High-speed rail is better investment

Imagine you’re in charge of investing $50 billion in federal taxpayer dollars in the future of transportation in the U.S. for the 21st century. Would you:

(a) Commit the money to propping up a bankrupt General Motors, making the U.S. the majority shareholder in a new, downsized GM, with a 60 percent stake?

(b) Invest it in the creation of a high-speed rail system?

The Obama administration has already answered that question for you. It’s picked (a). In other words, it’s elected to “invest” in a gutted version of a bloated, failed corporation, in a risky bet that could leave taxpayers on the hook for even more money down an unpaved road.

The New York Times on June 1 quoted an unnamed administration official waffling on the risk of this investment: “We don’t think … they will need more money. But the fact is there are things you don’t know — like when the car market will come back, and how much Toyota and Honda and Volkswagen will benefit from the chaos.” No kidding.

Instead of allowing the free market to reconstitute what is left of General Motors, the Obama administration has made the political decision to own what was once a major player in the automobile industry.

It also puts the government, as majority stockholder, in a peculiar posture of being chief investor in one automobile company that competes with Ford, which did not seek any federal bailout money, plus foreign carmakers that have plants in the U.S. employing American citizens.

The $50 billion commitment to a new General Motors is more than six times as much money as the $8 billion designated for high-speed rail in the stimulus package proposed by President Obama and passed by Congress earlier this year.

You might be thinking that the administration’s tunnel vision for transportation is one replete with more higher-mileage, lower-emissions vehicles on the nation’s roadways.

Listen, however, to the president in April, commenting on the stimulus package commitment of $8 billion to high-speed rail: “What we need, then, is a smart transportation system equal to the needs of the 21st century, a system that reduces travel times and increases mobility, a system that reduces congestion and boosts productivity, a system that reduces destructive emissions and creates jobs.”

The president has also stated that the $8 billion is just a “jump start” toward the vision, and he plans to follow it up with $1 billion a year for the next five years to fund work among 10 corridors that have been identified for high-speed rail. (Note to U.S. Rep. Tom Periello, Sen. Mark Warner and Sen. Jim Webb: Charlottesville and Lynchburg need to be included in this vision, too.)

The facts support the vision for high-speed rail, both in terms of efficiencies and reduction in energy costs and emissions. Clearly, this is an investment with a payoff for the 21st century. GM? Not so much.