Peter DeFazio (D-OR).

by RJ on Jan 26, 2009 9:18 am • link • report

Yeah, whoops, I knew that. Typo. Thanks.

Hey, 'Oregon' is one of my CAPTCHA words for this comment!

by David Alpert on Jan 26, 2009 9:20 am • link • report

I think you're off base with your criticism of Summers. First of all, not all economists agree that the Stimulus plan is a good idea (see Greg Mankiw's blog), and that infrastructure is necessarily better than tax cuts is also questionable. Second of all, the extent to which he is driving this part of the plan is based on one person's comments in one interview.

Regarding the actual issue (tax cuts vs. government spending) rather than the person (Summers), I'll just say that the government is very slow to do anything. Just because Congress puts a clause in the bill saying "This money must be spent within 120 days" doesn't mean it will happen. As a government employee, I have reason to doubt that it will.

This is not to say that infrastructure spending is not a good idea--simply that it should be justified on the merits of the project and not under the guise of "stimulus".

by PJ on Jan 26, 2009 9:48 am • link • report

Employment is the object of this bill. Keynes himself said that getting half the unemployed to dig ditches and the other half to fill them back up is just as good in situations like these.

Labor is not perfectly fungible either. Having someone pour cement does not require impressive amounts of training, etc.

Plus, are you really jumping on the "OMG Summers hates women!11!" bandwagon?

by MPC on Jan 26, 2009 10:13 am • link • report

Maybe someone can fund a trip for Summers to Munich for a few days to check it out. That city is infrastructure rich with car/bus/streetcar/s-bahn/u-bahn subways/regional rail/rail-airport connections/InterCity Rail/bike paths/walking paths/ pedestrian only areas that can take you anywhere you want to go, car or not. It was extremely impressive to see.

by NikolasM on Jan 26, 2009 11:05 am • link • report

Um, there's a whole lot of other stuff in there that isn't tax cuts. Agreed that transit should take priority over some of the other items in the package, but saying it's either transit or middle class tax cuts is establishing a false choice.

by NAB on Jan 26, 2009 11:20 am • link • report

MPC: the field of economics has learned a lot since Keynes. "Getting half the unemployed to dig ditches and the other half to fill them back up" will NOT create jobs, because it is a waste of resources.

by PJ on Jan 26, 2009 11:20 am • link • report

NAB, it's not exactly a false choice. We've got plenty of word from the people involved in the negotiations that the transit funds were dropped in an explicit exchange for more tax cuts in order to keep the total number at $850 billion. I agree that it need not be an either/or proposition in theory, but that's how this has played out so far.

Quite frankly, I'm not sure what to make of this. I'd love to see a big chunk of transit funding in the stimulus, but the Transportation Bill will be bigger, focusing on a longer timeframe, and far more important in signaling any change in transportation priorities for the US. It's kinda hard to pass judgment on this now without knowing what's coming down the pike. Even more confounding is the interplay between the stimulus and the Transportation bill - if transit gets left out of the Stimulus, does that mean it gets a better shake in the new TEA bill? Or does that simply mean there's less money to spend for the TEA bill? I don't know.

by Alex B. on Jan 26, 2009 11:32 am • link • report

Yes, Larry Summers, go away. We don't want one of the smartest economists in the country intimately involved at the highest levels of gevernment.

Please. Tax cuts are a nod to Republican and in keeping with Obama's plan for this to be a bipartisan bill. And like PJ said, many economists think tax cuts are the way to stimulate the economy. Also, fixing roads will get money spent and put more people to work quickly than a transit project. That is the kind of thing that belongs in the budget.

by Sir Spicious on Jan 26, 2009 11:59 am • link • report

I think one of the major underlying problems is that transit is sooo underfunded that the public will not necessary "see" the benefit of its money being spent.

It's all nice that WMATA, CTA, MTA and all the other transit acronyms have billions and billions in overdue maintenance, but the public, especially the part that does not use transit, is going to wonder where all that money went if they don't see more lines, or less traffic due to folks that switched from cars to transit.

While I am not an economist, I do know one thing. Government spending *will* *get* *spent*, and usually overspent. Tax cuts go everywhere, but quite frankly, are mostly virtual money. The infamous Bush tax cuts got me about $45 a month. Without wanting to be arrogant over my "wealth", I barely notice an extra $45 a month. I have a budget that I live within, and the rest goes to savings, and retirement. So $45 a month to savings is $540 in my savings account. Whoopdidoo. If you don't live within your means, you might use your $45 a month on paying down your credit card. And honestly, with the average American having $20k in depth, nobody's gonna notice that either.

So, please government: fix the infrastructure. Fix pot holes in the road, fix tunnels in metro, fix cracks in bridges and levees, fix the power grid, fix the waterways.

I can not imagine that states and other authorities don't have wish lists of emergency and overdue stuff that will be done immediately. Just fund approved projects, on the condition that the money that was reserved for those projects will be used for projects that are in the pipeline. I'll even accept that there will be a few bridges to nowhere. Whatever.

Also, please don't cut taxes. The US governments are highly underfunded. Why do you think the infrastructure is so crappy? It's because there's not enough money to keep things up.

by Jasper on Jan 26, 2009 12:16 pm • link • report

Also, we need some train songs for the 21st century. All our train songs are from the 19th and 20th centuries.

by Bianchi on Jan 26, 2009 12:30 pm • link • report

We've just seen light rail open in Phoenix and Charlotte, we've got DART expanding in Dallas, SFO BART extension three years ago, and Sea-Tac light rail opening this year in Seattle, so don't understand why there's not more gratitude for recent progress.

The FTA's budget is only $7 billion annually, and the Fed Gov't is not about to start covering a lot of operating costs. So a few extra billion would be a big boost for Dulles Rail, and the Dallas/LA/Seattle/Portland/San Fran extensions.

by Dave on Jan 26, 2009 12:34 pm • link • report

Harvard has an excellent recent tradition towards infrastructure, way way superior to selfish Yale:

http://cos-mobile.blogspot.com/2008/04/harvard-defeats-yale.html

by Douglas Willinger on Jan 26, 2009 12:37 pm • link • report

FYI, I consider this my "home" blog, so I'm weighing in here. Lost in the discussion is the simple fact that tons of people are utterly reliant on transit, especially the most vulnerable among us, and at a time when transit is booming more than ever, we're talking about a measly $2 billion that could keep people working; and getting to and from work. And THAT money could be spent quickly. No need for EIS or complicated assessments. Just think of what DC could do with some of that money to replace switches, hire repair crews, prevent next year's likely fare increase...

The message in the stimulus package as it stands is backwards: We will extend your unemployment benefits if you lose your job, but we won't help you keep a job by making sure you have a reliable way to get there.

Or we can bail out corrupt or mismanaged financial institutions in some cases, but we don't have money for everyday transit riders who are merely victims of the rotten economy.

It's not a choice between tax cuts and operating assistance — there are plenty of other things that could probably be cut or reduced to make room for that funding. Like, say, removing $2 billion from highways, especially considering there's nothing stopping states from building new ones with the money instead of going towards repair.

by Steve Davis on Jan 26, 2009 12:49 pm • link • report

Oh, and to clarify, I don't think there's any need to tell Slaughter anything other than to clear the amendment to the floor. It would be very unlikely that it would be anything other than a simple majority rule. It's worth being short, simple, and nice as she's out of our district and generally sympathetic to our issues.

by Steve Davis on Jan 26, 2009 12:52 pm • link • report

Also, please don't cut taxes. The US governments are highly underfunded.

I'd argue that it highly overspends. That boondoggle in Iraq sure is costing us a pretty penny.

MPC: the field of economics has learned a lot since Keynes. "Getting half the unemployed to dig ditches and the other half to fill them back up" will NOT create jobs, because it is a waste of resources.

You're being myopic. The act of digging and filling ditches would create jobs: the jobs of filling and digging ditches. The whole concept behind fiscal policy like this is that it really doesn't matter what you do so long as you get more money circulating in the system. I suggest you read Keynes before you pass judgment on his views.

The fact that the mantra of this stimulus is "shovel-ready" tells me that employment, not utility is the name of the game.

And deficit spending to stimulate full employment isn't Keynes? Coulda fooled me. I'm reading his book right now and that ain't the conclusion I'm coming to.

by MPC on Jan 26, 2009 1:20 pm • link • report

Hmmmm, let's close the italics, shall we?

by Alex B. on Jan 26, 2009 1:54 pm • link • report

I called her office, and asked her to bring DeFazio's and Nadler's amendments to the floor. I mentioned that although I don't live in her district, assisting transit is important as I and many others rely on it to get around. The staffer took a note of my comments, and I thanked them for taking my call.

Quick and easy. Thanks for the call to action.

by Ted on Jan 26, 2009 2:12 pm • link • report

@Ben Ross

So you honestly think we'll attain high utility AND employment in one fell swoop with this stimulus? I must say you're quite the optimist.

The fact of the matter is that this bill is already laden with pork. Most of it has nothing to do with economic growth and more of harking back to the Keynesian illusion that you can create wealth by having paper money fall from the sky.

Economic growth is attained through investment, which is brought on by savings. Savings is sacrificing consumption today to have more of it tomorrow. Infrastructure investment is that. That's the last thing we want. The whole point of this stimulus is to stimulate, not invest.

However once special interests get their hands on federal dollars, which was inevitable, it became whatever they wanted it to be.

by MPC on Jan 26, 2009 2:16 pm • link • report

MPC, aren't all interests "special" to someone?

by Bianchi on Jan 26, 2009 2:20 pm • link • report

Yea, but usually they have to pay for it themselves.

I'd be interested in tons of things if I could get the taxpayers rather than myself to pay for the stuff.

by MPC on Jan 26, 2009 2:30 pm • link • report

Investment and savings are not necessarily equal. That is Keynes' starting point.

MPC, what's your point? Are you arguing that it's wrong to try to spend money usefully when we spend it?

by Ben Ross on Jan 26, 2009 2:31 pm • link • report

MPC, I'm not sure if I'm understanding you correctly, and I might be missing your point.

Keynesian economics absolutely is deficit spending to stimuluate the economy; I wasn't suggesting otherwise. My point was twofold:

1. I don't believe even Keynes thought that "really doesn't matter what you do so long as you get more money circulating in the system". I could be wrong on this though.

2. Keynes was not entirely right. There is considerable debate amongst economists still about the merits of Keynesian economics. The consequences of government deficit spending are so far-reaching (from currency valuation to crowding out of private business to interest rates on Treasury notes) that absolutely no economist would agree with you that digging and refilling ditches would have a positive impact on the economy.

by PJ on Jan 26, 2009 2:40 pm • link • report

MPC, what's your point?

My point is that anyone who thinks this a utility-based spending program is being naive about it all. The first and foremost purpose is to put unemployed voters to work.

After that, how do we know at all what the benefits beyond employment will be from this? We could hire 20,000 men to build another Hoover Dam near Lake Tahoe but that wouldn't be of much use. However, the construction workers union, for example, couldn't care less what the taxpayers get out of the public works, but just to make sure that their workers get work. Thus rather than the market determining where the idle resources of labor and money should be allocated towards, we let government and quasi-government attachments to do so. And I'm 100% confident the politicians will put the greater good ahead of their own re-election.

by MPC on Jan 26, 2009 2:42 pm • link • report

The private market would of course allocate money correctly. To redecorate John Thain's office.

by Ben Ross on Jan 26, 2009 2:48 pm • link • report

Har har har. Your red-herrings are so hilarious. I mean, asymmetric risk in the financial markets has everything to do with the rapidly diminishing marginal utility associated with government spending.

Red-herrings on your part aside, you honestly believe that government spending is free of graft and rent-seeking tendencies?

I mean, at least just give money to the states to spend if you want to keep the government spending multiplier. The closer to local-level (ideally personal, but again we're trying to keep the fiscal multiplier). That way the utility would certainly be higher than spending on a national level.

by MPC on Jan 26, 2009 2:55 pm • link • report

Private enterprise has never built large-scale transportation infrastructure on its own. There's too much of a free rider problem, since nobody owns enough contiguous land all along a corridor from a major city out to more distant residential or employment areas. If one company did own enough of the land, they'd be a municipality, like Celebration Florida, and then anything they do is "government".

As I've written before, I'd really be curious to see what woudl happen in a true libertarian alternate reality where the government refused to build transit or roads, but I'm pretty sure the answer is that we wouldn't have a nation from sea to shining sea, our cities wouldn't have grown out of the agricultural model, and we'd be a backwater economy.

by David Alpert on Jan 26, 2009 2:55 pm • link • report

David, no the problem is that private corporations don't have the right to seize private property and compensate below the actual price of the real estate.

Eminent domain is *great* for 'getting things done'.

by MPC on Jan 26, 2009 2:58 pm • link • report

"Eminent domain is *great* for 'getting things done'."

Is that an argument against ever doing anything that might help anyone? Without government, how else would you have an economy, or courts, food safety standards, or schools etc.? These things are similar in that they aren't inherently profitable to build and run. Yet, our society needs them to function in its current capacity. Someone has to provide them. That's why we pool our resources together in the form of taxes. Government spending is spending on us.

by Cavan on Jan 26, 2009 3:04 pm • link • report

@David

And as for your second paragraph, I would agree that for roads, for the longest time, free-rider (economic, not physical) related market failures would discourage road construction. I would support taxation to fund it in light of the free-rider issue.

However, now they can track the tags of who uses roads thanks to cameras. Thus it's an excludable good. The only thing at that point the government has an advantage on is it can seize the land rather than have to pay for it.

I believe in free markets. I'm not some anarcho-capitalist Randroid.

by MPC on Jan 26, 2009 3:07 pm • link • report

"government" is just a bunch of people who got together and decided to some things togther -because they had an interest in doing so. Call it a special interest or not.

by Bianchi on Jan 26, 2009 3:09 pm • link • report

I'm not an anarcho-capitalist. I believe government exists above all to preserve the rule of law, to enforce contracts, to protect against force and fraud. None of those things require the theft of private property.

I'd even say that the government is justified to provide public goods in the event of market failures. That said, I just stated why roads don't fall under that category anymore.

"Life, Liberty and Property"

by MPC on Jan 26, 2009 3:10 pm • link • report

Bianchi

Now you're on to something.

Government is the ultimate special interest. It involves bribing people with other people's money so that those in power can stay in power.

Why does pork always go to the home district of the legislator sponsoring the bill after all?

by MPC on Jan 26, 2009 3:13 pm • link • report

MPC, as people who live together, not like Ted Kaczinski, we are all part of government, even you. "government" is not the "special" interest: It's the things that people decide upon doing together-those are the interests. If we don't like what those things are or the way the organizing is done, we have opportunities for changing both.

by Bianchi on Jan 26, 2009 3:30 pm • link • report

Are you seriously saying my clout is comparable to that of a lobbying firm or interest group?

So maybe you'll prescribe for me to become "active" in politics, right? Somehow I don't think petitioning my grievances is gonna do much. You make an impact in politics by joining a big-money group such as PAC or political party. Wholesale gets things done.

Money and votes are the mothers milk of politics, and money buys votes. I cannot believe you can't see this.

by MPC on Jan 26, 2009 3:39 pm • link • report

mpc, your opinion of my ability to grasp complex concepts or my right to exist given the frequency that you make degrading comments implying other commenters are sub-human and your claim to a super power to read other peoples minds aside, regarding your comment about Big Lobby - the new Chief Executive, in his first week at work, made an executive rule limiting the influence of Big Lobby in his administration. So we have a concrete example of both what I was referring to (opportunities for making changes) and a change toward minimizing the organizing that angers you to the point of lashing out at complete starngers. PS don't forget your blood pressure meds.

by Bianchi on Jan 26, 2009 3:58 pm • link • report

I won't respond to ad hominems.

The rule enacted by Obama is encouraging. I'll be interested to see what it's effects are. To judge a rule/law based on its rhetoric/intentions rather than its outcomes is a foolish thing to do.

I still believe that PACS/political parties/special interests have a far greater influence on policy than you or I do.

by MPC on Jan 26, 2009 4:07 pm • link • report

"I won't respond to ad hominems." Does this signal you'll stop using them?

by Bianchi on Jan 26, 2009 4:14 pm • link • report

MPC, as a commenter on GGW, which advocates for smart growth, you are a member of a special interest. And since GGW attempts to influence policy makers to support its aims, you are basically a staff member to a lobbyist.

by Sir Spicious on Jan 26, 2009 4:16 pm • link • report

This is one of the more useful call to arms that I have seen on this blog. I liked the Rachel Maddow piece. Thank you. I called. Some good news (ah, the gift that keeps on giving) is that today Obama reversed Bush's ban of the waiver in California, so that now that state can enact a law to force automakers to cut greenhouse gas emissions by 30 percent by 2016. No, it's not mass transit per se, but it's something. It's letting California be California, and that can only be good for the nation.

by Jazzy on Jan 26, 2009 6:50 pm • link • report

Before anyone makes another comment about the stimulus, please read Robert Samuelson's concise and informative article in today's Washington Post, Three Crises in One.

by Chuck Coleman on Jan 26, 2009 6:52 pm • link • report

Good piece, Chuck

by MPC on Jan 26, 2009 7:25 pm • link • report