Friday, July 16, 2004

Light rail light on economic logic 

The Elder -- who hid under my academic robes when debating trade policy with the Commish last night -- talks about light rail in the Twin Cities after reading the Economist
Trying to justify the existence of the light rail line by bragging up the "economic impact" in the areas surrounding the stations reminds me suspiciously of the efforts to claim that building sports stadiums will have a positive impact on the local economy. That hogwash has been thoroughly debunked by some of the best minds in the economics field.
He's of course talking about me, though I'd point through to my good friends Brad Humphries and Dennis Coates in this regard.  Tim Chapin at Florida State summarizes the costs and benefits thus:

[I] investigated the development impact of two sports projects (Cleveland�s Gateway and Baltimore�s Camden Yards) on their surrounding districts. Only in the case of Cleveland did the surrounding district experience substantial physical edevelopment. From this [I] concluded that sports facilities offer opportunities for development but that this outcome is by no means guaranteed by investments in sports facilities.

A related, but largely unexplored issue is that of the development costs of these projects. New facilities often require the relocation of existing businesses and/or government offices to provide enough land for a stadium or arena. Similarly, concurrent infrastructure improvements (interchanges, for example) may also require the relocation of existing firms from the district. While these development costs are sometimes identified as following from a project, they remain largely overlooked in the rush to get a project completed.  

The problem I observe with the Metrodome has always been what happens around the stadium when a sports event is not occuring.  Likewise, since light rail is meant to be commuter rail and therefore unlikely to run much on weekends, mid-day or evenings, will the spaces around the stations be black holes of inactivity much of the time?  I mean, what happens around this thing at 1pm?
The Elder also notes: conclude that "the return of rail has given the Twin Cities something of a boost" is ridiculously pre-mature. The line opened this month for farg's sake. If there's been a "boost", I'd like someone to please point it out to me.
It's similar to the stories splashed across the local media crowing about how many people used the light rail line in the first week, as if that was enough to call it a success and silence the critics. Keep an eye out for the stories in January about light rail ridership after six months. You'll have to look hard, as me thinks they won't be on the front pages anymore.
There is also a mention in The Economist story of the Taxpayers League of Minnesota, an organization led by our AM-1280 The Patriot radio colleague, David Strom:
Supporters of the project enthused, in the usual way, about reordering the urban landscape and cherishing the environment. To its opponents, however, light rail epitomised an outdated urban liberal penchant for social control, dense living and an irrational Europhilia--all the sort of things that left-leaning Minnesota used to be proud of. The conservative Taxpayers League of Minnesota, which carries much weight with conservative Republicans (including the state's governor, Tim Pawlenty) pointed out that light rail cost far more than roads.

It should be pointed out that the League has already had the estimable Randal O'Toole -- whose work I've followed for sometime in Liberty magazine (and they are finally getting it online, hurrah!) with a full study of light rail.  For a shorter read, consider David's sound bite:

Randal O�Toole and Wendell Cox published a study for the Heritage Foundation that asked and answered that question. Assuming an amazing 50% increase in transit�s market share (percentage of people using transit as a percentage of all travel) they calculated that the total time savings for peak period commuters would be 22 seconds.

Alternatively, O'Toole's study computes that the cost of removing one driver from the road system in Minneapolis for one day by use of light rail to be at least $18 and perhaps as much as $26.  All told, the estimate is for 9,000 cars taken off the roads -- if the planners are right. 


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Posted by King : 1:52 PM