More Wasteful Spending

Is what I'm sure the GOP and Tea Party will call the Administration's plan for High Speed Rail.*

Do not be fooled. This is the kind of investment in infrastructure our nation has needed for decades. I'm not even talking about the kind of good, paying jobs the building of this infrastructure will create, but the strategic and economic benefits we will receive once it is up and running.

It is also pretty bold talk for folks to call these improvements wasteful considering how less profitable the airline industry would be without government subsidies.

Without those subsidies, airlines would have to charge you the real cost of flying, in order to turn a profit. At that point, flying would return to being the luxury or essential business item it really ought to be.

Unfortunately, with our government needing to cut back on those massive subsidies, American travelers will get caught between the high, non-artificial cost of airline travel and the high and rising price of gasoline. (The rising cost of gasoline that, coincidentally, continues to increase the airlines' need for subsidization.) That will be bad for the economy as a whole as it will decrease our economic mobility.

How many billions in subsidies does this nation pour into the airline industry at the local, state and federal levels? All to support the infrastructure of Americans to traverse great distances more efficiently than by car. Add to that the unnecessary disadvantages that the government has placed on passenger rail service, and the market is rigged. Airlines "won" not because of the "invisible hand," but by the underhanded scheme.

Let me put it to you this way, the only reason people still fly commercial is because they have no options for long or medium distance travel. The only reason there are no options is because the government has interfered in the market on the side of the airlines. At this point, we have to choose between A) continuing to increase the subsidy for airline travel to make it economical for travelers or B) start investing in alternatives, so we can reduce the costs of those subsidies over time.

Remove those artificial disadvantages. Turn off the subsidy spigot for the airlines. Build ourselves an additional transportation infrastructure and give people the option to decide based on convenience and price. Watch what happens.

(HT: Alli)

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