temporary effect that dissipated quickly, leaving a legacy of higher debt, a bloated Fed balance sheet and uncertainty—all of which slow growth and job creation.

.None of this should be surprising. Well-known theories of consumption predict that temporary payments to households will not increase economic growth by much. Careful empirical studies of stimulus programs in the 1970s showed that stimulus grants to states did not increase infrastructure spending. A vast literature and experience from the 1970s show that discretionary monetary policy, as distinct from rules-based policy, leads to boom-bust cycles with ultimately higher unemployment and higher inflation. With sounder, more stable and more predictable monetary and fiscal policies in the 1980s and '90s we had long expansions and lower unemployment.

The best way to reduce unemployment is to restore sound fiscal and monetary policies. There are some welcome signs that the policy pendulum has begun to swing back in that direction. The recent election revealed deep concern about high debt, deficits and spending.

Three-fourths of business economists and one-half of academic economists say that easy monetary policy exacerbated the housing boom and bust that led to the financial crisis. Reactions to a second round of quantitative easing have been negative at home and abroad. The very word "stimulus" is now avoided by former proponents of spending stimulus. The recent agreement to extend existing income tax rates represents a shift to more predictable policies.

Unfortunately, the president's State of the Union speech raised doubts about the return to sound policy by stressing more government spending and criticizing further extensions of current personal income tax rates. So it is essential for policy makers to grab the policy pendulum, pull it back toward sound fiscal and monetary policy, and tie it in place so it never swings back again.

They should start by laying out a credible plan to reduce spending and stop the debt explosion. If spending as a share of GDP can be brought to 2000 levels and held there with entitlement reforms, then the budget can be balanced without employment-retarding tax-rate increases. A concrete goal should be to establish a long-term budget that the Congressional Budget Office (CBO) can credibly show would bring the debt-to-GDP ratio to 40%. If the plan is ready for this summer's CBO long-term projections, it will give an immediate boost to economic growth and job creation as uncertainty about debt sustainability falls. An example of what the CBO's next projection might look like is shown in the nearby chart of U.S. debt history along with the CBO's projections made in 2009, 2010 and, if the plan is ready, in 2011.

Some want to delay reducing government spending because of high unemployment and the fragile recovery. But there is no convincing evidence that a gradual and credible reduction in government purchases will increase unemployment. The history of the past two decades shows that lower government purchases as a share of GDP are associated with lower unemployment rates. A much better way to reduce unemployment is to encourage private investment. Over the past two decades, unemployment fell when investment increased as a share of GDP. (See the other nearby chart.)

Meanwhile, the Fed should lay out a plan for reducing its extraordinarily large balance sheet. To achieve a more predictable rules-based policy going forward, the Fed's objectives should be clarified. The Federal Reserve Act now says the Fed must "promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates." But too many goals blur responsibility and accountability and they allow for confusing changes in emphasis from one goal to another.

Recently the multiple objectives have been used as a rationale for interventionist policies, such as QE2, an approach that Fed officials avoided in the 1980s and '90s. Such interventions can have the unintended consequence of increasing unemployment—as illustrated by the decisions to hold interest rates very low in 2003-2005, which may have caused a bubble and led to the high unemployment today.

It would be better for economic growth and job creation if the Fed's objective was simply "long-run price stability within a clear framework of economic stability." Such a goal would provide a foundation for strong employment growth and would not prevent the Fed from providing liquidity, serving as lender of last resort, and cutting the interest rate in a financial crisis or recession.

The Fed should also be required to report in writing and in hearings its strategy for monetary policy. Such a requirement was removed by Congress in 2000 and should be restored. But rather than reporting only on the monetary aggregates as in the past, the renewed requirement should focus on the strategy for setting interest rates. The Fed should establish its own strategy and report it to Congress.

The Fed would have the discretion to deviate from its strategy in a crisis. But if it does deviate it should be required to report the reasons. This approach provides a degree of political control and accountability appropriate for an independent agency without interfering in day-to-day operations. Such reforms will reverse the short-term focus of policy and help achieve sustained growth and job creation.

 

[unregistered]

 

[Wok]

Must be the non hacker ward eh?

Hm, real support for the troops there.

 

[unregistered]

 

[Wok]

Just look at how he characterizes them, must be the only kind he comes in contact with.

Whatever. They are only out there putting their lives on the line and all...

 

[hogjack]

It's simply astonishing after all the hand wringing and gnashing of teeth by the wet legs here concerning the Bush 400 billion deficit, we are confronted with a deafening silence from the same sector in regard to the 1.5 trillion conjured up by Obama and the economically insane Democrats.

No deafening silence here. The Bush Republicans were an embarassment to the "conservative" side of the political spectrum when it came to fiscal restraint and responsibility. Not only that but the George W. Bush budgets were consistently phony by slipping in the real war costs back in weeks after they main Federal budget was passed.

The Obama Administration has demonstrated no fiscal conscience by burying the country into further indebtedness. Only the November elections woke up Obama's people to the fact that their insanity is not without consequences. That's the ONLY reason the Democrats would change their government-centric lives. Nevertheless, not a peep about it during the State of the Union. Winning the future? The future is all about PAYING UP.

Neither main political party is brave enough to do what needs to be done. The Republicans live in their mythical world of phony conservatism and the Democrats haven't seen a program that shouldn't be started and funded fully until the end of time.

Meanwhile, the world's dynamics have changed considerably where America is still "on top" but Pax Americana is winding down due to largess, stupidity, laziness and hubris.

 

[jeninflorida]

Must be the non hacker ward eh?

I think you upset Dr. Phil wannabe....Merk lives in a mental state of mind

some kind of altered state

 

[mercury14]

Just look at how he characterizes them, must be the only kind he comes in contact with.

Since my job is military psychiatry, yes that's the only type I come in contact with on a professional level. But then you knew that. Feeling forgetful again, Vette?

 

[unregistered]

 

[mercury14]

Some are, some aren't. Some are trying to figure out how to keep from doing their duty, we see it in every war.

Come on out and make your point.

 

[RightField]

Hermain Cain is an interesting guy.

 

[RightField]

Here's another liberal folly. This article debunks several of the liberal myths around high-speed rail...a hot topic of discussion today since the President's recommended budget just came out today. Thank goodness it's up to the House to put the budgets together. The President magnanomously offered to freeze the hightened level of spending in place while at the same time he's saying that he's going to bring the deficits down. Blah!

February 14, 2011
The Enemies of Good Government
By Robert Samuelson

WASHINGTON -- Vice President Joe Biden, an avowed friend of good government, is giving it a bad name. With great fanfare, he went to Philadelphia the other day to announce that the Obama administration proposes spending $53 billion over six years to construct a "national high-speed rail system." Translation: the administration would pay states $53 billion to build rail networks that would then lose money -- not a little, but lots -- and, thereby, aggravate the budget squeezes of the states or federal government, depending on which covered the deficits.

There's something wildly irresponsible about the national government's undermining states' already poor long-term budget prospects by plying them with grants that provide short-term jobs. Worse, the high-speed rail proposal casts doubt on the administration's commitment to reducing huge budget deficits (its 2012 budget is due Monday). How can it subdue deficits if it keeps proposing big new spending programs?

High-speed rail would definitely be big. Transportation Secretary Ray LaHood has estimated the administration's ultimate goal -- bringing high-speed rail to 80 percent of the population -- could cost $500 billion over 25 years. For this stupendous sum, there would be scant public benefits. Precisely the opposite. Rail subsidies would threaten funding for more pressing public needs: schools, police, defense.

How can we know this? History, for starters.

Passenger rail service inspires wishful thinking. In 1970, when Congress created Amtrak to preserve intercity passenger trains, the idea was that the system would become profitable and self-sustaining after an initial infusion of federal money. This never happened. Amtrak has already swallowed $35 billion in subsidies, and they're increasing by more than $1 billion annually.

Despite the subsidies, Amtrak does not provide low-cost transportation. Longtime critic Randal O'Toole of the Cato Institute recently planned a trip from Washington to New York. Noting that fares on Amtrak's high-speed Acela start at $139 one-way, he decided to take a private bus service. The roundtrip fare: $21.50. Nor does Amtrak do much to relieve congestion, cut oil use, reduce pollution or eliminate greenhouse gases. Its traffic volumes are simply too small to matter.

Consider. In 2010, Amtrak carried 29.1 million passengers for the entire year. That's about one-twenty-fifth of annual air travel (2010 estimate: 725 million passengers). It's also roughly a quarter of daily automobile commuters (124 million in 2008). Measured by passenger-miles traveled, Amtrak represents one-tenth of 1 percent of the national total.

Rail buffs argue that subsidies for passenger service simply offset the huge government support of highways and airways. The subsidies "level the playing field." Wrong. In 2004, the Department of Transportation evaluated federal transportation subsidies for the period 1990-2002. It found passenger rail service had the highest subsidy ($186.35 per thousand passenger-miles) followed by mass transit ($118.26 per thousand miles). By contrast, drivers received no net subsidy; their fuel taxes more than covered federal spending. Subsidies for airline passengers were about $5 per thousand miles traveled. (All figures are in inflation-adjusted year 2000 dollars.)

High-speed rail would transform Amtrak's small drain into a much larger drain. Once built, high-speed rail systems would face a dilemma. To recoup initial capital costs -- construction and train purchases -- ticket prices would have to be set so high that few people would choose rail. But lower prices, even with favorable passenger loads, might not cover costs. Government would be stuck with huge subsidies. Even without recovering capital costs, high-speed rail systems would probably run in the red. Most mass-transit systems, despite high ridership, routinely have deficits.

 

[Sean Renaud]

Despite the subsidies, Amtrak does not provide low-cost transportation. Longtime critic Randal O'Toole of the Cato Institute recently planned a trip from Washington to New York. Noting that fares on Amtrak's high-speed Acela start at $139 one-way, he decided to take a private bus service. The roundtrip fare: $21.50. Nor does Amtrak do much to relieve congestion, cut oil use, reduce pollution or eliminate greenhouse gases. Its traffic volumes are simply too small to matter.

I call bullshit. It costs more than that to go from San Diego to LA so unless he's talking about Washington DC to New York and even that's a stretch this is an outright lie.