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states can fund transit lisa schweitzer usc 2012

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Unformatted text preview: in infrastructure is that when Washington makes mistakes it replicates those mistakes across the nation. Federal efforts to build massive public housing projects in dozens of cities during the 20th century had very negative economic and social effects. Or consider the distortions caused by current federal subsidies for urban light-rail systems. These subsidies bias cities across the country to opt for light rail, yet rail systems are generally less efficient and flexible than bus s ystems, and they saddle cities with higher operating and maintenance costs down the road. When the federal government subsidizes certain types of infrastructure, the states want to grab a share of the funding and they often don't worry about long-term efficiency. High-speed rail is a rare example where some states are rejecting the "free" dollars from Washington because the economics of high speed rail seem to be so poor.11 The Obama administration is trying to impose its rail vision on the nation, but the escalating costs of California's system will hopefully warn other states not to go down that path.12 Even if federal officials were expert at choosing the best types of infrastructure to fund, politics usually intrudes on the efficient allocation of dollars. Passenger rail investment through Amtrak, for example, gets spread around to low-population areas where passenger rail makes no economic sense. Indeed, most of Amtrak's financial loses come from long-distance routes through rural areas that account for only a small fraction of all riders. Every lawmaker wants an Amtrak route through their state, and the result is that investment gets misallocated away from where it is really needed, such as the Northeast corridor. 5|Page States CP BDL Answers to: Perm – Do Both [____] [____] Inclusion of federal spending increases regulations, which massively increase spending and doom program effectiveness. Chris Edwards, director of tax policy studies at the Cato Institute, 2011 (“Federal Infrastructure Investment,” http://www.cato.org/publications/congressionaltestimony/federal-infrastructure-investment) Another problem is that federal infrastructure spending comes with piles of regulations. DavisBacon rules and other federal regulations raise the cost of building infrastructure. Regulations also impose one-size-fits-all solutions on the states, even though the states have diverse needs. The former 55-mph speed limit, which used to be tied to federal highway funds, is a good example. Today, federal highway funds come with requirements for the states to spend money on activities such as bicycle paths, which state policymakers may think are extraneous . 6|Page States CP BDL Answers to: Perm – Do Both [____] [____] Joint federal-state action fails to capture any of federalism's benefits Chris Edwards, director of tax policy studies at the Cato Institute, 2011 (“Federal Infrastructure Investment,” http://www.cato.org/publications/congressionaltestimony/federal-infrastructure-investment) Examining this list, it becomes apparent that different institutional features of the federal structure are more or less important for securi...
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This document was uploaded on 02/06/2014.

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