Tuesday, January 3, 2012

Jobs, jobs and more jobs, just not for High-Speed Rail

California High-Speed Rail Peer Review Committee Report Due Out Today: Not good news for HSR

First, there's some fast breaking news in California about HSR.  The rail authority has, by law, a peer review committee that is intended to provide oversight and accountability.  Well, they are about to issue a report on the rail authority's funding plan and they don't like it.  They are empowered to advise the Legislature, and apparently will do so by recommending termination of funding for this project.  We're on stand-by, waiting for the full report to be released.  Here is an article on this from the LA Times: 

Two articles: Both about jobs and how the High-Speed Rail Authority has not been truthful. 
I'm shocked; shocked, do you hear?

Here's a two-fer.  The first article is about how the jobs numbers promised by the California High-Speed Rail Authority are lies. And, the fact that the San Jose Mercury News, which has long supported the HSR project in California, now acknowledges the error of their ways and admits that this project is a stinker that should be stopped.

The second article, below, is from today's New York Times and shows that all those jobs promises by the government are all hyped up exaggerations associated with just about any project that seeks or receives government funding, the high-speed rail project therefore no exception. It's become standard government practice.

As we said, the Mercury News is a Silicon Valley and San Jose newspaper, one of the more widely circulated papers in the Bay Area. They were big HSR supporters. They have changed their tune. Although, like many other papers now hostile to the CHSRA's efforts, the Merc. still insists on the value of the "concept":

"Building high-speed rail in California remains a visionary idea to provide efficient, clean-technology transportation connecting the state's north, center and south."

Yeah, yeah.  Until you dig into those claims and discover, oops, they aren't true either. Concepts such as HSR always sound like good sound-bites for political speech making. Nonetheless, the Merc. has now put its imprimatur on complete project termination.  That's good enough for us.  The hold-outs in California are still the major SF and LA papers, including the LA Times with the largest circulation.  

This year we can expect the rest of the California press to finally acknowledge the realities behind this project and all the lies that have, one by one, been exposed.

One little footnote here:  Those among us eager to take credit for this dramatic turn-around about the value and benefits from high-speed rail should note that the most important contributor to the changing of minds in California as well as the rest of the country is the California High-Speed Rail Authority itself.  They could not have done a better job if they tried to shoot themselves in both feet, a feat at which they excelled. 
Editorial: Bullet train is a misfire -- It's too costly and state won't get promised jobs
San Jose Mercury News
Posted: 01/02/2012 05:35:58 PM PST
Updated: 01/03/2012 10:31:18 AM PST

The promise of 1 million jobs springing from California's high-speed rail project has turned out to be a mirage. The real number, when stripped of rail supporters' obfuscating statistic-speak, shrinks to about 60,000 jobs a year at most for the 22 years it would take to build the railroad.

That's one more reason to stop the project now. Gov. Jerry Brown needs to wake up and tell the Legislature not to approve the sale of bonds for the first segment in the Central Valley now set to begin construction in 2012.

When Brown took office a year ago, he realized the cost estimates for high-speed rail were delusional. He made some get-real appointments to the rail authority and asked for a realistic cost, which he got: $99 billion, more than double the amount that appeared in the 2008 ballot measure approved by voters. 

This number pushed us over the edge to oppose a transportation plan we originally supported. Yet Brown persisted in backing high-speed rail - no doubt influenced, at least in part, by its job-stimulus potential.

Now that the number of jobs has deflated, it's critical to stop the project. Pushing ahead with the first segment will likely throw $5.5 billion of good money into a train to nowhere.

One million jobs was a strong selling point for a state with 11.3 percent unemployment, far higher than the national average. When rail supporters were confronted with the ballooning cost, they seized the jobs figure produced by project planners and economists as one reason to forge ahead.

Under scrutiny by a reporter from the San Jose Mercury News, however, the actual job number shrank dramatically.

The 1-million figure came from the project's technical studies. It actually was the number of "job years," a statistical term that counts years of work rather than actual jobs. One person working for five years adds up to five job years in this parlance.

Economic development professionals say this job estimating technique is common for planning documents, and that's fine, as long as it's accurately conveyed to the public. In the case of high-speed rail - and perhaps other projects we'll be examining in the new year - public reports omitted the "years" after "job," which of course is misleading. For most of us, five jobs means five people getting a paycheck, not one person working for five years at the same job.

Early next year, the Legislature will be asked to authorize a bond sale to pay for the Central Valley segment. It has the authority to say no if it finds the project doesn't deliver the benefits and costs promised to voters. This should be obvious to them and to Brown.

Building high-speed rail in California remains a visionary idea to provide efficient, clean-technology transportation connecting the state's north, center and south. As population grows through this century, building roads to accommodate it will cost more and pollute more than rail. But today, California is sinking under a budget deficit that could starve our schools and basic social services for years to come. 

A hard new reality has set in: we can't keep digging ourselves into an ever-deeper hole of debt. 

High-speed rail must wait for a better day.


Attention Unions and Democrats (and everybody else).  Let's, once and for all, put this jobs nonsense to rest.  We agree. HSR will require construction employment.  Operating the train will require personnel.  There will be new jobs around an operating HSR system.  

However, the number of jobs promised for the construction and operation of high-speed rail is ridiculous.  This NYT article doesn't even mention HSR as one of those job bubbles, although there are many other projects that have suddenly acquired new luster with promises of zillions of jobs.  It's a political game and doesn't mean anything.

Every other breath taken by any politician will have jobs creation attached to it. For HSR it used to be how the train would save our environment.  That promotional rosy picture has faded, since it's so long term and most politicians don't care that much about it anyhow. 

Our environment won't go to hell during the terms of any of our current electeds, so they, and therefore the rail authority, can drop that unheard message.  Air pollution, CO2, greenhouse effect, foreign oil, peak oil, energy efficiency, all those buzz-phrases that were so important even a year ago, can't be heard very much any longer because they have been replaced by the problem de jour, unemployment. 

But jobs, that's right now and going into the elections.  Each and every penny spent by this Democratic Administration and by Congress has "jobs" written all over it. 

As we now know, Mike Rosenberg's Mercury News article of several weeks ago, which we re-printed in this blog, dismissed those exaggerated one million jobs claims of the CHSRA, Senator Boxer and Congresswoman Pelosi, who support this train using the jobs mantra as justification. 

Jobs is a politically fashionable but false claim, as is the one from the rail authority about Amtrak's use of the intended rail section to be built in the Central Valley.  All lies.

When will the rest of California tire of the lying that justifies the intended expenditure of over $100 billion for a luxury train for the wealthy?

January 2, 2012

New Laws Now Evaluated by Job Creation
WASHINGTON — After years of judging the merits of federal laws by their costs or savings, Washington is applying a new yardstick: Will they create or destroy jobs?

When the American Public Transportation Association seeks more federal money, it argues that “public transit projects will put people to work.” Specifically, it says, “Every $1 billion we invest in public transportation means 36,000 jobs.”

When Lockheed Martin lobbies for the F-35 joint strike fighter, it says the new plane will strengthen the economy by “creating direct and indirect jobs for 127,000 Americans” in 47 states.

Health care lobbyists argue that cuts in Medicare and Medicaid take jobs away from nurses and other hospital employees. Tree farmers argue that cutting forest conservation programs will destroy “good-paying rural jobs.”

With unemployment stubbornly high, jobs, it seems, can be used to justify anything and everything. But some economists and other critics say that the figures can be misleading as advocates cook up inflated estimates to make their case.

“Many economists think most of that is pretty silly,” said David Card, an economics professor at the University of California, Berkeley, who is president of the Society of Labor Economists. “It’s just a selling point. You can say anything, no matter what, creates jobs. I don’t think people should pay much attention to it.”

Sometimes opposing sides offer the logic-defying claim that only their preferred outcome would be good for jobs. Republican lawmakers, for example, criticize new environmental regulations as job destroyers, but supporters of tougher clean air rules say they will create tens of thousands of jobs in pollution control industries.

Estimates of job creation or destruction often come from economic consultants hired by groups lobbying for or against a proposal. The impact can be magnified by including the indirect effects of a proposal on other parts of the economy.

Prof. John M. Abowd, a labor economist at Cornell, said that “labor markets are hugely dynamic,” with large numbers of jobs being created and destroyed even when the total level of employment stays roughly the same. For this reason, he said, it is often difficult to tell whether spending for a specific purpose directly creates jobs.

The wireless industry wants the government to free up more radio frequencies to meet consumer demand for mobile broadband. If allowed to use those frequencies, wireless companies say, they will spend billions of dollars on wireless networks, creating more than a half-million jobs.

Similar arguments are made for legislation to crack down on foreign Web sites that sell counterfeit goods and illegally copied music, movies, television shows and books.
Copyright, trademark and intellectual property rights may sound like obscure issues in the context of jobs. But a coalition of big companies, Creative America, frames its message to Congress in a way that politicians notice: “Stop foreign Internet criminals from stealing our jobs.”

A coal-industry group, attacking power-plant rules proposed by the Environmental Protection Agency, says they would “destroy over 180,000 jobs per year.” The estimate comes from a study commissioned by the American Coalition for Clean Coal Electricity, whose members include coal producers like Peabody Energy and Arch Coal.

Not to be outdone, companies that make scrubbers and other pollution-control equipment have their own trade association, the Institute of Clean Air Companies. They support many E.P.A. clean air standards. And they say that 1.5 million jobs will be created in the next five years as a result of the new requirements.

“These are good-paying American jobs for electricians, welders and engineers,” the institute says.

The National Association of Letter Carriers, fighting a proposal to eliminate Saturday mail delivery, says it would not only degrade customer service, but also threaten millions of jobs at direct marketers, printing and publishing companies and other businesses in the mailing industry. New taxes are portrayed as job-killers, while tax breaks are defended as job creators.

To help reduce the deficit, President Obama recently proposed new fees and taxes that would raise $36 billion over 10 years from airlines and air passengers. The industry sums up its opposition in four words: “Add Taxes. Lose Jobs.”

“Proposed airline taxes are a one-way ticket to the unemployment line for 181,000 Americans,” says the Air Transport Association, a trade group for air carriers.

The National Association of Manufacturers tells Congress that higher energy taxes will lead to higher prices and “millions of lost jobs.”

The new health care law levies many new taxes. Representative Erik Paulsen, Republican of Minnesota, is leading efforts to repeal one, on certain medical devices. The tax, he says, would “eliminate more than 40,000 well-paying jobs.”

Republican candidates for president say the health law, with its requirement for many employers to provide insurance or improve benefits, puts millions of full-time jobs at risk.

On the contrary, Obama administration officials say, the law will preserve and create jobs in several ways: by providing tax credits to small businesses to make insurance more affordable; by increasing the demand for health care goods and services; and by providing billions of dollars to build community health centers and school clinics.

People often cite jobs in trying to keep their favorite tax breaks.

The National Farmers Union, lobbying for extension of tax credits for renewable energy, says, “Wind energy creates jobs.” Farmers often receive lease payments from wind energy companies that place wind turbines on their land.

A new study commissioned by the American Wind Energy Association, a trade group, says that extending a tax credit for wind energy would “create and save 54,000 jobs,” while expiration of the tax break as scheduled at the end of 2012 would cause the loss of 37,000 jobs. 

Even tree farmers and their advocate, the American Forest Foundation, buttress their case by arguing that trees mean jobs.

Fearing that Congress will cut forest conservation programs in the 2012 farm bill, the foundation tells lawmakers, “Every square mile of private forest land supports five American jobs.”

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