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Special-Interest Politics Is a Lot of What Infrastructure Is About

Summary:
Cars drive in Union City, N.J., March 31, 2021. (Eduardo Munoz/Reuters) Opinion polls show that increases in infrastructure spending are usually popular. I assume that’s because people have no clue about what are in the bills or the distortions that federal intervention creates. I am thinking that most people also hear the word infrastructure and think it’s about roads and bridges. Who doesn’t want well-maintained roads, especially when we are constantly and incorrectly told that our infrastructure is crumbling? Advertisement Because of the way politicians talk about federal involvement in infrastructure, people tend to assume that without it there would be no infrastructure or poor infrastructure. It is, of course, nonsense, since

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Special-Interest Politics Is a Lot of What Infrastructure Is About
Cars drive in Union City, N.J., March 31, 2021. (Eduardo Munoz/Reuters)

Opinion polls show that increases in infrastructure spending are usually popular. I assume that’s because people have no clue about what are in the bills or the distortions that federal intervention creates. I am thinking that most people also hear the word infrastructure and think it’s about roads and bridges. Who doesn’t want well-maintained roads, especially when we are constantly and incorrectly told that our infrastructure is crumbling?

Because of the way politicians talk about federal involvement in infrastructure, people tend to assume that without it there would be no infrastructure or poor infrastructure. It is, of course, nonsense, since the biggest owner of and investor in infrastructure is the private sector, and the federal government with all its rules and regulations is more like the tail that wags the dog — often in very counterproductive ways.

Then there are all the people who believe that infrastructure spending will boost the economy, which is rarely the case, especially in the short term. That’s in part because infrastructure packages have become a perfect vehicle for politicians to reward their political allies through blatant cronyism and favoritism.

Just look at how the U.S. House of Representatives treats private freight-rail carriers in its transportation bill, due on the floor next week for a vote. Transportation and Infrastructure Committee chairman Peter DeFazio (D., Ore.) and his friends view their transportation legislation as the perfect place to advance organized labor’s lobbying agenda in totality. Never mind that large and profitable railroad companies such as CSX and Union Pacific don’t need a transportation bill because they pay for their own systems, and railroads are the most environmentally efficient way to move goods on land. I guess they fail to see the irony of disadvantaging a transportation mode they supposedly value in favor of union featherbedding and more-polluting competitors. They also fail to see the irony in showering large profitable companies with subsidies while constantly complaining about big companies getting their way at our expense.

Their commitment to labor unions is also obvious in the long-running debate on how many people need to sit physically in the cab of a freight locomotive, which currently stands at two. Some background:

In 2016, the FRA proposed a rule requiring that freight train crews have at least two operators. It initially claimed, without evidence, that one-person crews are inherently more dangerous than two-person crews. Regulators assumed that increasing the number of operators was the most effective way to improve freight railway safety.

Three years later, the FRA rescinded the rule on the grounds that data couldn’t establish that two operators were safer than one. Unfortunately, in 2021, the Ninth Circuit vacated the FRA’s order. Now, the Democrats, encouraged by their union friends, are hoping to impose the mandate by statute. This comes as the railroads have invested billions in technology that would enable them to move rail workers outside the cab to more productive work — something rank-and-file employees probably value, but the battle on this issue has resurfaced union fear about reducing the number of fee-paying members.

This is problematic in several fronts. First, as my Mercatus colleague Patrick McLaughlin’s work demonstrates, if safety is the goal, private-sector innovation is the way to go. Also, crew-size mandates can have counterproductive effects of their own. Back in 2016, he noted:

A careful analysis of the historical causes of safety improvements in rail transportation indicates that track and equipment expenditures are much more important to safety than crew size. . . . Beyond maintenance and equipment, using automation to reduce accidents caused by human error also has a proven track record. The danger in mandating something that’s not obviously effective, such as minimum crew sizes, is that states will end up shifting the industry’s scarce resources away from what obviously is effective. This can also hinder further development of innovative technologies that can deliver even greater safety.

This is why you don’t have to be a raging libertarian to believe that this is not a great idea. In fact, in his Slow Boring newsletter on trains in America titled, “We should try to make good trains,” Matt Yglesias writes:

This is an extremely tedious battle that’s been passing back and forth for years, originating in the ongoing rollout of Positive Train Control technology on American railroads. Freight operators want to take advantage of this technology to, in some cases, cut back train staffing to just a single person. Labor interests don’t want to lose the jobs … If Democrats got their way on this, freight shipping would be a bit more expensive than it should be and more cargo would go in trucks and it would be worse for the environment.

I could go on and on about how much of infrastructure spending today and in the past has to do with pleasing unions and other special interests. I would also like to think that if people knew what is actually going on, they would withdraw their blind support for more money always going to infrastructure. I am probably dreaming.

Veronique de Rugy is a senior research fellow at the Mercatus Center at George Mason University.
Veronique De Rugy
Veronique de Rugy is a senior research fellow at the Mercatus Center at George Mason University and a nationally syndicated columnist. Her primary research interests include the U.S. economy, the federal budget, homeland security, taxation, tax competition, and financial privacy. Her popular weekly charts, published by the Mercatus Center, address economic issues ranging from lessons on creating sustainable economic growth to the implications of government tax and fiscal policies. She has testified numerous times in front of Congress on the effects of fiscal stimulus, debt and deficits, and regulation on the economy.

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