Obama’s Stimulus Plan May Need a Roads Diet

A lot of people have been saying that there is too much emphasis on “roads and bridges” in Obama’s infrastructure stimulus talk. I basically agree, though  we haven’t seen the actual plan yet, so the talk may be premature. Still, we already know that mass transit spending is one of the best ways to provide economic stimulus. Now, I want to show you that our roads don’t need that much more investment, according to two major transportation infrastructure studies of the last few years. Both studies have urged for more transit investment.

The Economist stated its worries about the infrastructure stimulus plan:

The federal government is not good at discriminating between infrastructure schemes. Too much cash has gone into encouraging sprawl or keeping senators from small states happy with showy projects; too little into building things that are harder to get approved but encourage economic growth or control congestion, such as light railways or road-rail freight systems.

Obviously each project should be measured on its merits. But a good broad test will be where the money goes. The 100 biggest metropolitan areas account for 65 percent of America’s population and 75 percent of its output. That is where the infrastructure is needed. But if “bridges to nowhere” start springing up in the boondocks, it will probably be money wasted.

Emphasis added.

President-Elect Obama’s choice for the White House’s Office of Management and Budget, estimated back in May, when he was Director of the Congressional Budget Office, that $12 billion in additional highway spending is all that is needed (pdf link) to get 83% of the benefit from spending additional funds. On top of that, according to the National Surface Transportation Policy and Revenue Study Commission (NSTPRSC) final report, even with $185~276 billion (in 2006 dollars) of annual highway capital expenditures over the next 45 years, the average traffic delay will increase slightly, and the total traffic delay will more than triple. The current rate of expenditure is only $68 billion per annum. Think about that, we could increase capital funding for roads by more than four fold and still not improve congestion. Clearly, we can’t build our way out of clogged roadways and traffic delays. Our only solution? Both the CBO study and the NSTPRSC note the only way to reduce congestion or mitigate its costs over the coming decades is to implement congestion pricing. Where’s Carless in Seattle when you need him?

On other other hand, currently only about $1.6 billion a year is spent by the feds on building fixed-guideway transit, while there is $248 billion in projects on the drawing board. The APTA has said that there is $8 billion in transit projectsready to go at this moment. Now, obviously not all of the projects for either set pass the fed’s cost-benefit test, but NSTPRSC study says that it’s far too hard for transit projects to qualify for funding, and the delays imposed by the federal review and funding process are excessive. Still, the same NSTPRSC study says with as little* as $21~24 billion a year spent on transit, 12,500 miles of fixed-guideway transit could be built, more than tripling the amount of rail nationwide, and increasing the number of riders by more than eight fold.

The NSTPRSC study’s money quote, which recommended vast increase in transit and intercity rail funding:

Our Nation will need to put more emphasis on transit and intercity passenger rail and make them a priority for our country. A cultural shift will need to take place across America to encourage our citizens to take transit or passenger rail when the option is given. It is also important to increase the market share for freight rail, and to make significant increases in highway investment as part of developing a robust surface transportation network.

Congress has put good money into studying where our infrastructure needs to be improved the most. I hope they listen and don’t spend the whole thing building, as Obama puts it, “roads and bridges”.

*little compared to the highway investment mentioned in the previous paragraph.