Christie and ARC: A Different Perspective

I’ve gone back and forth on Gov. Christie’s decision to kill the ARC about 10 times in the last 24 hours, and probably will do so another 10 times in the next 24 hours, but with all due respect to David and Matthew and innumerable other vocal opponents of the decision, it’s hard to offer a fair evaluation of what Christie has done here without reference to this state’s truly dire fiscal situation, which exists in spite of one of the highest overall tax burdens in the country. 

Although I’m not a transportation wonk in any way, I think it’s also important to note some additional context here, and in particular the difference between the idea of the ARC Tunnel and the ARC Tunnel as it was likely to actually exist.  The erascible Paul Mulshine adds some background. 

And, while we’re here, it’s probably worth pointing to Mark Di Ionno’s lament over a failure 53 years in the making.

Again, I’m really torn on this one.  But there’s a lot more to this story and decision than simply “higher gas taxes” versus “badly needed infrastructure.”  If, as Paul Krugman claims, this is the “worst policy decision ever made by the government of New Jersey,” then it’s a failure with more than enough blame to go around.

UPDATE: Along the same lines as me, but with a much more informed take, please see Reihan Salam (h/t Tony S. in the comments), who also has the good sense to quote at length from a recent op-ed in the Bergen County Record “by the staff of the Regional Plan Association, a group that has been working on regional transportation and planning issues in the New York area since the 1920s.” 

You should really read Salam’s whole piece, but I wanted to emphasize one critical quote from that Regional Plan Association op-ed:

Half a dozen Governors over ten years have spent more than the state’s Transportation Trust Fund could afford, collecting about $900 million a year in gas taxes and other sources, but spending about $1.4 billion each year on capital projects. The gap was filled by borrowing – a familiar story in New Jersey these days. Unfortunately, the bill is now due. Starting in less than one year, every dollar collected in gas tax revenues for the next 30 years will go to paying off bonds that have already been spent. Unless hundreds of millions of dollars in new revenues or significant cost reductions can be identified, the state’s capital spending on other transportation projects (street and bridge repairs, highway upgrades, other transit investments, etc.) will drop dramatically. 

(My emphasis). 

As densely populated as New Jersey is, and despite its proximity to New York, there are still people who have to drive to work.  As importantly, there are also a fairly large number of large corporations in the pharmaceutical and telecom industries based in New Jersey, far from any significant access to rail service and in no position to expect such access.  Indeed, once you get outside the close-in suburbs (admittedly the lion’s share of the state’s population base), you quickly find that those two industries are about as or more important to the local economy than almost any other industry in any other locality of the country.  In other words, continued maintenance of our state’s roads at least at current levels is perhaps just as much a critical element of the economic future of New Jersey as easier access to Manhattan. 

Finally, it’s important to remember that the projected benefits of the ARC Tunnel Project are just that: projected.  Those projections are ultimately based on a whole set of fairly optimistic assumptions about what the NYC economy (and thus, by extension, the global economy) will look like decades from now.  Those projections may well turn out to be right, and NYC is as safe a city to base long-term projections on as any that has existed in our country’s history.  But they are still projections.

UPDATE 2: Christie agrees to study “several options presented by Secretary LaHood to salvage a trans Hudson tunnel project,” while emphasizing that “The fact that the ARC project is not financially viable and is expected to dramatically exceed its current budget remains unchanged.”  (H/T: ThatPirateGuy in the comments).

As I said, there is a lot more to this issue than just “gas tax” versus “badly needed infrastructure,” and much of the outrage spawned by Christie’s initial decision simply ignored that basic fact.