Some Republicans in the legislature have been trying to kill the attempt by Charlotte Republican Rep. Ric Killian to do what three Republican governors have already done: turn back federal rail project money. Sen. Bob Rucho, a Republican from Matthews, stated that the Senate GOP leaders agreed that the state should accept the federal rail money. Republican Senate President Pro Tem Phil Berger is quoted in the Cary News as saying, “I personally do not think the legislature will be able to unwind this transaction.”
Maybe these Republicans did not notice the minor revolution that took place last November that put Republicans in power in the U.S. House and in both chambers of the N.C. General Assembly. That revolution sent the message that it is no longer business as usual in D.C. or Raleigh.
When in power, Republicans are expected to lead, and that is exactly what the Republican governors in Wisconsin, Florida, New Jersey, and Ohio are doing. These governors have recognized that the public is demanding responsible leadership that will transform the “business as usual” special interest politics in Washington and in state houses. Special interests in the states that feed at the federal trough must be challenged.
But challenging special interests by turning back “free” federal money is not easy. It takes the ability to explain the facts. This “free” rail money ensnares North Carolina taxpayers for likely cost overruns and operational deficits for 20 years. If the taxpayers get fed up with this drain on their pocketbooks and end the rail project, the feds demand a refund of the “free” federal money.
A soon-to-be-releaed John Locke Foundation report from Wendell Cox of Demographia outlines additional facts. The rail improvements funded by the $461 million federal grant will not solve auto congestion problems or reduce pollution and energy consumption. For example, the promised improvements in train service between Raleigh and Charlotte would reduce auto traffic on Interstate 40 and I-85 by at most 0.04 percent.
The rail advocates’ most important rallying cry — “It creates 4,800 jobs” — is bogus. As economists tell us, these public sector projects displace jobs in the private sector with only a slight increase or no net increase in the total number of jobs. Plus transportation officials have based their figure on the dubious concept “job-years,” which allows them to inflate the numbers. For example, 4,800 job-years might actually mean 1,200 jobs that last for four years apiece.
But perhaps more important than the facts is the lost opportunity to lead. North Carolina Republicans need to stop following the crowd and instead lead the movement for reform that was expressed in the election last November. In other words, voters demanded that politicians act to diminish the power of the federal government and to restore the power of the states.
The train grant is a prime opportunity to lead. The federal government has for too long used its superior taxing powers to bribe the states to accept its policies, and the feds have powerful allies in the state. In this case, the state departments of Transportation and Commerce, the N.C. League of Municipalities, and the mayors of and business interests in the major cities along the route all lobbied to defeat the bill that would have returned the federal rail money to the feds.
Securing this federal money for these narrow special interests is important to them, but detrimental to the state and nation. Republicans lost the opportunity to remind these special interests that 40 cents of every federal dollar spent is borrowed. They failed to remember that Standard and Poor’s announced on Monday that it is likely to downgrade the U.S. government’s credit rating — making borrowing harder and raising interest rates. Republicans need to lead by reminding the special interests that lobby for federal money that they are contributing to the nation’s financial crisis by greedily fighting for more federal money. It is time for them to stop thinking about their narrow special interests and think about the future of the country.
Dr. Michael Sanera is Director of Research and Local Government Studies for the John Locke Foundation.