If You’re Riding Through Hell . . .
Americans who live outside the Northeast Corridor might enjoy the schadenfreude of knowing that New York Governor Andrew Cuomo has dubbed this the “summer of hell” amid disruptions in public transit. But hell doesn’t have as many circles of dysfunction, and the root cause is the political misallocation of resources.
Hundreds of trains that run through New York City will be delayed or diverted this summer so Amtrak can make long overdue track repairs at Penn Station, the busiest rail hub in North America. Derailments are now common, and New York’s subways are also breaking down. The mess is a mere portent of the misery that commuters will experience when the 107-year-old tunnel under the Hudson River, which was badly damaged by Hurricane Sandy in 2012, undergoes repairs.
Liberal politicians extol the virtues of public transit, so why can’t they run a decent public railroad? The answer is that modern progressives prefer doling out transfer payments to voters and public workers rather than make long-term investments in subway cars, tunnels and bridges. And even when they do build something, they pile on the costs to pay off their other political constituencies.
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Take the Hudson tunnel retrofit, which the Federal Railroad Administration’s (FRA) draft environmental impact statement last week pegged at $13 billion, up from $7.7 billion from just last year. Cost drivers include measures to minimize traffic delays, but also defensive contracting to avoid lawsuits. The FRA proposes blocking ugly views of construction with barricades and fencing that are “clad with aesthetically attractive or artistically enhanced fabric.” Marsh-pennywort plants in the Meadowlands would be transplanted to protected areas.
The FRA and New Jersey Transit had to make such concessions to get an alphabet soup of agencies—29 participated in the study—to issue the 19 permits required. Tunnel construction is planned to start in 2019 and wrap up by 2026, if you choose to believe.
New York’s Metropolitan Transportation Authority (MTA) spent 45 years and $4.5 billion building the two-mile Second Avenue subway, which was first proposed in the 1920s. In 1999 the East Side Access project to bring Long Island Railroad trains into Grand Central was estimated to cost $4.3 billion. The MTA now expects to complete it by 2023 for $10.8 billion.
Political demands drive up costs and create delays. New Jersey politicians wanted the World Trade Center Transportation Hub to be an architectural masterpiece. Their counterparts in Staten Island didn’t want to inconvenience ferry riders by temporarily closing the 1 subway line. This is how a train station that serves a mere 46,000 daily commuters—less than 10% of Penn Station’s traffic—wound up costing $4 billion.
Then there are labor agreements. The 1931 Davis-Bacon Act requires public projects receiving federal funds to pay prevailing wages typically determined by unions. Work rules stipulate how many and which workers must perform specific tasks. Inefficiency is rewarded with overtime.
The Federal Transit Act also requires federal grant recipients to protect workers against a “worsening” of their employment condition. This in effect bars transit agencies from contracting out services, reducing benefits or laying off workers. The Department of Labor looks to unions to certify that agencies are upholding the law, which increases their clout in collective bargaining.
Since 2005 the MTA’s labor costs—which account for 60% of expenses—have swelled by 80%. Pension and health costs have doubled. In January the agency bumped pay by an additional 5% over the next two years, threw in a $500 bonus and agreed to hire 100 workers to remodel worker facilities.
With all the money that government spends on labor and marsh-pennyworts, it’s no surprise that capital investment has been neglected. The MTA’s rolling stock hasn’t been replaced for 20 to 30 years since Mayors Ed Koch and Rudy Giuliani prioritized service improvements. The MTA still uses block signals from the 1930s, which explains why so many are malfunctioning and causing delays. While the current capital plan allocates $2.8 billion to modernize the signal system, the upgrade won’t be finished for half a century.
Progressives say we don’t spend enough on public works, but dedicated taxes for New York’s MTA have doubled over the last decade. Washington is spending 35% more on public transit than a decade ago. Don’t forget the $11 billion that the Northeast got from Hurricane Sandy relief for transportation, which should have covered the cost for signal repairs. But politicians instead prioritized spending $15.9 billion for “community development” and billions more in pork. As taxes rise most of the money goes to buying votes rather than upgrades that will be finished on some other politician’s watch.
The heyday for American public works came before the political dominance of public unions and the welfare state. And now the price for decades of progressive governance will be years of long commuter delays and tens of millions of hours in lost productivity.