A Call to Redirect Mass Transit Spending

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Randal O'Toole's Cato Institute study, "A Desire Named Streetcar," finds public transit systems wasting federal dollars and losing riders. O'Toole tells Scott Simon he favors more buses and fewer costly light-rail projects.

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SCOTT SIMON, host:

The Cato Institute has just issued a new study with a catchy name, A Desire Named Streetcar. Randal O'toole, a CATO Scholar and director of the Thoreau Institute wrote the study which says that a generation of federal subsidies to build mass transit systems has been misspent. He says that new light rail systems built with federal support in places like Atlanta, St. Louis, and the San Francisco Bay area have not attracted more riders or discouraged people from driving. Randal O'Toole joins us now from Portland, Oregon. Thanks so much for being with us.

Mr. RANDAL O'TOOLE (Scholar, Cato Institute and Author of the Study, 'A Desire Named Streetcar'): Glad to be here.

SIMON: You essentially argue that public transit systems have not succeeded in a sense in relocating population density, and that buses are a more successful way to follow population density, and, for example, deliver people who might be living in the inner city to jobs that are opening up in new areas.

Mr. O'TOOLE: Well, buses are more flexible than trains. They can rerun the buses, you can rearrange routes, you can do a lot of things that you can't do very well with rail systems. A typical light rail system costs about $50 million a mile.

SIMON: You trace a lot of this back to 1964, the Urban Mass Transportation Act.

Mr. O'TOOLE: Yes. In 1956, Congress passed the Interstate Highway Bill which allocated highway funds to the states on a strict formula based on population and the land area of the states.

SIMON: This was very significant because it literally made it possible for someone living in the smallest town in the west to pop up in New York City if they wanted to four or five days later.

Mr. O'TOOLE: That's right. But when Congress passed the Urban Mass Transit Act in 1964, it put the transit money out there on a first come, first serve basis. And so the race was on to come up with the most outrageously expensive transit system that you could so that you could get, quote, your share of the federal transit fund.

SIMON: Doesn't federal support for some of the new public transit systems that were built over the past generation, hasn't it at least created a lot of jobs? I mean, the American Public Transportation Association says that every billion dollars invested by the federal government creates about 47,000 jobs.

Mr. O'TOOLE: Well, we could fly airplanes over Wyoming and toss money out of the airplanes, and then you would have all kinds of jobs of people collecting the money, distributing the money; but that doesn't mean we're really doing anything productive.

SIMON: At the heart of your report is the idea that innovations in public transit have been stifled by federal bureaucratic regulations.

Mr. O'TOOLE: If 80% of your money comes from taxpayers, and the checks are signed by Congressional appropriators, then you're going to be listening more to the appropriators than to the users. In Portland, we have a light rail line with a transit station named after Senator Mark Hatfield. San Jose has a transit station named after then Congressman, Norm Mineta, who's now secretary of transportation. So the way to get yourself immortalized if you're a member of Congress is to build a rail system, and then you can get a station named after you. But what member of Congress is going to be honored by having a bus named after them? So this is just one more pressure to go for the expensive, inefficient transit, rather than the kind of transit that will really serve transit riders.

SIMON: What might encourage municipalities to, let's say, increase bus routing?

Mr. O'TOOLE: Well, every six years, Congress renews the federal transportation funding, and I think they need to say there's a fixed formula for just distributing transit money to the cities; and that formula should be based on not only the population of the cities, but how many transit riders there are in those cities. So that would give transit agencies incentives to do things that build transit ridership cost effectively, rather than do things that cost a lot of money, and maybe even lead to a decline in transit ridership.

SIMON: Mr. O'Toole, thanks very much.

Mr. O'TOOLE: Thank you very much.

SIMON: Randal O'Toole is an adjunct scholar at the Cato Institute. And to read his study, 'A Desire Named Streetcar' you can come to our website, npr.org.

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