Category Archives: News commentary

Happy Compensated Emancipation Day

The reason why you don’t have to file your income taxes until tomorrow, April 18 this year is that today is a holiday in the District of Columbia (which means DC IRS workers get the day off) to celebrate the passage of the Compensated Emancipation Act of 1862. Under this law, Congress appropriated a million dollars to buy DC slaves for $300 each, thus freeing 3,185 slaves.

Britain had freed slaves without violence in 1834 through compensated emancipation. Abraham Lincoln had long supported the idea of compensated emancipation, having introduced a bill for it during his time in Congress in 1847-1848. Robert E. Lee and many other Virginians also supported the idea.

The objections came from abolitionists, who felt slavery was immoral and slaveholders shouldn’t be compensated, and from slaveowners in the deep South, where cotton was a primary crop and cotton picking was such an undesirable job that they feared they could only produce it with slavery. Someone patented a mechanical cotton picker in 1850, but apparently it didn’t work very well for mechanical pickers didn’t replace humans for another hundred years.

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Amtrak Is More Expensive Than You Think

While the Antiplanner was preparing to take Amtrak trains from Portland to Washington, DC, Amtrak was suffering from a spate of derailments, one near Chicago Union Station on March 26 and two in New York’s Penn Station on March 24 and April 3. Moreover, Amtrak now admits that it knew about the defective track that led to the Penn Station derailments, and didn’t fix it because it didn’t realize how serious the problem was.

Tracks are held in place by ties that were once all made of wood but that lately have been made of concrete. The Penn Station tracks still had wood ties, and an assessment before the accident found that some of the ties were partly rotted away. Replacing ties is difficult on heavily used rail lines, so Amtrak didn’t replace them right away, a mistake that led Amtrak’s CEO to make a public apology.

The accidents led New Jersey Governor Chris Christie to withhold state funds that New Jersey Transit pays to Amtrak to run its trains on Amtrak’s tracks. I suppose if I were paying money for a service, I would withhold funds if the service turned out to be unsafe. But Amtrak needs money to replace ties, so withholding funds might be the wrong solution in the long run.

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“Something Is Wrong & It’s Holding Us Back”

“The United States of America is truly an exceptional country,” says controversial JPMorgan Chase CEO Jamie Dimon, “but it is clear that something is wrong — and it’s holding us back.” Dimon’s annual letter to shareholders identifies some of the things that are wrong and suggests ways to fix them.

Dimon is controversial simply because he headed one of the nation’s leading banks at the time of the 2008 mortgage crisis, yet to the Antiplanner he was one of the heroes of that crisis. The mortgage bond market was invented by JPMorgan, but when Dimon became CEO he recognized the market wasn’t viable and ordered the bank to stop trading such bonds. When Bear Stearns and Washington Mutual went broke because of their heavy involvement in such bonds, it could have precipitated a major financial crisis, and Dimon agreed to take over those banks to avoid that crisis

Such takeovers are the standard way the U.S. government has dealt with failing banks, and they are not a gift to the banks doing the takeovers. The banks agree to accept the defunct banks’ assets and (much larger) liabilities in order to keep the monetary system going as well as to save the Federal Deposit Insurance Corporation billions of dollars it would have to spend paying off insured depositers.

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The Future of Brightline

Mexican conglomerate Grupo Mexico is acquiring Florida East Coast Railway for $2.1 billion. This raises questions about the future of Brightline, FEC’s planned moderate-speed rail line that was previously called All Aboard Florida. Brightline is scheduled to begin operating between West Palm Beach and Ft. Lauderdale in July, and extending to Miami in August.

Phase two of Brightline is to be an extension to Orlando, which would require construction of about 40 miles of new rail line that would be used almost exclusively for passengers. FEC estimates this will cost more than $1.0 billion.

Brightline claims its trains will operate at 80 to 125 miles per hour. But it is promising to deliver people the 65 rail miles from Miami to West Palm Beach in 60 minutes. That’s an average speed of–let me see–65 miles in 60 minutes (counts on fingers) works out to just 65 miles per hour. That’s certainly faster than existing commuter trains, which require about 100 minutes for the same trip (making many more intermediate stops). But it’s not significantly faster than driving, which Google says takes about 70 minutes.

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Trump to Congress: Eliminate New Starts

When Elaine Chao was confirmed as Secretary of Transportation, rail advocacy groups were optimistic that she and the administration would look favorably towards more funding for rail “infrastructure.” So when Trump’s budget came out, they were shocked, or pretended to be shocked, that Trump proposed cuts to transit, Amtrak, and TIGER grants carried over from the 2009 stimulus program.

Transit cuts were part of Trump’s “attack on cities,” said urbanist Yonah Freemark. No, it was more like part of Trump’s hostility to pouring money down a rathole that produces no benefits.

As the Antiplanner explains in this op-ed in the Morning Consult, New Starts funding is worse than trying to create jobs by digging holes and filling them up. At least the holes, once filled, don’t impose any further obligations on society, but cities that build New Starts projects are legally obligated to continue operating and maintaining the projects for decades. Most of these projects have high costs and negligible benefits.

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Did Nader Really Call Apple a Monopoly?

“Consumer advocate Ralph Nader, concerned about fake news prevalent on social media sites, believes Congress should weigh in with antitrust legislation targeting Facebook, Google, Microsoft and Apple,” reports the Washington Examiner. Say what? Just what do Microsoft and Apple have to do with so-called fake news? How are any of these companies monopolies? Is Ralph Nader getting senile or was he misquoted?

YouTube has a video of part of his comments that he gave at an event commemorating the passage of the Freedom of Information Act. It doesn’t show the whole event, but it appears that one of the other speakers or someone in the audience said something positive about the role of social media in mobilizing grassroots activism.

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Making a Good Budget Great

President Trump’s 2018 budget takes a meat cleaver to many federal programs. In my issue areas–transportation, housing, and public lands–it would end the Federal Transit Administration’s New Starts program; end funding for Amtrak’s long-distance trains; eliminate HUD community development block grants; and reduce funding for public land acquisition. There’s no high-speed rail or trillion-dollar infrastructure program, and nothing that suggests Trump would support federal funding for those things.

Trump calls this the “America First” budget. What it really is is a “Federal Funding Last” budget, as Trump proposes to devolve to state and local governments and private parties a number of programs now funded by the feds. In theory, the result should be greater efficiency and less regulation. However, in most of the areas I know about, Trump could have gone further and produced even better results.

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Infrastructure Yes; Federal Deficits NO!

The American Society of Civil Engineers (ASCE) will surely benefit if the federal government were to spend a trillion or three dollarson infrastructure. So it is no surprise that its latest infrastructure report card says the nation needs to spend not one, not three, but four-and-a-half trillion dollars on infrastructure.

Yet there is no reason for the federal government to get involved in any of the infrastructure needs claimed by ASCE. In fact, the potential for federal spending on infrastructure is probably doing more harm than good since other people aren’t doing what they should be doing because they are counting on, or at least hoping for, the floodgates of federal funding to open.

Here are some of the most important infrastructure needs identified in the ASCE report:

  • Transit gets the lowest grade of any of ASCE’s infrastructure categories. Not coincidentally, transit is the most tax-dependent and gets more federal subsidies of any of the other infrastructure categories.
  • Railroads get ASCE’s highest grade. They also happen to be the least subsidized, being almost entirely private. Will anyone learn this lesson about private vs. public ownership of other infrastructure.
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APTA Wants a Piece of the Infrastructure Pie

Everyone wants a piece of Trump’s trillion-dollar infrastructure plan, even though they don’t really know what that plan is. Perhaps most arrogant of all, the American Public Transportation Association thinks that transit industry should get $200 billion, or 20 percent of the total.

That’s the same transit industry that carries 1 percent of all passenger miles in the United States–and no freight. That’s the same transit industry into which taxpayers have pumped more than $500 billion in operating subsidies and $350 billion in capital improvements since 1990, only to see annual transit trips per urban resident fall from 47 in 1990 to 40 in 2016. That’s the same transit industry that’s likely to be mostly replaced by self-driving cars in a few years. So, sure, blow $200 billion on it.

APTA’s plan might sound reasonable to transit fanatics who think that transit is worth a lot more than roads. But this assumes that the entire trillion-dollar infrastructure plan is for transportation. In fact, infrastructure includes things like Flint, Michigan’s water supply, a smart electrical grid, and high-speed internet to rural and low-income areas. With all these potential projects, why should an obsolete transportation system that carries 1 percent of passenger travel and no freight get 20 percent of the funds?

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Slow Growth of Labor Productivity

The Bureau of Labor Statistics has published a report finding that labor productivity has grown more slowly after the last recession–in other words, during the Obama administration–than during any other recovery period in recent history. Normally, the response to a recession is for private companies to clean out all of their least productive programs, and the people who worked in those programs find more productive jobs elsewhere. The result is a growth in labor productivity during the recovery period.

Much of Obama’s “stimulus” program, however, was aimed at protecting jobs during the recession, so many less-productive programs managed to survive and the people working in those programs didn’t have the (admittedly stressful) opportunity to find more productive work. Other parts of the stimulus program involved funding of less productive projects that normally wouldn’t have been funded. The result was a slow growth in productivity.

We can see the difference between government and private productivity by comparing the private rail industry with Amtrak and the transit industry. As shown in the table below, transit employees have more than doubled while ridership has grown by just 50 percent, so employee productivity has declined by more than 30 percent.

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