Christie’s And GOP’s Abhorrence To Investment Guarantees Economic Decline

Last week, I wrote in the wake of the New Jersey government shutdown that Chris Christie embodied the hubris, entitlement, lies, belligerence and lack of policy concerns of the current Republican party. Nowhere is that more evident than in his willful destruction of the transportation infrastructure in his home state, decisions that may have real ramifications for the entire New York City metro area economy.

His first decision, in 2010, was to abandon the proposed new third rail tunnel to NYC, in order to ease pressure on the two deteriorating existing tunnels that had been ravaged by Hurricane Sandy. Christie rejected the proposal because, he claimed, the state could not afford the cost overruns if they occurred. Christie’s cost numbers overstated the cost of the tunnel by 40% and he claimed that New Jersey would be on the hook for 70% of that cost when the actual number was 15%.

The real reason for Christie’s backing out of the project was that New Jersey desperately needed to restore its transportation fund and that would require a hike in the gas tax. That, of course, would be a tax hike which would devastate Christie’s future political ambitions. So Christie instead used the $1.8 billion allocated for the tunnel project to help fund repairs of the states’ roads and bridges. In the end, a few years later and after the transportation fund had essentially run dry, Christie was forced by the legislature to finally raise the tax.

Despite the money saved from backing out of the tunnel project, Christie managed to cut the state subsidy to NJ Transit by 90%, reducing the budget for repairs and maintenance by 50%. The rail line, once as high performing as its neighbor Metro North, is now plagued by constant delays, breakdowns, and even derailments. In addition, over $2.5 billion in NJ Transit projects were delayed last summer as Christie fought with the legislature over the gas tax.

However, Christie did find a good use for that previously allocated tunnel money and that was to subsidize a high-speed ferry to Manhattan for wealthy Wall Street traders and corporate big shots who lived in northern New Jersey. The Seastreak holds about the same number of passengers as a commuter bus and costs passengers $24 for a round trip ticket, which hardly covers the actual cost of the trip. Instead, New Jersey subsidizes that round trip to the tune of $94 dollars, costing the state around $7,200 each day and $1.8 million a year. And all to make sure that a handful of Wall Street fat cats don’t have to deal with the overcrowding and delays on NJ Transit that Christie himself has caused.

New Jersey commuters are suffering through a summer of hell as Amtrak is doing repair work to the tracks at Penn Station, closing down a number of tracks. NJ Transit is still a mess, with countless breakdowns and delays. And all the while, everyone is praying that the two existing, century-old, salt-ravaged rail tunnels hold up. Amtrak has estimated they will both be required to be shut down in the next 15 years for major repairs. If one of the tunnels fails, it is estimated that it would reduce rail traffic through the Northeast Corridor by 75%, creating an economic disaster for that region.

If Christie had moved ahead with the new tunnel, it was scheduled to come online sometime next year. Now, the revised project won’t be completed until sometime in the middle of the next decade, if it even gets off the ground. Last week, the US Department of Transportation withdrew from the board overseeing the project and still has not committed money to the project.

Christie’s short-sighted approach to infrastructure in order to satisfy his own personal quest for power is reflecting of the Republican party as a whole. Amtrak, which is responsible for most of the rail lines in the Northeast Corridor has been underfunded for years. But the short-sightedness goes well beyond the NYC metro area. Opportunities to build for the future by investing in nationwide access to high-speed broadband, renewable technologies, or even in the maintenance and repair of the transportation system built since the 1950s that made this country great have been blocked by Republicans because “we can’t afford it”.

This is farcical because, for much of the last decade, real interest rates have been negative, meaning those investments would virtually be cost free on an inflation adjusted basis. Republicans also point to tremendous debt, but then make budget and tax proposals which would increase that number by 50% in just ten years. When faced with total control of government, the GOP chose to forego an infrastructure plan that would have probably generated bipartisan support and instead opted to cut taxes via the ACA repeal and tax reform. And most of that money would simply go into filling rich people’s money with more cash, rather than investing in the infrastructure we need for the future.

Earlier, I wrote about the increasing isolation of the US under Trump’s leadership. Increasing isolation and refusal to invest in the future is a recipe for economic decline and stagnation, whether from the increasing costs of climate change or the failure of our transportation and communication infrastructure. But that is the current Republican strategy and we will all pay a price for that going forward.


Originally published at tidalsoundings.blogspot.com on July 12, 2017.