Archive for July 6th, 2010

Rail for the Valley Open House – Thursday July 8 – Chilliwack

July 6, 2010

Hi everyone

Rail For the Valley is holding an open house in Chilliwack this Thursday to showcase the issue of passenger rail service in the Fraser Valley. The goal is to inform the public as to the current state of activities and to gain additional support. This event is open to the public and directed towards the City of Chilliwack.

The open house will offer a chance for the public to see details of the campaign including track details, benefits, and ways to help with the movement. If you have any questions regarding this event, please email rftvfriends@gmail.com.

Refreshments will be served. We hope you can stop by for a few minutes.

Thank you!

http://rftv.wordpress.com/2010/06/20/open-house-july-8th/

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Krugman: Lost Decade, Here We Come – Sent by the Light Rail Now Folks

July 6, 2010

Paul Krugman’s article from several days ago (see below) drives home the point that “deficit hawkism” is NOT just an American lunacy – it’s somehow ascended to the prevailing “conventional wisdom” globally. As I pointed out in a previous recent post, “This has some very bad implications for public transportation funding, the transit budget crisis, public transit services and ridership, and development of crucial improvements such as new rail starts.”

It’s also important for public transportation professionals and advocates to perceive that public transport budget problems – at the agency level and the industry level, in country after country – are occurring in this context of GLOBAL crisis and GLOBAL austerity policies. Public transport supporters need to get this across to the public, in particular to respond to the campaign by transit adversaries to pillory each individual transit system, making it appear that its budget difficulties are the result of incompetent management and planning, budgetary wastefulness, and, most of all, the demon rail.

Lyndon Henry

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New York Times
June 6, 2010

Lost Decade, Here We Come

Paul Krugman

The deficit hawks have taken over the G20:

Those countries with serious fiscal challenges need to accelerate the pace of consolidation, it added. We welcome the recent announcements by some countries to reduce their
deficits in 2010 and strengthen their fiscal frameworks and institutions.

These words were in marked contrast to the G20s previous communiqué from late April, which called for fiscal support to be maintained until the recovery is firmly driven by the private sector and becomes more entrenched.

Its basically incredible that this is happening with unemployment in the euro area still rising, and only slight labor market progress in the US.

But don’t we need to worry about government debt? Yes but slashing spending while the economy is still deeply depressed is both an extremely costly and quite ineffective way to reduce future debt. Costly, because it depresses the economy further; ineffective, because by depressing the economy, fiscal contraction now reduces tax receipts. A rough estimate right now is that cutting spending by 1 percent of GDP raises the unemployment rate by .75 percent compared with what it would otherwise be, yet reduces future
debt by less than 0.5 percent of GDP.

The right thing, overwhelmingly, is to do things that will reduce spending and/or raise revenue after the economy has recovered specifically, wait until after the economy is strong enough that monetary policy can offset the contractionary effects of fiscal austerity. But no: the deficit hawks want their cuts while unemployment rates are still at near-record highs and monetary policy is still hard up against the zero bound.

But what about Greece and all that? Look, right now sovereign debt problems are taking place in countries with a very specific problem: they’re part of the euro zone, AND they’re badly overvalued thanks to huge capital inflows in the good years; as a result they’re facing years of grinding deflation. Counties not in that situation are not facing any pressure from the markets for immediate cuts; as of this morning, 10-year bonds were yielding 3.51 in Britain, 3.21 in the US, 1.27 in Japan.

Yet the conventional wisdom now is that these countries must nonetheless cut not because the markets are currently demanding it, not because it will make any noticeable difference to their long-run fiscal prospects, but because we think that the markets might demand it (even though they shouldn’t) sometime in the future.

Utter folly posing as wisdom. Incredible.
http://krugman.blogs.nytimes.com/2010/06/06/lost-decade-here-we-come/