Feeds:
Posts
Comments

Archive for April 23rd, 2011

It’s not too surprising to learn that spending money on “high-speed” rail is foolish. And it’s hardly a revelation to learn that politicians over-promise and under-deliver when they push through these boondoggles.

My Cato colleague, Randall O’Toole, has written extensively about these money-losing white-elephant projects. But it’s not exactly shocking news that libertarians would resist wasteful government spending.

But it is stunning when establishment leftists admit that such programs are a mistake.

Here are excerpts from a column by Charles Lane, an editorial writer for the Washington Post. Yes, your eyes are not deceiving you. Even folks at the Washington Post are recognizing (or at least beginning to recognize) that government is a giant sink-hole that squanders tax dollars and undermines prosperity.

Today, Liu Zhijun is ruined, and his high-speed rail project is in trouble. On Feb. 25, he was fired for “severe violations of discipline” — code for embezzling tens of millions of dollars. Seems his ministry has run up $271 billion in debt — roughly five times the level that bankrupted General Motors. But ticket sales can’t cover debt service that will total $27.7 billion in 2011 alone. Safety concerns also are cropping up. …On April 13, the government cut bullet-train speeds 30 mph to improve safety, energy efficiency and affordability. The Railway Ministry’s tangled finances are being audited. Construction plans, too, are being reviewed. Liu’s legacy, in short, is a system that could drain China’s economic resources for years. So much for the grand project that Thomas Friedman of the New York Times likened to a “moon shot” and that President Obama held up as a model for the United States. …China’s train wreck was eminently foreseeable. High-speed rail is a capital-intensive undertaking that requires huge borrowing upfront to finance tracks, locomotives and cars, followed by years in which ticket revenue covers debt service — if all goes well. “Any . . . shortfall in ridership or yield, can quickly create financial stress,” warns a 2010 World Bank staff report. Such “shortfalls” are all too common. Japan’s bullet trains needed a bailout in 1987. Taiwan’s line opened in 2007 and needed a government rescue in 2009. …the Beijing-Tianjin line, built at a cost of $46 million per mile, is losing more than $100 million per year. …On the whole, I’d say China should envy us.

Read Full Post »

Michael Ramirez is a first-rate cartoonist for Investor’s Business Daily. Here are two of his recent gems.

As always, humor works when it is based on something true.

With that in mind, do you prefer this cartoon, which shows Obama scolding the Founding Fathers for their extreme libertarian views?

Or what about this cartoon, which makes the obvious point that growth is rather difficult when the productive sector of the economy is hobbled by too much government.

Read Full Post »

Follow

Get every new post delivered to your Inbox.

Join 2,294 other followers

%d bloggers like this: