Category: Public Choice

“Folly” of $66 Billion Subsidy for Trains, When Americans Prefer Cars and Planes

(p. 9) While long-haul railroads have a beloved place in our history, Americans almost entirely abandoned them more than a half century ago for the greater convenience of cars and the speed of planes.

And yet, not only have we continued to run a hugely loss-making nationwide network of passenger trains, last week’s bipartisan infrastructure plan includes tens of billions more for an Amtrak-based transportation system that will only ever be used by a small sliver of Americans outside of the Northeast Corridor rail line (known as the N.E.C.), which stretches from Washington to Boston.

The folly of another $66 billion — mostly for passenger railroads, one of the biggest allocations in the bipartisan compromise — makes me doubt how well other pieces of the trillions in spending proposed by the administration will be allocated. (President Biden wanted even more for Amtrak.)

. . .

Really? Consider a few stats: In the 2019 fiscal year, when excluding the N.E.C., Amtrak carried just 4.5 million passengers (not including services subsidized by states and cities), roughly 1.4 percent of our population. On average, passengers paid $115 while Amtrak spent $222 to transport each of them.

Unprofitable ticket prices notwithstanding, long-distance train travel dropped by 5.4 percent between the 2010 and 2018 fiscal years, while air travel rose by nearly 24 percent. On average, Amtrak filled only 55 percent of its long-distance seats in 2018. Does that warrant another $66 billion?

. . .

Populous California, where the automobile has reigned for decades, is an example of why betting on an American train travel revival is questionable. High-speed service between Los Angeles and San Francisco — which was approved by voters in 2008 at an estimated cost of $33 billion with completion expected in 2020 — remains a mirage. Completion is unlikely before 2030, while outlays are now projected to total at least $100 billion.

The California fiasco illustrates how execution will be key to implementing any infrastructure projects. But the government’s record is not great.

For the full commentary, see:

Steven Rattner. “Who Needs Amtrak? Not Wyoming.” The New York Times, SundayReview Section (Sunday, July 4, 2021): 9.

(Note: ellipses added.)

(Note: the online version of the commentary has the date July 1, 2021, and has the title “Why ‘Amtrak Joe’ Should Pull Back on Train Funding’.” Where the wording of the two versions slightly differs, the passages quoted above follow the online version.)

Central Planners’ Electric-Vehicle Push Is “More Political Showmanship Than Sound Planning”

(p. A1) The Toyota Prius hybrid was a milestone in the history of clean cars, attracting millions of buyers worldwide who could do their part for the environment while saving money on gasoline.

But in recent months, Toyota, one of the world’s largest automakers, has quietly become the industry’s strongest voice opposing an all-out transition to electric vehicles — which proponents say is critical to fighting climate change.

. . .

(p. A9) In statements, Toyota said that it was in no way opposed to electric vehicles. “We agree and embrace the fact that all-electric vehicles are the future,” Eric Booth, a Toyota spokesman, said. But Toyota thinks that “too little attention is being paid to what happens between today, when 98 percent of the cars and trucks sold are powered at least in part by gasoline, and that fully electrified future,” he said.

Until then, Mr. Booth said, it makes sense for Toyota to lean on its existing hybrid and plug-in hybrid vehicles to reduce emissions. Hydrogen fuel cell technology should also play a role. And any efficiency standards should “be informed by what technology can realistically deliver and help keep vehicles affordable,” the company said in a statement.

. . .

On paper, Toyota’s approach to zero-emissions vehicles, the hydrogen fuel cell, is a dream: Unlike battery-powered electric vehicles, these cars carry hydrogen tanks and fuel cells that turn the hydrogen into electricity. They refuel and accelerate quickly, and can travel for several hundred miles on a tank, emitting only water vapor. And hydrogen, theoretically, is abundant.

But a high sticker price, as well as lack of refueling infrastructure, has hampered the growth of a hydrogen economy, at least for passenger cars.

. . .

Jeffrey K. Liker, professor emeritus of industrial and operations engineering at the University of Michigan and author of “The Toyota Way,” said that there were other factors slowing Toyota’s push. A famously cautious company, Toyota has researched solid-state batteries, which are safer than the widely used lithium-ion technology, but readying that technology has taken longer than they expected, he said. Toyota has also spoken about not wanting to lay off employees or bankrupt suppliers in a rapid transition to electrics.

“Toyota’s view is also that countries are jumping in with the idea of the electric-vehicle endgame without a real plan, and it’s more political showmanship than sound planning,” Mr. Liker said.

For the full story, see:

Hiroko Tabuchi. “Maker of Prius Now Resisting Emissions Push.” The New York Times (Monday, July 26, 2021): A1 & A9.

(Note: ellipses added.)

(Note: the online version of the story was updated Aug. [sic] 6, 2021, and has the title “Toyota Led on Clean Cars. Now Critics Say It Works to Delay Them.”)

Liker’s book mentioned above is:

Liker, Jeffrey. The Toyota Way, 14 Management Principles from the World’s Greatest Manufacturer. 2nd ed: McGraw-Hill Education, 2021.

China Charges Montenegro $1 Billion to Build Road “From Nowhere to Nowhere”

(p. 4) MATESEVO, Montenegro — One of the world’s most expensive roads slices through the mountains of Montenegro, soaring over deep gorges on towering bridges, before reaching its destination: a muddy field outside a hamlet with a few dozen houses, many of them empty.

Mirka Adzic, a resident of the hamlet, Matesevo (population: around 15), said she was delighted there would soon be a modern expressway so close to home as it would save her from having to take a treacherous mountain track, previously the only access to the outside world.

But, much as she likes the new Chinese-built expressway — which is supposed to open in November [2021] at a cost of nearly $1 billion after six years of hazardous work, two years behind schedule — she doesn’t really understand it.

Struggling to support a family on her husband’s meager salary as a driver for the Chinese construction company that built the road, she is baffled that her country, one of Europe’s poorest, has committed so much money to a gargantuan, state-of-the-art engineering project. Montenegro is now saddled with debts to China that total more than a third of the government’s annual budget.

Ms. Adzic is not alone. Montenegro’s new prime minister, Zdravko Krivokapic, who took over late last year from the government that signed the road and loan contracts with China in 2014, described the highway as a “megalomaniac project” that “goes from nowhere to nowhere” and badly strained his country’s finances.

. . .

A 2012 study led by a British company for Montenegro’s Ministry of Transport warned that construction costs would be unusually high because of the mountainous terrain. Even so, its cost estimates were considerably lower than the more than $900 million charged by the China Road and Bridge Corporation to build the 25-mile, but particularly difficult, stretch of the highway.

An earlier feasibility study, in 2007, by Louis Berger, an engineering company in Paris, warned that traffic along the proposed highway would not be “high enough to justify” investment “from a purely financial basis.”

. . .

Nearly $280 million, more than half of the total amount of money paid to local subcontractors, has gone to a single Montenegro company, Bemax, formally owned by a onetime cafe owner who, before he moved into road building, had no previous experience in engineering work, according to MANS, the research group.

Nebojsa Medojevic, a member of Parliament, claimed that Bemax was in reality owned by a close adviser of Mr. Djukanovic, Milan Rocen, a former ambassador to Moscow. Mr. Djukanovic denied this, saying he had “of course” asked his adviser and been assured the claims were false. Mr. Rocen has himself categorically denied owning Bemax.

For the full story, see:

Andrew Higgins. “Montenegro, a Nearly $1 Billion Road to ‘Nowhere’.” The New York Times, First Section (Sunday, August 15, 2021): 4.

(Note: ellipses added.)

(Note: the online version of the story has the date Aug. 14, 2021, and has the title “A Pricey Drive Down Montenegro’s Highway ‘From Nowhere to Nowhere’.”)

As Chinese Marxists Limit Liberty, the Young Show “Silent Resistance” by “Lying Down”

(p. 4) Five years ago, Luo Huazhong discovered that he enjoyed doing nothing. He quit his job as a factory worker in China, biked 1,300 miles from Sichuan Province to Tibet and decided he could get by on odd jobs and $60 a month from his savings. He called his new lifestyle “lying flat.”

“I have been chilling,” Mr. Luo, 31, wrote in a blog post in April [2021], describing his way of life. “I don’t feel like there’s anything wrong.”

He titled his post “Lying Flat Is Justice,” attaching a photo of himself lying on his bed in a dark room with the curtains drawn. Before long, the post was being celebrated by Chinese millennials as an anti-consumerist manifesto. “Lying flat” went viral and has since become a broader statement about Chinese society.

. . .

Mr. Ding, 22, has been lying flat for almost three months and thinks of the act as “silent resistance.”

. . .

The ruling Communist Party, wary of any form of social instability, has targeted the “lying flat” idea as a threat to stability in China.

. . .

Mr. Luo was born in rural Jiande County, in eastern Zhejiang Province. In 2007, he dropped out of a vocational high school and started working in factories. One job involved working 12-hour shifts at a tire factory. By the end of the day, he had blisters all over his feet, he said.

In 2014, he found a job as a product inspector in a factory but didn’t like it. He quit after two years and took on the occasional acting gig to make ends meet. (In 2018, he played a corpse in a Chinese movie by, of course, lying flat.)

Today, he lives with his family and spends his days reading philosophy and news and working out. He said it was an ideal lifestyle, allowing him to live minimally and “think and express freely.” He encourages his followers, who call him “the Master of Lying Down,” to do the same.

After hearing about Mr. Luo’s tangping post on a Chinese podcast, Zhang Xinmin, 36, was inspired to write a song about it.

. . .

Mr. Zhang uploaded the song to his social media platforms on June 3, and within a day censors had deleted it from three websites. He was furious.

. . .

Lying down is really good
Lying down is wonderful
Lying down is the right thing to do
Lie down so you won’t fall anymore
Lying down means never falling down.

For the full story, see:

Elsie Chen. “For Young People in China, ‘Lying Flat’ Beats Working.” The New York Times, First Section (Sunday, July 4, 2021): 4.

(Note: ellipses, and bracketed year, added.)

(Note: the online version of the story has the date July 3, 2021, and has the title “These Chinese Millennials Are ‘Chilling,’ and Beijing Isn’t Happy.”)

Facebook and Twitter Colluded with Government to Censor Free Speech

(p. A17) The media has panned Donald Trump’s First Amendment lawsuits against Facebook, Twitter and YouTube: “sure to fail,” “as stupid as you’d think,” “ridiculous.”

. . .

But the central claim in Mr. Trump’s class-action lawsuit—that the defendants should be treated as state actors and are bound by the First Amendment when they engage in selective political censorship—has precedent to back it up. Their censorship constitutes state action because the government granted them immunity from legal liability, threatened to punish them if they allow disfavored speech, and colluded with them in choosing targets for censorship.

. . .

A growing body of evidence suggests that social media companies have voluntarily worked with Democratic officials to censor content the latter disfavor. In Brentwood Academy v. Tennessee Secondary School Athletic Association (2001), the high court held that state action exists if the private party’s conduct results from “significant encouragement, either overt or covert,” or if the private party is a “willful participant in joint activity with the State or its agents.”

According to allegations in other pending lawsuits, Twitter formed “trusted partner” relationships with state officials to remove content identified by the officials as election misinformation—when in reality the content was simply critical of state policies.

In September 2020 Mr. Zuckerberg acknowledged that Facebook “works with” the Centers for Disease Control and Prevention to remove Covid-related content. The company’s official policy states that it is “advised” by public-health authorities about what Covid content should be blocked. For months, while officials including Anthony Fauci proclaimed that the Wuhan lab-leak theory was “debunked” and a “conspiracy theory,” Facebook blocked any mention of that theory as “misinformation.”

But after Dr. Fauci and the administration retreated from this position, Facebook almost immediately lifted its ban. Recently published email exchanges between Mr. Zuckerberg and Dr. Fauci reveal no evidence of direct instruction from the government on this point but make a case for Facebook’s willful participation in a joint activity with the government.

For the full commentary, see:

Vivek Ramaswamy. “Trump Can Win His Case Against Tech Giants.” The Wall Street Journal (Monday, July 12, 2021): A17.

(Note: ellipses added; italics in original.)

(Note: the online version of the commentary has the date July 11, 2021, and has the same title as the print version.)

Politicians Have a “Ribbon-Cutting Bias”

(p. A4) A new paper by a pair of economists says the gains from infrastructure spending aren’t always clear-cut and recommends that policy makers examine the costs and benefits of each project.

“If we are going to commit a significant amount of resources to new infrastructure projects or to maintain our existing infrastructure, bringing some discipline to the way we decide what we’re spending on is an important element of this,” said James Poterba, an economist at the Massachusetts Institute of Technology, who co-wrote the paper with Edward Glaeser of Harvard University.

. . .

In some cases, the authors write, the best solution doesn’t involve construction at all. Rather than building new lanes to ease traffic in a dense urban area, it might make sense to consider congestion pricing, which charges drivers a variable fee depending on time of day, they write.

Mr. Poterba recommended a voucher or tax-rebate system for lower-income households to ensure they aren’t disproportionately hurt by the fees.

The cost of repairing an unsafe bridge in a remote area with very little traffic may exceed the benefits, they write. In that case, the most economically efficient solution might be to close or demolish it. It might also make more sense to link cities with rapid buses on dedicated lanes rather than build new rail lines. Satellite broadband or 5G network access might be a good alternative to laying fiber optic cables to provide high-speed internet access to rural areas, they write.

. . .

Identifying the benefits of a project also is complicated, because measuring benefits depends on how much it will be used, which is difficult to predict in advance.

“You have to be careful you’re not being highballed with rosy projections about what the demand for utilization will be,” said Mr. Poterba.

. . .

Officials sometimes prefer spending on new projects over maintenance because of a “ribbon-cutting bias,” Mr. Poterba said, “where you can point to the thing and say it wasn’t there before my time and now it’s there.”

For the full story, see:

David Harrison. “Paper Questions Spending On Projects.” The Wall Street Journal (Thursday, July 15, 2021): A4.

(Note: ellipses added.)

(Note: the online version of the story has the date July 14, 2021, and has the title “Not All Infrastructure Projects Are Worth It, Paper Finds.”)

Disney’s Imagineers “Brain Trust” Leaving California for Florida’s “Business Friendly Climate”

(p. B3) Disney executives told roughly 2,000 workers in Southern California—including many members of its famed Imagineers force—that their jobs would be moving to a new campus in Orlando.

. . .

Though Disney’s narrative on Wall Street has lately focused on its streaming efforts, any change to the parks that are beloved by consumers and protected by employees carries symbolic resonance.

That is especially true for the Imagineers, which have become one of Disney’s most revered and mysterious workforces. Since their founding in the mid-20th century, the Imagineers have been credited by fans and Walt Disney himself with innovating some of the signature touches found in Disney theme parks, including beyond traditional entertainment.

. . .

The costly nature of Disney’s new office points to the sophistication of the tech operations moving there. The Imagineers in particular have come to be known as a Disney brain trust, with new employees joining from Google Inc. or the National Aeronautics and Space Administration.

As the scope of Disney’s parks division has grown, smaller groups of Imagineers have been based in Florida, Shanghai and other parts of the world. With this most recent announcement, the largest concentration of Imagineers will no longer be based in Southern California for the first time since their founding.

Imagineer projects have included the Haunted Mansion and Soarin’ Around the World as well as newer additions such as the Avengers Campus and a “Zootopia”-themed land. Employees are immersed in the Imagineer way: to constantly “plus” their work—that is, make every detail a bit better—and think of each project in a “blue sky” way with no limitations.

Josh D’Amaro, the Disney executive overseeing the relocation, recently ended a parks presentation with a clip of Imagineers watching a walking robotic “Groot” from the film “Guardians of the Galaxy.” And then he wielded a “Star Wars” lightsaber.

“It’s real,” he added, two words that sent online fandoms into frantic speculation over what the Imagineers were cooking up. Patent applications routinely stream out of the division, many dissected by parks disciples for clues about what changes might be afoot.

In announcing the change, Mr. D’Amaro, head of Disney’s parks, experiences and products division since May 2020, said the decision didn’t come lightly since he had moved his own family across the country while climbing Disney’s ranks. He cited Florida’s business-friendly climate in announcing the move and pointed out to employees that the state offered a lower cost of living with no state income tax.

For the full story, see:

Erich Schwartzel “Disney Magic Makers to Relocate.” The Wall Street Journal (Saturday, July 24, 2021): B3.

(Note: ellipses added.)

(Note: the online version of the story has the date July 23, 2021, and has the title “Disney Looks to Relocate Its Theme-Park Magic Makers to Florida.” Where there is a slight difference in wording, the quotes above follow the online version.)

Center-Left Biothreat Expert Says Many Scientists Rejected Wuhan Lab Origin, Not Due to Evidence, but Due to Trump

(p. A13) A few months before Covid-19 became a pandemic, Filippa Lentzos started reading about unusual flu cases in Wuhan, China. Ms. Lentzos, a social scientist who studies biological threats, belongs to an email group she describes as consisting of “ex-intelligence, bioweapons specialists, experts, former State Department diplomats” and others “who have worked in arms control, biological disarmament.”

As Chinese authorities struggled to contain the outbreak, she recalls, the expert circle asked questions about the pathogen’s origin: “Is this security related? Is it military? Is there something dodgy going on? What information are we not getting here?”

. . .

. . . in February 2020, a group of scientists had published a statement in the Lancet calling out “conspiracy theories suggesting that COVID-19 does not have a natural origin.” The New York Times and Washington Post dutifully attacked Mr. Cotton as unhinged. Media, with an assist from some virologists, dismissed the lab-leak theory as “debunked.”

Ms. Lentzos, who places her own politics on the Swiss “center left,” thought that conclusion premature and said so publicly. In May 2020, she published an article in the Bulletin of the Atomic Scientists weighing whether “safety lapses in the course of basic scientific research” caused the pandemic. While acknowledging there was, “as of yet, little concrete evidence,” she noted “several indications that collectively suggest this is a serious possibility that needs following up by the international community.”

. . .

The article barely made a ripple. “If you look at the argumentation that’s used today, it’s exactly the same basically as what I laid out, which was, accidents happen,” she says. “We know that they’re having questions around safety. We know they were doing this field work. We see videos where they’re in breach of standard biosafety protocol. We know China is manipulating the narrative, closing down information sources—all of that stuff. All of that is in there. But it didn’t get much traction.”

. . .

American liberals—including many scientists—conflated open-mindedness about the question with support for Mr. Trump. Ms. Lentzos was one of the few who could separate their distaste for him from their analysis of the pandemic.

. . .

The most significant problem came from the scientific community. “Some of the scientists in this area very quickly closed ranks,” she says, and partisanship wasn’t their only motive: “Like most things in life, there are power plays. There are agendas that are part of the scientific community. Just like any other community, there are strong vested interests. There were people that did not talk about this, because they feared for their careers. They feared for their grants.”

Ms. Lentzos counsels against idealizing scientists and in favor of “seeing science and scientific activity, and how the community works, not as this inner sacred sanctum that’s devoid of any conflicts of interests, or agendas, or any of that stuff, but seeing it as also a social activity, where there are good players and bad players.”

Take Peter Daszak, the zoologist who organized the Lancet letter condemning lab-leak “conspiracy theories.” He had directed millions of dollars to the Wuhan Institute of Virology through his nonprofit, EcoHealth Alliance. A lab mistake that killed millions would be bad for his reputation. Other researchers have taken part in gain-of-function research, which can make viruses deadlier or easier to transmit. Who would permit, much less fund, such research if it proved so catastrophic? Yet researchers like Marion Koopmans, who oversees an institution that has conducted gain-of-function research, had an outsize voice in media. Both she and Mr. Daszak served on the World Health Organization’s origin investigation team.

. . .

Ms. Lentzos has experience working with United Nations agencies, including the World Health Organization. “It was incredibly exciting to finally go in. And then you become more disillusioned when you see how things operate, how things don’t operate,” she says. “Like any large organization, they are slow, and inflexible, and bureaucratic.”

For the full interview see:

Adam O’Neal, interviewer. “THE WEEKEND INTERVIEW; A Scientist Who Said No to Covid Groupthink.” The Wall Street Journal (Saturday, June 12, 2021): A13.

(Note: ellipses added.)

(Note: the online version of the interview has the date June 11, 2021, and has the same title as the print version.)

Slow FDA Feeds Skepticism of mRNA Covid-19 Vaccines

(p. A19) In December 2020, the F.D.A. approved the distribution of mRNA coronavirus vaccines made by Pfizer and Moderna under the agency’s emergency use authorization provision, which permits an accelerated approval process for medications and treatments during a public health emergency.

. . .

In theory, full approval should be imminent, since Pfizer applied for full approval in early May, and Moderna asked for full approval on June 1. This process is often long, requiring the agency to inspect manufacturing plants and review considerable amounts of documentation for vaccine production. But in this case, because of the urgency of the pandemic, the vaccine makers began to submit this material, called a biologics licensing application, in late 2020, and they’ve continued to submit more information. The F.D.A. has already reviewed some of the submissions and has provided feedback to the manufacturers. The emergency authorizations were granted more than six months ago. That’s more than ample time for the agency to conduct plant inspections and review the applications.

. . .

Fortunately, two doses of the mRNA vaccines appear to provide nearly full protection from Covid-related hospitalization and death, and the shots substantially reduce infections.

The lives and health of millions of Americans rest on the F.D.A.’s decision to fully license these vaccines.

For the full commentary see:

Eric J. Topol. “Vaccines Need Full Approval.” The New York Times (Monday, July 5, 2021): A19.

(Note: ellipses added.)

(Note: the online version of the commentary has the date June 1, 2021, and has the title “It’s Time for the F.D.A. to Fully Approve the mRNA Vaccines.”)

Longshoreman Union Reduces Efficiency of American Ports

(p. A15) Global supply chains are buckling, driving up prices, creating shortages and frustrating consumers.

. . .

One problem is productivity. In Asia, ships are worked 24/7, or 168 hours a week, compared with 16 hours a day, or only 112 hours a week, at Los Angeles-Long Beach. Terminal gates used by truckers to deliver and receive seaborne containers operate only 88 hours a week, vs. 168 in Asia. For larger ships, it takes 24 seconds on average to move a container at the Chinese ports of Shanghai, Qingdao and Yantian, vs. 48 seconds at Los Angeles, according to IHS Markit port-performance data.

. . .

A decades-long history of toxic labor-management relations has led to huge cost increases that discourage operators from expanding work hours, limit their ability to automate terminals, and end in avoidable delays during contract negotiations. Many companies won’t soon forget six months of costly delays at West Coast ports during contract negotiations with the International Longshore and Warehouse Union in 2014 and 2015. More than 30 container ships were backed up at anchor off the ports during that episode. Companies will be closely watching the next round of negotiations in 2022.

There is no sign that the labor-management paradigm will change, and a Democratic administration is unlikely to challenge longshoremen’s unions to make compromises.

For the full commentary see:

Peter Tirschwell. “Behind Your Long Wait for Packages.” The Wall Street Journal (Thursday, June 3, 2021): A15.

(Note: ellipses added.)

(Note: the online version of the commentary has the date June 2, 2021, and has the same title as the print version.)