Memo to Barack: Trains, not Planes (or Autos)

Based on work done by energy economists over several decades, there are few infrastructure investments that will extend as deep into the economy as new investment in public transport. The solution you’re looking for creates a ton of jobs on the front end, and captures broad based wealth and efficiencies on the back end. An extension to existing railways and new rail lines is the investment that keeps giving, over time.

The schedule of greatest impact is as follows. First, new commuter rail and enhancement of existing commuter rail. Second, new light rail. Finally, high speed rail. In that order.

Let’s consider the front end: steel and copper for the tracks and grid. Lots of manual labor to clear and build the lines, managerial labor to contract the providers, and engineering and manufacturing labor to design and build the trains. Now let’s consider the back end: massive efficiencies in time, in productivity, and fewer cars on the road. Less dependence on oil, and less cost for upkeep of roads. Implications for air quality are obvious. The aggregate savings to society would expand outward for decades.

You should also consider attacking the rail and transport problem using emergency powers. There is not enough time to spend years on the public hearing processes that normally attend these projects. You may also want to first target metropolitan areas where the greatest impact can be made. Los Angeles, Seattle, and Miami are cities that come to mind as rich with enormous, potential savings.

You will not capture many of these long-terms payoffs from investing in bridges and roads, however. While bridge and road projects will certainly be a part of your spending bill, and while they do create alot of jobs upfront, investing in automobile architecture is a poor investment. The back end benefits diminish over time.

Finally, the expansion of public transport, all of it electrified, will drive the need for a better power grid. And in states like California a large increase in public transport can be paired with increases in utility grade solar power generation.

-Gregor

  • rosswhiting

    I approve and Gregor you have been awarded a 10 yr multibillion dollar to electrify the Northeast corridor. Congrats. :) (If only I had this kind decision making power, I can have a morning dream.)

  • http://blog.facetplay.com sssrinivasan

    Great idea. completely agree with you. Population also gets far more productive on laptops while being driven to work instead of having to stress out watching for other cars. Sure hope the trend to socialization of the economy extends to transportation too…

  • http://elliottng.com elliottng

    Great idea but my question is: is it labor intensive enough? will it soak up unemployment? And since our labor was heavily in FIRE (finance, ins., real estate) how does that apply to building rail projects?

  • gregor.us

    Hi. My view is that it will create just as many jobs as road and bridge work. Many rail lines run over bridges anyway. My other view is that it has to be done on an emergency basis. I also think there would be opportunity to create public private partnerships in rail, and to do so at every level from financing to revenues.

    G

  • http://elliottng.com elliottng

    Land use policy will be a key issue. Getting the fiscal stimulus in play may require Federal Eminent Domain applied pretty aggressively. Its a good idea and I think in general Land Use policies need to be revisited in a post-oil world (or even approaching that point)

  • Robert Dobb

    interesting concept., Gregor.US.

    since their inception, and right on thru recent decades, the rails were in bed with Federal governments and or subsidized with tax payer money. and after all of this, and somewhere around 80/90 years of government support, there were more RR bankruptcies during the 60's-70's than any time in their history.

    ever notice the history of how the owners of the rails themselves, from the 1800's to the 1970's, became VERY wealthy, yet the rail stocks were basically flat?

    along comes the deregulation of the 1980's. and over the next 25 years rail stocks go on to provide investors with MASSIVE 15 to 18 bagger returns.

    so, it's back to some sort of re-regulation? and more government rail and infrastructure projects?

    sure, like pre 1980, the Feds puts up the 100 billion of taxpayer money…. the rails take all the profits.

  • gregor.us

    Thanks Ross. I'll need to hire lots of workers and they'll need to be wearing the right clothes, of course. :-)

  • gregor.us

    Thanks Ross. I'll need to hire lots of workers and they'll need to be wearing the right clothes, of course. :-)

  • gregor.us

    Thanks Ross. I'll need to hire lots of workers and they'll need to be wearing the right clothes, of course. :-)