Posts Tagged ‘light rail’

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Creating artificial demand

July 30, 2009

I spoke with a friend of mine last night on the issue of infrastructure-building in cities as a means of creating economic stimulus and reducing environmental impact. Our debate turned to proposals to build both light rail and heavy rail systems in Ohio’s cities, especially in Cincinnati.

The support for these proposals is based on these principles:

  1. People want and need mass transit, because it will be cheaper than driving cars.
  2. Cities want and need mass transit to alleviate congestion problems and to create jobs.
  3. These mass transit systems, once created, will be sustainable, profitable and successful.

I will not get into the specifics of #1 and #2, since a number of other studies have already addressed these misconceptions. One in particular dispels the myths of the environmental and economic benefits of these systems, and even points to the role that government-subsidized rail systems played in causing the economic collapse in Japan (the so-called “Lost Decade,” from which Japan has yet to fully recover).

But all the research I have ever read suggests that #3, the sustainability and profitability of mass transit, is unlikely. Most mass transit programs in major cities have to be subsidized by the government because the general public does not use them enough to be profitable.

Why would the government use tax dollars to build something that the average person doesn’t want and wouldn’t use anyways? Why, to “stimulate the economy” and “create jobs,” of course. This is the principle of creating artificial demand.
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