Ricochet is the best place on the internet to discuss the issues of the day, either through commenting on posts or writing your own for our active and dynamic community in a fully moderated environment. In addition, the Ricochet Audio Network offers over 50 original podcasts with new episodes released every day.
New York City’s Infrastructure Is a Mess. Who Is to Pay?
Bloomberg News/Businessweek ran an extensive piece about the potentially disastrous condition of Penn Station in New York City and the perilous state of the two Hudson River tunnels that feed it. The tunnels are over 100 years old. The construction fill from the original World Trade Center that was used to create new land changed the course of the Hudson in such a way as to erode the river bed above the tunnels. Hurricane Sandy partly filled the tunnels with salty water, and the salt deposits are eating away at the elderly concrete.
The tunnels now carry far more people than they were ever envisioned to carry into the busiest single train station in the United States, so closing them for repairs would congest commuter traffic horribly, and projects to construct newer tunnels to supplement these aging ones have never come to fruition. So the author of the piece, Devin Leonard, details in his article:
As the gateway to America’s largest city, Penn Station should inspire awe, as train stations do in London, Paris, Tokyo, and other competently managed metropolises. Instead, it embodies a particular kind of American failure—the inability to maintain roads, rails, ports, and other necessary conduits. For generations, the officials connected to Penn Station have been blind to, or unable to deliver on, the idea that improving the station would more than pay for itself. (One estimate, from the Business Roundtable, says that a dollar invested in infrastructure yields as much as $3 in economic growth.) In the final days of 2017, the situation reached perhaps its bleakest point yet, when the Trump administration signaled its disinterest in coming to the rescue: The president will not honor an Obama-era commitment to New York and New Jersey to foot half the cost of a new tunnel, dumping planners back at square one. [emphasis mine]
Mr. Leonard concludes his piece with a repetition of what I have highlighted above. The question ultimately is, who will pay? Or rather, who should pay? As Mr. Leonard details at length in the article, New York City itself, New York State, and New Jersey have all had ample opportunities to fix Penn Station and the tunnels over the last 30 years, and yet they have never done so.
Penn Station is a debacle reaching across time. Its past is a slow-motion disaster of inaction and canceled reforms, its present an ongoing disgrace. And its future could be truly catastrophic, in the form of a tunnel failure that pinches shut one of the most vital economic arteries in America.
Of course, Amtrak somehow owns the station and the tunnels, and (pardoning the pun) Amtrak’s track record of repairs and self-improvement is hardly inspiring. Amtrak is a creature of the federal government, a Frankenstein’s Monster of its own creation. By that argument, the US Government should really be on the hook for fixing the station and the tunnels. Yet the tunnels are primarily used only by those working and living in and around New York City. Commuters to and from New Jersey, Amtrak riders coming to or leaving the city, and of course tourists are the chief customers. Should they not pay for what they are using? It seems that, at least in part, New Jersey commuters have contributed to the system’s overgrowth and overuse.
The addition of New Jersey Transit trains in the 1990s was both an economic boon to the region—I bought a house in Maplewood, N.J., in 1996 so I could ride the new Midtown Direct to work—and the beginning of Penn Station’s transformation from mere malodorous eyesore to Hieronymus Bosch-grade hellhole. With Jersey commuters swarming the place, farsighted politicians presented grand visions for upgrading it. They all failed.
It should be obvious that Mr. Leonard has no great fondness for the station (and I do admire his colorful metaphors for it). What follows in his article is a listing of all the major proposals to fix it, going back to a 1990 proposal from the late Sen. Daniel Moynihan. National catastrophe (9/11), political scandal (Eliot Spitzer’s fondness for hookers, John Corzine’s own corrupt administration), or political calculation (New Jersey Governor Christie’s canceling of funding) managed to kill every attempt, and now the Trump administration has killed an agreement that the Obama administration has made too.
But really, who should pay for it, if the situation is as dire as Mr. Leonard claims? New York City is moving ahead on a new station annex, the one originally championed by Moynihan, but is the station as vital as the tunnels that feed it?
But the $1.6 billion Moynihan Train Hall, as it will be known, isn’t likely to significantly reduce congestion, according to NYU’s Moss. Amtrak and LIRR passengers will still be able to access the train complex from the existing Penn Station, which is a block closer to the center of Manhattan. (The Cuomo administration says the impact will be greater.) Moss is among those who scoff at the idea of prettying the upper-level train station experience when what lies beneath is a such mess. “We don’t need a transit temple,” he says. “We need to focus on the tunnels and getting more tracks into Manhattan.”
While I’m not generally sympathetic to libertarian arguments about private roads, there are always exceptions. This, I would argue, is a major one. Rather than wheedling federal handouts to fix a tunnel of primarily local significance, why cannot New York and New Jersey simply sell tunnel rights to a private corporation, and let them finance it, construct it, and collect tolls, fees, and taxes from it?
Amtrak has been around, zombie-like, longer than I’ve been alive and to nobody’s benefit except in the Atlantic northeast, since politicians ultimately control its routes and rights of way. So, it should be kept away from any tunnel project as one would keep away a smallpox carrier. Let the private sector take over this mess, and let those who use it also pay for it, instead of spreading the pain amongst the US at large, or the entire tax bases of New York and New Jersey.
If more tracks are needed for Manhattan, then get the government out of the business of building them, for it is apparent that they are incompetent to do so.
Published in Economics
I was at the barber a few weeks ago in Boise Idaho. One of the other patrons began discussing how what Boise really needed was some sort of tram to really make it big. I wanted to hit my head into the wall. Great, something else to pay for. We can all see where these projects go.
It’s not just the station proper, but the mass of pedestrian tunnels connecting every subway for several blocks in every direction. The first task, and it’s not insignificant, would be figuring out what exactly ‘Penn Station’ means.
(According to Matthew Broderick’s Godzilla) there are 14 tunnels running in and out of Manhattan. Almost all of them are in the 50-100 year range. Just like the roads, every expansion has been followed by increased usage such that everything is always at maximum capacity. It’s a real mess.
However, I agree that I don’t see any reason why I should pay for their infrastructure (now that I don’t live there anymore). Politicians set the fares low to remain popular with the public, ignoring the fact that their revenues don’t come close to paying for the system. Same with bridge tolls, but in the other direction; they are ridiculously high for the cost of maintenance. But it’s about shaping public behavior. Politicians decide they like people on the trains, and not in cars, so that’s how fares and tolls are calculated.
The main change that privatization would accomplish would be to inject a serious dose of reality into the equation.
If New York and New Jersey want to collect tolls on it, whether public or private, I want the Feds to have no part whatsoever. Drop the tolls entirely (and permanently), and drop Davis-Bacon, and I’d grudgingly accept 50% of the tab. I agree with federal funding of interstates (with the same caveats), so fair is fair.
The real problem is that politicians dont see the re-election value of fixing pot holes over a new bridge/tunnel/runway.
How is it, when they consider a new fighter plane they consider the lifetime costs of operating the machine – thus the F-35 gets tagged with a $1 Trillion dollar price tag. (they also assume a 20-30 year lifespan for each of the machines) But when they build a bridge or a tunnel, nobody budgets the costs of maintenance for it. How can it be?
How is it, that every government construction project costs double or more than original quotes, is never completed on time and still nobody questions upkeep and maintenance of the project?
This is the real reason why the “Hyperloop” fantasy will never work. The government cant maintain a school well enough to be weather proof – is suddenly expected to maintain a 300 mile tunnel air tight? Never gonna happen.
“As the gateway to America’s largest city, Penn Station should inspire awe, as train stations do in London, Paris, Tokyo, and other competently managed metropolises.”
Let me take this back to my post about historical context that’s on the main page. What do London, Paris and Tokyo all have in common? They had the living crap bombed out them in the middle of the last century. If we could only have someone level NYC then we could have a wonderful post-war train station, too.
George Soros should pay.
I have heard from family that this same conversation was happening in Omaha, Nebraska.
How many environmental group lawsuits would hold up any big project? No big infrastructure project in the USA proceeds without multiple lawsuits against multiple parts of the project. How many suits are already making their way through the court system in New York and New Jersey?
Fantastic point, and made all the funnier since it’s the left in both cases. They want the big public works, and they block them from being built.
This has, in part, been addressed by the private sector. A ferry line in Hoboken provides parking in NJ, a return trip to Manhattan and private busses that can cart passengers across Manhattan for free at any time during the day. It competes with Amtrak, the subway and city busses, and successfully.
NYC does not need more federal subsidies. Between the NYHA, welfare payments, snap funds. section 8 housing subsidies, Obamaphones, Medicaid and utility subsidies, the city of NY gets billions and billions in federal subsidies. Let the people who live and commute there pay their own way. If they don’t like it, I suggest that they move.
And would be additionally addressed with a realistic market to play in. I used to take boat from a pier next to my apartment building that went directly to a pier at Wall St. They stopped the service because they couldn’t get enough riders with the PATH train at less than half the price.
Under a private system, some of the current fares, which are too low, would have to rise, meaning there would be more competition from the private solutions.
Move Wall Street to Kansas and shrink the city by a couple million.
That’s another realistic solution. The stock exchange could be moved, but something with far more impact is that companies put their headquarters there. But if the infrastructure doesn’t allow their employees to get to work, it’s the wrong location. Jersey City experienced a boom after 9/11 for that very reason, along with spreading assets into a less concentrated target. There’s room for a lot more of that.
With the advent of computer stock trading, some of Wall Street is already moving to no-income-tax Florida. Rick Scott is recruiting more.
Point of Order. Paris was never significantly bombed.
Hope to God no one brings up the idea of “bus rapid transit”. This &$@#&$@#$(@$ has screwed with my life for over a year (somehow, running buses in the middle of the street requires ripping up the street) and it’s not even close to being done.
https://www.abqjournal.com/1116887/mayor-outlines-major-problems-with-art-including-inability-to-charge-buses.html
Seriously, it would be cheaper to hire Uber drivers to ferry the drunks and drug addicts up and down the street than this nonsense. Which was all predicated on a magical $69 million grant from Uncle Sugar, which of course hasn’t materialized.
Which is 90% of the issue with Penn Station. Since the creation of Amtrak (thanks, Nixon), Penn Station has been owned by the Federal Government (Amtrak), the state governments of New York and New Jersey (PATH), the state government of New Jersey (NJ Transit), and the City of New York (MTA). Is there any wonder everything related to it is over budget and late?
On a more serious note, most of that was trying to satisfy Westfield, the Australian shopping mall company, that had just signed a 99-year-lease on the mall under the WTC the week of Sept 11. Since it’s now almost impossible to get in or out of the WTC site without passing literally 100 police officers, a mall is a lot less attractive to a developer, but they’re stuck with it.
I’m sorry, could you repeat that? I’m having trouble understanding you.
How about an unmanaged one, like Houston?
Why is the Champs Elysees lined with trees? So the German could march in the shade.
Why are they being torn up now? Muslims love the sun.
I remember the City Journal’s 10 Blocks podcast covering the Port Authority and found it here. It did a good job of showing the troubles of the Port Authority and had good ideas for improvement if I remember correctly. I need to give it another listen and read the articles they link to.
The conversation is happening in Indianapolis and its north suburbs as well. A lot of talk about “perception” of Indy as a big city, and much less talk about cost. Good news is it isn’t going anywhere (so far).
That’s what they showed people saying in some of the old Soviet movies.
So high tax New York (city and state) and high tax New Jersey can’t find the moneys to pay for needed infrastructure repairs and upgrades that they have long known would be necessary. Yet, in the proceeding decades they worked ceaselessly to grow their governments into just about every nook and cranny of their citizen’s lives. Maybe if they had just stuck to performing the core tasks of governing they’d have the resources to solve this problem.
But then they would have been stuck doing only core tasks. By expanding into new areas, while ignoring the core responsibilities, they now get to demand tax increases and federal funds to do the things they would have done if they hadn’t been doing the things they shouldn’t.
To give you some idea of just how bloated the PATH budget is, the following graphic shows that, the PATH system is the most expensive rail system on the planet. It’s almost double the cost per rail car mile of the famously expensive and wasteful LA system
This enormous expense is subsidized by other, profitable, parts of the PATH portfolio. The auto bridges and tunnels are immensely profitable. For all the ballyhoo about the evils of the private auto and the blessings of mass transit, the tolls levied at the bridges and tunnels subsidize the money-hemorrhaging PATH rail system.
I expect that’s because much of the track is under water. The rail lines are also very short, which might concentrate the cost, although I’m not sure about that.
Actually, most of the line is above ground and dead straight – from Jersey City to Newark.