Taking the train to NY on Pittsburgh's original rail link to the world takes more than 9 long hours which gives one plenty of time to think about the decline of America's rail infrastructure and the coming decline of it's competitor-- the government funded highway system.
People already worried about the woes of the housing bubble, the cost of the Fed's bailout of Fannie Mae and Freddi Mac and the city of Pittsburgh's debt might not be happy about finding out there are a lot more liabilities and unbacked promises still under the torn up rug. The word "Trust Fund" is usually a good clue that a big unfunded liability lies under your feet.
The LA Times has a nice story on a funny situation the government is in as people start to drive less and move towards fuel efficient cars.
"The result: The principal source of funding for highway projects will soon hit a big financial pothole. The federal highway trust fund could be in the red by $3.2 billion or more next year.
The fund, set to finance about $40 billion in transportation projects next year, is increasingly strained. And the problem has taken on greater urgency as lawmakers face a backlog of projects to maintain the nation's aging interstate highway system and ease traffic congestion.
"The situation has only been exacerbated by rising fuel prices, which are causing motorists to drive less and resulting in less revenue for transportation improvements," said David Bauer, senior vice president for government relations at the American Road and Transportation Builders Assn."
One is reminded of the situation the government is in as a major player in the cigarette business. Allegedly, they want people to stop smoking but at the same time they rely heavily on cigarette tax revenues.
President Bush had a particularly bizarre plan to fill the hole in road funding by actually cutting Mass Transit subsidies at a time when use of this far more efficient mode of transportation is exploding. Of course this is why we need the government to be involved in the first place. Projects that make financial sense will be paid for by private investors, but we need the government to sustain those that make no sense.
The Week Ahead: A Trip to Asheville
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