Posts

The Slow-Motion Financial Suicide of the Roman Empire by Lawrence W. Reed & Marc Hyden

More than 2,000 years before America’s bailouts and entitlement programs, the ancient Romans experimented with similar schemes. The Roman government rescued failing institutions, canceled personal debts, and spent huge sums on welfare programs. The result wasn’t pretty.

Roman politicians picked winners and losers, generally favoring the politically well connected — a practice that’s central to the welfare state of modern times, too. As numerous writers have noted, these expensive rob-Peter-to-pay-Paul efforts were major factors in bankrupting Roman society. They inevitably led to even more destructive interventions. Rome wasn’t built in a day, as the old saying goes — and it took a while to tear it down as well. Eventually, when the republic faded into an imperial autocracy, the emperors attempted to control the entire economy.

Debt forgiveness in ancient Rome was a contentious issue that was enacted multiple times. One of the earliest Roman populist reformers, the tribune Licinius Stolo, passed a bill that was essentially a moratorium on debt around 367 BC, a time of economic uncertainty. The legislation enabled debtors to subtract the interest paid from the principal owed if the remainder was paid off within a three-year window. By 352 BC, the financial situation in Rome was still bleak, and the state treasury paid many defaulted private debts owed to the unfortunate lenders. It was assumed that the debtors would eventually repay the state, but if you think they did, then you probably think Greece is a good credit risk today.

In 357 BC, the maximum permissible interest rate on loans was roughly 8 percent. Ten years later, this was considered insufficient, so Roman administrators lowered the cap to 4 percent. By 342, the successive reductions apparently failed to mollify the debtors or satisfactorily ease economic tensions, so interest on loans was abolished altogether. To no one’s surprise, creditors began to refuse to loan money. The law banning interest became completely ignored in time.

By 133 BC, the up-and-coming politician Tiberius Gracchus decided that Licinius’s measures were not enough. Tiberius passed a bill granting free tracts of state-owned farmland to the poor. Additionally, the government funded the erection of their new homes and the purchase of their faming tools. It’s been estimated that 75,000 families received free land because of this legislation. This was a government program that provided complimentary land, housing, and even a small business, all likely charged to the taxpayers or plundered from newly conquered nations. However, as soon as it was permissible, many settlers thanklessly sold their farms and returned to the city. Tiberius didn’t live to see these beneficiaries reject Roman generosity, because a group of senators murdered him in 133 BC, but his younger brother Gaius Gracchus took up his populist mantle and furthered his reforms.

Tiberius, incidentally, also passed Rome’s first subsidized food program, which provided discounted grain to many citizens. Initially, Romans dedicated to the ideal of self-reliance were shocked at the concept of mandated welfare, but before long, tens of thousands were receiving subsidized food, and not just the needy. Any Roman citizen who stood in the grain lines was entitled to assistance. One rich consul named Piso, who opposed the grain dole, was spotted waiting for the discounted food. He stated that if his wealth was going to be redistributed, then he intended on getting his share of grain.

By the third century AD, the food program had been amended multiple times. Discounted grain was replaced with entirely free grain, and at its peak, a third of Rome took advantage of the program. It became a hereditary privilege, passed down from parent to child. Other foodstuffs, including olive oil, pork, and salt, were regularly incorporated into the dole. The program ballooned until it was the second-largest expenditure in the imperial budget, behind the military.It failed to serve as a temporary safety net; like many government programs, it became perpetual assistance for a permanent constituency who felt entitled to its benefits.

In 88 BC, Rome was reeling from the Social War, a debilitating conflict with its former allies in the Italian peninsula. One victorious commander was a man named Sulla, who that year became consul (the top political position in the days of the republic) and later ruled as a dictator. To ease the economic catastrophe,Sulla canceled portions of citizens’ private debt, perhaps up to 10 percent,leaving lenders in a difficult position. He also revived and enforced a maximum interest rate on loans, likely similar to the law of 357 BC. The crisis continually worsened, and to address the situation in 86 BC, a measure was passed that reduced private debts by another 75 percent under the consulships of Cinna and Marius.

Less than two decades after Sulla, Catiline, the infamous populist radical and foe of Cicero, campaigned for the consulship on a platform of total debt forgiveness. Somehow, he was defeated, likely with bankers and Romans who actually repaid their debts opposing his candidacy. His life ended shortly thereafter in a failed coup attempt.

In 60 BC, the rising patrician Julius Caesar was elected consul, and he continued the policies of many of his populist predecessors with a few innovations of his own. Once again, Rome was in the midst of a crisis. In this period, private contractors called tax farmers collected taxes owed to the state. These tax collectors would bid on tax-farming contracts and were permitted to keep any surplus over the contract price as payment. In 59 BC, the tax-farmer industry was on the brink of collapse. Caesar forgave as much as one-third of their debt to the state. The bailout of the tax-farming market must have greatly affected Roman budgets and perhaps even taxpayers, but the catalyst for the relief measure was that Caesar and his crony Crassus had heavily invested in the struggling sector.

In 33 AD, half a century after the collapse of the republic, Emperor Tiberius faced a panic in the banking industry. He responded by providing a massive bailout of interest-free loans to bankers in an attempt to stabilize the market. Over 80 years later, Emperor Hadrian unilaterally forgave 225 million denarii in back taxes for many Romans, fostering resentment among others who had painstakingly paid their tax burdens in full.

Emperor Trajan conquered Dacia (modern Romania) early in the second century AD, flooding state coffers with booty. With this treasure trove, he funded a social program, the alimenta, which competed with private banking institutions by providing low-interest loans to landowners while the interest benefited underprivileged children. Trajan’s successors continued this program until the devaluation of the denarius, the Roman currency, rendered the alimenta defunct.

By 301 AD, while Emperor Diocletian was restructuring the government, the military, and the economy, he issued the famous Edict of Maximum Prices. Rome had become a totalitarian state that blamed many of its economic woes on supposed greedy profiteers. The edict defined the maximum prices and wages for goods and services. Failure to obey was punishable by death. Again, to no one’s surprise, many vendors refused to sell their goods at the set prices, and within a few years, Romans were ignoring the edict.

Enormous entitlement programs also became the norm in old Rome. At its height, the largest state expenditure was an army of 300,000–600,000 legionaries. The soldiers realized their role and necessity in Roman politics, and consequently their demands increased. They required exorbitant retirement packages in the form of free tracts of farmland or large bonuses of gold equal to more than a decade’s worth of their salary. They also expected enormous and periodic bonuses in order to prevent uprisings.

The Roman experience teaches important lessons. As the 20th-century economist Howard Kershner put it, “When a self-governing people confer upon their government the power to take from some and give to others, the process will not stop until the last bone of the last taxpayer is picked bare.” Putting one’s livelihood in the hands of vote-buying politicians compromises not just one’s personal independence, but the financial integrity of society as well. The welfare state, once begun, is difficult to reverse and never ends well.

Rome fell to invaders in 476 AD, but who the real barbarians were is an open question. The Roman people who supported the welfare state and the politicians who administered it so weakened society that the Western Roman Empire fell like a ripe plum that year. Maybe the real barbarians were those Romans who had effectively committed a slow-motion financial suicide.

Lawrence W. Reed

Lawrence W. Reed

Lawrence W. (“Larry”) Reed became president of FEE in 2008 after serving as chairman of its board of trustees in the 1990s and both writing and speaking for FEE since the late 1970s.

The Greek “OXI” (NO) vote is all over the news. But, what’s next? by LaRouchePAC

Revive the Glass-Steagall Act — It’s time for our own United States to take the next historic steps to free the world of austerity.

If you don’t know what the Glass-Steagall act is, please take a moment and review the background of the law, and what it did.

Lyndon LaRouche’s call to action, below,  is our historic responsibility not only to other nations of the world, but to ourselves, so that we might give a future to the next generations.

LaRouche: To Save the Trans-Atlantic Region, Implement FDR’s Glass Steagall Act Now

July 6, (EIRNS) — Lyndon LaRouche today responded to Sunday’s landslide rejection by Greek voters of the Troika’s genocidal austerity program, by clearly spelling out how the United States can play a decisive role in solving the otherwise irreversible collapse of the entire British-run trans-Atlantic financial system. LaRouche called for the United States to immediately adopt a return to President Franklin Delano Roosevelt’s original Glass Steagall policy.

The United States, LaRouche declared, should set the example for Europe, by immediately reinstating FDR’s Glass Steagall.

“The U.S. should solve the problem of the European mess, starting with the mess in Britain, by a Glass Steagall reorganization, clearing out the oversized and useless debt. Cancel all the debt with no intrinsic value, by going back to President Franklin Roosevelt’s successful model.  Only by such a debt cancellation can there be any prospect of a longterm recovery, in real physical economic terms.”

In his weekly live broadcast dialogue with LPAC’s Policy Committee, on July 6, LaRouche elaborated on his call for immediate Glass-Steagall:

“What has happened, as a result of the Greek operations during yesterday and today, has created a situation in which… Europe, most nations in Europe, and also the United States, are implicitly bankrupt. This is number one.

“Now what I mean on number one, on the bankruptcy, is that Wall Street in particular, and everything that coordinates with Wall Street, is now actually worthless.  That will be shown in due course, that we hope we can get this thing under control. What this means, we have to go to a Glass-Steagall action.  The only way we can do this, is a Glass-Steagall action.  That means, in the trans-Atlantic region, I’m talking about right now the trans-Atlantic region:  The situation is that the United States in particular is in a collapse.  That is, Wall Street and the things which are associated with Wall Street, are now actually worthless, which means a great amount of what is called money, among the business community, especially the financial business community, is worthless, and it is going to be very difficult for Wall Street and President Obama, both, to try to cover things over in this matter.

“Now the other side of this situation is, that it is perfectly possible for us in the United States itself, and with cooperation with certain circles in Europe and elsewhere, we’re quite capable of solving the problem.  And the solution is obviously, Glass-Steagall, Franklin Roosevelt’s own Glass-Steagall.  That is essentially the key thing.

“And the only way that the United States and the people of the United States could possibly escape from a general breakdown of the financial system of the United States, is to go back to Glass-Steagall.  That would mean we would simply cancel most of everything that’s called Wall Street, or anything like it; just cancel it.  It’s rubbish.  It has no intrinsic value.

“And therefore we have to go back to Franklin Roosevelt’s policies in order to save the United States economy.  Now, it’s going to be a tough row to hoe, because we have very poor skills available in the U.S. population.  The productive power of labor, in the United States’ population, has collapsed to a great degree…

“We see that, when people say, ‘well, some people are poor, they’re not worth keeping.’ Well, that’s not the problem, that’s not the truth of the matter. What they’re trying to do is kill off people, as in the case of California.  What’s happening in California, is actually an intentional determination, to kill off as many people in California and adjoining areas as possible. That’s what the policy is; that’s plain talk, no beating around the Bush.  And the Governor of California is one of the leaders, who is leading toward a campaign for mass-slaughter of people in California and adjoining areas.  That’s the reality!

“However, if we go to Glass-Steagall, Franklin Roosevelt’s Glass-Steagall, with means which I’m fully aware of as feasible, we can prevent that.  But the key thing now that’s driving it, is the fact that the European economy is going into a spin, downward, and this includes the British system itself, and it means other areas.”

RELATED ARTICLES:

What’s Wrong With the Latest Greek Bailout Deal

3 Tough Questions the Eurozone Will Face Over Greek Financial Crisis

Majority of Greek Voters Rejected Reasonable Offer to Let Them Stay in Eurozone. What’s Next.

Good Luck Finding a Place to Hide as Global Markets Crumble

Greece: How Did It Get Into This Mess?

RELATED VIDEO: Farage: Isn’t the EU quite as bad as the USSR, Mr Tusk?

The European Union: Borders on the Brink of Breaking

The borders of Europe are coming under severe strain. As we predicted here earlier this year, the migrant ‘crisis’ is no such thing. It is, rather, an ongoing situation of continent-wide turbulence with no foreseeable end. European ministers this week met to discuss the situation, but even they will find themselves unable to solve the problem.

Because the problem they face is that the drivers of the situation are far beyond their control. They are beyond any one politician or any one government. Indeed, they are also proving to be beyond the continent. Let us imagine for a moment that the civil war in Syria was able to be stopped by outside intervention from the EU. This would over time lessen the flow of refugees from Syria. But it would do nothing to prevent the human tide of asylum seekers and economic migrants heading towards Europe from Eritrea and sub-Saharan Africa.

What is the EU plan to deal with these situations? In truth, the EU is finding it difficult to control its external borders. So it is highly unlikely to achieve peace and stability across one continent (the Middle East) and prosperity to another (Africa). Until those things do occur, the pressure of mass movement of people towards the entry points of Europe will continue.

So what can be done? It is a very ominous sign that in recent days, weeks and months so many countries have gone increasingly unilateral. The Austrians have severely tightened their border with Italy because they do not trust the Italian authorities. Hundreds of migrants have piled up in a backlog at a border which is wholly closed to them. Hungary is planning a physical wall to go up on its border with Serbia. And at the French port of Calais there are desperate sights as migrants clamber onto vehicles bound for the UK. With other European countries refusing to share Italy’s burden, the Italians are threatening to give refugees travel permits that would effectively make them able to go anywhere. It is a grenade they have not yet thrown, but a grenade nonetheless.

The dream of the EU was that the borders of Europe would come down. But as the continent comes to terms with this latest crisis, it has not been able to stand together. The free movement of EU citizens within the EU is one thing. But the free movement of non-EU citizens within the EU threatens the cooperation of the whole enterprise. If Europe is to face up to this challenge it must first accept what it cannot do. And then swiftly move on to doing what it can.


mendozahjs

FROM THE DIRECTOR’S DESK 

I am writing this week’s column with one eye fixed on a TV screen outlining latest developments in France and Tunisia, where the scourge of Islamist terrorism has once again struck with a tragic beheading at a factory near Lyons this morning and one at a tourist resort in Sousse this afternoon.

Words cannot adequately describe the senseless brutality of these acts of terrorism. But they can go some way to explaining it and similar acts of violence carried out in the name of religion as can be seen through Rabbi Lord Jonathan Sacks’ masterful new book,Not in God’s Name: Confronting Religious Violence, which was the subject of a parliamentary discussion hosted by The Henry Jackson Society this week with its author.

Leaving aside the exemplary nature of Rabbi Sacks’ delivery of his central themes – which was described by the Member of Parliament hosting as the finest speech he had heard in his 18 years in the House of Commons – what came across clearly is the idea that while to deny that those who state they are acting on religious motives in committing violence are actually doing so is absurd, neither can it be said that there is an inherent relationship between religion and violence. As the author puts it: “there is a connection between religion and violence, but it is oblique, not direct.” Indeed, to take Rabbi Sacks’ argument further, as he does in the book, it is possible to see violence being carried out in the name of religion, but in reality it is being employed in pursuit of political, not religious objectives. Thus what ISIS and its adherents actually aspire to is temporal power in the form of a caliphate, even if this is dressed up in spiritual rhetoric.

This is an important factor to remember when considering events such as those witnessed today. We cannot deny the role of religion in terrorism, but we cannot consider religion just part of the problem and not also part of the solution. Arguably, it is only by Islam stripping away the political parts of its more extreme followers’ agendas from the religious ones of those of the moderate majority – as Christianity and Judaism did in their turn beforehand – that we will find the lasting way to meet the Islamist challenge.

Dr Alan Mendoza is Executive Director of The Henry Jackson Society

Follow Alan on Twitter: @AlanMendoza

Hawaii’s $205 Million Obamacare Exchange Implodes

by Alexander Hendrie, Americans for Tax Reform.

Despite over $205 million in federal taxpayer funding, Hawaii’s Obamacare exchange website will soon shut down.  Since its implementation, the exchange has somehow failed to become financially viable because of lower than expected Obamacare enrollment figures. With the state legislature rejecting a $28 million bailout, the website will now be unable to operate past this year.

According to the Honolulu Star-Advertiser the Hawaii Health Connector will stop taking new enrollees on Friday and plans to begin migrating to the federally run Healthcare.gov. Outreach services will end by May 31, all technology will be transferred to the state by September 30, and its workforce will be eliminated by February 28.

While the exchange has struggled since its creation, it is not for lack of funding. Since 2011 Hawaii has received a total of $205,342,270 in federal grant money from the Department of Health and Human Services (HHS). In total, HHS provided nearly $4.5 billion to Hawaii and other state exchanges, with little federal oversight and virtually no strings attached.

Despite this generous funding, the exchange has under performed from day one. In its first year, Hawaii enrolled only 8,592 individuals – meaning it spent almost $23,899 on its website for each individual enrolled. Currently over 37,000 individuals are enrolled in Hawaii’s exchange – well below the estimated 70,000 enrollees that is required to make the website financially viable. Unfortunately, taxpayers will have to hand out an additional $30 million so that Hawaii can migrate to the federal system.

This is not the first time that a state exchange has failed, and taken millions of dollars in federal funds down with it. Earlier this year, Oregon’s state exchange was officially abolished at an estimated cost of $41 million. Cover Oregon, as it used to be known received $305 million in funds from HHS but failed to produce a workable website months after the 2013 November deadline. The debacle has promoted numerous federal agencies and organizations to investigate allegations of inappropriate political interference from then Governor Kitzhaber’s 2014 reelection campaign.

Hawaii now joins Oregon, Massachusetts, Maryland, Vermont, New Mexico, and Nevada as cautionary tales in government central planning. With so many failed state exchanges, questions need to be asked about the haphazard allocation of billions of dollars in taxpayer funds and the complete lack of oversight.

EDITORS NOTE: The featured image is courtesy of Shutterstock.

The Welfare State Needs Abolition, Not “Reform” by DOUG BANDOW

The United States is effectively bankrupt. Economist Laurence Kotlikoff figures the government faces unfunded liabilities in excess of $200 trillion. Making the programs run more efficiently would be helpful. But only transforming or eliminating such programs will save the republic.

The left likes to paint conservatives as radical destroyers of the welfare state. If only.

Instead, some on the right have made peace with expansive government. Particularly notable is the movement of “reform conservatism.” The so-called “reformicons,” notes Reason’s Shikha Dalmia, “have ended up with a mix of old and new liberal ideas that thoroughly scale back the right’s long-running commitment to free markets and limited government.”

The point is not that attempts to improve the functioning of bloated, inefficient programs are bad. But they are inadequate.

Yes, government costs too much. Government also does too much. And that cannot be remedied by lowering administrative costs, eliminating waste, improving delivery, or even reducing perverse incentives.

The worst “reform conservatism” idea is to manipulate the state to support a particular “conservative” vision. Dalmia points out that many reformicons want to use the welfare state to strengthen institutions which they favor.

For instance, “just as George W. Bush’s compassionate conservatism proffered a series of special tax incentives to prop up religious institutions, reformicons want targeted tax breaks to strengthen middle-class families. Some want to restrict immigration and trade, just like unions of yore.”

Utah Sen. Mike Lee, for instance, criticizes conservatives who “have abandoned words like ‘together,’ ‘compassion,’ and ‘community’.” Although he warned against overreliance on the state, he still wants to use it for his own ends, proposing greater flexibility in allowing workers to choose between comp time and overtime — by imposing such a provision on private collective bargaining agreements.

Reformicon intellectuals and politicians argue for an expanded Earned Income Tax Credit for singles and increased deductions for dependents and tax credits for parents who stay at home. Some want more taxes on the wealthy, new employee-oriented public transportation, a preference for borrowing over deficit reduction, subsidies for hiring the unemployed, and punishment for colleges whose students welsh on their educational loans.

Senators Lee and Marco Rubio and Lee have introduced the “Economic Growth and Family Fairness Tax Reform Plan.” It offers some corporate and individual tax reductions but raises the rates on most everyone by lowering tax thresholds. The bill also increases the child credit, even for the well-to-do.

Alas, this differs little from liberal social engineering.

As Dalmia puts it:  “Broad-based, neutral tax cuts to stimulate growth are out, markets are optional tools, the welfare state is cool, redistributive social engineering is the way forward, and class warfare is in.”

Reformicons don’t so much disagree as argue that they can do better than liberals. For instance, Yuval Levin of National Affairs contended that his movement relies on “experimentation and evaluation [and] will keep those programs that work and dump those that fail.”

What motivates this approach? After Barack Obama’s victory, Levin explained, he and other conservative thinkers “were trying to figure out what the hell this new world looked like.” They hoped to apply “the Judeo-Christian moral tradition to critical issues of public policy.”

Of course, the Judeo-Christian moral tradition didn’t arise with a focus on public policy. Jesus spoke at length on the relationship of men to God and each other, but largely avoided politics. He never advocated coercively applying his teachings — that the federal government should force men to love God and their neighbors, as long as the enforcement was efficient, for instance.

But politics drives reform conservatism. Bloomberg’s Ramesh Ponnuru contended that it’s a matter of necessity: “Times change and people need to change if they are going to remain relevant.”

Henry Olsen of the Ethics and Public Policy Center made a fulsome pitch for conservatives to embrace social benefits for “their” voters. After all, “Many of those working-class voters are located precisely in the two places a Republican presidential candidate needs to carry to win the White House.”

He concluded:  “American conservativism at its best embraces Reagan’s thought, combining a love of liberty with an overriding love of all people. In the present crisis, antigovernment fundamentalism threatens to place the two at odds with one another, to fatal effect for conservatism and for the country.”

Expressing interest in reformicon ideas are GOP presidential contenders Rubio, Jeb Bush, and former Texas Gov. Rick Perry. Indiana’s Mike Pence, another possible GOP candidate, recently expanded Medicaid, in a reform-oriented fashion.

Ohio’s Gov. John Kasich (yet another potential contender), grew Medicaid without reform — claiming God’s direction. However, there’s no evidence so far that technocratic “reform conservatism” is more politically attractive than simple conservatism.

Of course, no one should want policies that don’t work. But that doesn’t address the most important question: is the end itself justified? Efficient income redistribution doesn’t make the process morally right, only less wasteful on its way to being wrong.

And such measures can create new problems. For instance, author Amity Shlaes and Matthew Denhart of the Calvin Coolidge Presidential Foundation warn that the Rubio-Lee plan would generate resentment by pitting individuals against families.

It also would sacrifice opportunities to spur economic growth by emphasizing group privileges over rate reductions for all. The two worry: “If the self-styled party of enterprise does not emphasize the individual, no one will.”

Big issues are at stake. The current economic system isn’t working for all. Rubio asked the right question: “How can we get to the point where we’re creating more middle-income and higher-income jobs, and how do we help people acquire the skills they need?”

Social engineering, even conservative social engineering, is not the answer.

The starting point for job creation remains what it always has been, making it easier and less costly to create businesses and jobs. Children need alternatives to the public school monopoly. Yes, the family is under pressure, but the best Washington can do is to do no harm.

For most issues the principal answer will come outside of politics, as Lee recognized: “Collective action doesn’t only — or even usually — mean government action.”

Some reformicon ideas might make some conservatives appear more presentable to the public, but this approach will win few converts from committed statists. But reform conservatism fails to provide a coherent answer to the most important problems facing America.

Government is not just inefficient: it is doing the wrong things.

Doug Bandow

Doug Bandow is a senior fellow at the Cato Institute and the author of a number of books on economics and politics. He writes regularly on military non-interventionism.

High-Speed Rail Fiasco will Break the Bank!

A national spider-web of high-speed rail is being pushed throughout America despite proof of “insolvency” and “never-ending subsidies.” Taxpayers need to know!

The fast-track towards US High-Speed-Rail was funded in the 2009 Stimulus, based on the President’s “80% High-Speed Rail 25-Year Plan,” even though the $10.1 Billion appropriate was quickly allocated, the high priority for deficit-reduction in the House of Representatives 2011 Budget, eliminated federal funds and High-Speed-Rail was derailed!

High Speed Rail Doomed: Too Expensive!

The Reason Foundation report forecasts U.S. High Speed Rail failure! European travel compared to America is apples-to-orange, because European rail transportation began pre-automobile, leading to the natural development of a full-service transportation system. This can’t be duplicated in America’s car-culture that provides cheaper and independent personalized travel. Reason.org reports the figures: Construction costs are $10 Million per mile and operational costs of $50,000 per seat, translating to $2.4 Billion for a 240-mile track that requires 6-to-9 million passengers to break even! The odds are against 25% of the country, as passenger ridership is concentrated in the highly populated New England corridor, monopolizing three-fourths of all US passengers, leaving all other projects scrambling for riders, subsidy-driven dollars and taxpayer obligations.
Treasure Coast Florida or New York’s Grand Central Terminal?

Similar to the Seven/50 Regional Planners in Florida, highly paid speculators pitch the Federal Railroad Administration and Department of Transportation goals for High-Speed-Rail to serve as a catalyst for growth, increase mobility, reduce national oil dependency, foster livable urban and rural communities, improve safety, maximize economic returns, environmental sustainability with US 33% greenhouse emissions.

On the other side of the fence! The International Energy Agency affirms that emissions in America are down to 1992 levels and California Air Resources Board recommends many more cost-effective ways to improve the air than through High-Speed-Rail! In truth, a massive train network will blast through America’s peaceful hometown communities: creating pollution, congestion, adding to higher density, enormous construction and funding costs while inflicting untold stress on overburdened economies!

Taxpayers Choose Savings: As Debt Rushes Towards $18 Trillion!

The ticket to rail success is selling tickets! On Amtrak’s Boston-Washington DC corridor, one-way tickets range from $146 – $420 per person, at $3.50 a gallon for the 438-mile trip, the $97.00 cost for car travel wins! Plus, the savings for door-to-door convenience, unlike train travel.

The Truth! There Are No High-Speed Trains in America!

In Ryan Holeywell’s 2013 article “Has High-Speed-Rail Been Derailed?” he emphasizes that High-Speed-Rail has not been achieved in America! The US Code defines high-speed as: “reasonably expected to reach sustained speeds of more than 125 miles per hour,” while Amtrak’s Acela Express, the only classified High-Speed-Rail, uses a flawed rating based on “sharing tracks with others trains.” Virtually the tracks alone create the need to average speeds, thus, preventing “sustained speeds of 125 miles per hour.” Travel speed times are easily distorted by adding, or dropping, train stops and, if the objective for HSR is to move people faster, High Speed Rail remains a fantasy!

California Budget-Busting High-Speed-Rail Boondoggle

While the California San Francisco-Los Angeles projects another $43 Billion from the Feds, the Government Accounting Office (GAO) argues that satisfying this obligation will be more than ALL national grants combined for subway, light-rail and bus transit. “Where is the money?”

California Congressman Jeff Denham, House Subcommittee on Rails, skeptical of the California business plan, forced transparency from Governor Jerry Brown who admitted his plan is to use Cap-and-Trade Pollution Trade Funds to match $2.5 Billion state obligation. This funding is highly controversial and Kathryn Phillips, Director of The Sierra Club, has aligned with the Tea Party against High-Speed-Rail. While the deadline for matching funds looms, the entire project hangs in balance, but Governor Brown aggressively pursues HSR!

Major problems are escalating in the first High-Speed rail state, even though Californians approved a $10 billion bond issue six years ago, they are now fraught with confusion and anger! Joe Nation, a public policy professor at Stanford University, reflected the frustration to the San Jose Mercury News “this could turn into a real nightmare.” Conflicts explode over imminent domain grabs, water issues delayed 20 years behind rail, inflated ridership projections and low ticket prices creating endless subsidies.

Yes Nevada’s Senator Harry Reid, presses to reactivate his $5.5 Billion stimulus monies cancelled when the supplier was revealed as the Canadian Bombardier Company, in direct violation of the Buy-America law.

All Aboard Florida – Private Industry Hijacks Taxpayers!

As soon as Florida turned down a federal grant for HSR, Florida East Coast Industries (FECI) conveniently introduced “All Aboard Florida” – the first private high-speed railway. Since FECI owns the rail corridor, and strategic building plots in Miami and Orlando, this will be profitable venture for their bottom line, but Treasure Coast taxpayers, with already-strained budgets, are required to pony-up millions to implement AAF’s private venture and then endure the environmental-assault of 35 round-trip “sort-of-high-speed trains” as they whiz through, once peaceful, beachside communities. No profit for Treasure Coast taxpayers!

Treasure Coast Vs. Grand Central Station?

Before “All Aboard Florida,” Florida Department of Transportation and Amtrak, were discussing new Miami-Orlando passenger service with seven new stations stops! If all of these projected plans eventuate, the lifestyle of paradise along the Treasure Coast will be transformed into the hectic pace of Grand Central Station! When tourism is Florida’s shining star, and money-maker, why would efforts continue to diminish this success?
Let Failure Be the Guide for the Wise!

Randal O’Toole of the Cato Institute in his article: “Defining Success, The Case Against Rail Transit,” outlines what All Aboard Florida could have in store for their bottom line! The Miami-West Palm 1989-debacle that cost the SE Florida Regional Transportation Authority (Tri-Rail) $53 million, with a $9 million return and $1 Billion capital improvement for double tracking of 71 miles, was projected to create 30,000 new riders and, astoundingly in 2008, resulted in a meager 13,000 new riders. Pretty steep fare at $76,923 per new customer! The good news is that sensible riders chose the $14.62 car travel instead! Failure still looms with Tri-Rail’s $30 million deficit!

The heroes in this grand-picture are Governor Scott Walker of Wisconsin, Governor John Kasich of Ohio and Florida’s Governor Rick Scott – who used wise judgment to reject federal grants and put taxpayer concerns above speculation. Governor Scott saw the writing on the wall, when comparing the proposed ridership of 3 million, to the busy New York Acela’s real riders of 3.2 million, highlighting a highly unobtainable goal. Hopefully this story rings-a-bell for politicians rushing towards a doomed financial fiasco!

Taxpayer Loyalty Pays, While Breaking the Bank Does NOT Pay!

EDITORS NOTE: The featured image is courtesy of SignalPAD and is licensed under the Creative Commons Attribution-Share Alike 2.0 GenericSignalPAD does not in any way  endorse this author or DrRichSwier.com and their use of SignalPAD’s original work.