Random Thoughts on Public Goods and Light Rail Funds

Peter Gordon recently said this about us:

Newmark's Door points us to this very cool blog. Talk about public goods!

We won't dispute the "very cool blog" part, but is Political Calculations really a public good? And if so, where are the buckets of tax money that we ought to be getting from the government for providing you with our particular brand of public good?

On second thought, just have someone tell Congressman Jack Murtha (D-PA) that we're based somewhere in his district and we'll make it up through earmarks....

Speaking of Peter Gordon, he proposed that instead of building Los Angeles' "Subway to the Sea," that the money that would be used to build it might better be spent by giving low-income riders a "lifetime pension of $5,000 per year," which King Banaian argues would provide the riders with the option of buying a used car or paying for other bills (or a new car too - let's not rule that out if that's their choice!)

The problem with this proposal is that the money from the government will instead likely result in driving up the cost of all cars and whatever else the low-income individuals might spend the money upon, spurring higher inflation in the economy. Much like how increasing financial aid for students almost invariably results in even higher tuitions at the nation's colleges and universities.

Could there be a way to achieve the goals of light rail (less gas consumption, cleaner air, less road congestion), the taxpayer (less wasteful government spending), and low-income earners without sparking higher inflation?

We see a way to achieve a lot of different goals here using the money that might otherwise be used to build light rail systems. All hinging upon when the low-income recipients of money redirected away from light rail projects might choose to retire.

Compared to their high-income counterparts, those with low incomes will work much longer before becoming able to retire from the workforce. So, if you directed the money from light rail to instead go into Individual Retirement Accounts owned by the low-income recipients (our former light-rail riders), you would accelerate the build-up of their retirement savings to the point where they can choose to retire from work (and their daily commute) much sooner than they otherwise could have.

As an added bonus, since their annual incomes would not be inflated by the funds from light rail, the prices of the things they buy won't be driven up by the inflationary forces unleashed whenever the government floods the economy with money.

Getting out of the rat race dramatically reduces the amount of gas an individual uses, not to mention removing them from the road at the times when most people are trying to use them. So, with our proposal, we have, in one stroke, increased individual savings, made it possible for low-income people to retire earlier, kept inflation under control and reduced the amount of gas used in the future while simultaneously removing congestion from our roads and carbon emissions from the planet.

Then again, instead of obsessing over how to get a pretty low percentage of people to be able to afford earlier retirement by giving them other people's money and controlling what they do with it, we could just reduce taxes across the board and achieve all these things by making it possible for all income-earners to be able to afford to retire just a little bit earlier.

Holy cow! Political Calculations is a public good! Send those tax dollars to....