Told Ya Toyota

Posted by Walter Olson

Readers of Cato at Liberty knew all about this last July, and now the Obama Department of Transportation is confirming it publicly:

The Obama administration’s investigation into Toyota safety problems has found no electronic flaws to account for reports of sudden, unintentional acceleration and other safety problems. …
“We enlisted the best and brightest engineers to study Toyota’s electronics systems and the verdict is in. There is no electronic-based cause for unintended acceleration in Toyotas,” Transportation Secretary Ray LaHood said in a statement.

If, as retiring NHTSA official George Person charged last July, DoT officials dragged their heels in making public the exculpatory findings, there were very real costs to the economy. Not only did lawsuits proliferate which one hopes are now on their way to sputtering out, but Toyota (as Reuters reports) “was the only major automaker in the United States to report a drop in sales last year” even though the Japanese-owned automaker has ramped up costly dealer and sales incentives. Did it make a difference that the federal government has taken a proprietor’s interest in major Toyota competitors GM and Chrysler, or that a former trial lawyer lobbyist heads the National Highway Traffic Safety Administration? Those questions might be worth a hearing at the newly reconstituted House Energy and Commerce Committee.

A Ban On “Walking While Wired”?

Posted by Walter Olson

New York state senator Carl Kruger (D-Brooklyn) is crusading to ban pedestrians’ use of cellphones and other mobile devices while crossing the street. It’s for your own good, you must understand:

“When people are doing things that are detrimental to their own well being, then government should step in.”

The Daily Caller asked me to write an opinion piece about this proposal so I just did. Excerpt:

Phone use on the street has become near-ubiquitous in recent years, yet over nearly all that time — nationally as in Gotham — pedestrian death rates were falling steadily, just as highway fatalities fell steadily over the years in which “distracted driving” became a big concern.

In the first half of 2010, the national statistics showed a tiny upward blip (0.4 percent), occasioned by a relative handful of fatalities in a few states. Even a spokesman for the Governor’s Highway Safety Association, Jonathan Adkins, seems to agree it’s premature to jump to conclusions: “You don’t want to overreact to six months of data,” he told columnist Steve Chapman.

Like others who seek quasi-parental control over adults, Sen. Kruger tends to infantilize his charges. He told the Times: “We’re taught from knee-high to look in both directions, wait, listen and then cross. You can perform none of those functions if you are engaged in some kind of wired activity.”

This drew proper scorn from columnist Chapman: “Actually, you can perform all those functions and dance an Irish jig, even with text messages or rock music bombarding you.” That some ear bud devotees don’t take due caution is no reason to pretend they can’t.

C.S. Lewis, Lily Tomlin and Transportation Secretary Ray LaHood all get walk-on parts as well.

High-Speed Federalism Fight

Posted by Tad DeHaven

In October, I speculated that the upcoming elections could be the nail in the coffin for the Obama administration’s plan for a nationwide system of high-speed rail. Indeed, some notable gubernatorial candidates who ran, in part, on opposition to federal subsidies for HSR in their states proceeded to win. However, Transportation Secretary Ray LaHood made it clear in a recent speech to HSR supporters that the administration intends to push ahead.

LaHood’s message was targeted specifically to incoming governors John Kasich in Ohio and Scott Walker in Wisconsin, who argued that HSR doesn’t make any economic or practical sense for their states.

LaHood said that states rejecting federal HSR subsidies won’t be able to reroute the money to other uses, such as roads. Instead, LaHood said the rejected money will redistributed “in a professional way in places where the money can be well spent” — i.e., other states. And sure enough, other governors were quick to belly up to the Department of Transportation’s bar in order to grab Ohio and Wisconsin’s share.

From the Columbus-Dispatch:

New York Gov.-elect Andrew Cuomo has said he would be happy to take Ohio’s money. Last week, California Democratic Sens. Barbara Boxer and Dianne Feinstein wrote LaHood saying that California stands ready to take some, too, noting that several states that elected GOP governors this month have said they no longer want to use the rail money for that purpose.

“It has come to our attention that several states plan to cancel their high-speed rail projects. We ask that you withdraw the federal grants to these states and award the funds to states that have made a strong financial commitment to these very important infrastructure projects,” Boxer and Feinstein said in their letter to LaHood.

This is a textbook example of why the Department of Transportation should be eliminated and responsibility for transportation infrastructure returned to state and local governments. If California wishes to pursue a high-speed rail boondoggle, it should do so with its own state taxpayers’ money. Instead, Ohio and Wisconsin taxpayers now face the prospect of being taxed to fund high-speed rail projects in other states.

If California’s beleaguered taxpayers were asked to bear the full cost of financing HSR in their state, they would likely reject it. High-speed rail proponents know this, which is why they agitate to foist a big chunk of the burden onto federal taxpayers. The proponents pretend that HSR is in “the national interest,” but as a Cato essay on high-speed rail explains, “high-speed rail would not likely capture more than about 1 percent of the nation’s market for passenger travel.”

Retiring Official: DOT Is Sitting on Pro-Toyota Probe Results

Posted by Walter Olson

Damning if true: 

A new report in the WSJ strongly suggests Transportation Secretary Ray LaHood is unwilling to release a report on the agency’s investigation into charges of “sudden acceleration” in Toyotas because its findings are too favorable to the Japanese automaker’s case. The source is a high-ranking retiring NHTSA official, George Person, formerly chief of the agency’s Recall Management Division.

Department spokeswoman Olivia Alair describes the report as ongoing and not completed; she also denies that Person was “involved in” the probe but does not appear to deny that he was briefed on the resulting report and is familiar with its contents.

Person says some NHTSA officials objected to the keeping of the report under wraps; it is not known what position was taken by the Obama appointee who heads NHTSA, David Strickland, a former lobbyist for the trial lawyers’ association AAJ and a principal author of the horrendous children’s-product-safety law CPSIA. Earlier here.

“Wherever the science leads,” indeed.

Ray LaHood as Santa Claus

Posted by Tad DeHaven

U.S. News & World Report’s columnist Paul Bedard reports that Transportation secretary Ray LaHood told him that it’s fun playing Santa Claus to states and cities around the nation.

So let’s take a look at some recent examples of DOT gift-giving with federal taxpayers’ money:

  • DOT’s Federal Highway Administration helped restore an old brewery in Petosi, Wisconsin with a $450,000 gift. That should make taxpayers want to drink.
  • Dolgeville, New York intends to use DOT stimulus money to repair sidewalks even though the village acknowledges that the new sidewalks will have to be torn up and replaced again due to impending water and sewage line upgrades. Keynes would be particularly proud of this one. Last year the city received a $1 million gift from DOT for the “installation of period street lights, trees, accent pavers, street furniture and sidewalk improvements” on the city’s Main Street.
  • The Michigan Department of Transportation plans on spending $5 million in federal DOT money on a bunch of projects that are of unquestionable national importance: cobblestone streets in Grand Rapids; exhibits at the Detroit Science Center; rehabilitating the historic Quincy and Torch Lake Railroad Engine House in the Upper Peninsula; a bridge for bicyclists and pedestrians over the Clinton River in Utica and bike racks at several locations in Wayne, Oakland, and Macomb counties.

These projects might be worthwhile, but they should be paid for by the local interests who can best judge their worth.

In his 1932 book, Congress as Santa Claus, constitutional scholar Charles Warren offered a prescient warning on the dangers of federal subsidization of state and local affairs:

The continuance of this practice of shifting to the National Government responsibility for payment for matters which formerly were dealt with by individual initiative, by community cooperation, by voluntary organizations, or by local or State governments – the continuance of this practice of making drafts on the National Treasury to carry out purposes not within the enumerated or implied powers of the National Government will inevitably have two results.

So far as these Government donations consist of direct appropriations for private or local interests, they will deaden and finally destroy the eagerness or willingness of State Governments and local communities to pay for their own needs. So far as they take the shape of the so-called Federal Aid laws for local projects to be matched by local appropriations, they will have ‘a tendency to induce excessive expenditures by State and municipal governments, with top-heavy bond issues and oppressive local taxation.’

I doubt in Warren’s worst nightmares could he have envisioned the examples of DOT spending above, let alone the existence of a $90 billion federal Department of Transportation.

“Smart Growth” from a Dumb Agency

Posted by Tad DeHaven

The same federal agency that brought us monumental failures like public housing wants to play a bigger role in fostering so-called regional “smart growth.” HUD secretary Shaun Donovan recently traveled to Portland, Oregon to announce the Obama administration’s new Office of Sustainable Housing and Communities.

This new bureaucracy will distribute $140 million in grants for regional “smart growth” planning:

With OSHC’s grant programs, HUD will provide funding to a wide variety of multi-jurisdictional and multi-sector partnerships and consortia, from Metropolitan Planning Organizations and State governments, to non-profit and philanthropic organizations. These grants will be designed to encourage regions to build their capacity to integrate economic development, land use, transportation, and water infrastructure investments, and to integrate workforce development with transit-oriented development. Accordingly, OSHC’s grants will be coordinated closely with the Department of Transportation (DOT) and Environmental Protection Agency (EPA).

Donovan told a Portland State University crowd that “We at HUD are big admirers of what you’re doing here.” However, Randal O’Toole’s dismantling of the Portland planning utopia myth in a Cato Policy Analysis shows that the city is nothing to be emulated. That is unless other cities want less affordable housing, more congestion, higher taxes, and businesses relocating elsewhere.

Donovan then met up with his EPA and DOT colleagues in Seattle at smart growth conference. HUD isn’t the only one opening up the taxpayer’s wallet:

And the Department of Transportation is proposing $527 million to promote “livable communities” through grants to states and cities. Transportation secretary Ray LaHood says those grants, too, must meet the goals of his partner agencies.

LaHood: “It supports any new initiatives we develop on our own like expanding transit in low–income neighborhoods, or what our friends at HUD and EPA are working on in collaboration.”

Local coalitions are already forming to seek those federal dollars.

Let the rent-seeking begin.

The merits of Portland’s urban planning can be debated all day. But it stands federalism on its head when the federal government takes a particular city’s policies and then tries to shove it down the throats of the rest of the country. Based on what I know of Portland’s planning, I certainly wouldn’t want it where I live. Other cities, like Houston, have reached the same conclusion. But, I guess if Shaun Donovan likes it, then damnit, we’re all going to like it.

Raising an Eyebrow at LaHood’s Toyota Remarks

Posted by Daniel Ikenson

In response to the large recalls affecting several Toyota models, Transportation Secretary Ray LaHood yesterday advised Americans to “stop driving” their Toyotas. In testimony before the House Appropriations subcommittee on transportation, LaHood said:

My advice to anyone who owns one of these vehicles is stop driving it, and take it to the Toyota dealership because they believe they have the fix for it.

Later in the day, he elaborated:

I want to encourage owners of any recalled Toyota models to contact their local dealer and get their vehicles fixed as soon as possible. NHTSA will continue to hold Toyota’s feet to the fire to make sure that they are doing everything they have promised to make their vehicles safe. We will continue to investigate all possible causes of these safety issues.

As Transportation Secretary in an administration that is politically vested in the success of General Motors (recall how taxpayers were forced to take a 60% stake in GM for $50 billion+), was LaHood exploiting an opportunity to tip the scales further in GM’s favor? I guess we’ll never know for sure, but as long as GM remains nationalized, any comments by administration officials on matters affecting the auto industry should be viewed skeptically and through this prism, as they can irresponsibly move markets.

LaHood Eliminates Cost-Efficiency Rules

Posted by Randal O'Toole

Last week, Secretary of Transportation Ray LaHood announced that federal transit grants would now focus on “livability.” Buried beneath this rhetoric is LaHood’s decision to eliminate the only efforts anyone ever made to make sure transit money isn’t wasted on urban monuments that contribute little to transportation.

Back in 2005, then-Transportation Secretary Mary Peters stunned the transit world when she adopted a “cost-effictiveness” rule for federal transit grants to new rail projects. In order to qualify, transit agencies had to receive a “medium” cost-effectiveness rating from the FTA, meaning they had to cost less than about $24 for every hour they would save transportation users (either by providing faster service to transit riders or by reducing congestion to auto drivers). This wasn’t much of a requirement: a true cost-efficiency calculation would rank projects, but under Peters’ a project that cost $0.50 per hour saved would be ranked the same as one that cost $23.50 per hour. But any projects that went over the $24 threshold (which was indexed to inflation — by 2009 it was up to $24.50) were ruled out.

After unsuccessfully protesting this rule, transit agencies responded in one of four ways. Those close to the $24 threshold cooked their books to either slightly reduce the cost or slightly increase the amount of time the project was supposed to save. Those that were hopelessly far away from the $24 threshold, but had powerful representatives in Congress, obtained exemptions from the rule. These included BART to San Jose, the Dulles rail line, and Portland’s WES commuter train. Those that didn’t have the political clout either shelved their projects or, in a few cases such as the Albuquerque Rail Runner commuter train, tried to fund them without federal support.

Read the rest of this post »

Another Dumb “Stimulus” Idea at Taxpayer Expense

Posted by Doug Bandow

Sigh.  Will the error never end?  If you listen to Washington, you would think that taking money from taxpayers, who otherwise would buy cars, homes, computers, and any number of other items, and giving it the same taxpayers to get them to buy cars is a great way to stimulate the economy.

Of course, the Keynesian hope is that Americans will spend rather than save, as if the best way to resolve a crisis  resulting from too much spending and borrowing is to encourage more people to spend and borrow more.  Alas, Washington has never met an expensive new program that it didn’t like.

In fact, the “Cash for Clunkers” program is an even dumber idea than most “stimulus” proposals.  Cato’s Alan Reynolds notes how easily the program can be manipulated to frustrate the objective of improving auto gas mileage.

Moreover, the initiative probably doesn’t increase auto sales.  Rather, it primarily rewards people who would have bought a new car anyway.  Explains Jeremy Anwyl in the Wall Street Journal:

Nearly everyone now seems to be praising “cash for clunkers”—the federal program recently launched that will credit you up to $4,500 to trade in your old car for a more fuel-efficient vehicle. President Barack Obama says the program “has succeeded well beyond our expectations and all expectations.” Transportation Secretary Ray LaHood claims “this is the stimulus program that has worked better than any other stimulus program that was conceived.”

But cash for clunkers is also a program in limbo, having quickly run out of the $1 billion budgeted for it. Congress must now decide whether to let it die or whether to pump more money into it. So it’s time to ask if this program is really a good idea.

It is true that Internet car shopping activity, showroom traffic, and sales are all up, which is why the auto industry wants to keep the program going.

I love a good sales surge as much as anyone. But it’s not that simple. First, it’s not clear that cash for clunkers actually increased sales. Edmunds.com noted recently that over 100,000 buyers put their purchases on hold waiting for the program to launch. Once consumers could start cashing in on July 24, showrooms were flooded and government servers were overwhelmed as the backlog of buyers finalized their purchases.

Secondly, on July 27, Edmunds.com published an analysis showing that in any given month 60,000 to 70,000 “clunker-like” deals happen with no government program in place. The 200,000-plus deals the government was originally prepared to fund through the program’s Nov. 1 end date were about the “natural” clunker trade-in rate.

Let’s hope we can be saved from additional “stimulus” proposals which do far more to waste money than spur the economy.