As federal cash dries up, Minnesota’s rail mania recedes

Derailed

The fever for spending vast sums of taxpayer’s money on rail projects of dubious value which has afflicted policy makers in Minnesota in recent years seems to be breaking.

Last September, Ramsey County abandoned its pointless, expensive streetcar project; In February, the Met Council finally pulled the plug on the failed Northstar rail line; and in May, state funding for the Northern Lights Express (NLX) was axed to fund unemployment benefits for hourly workers.

Now, any lingering hopes for these projects and others could be facing the coup de grâce. The Star Tribune reports:

A new Republican-backed spending bill in Congress would explicitly ban federal funding for the NLX line and also gut funding for a federal grant program the Metropolitan Council is counting on for a planned extension of the Blue Line light-rail project and a bus rapid transit line.

“The dream is over” — John Lennon

“Just a few years ago, the outlook for passenger rail in Minnesota was bright,” the Star Tribune notes:

The state Legislature had set aside nearly $200 million for the long-planned Twin Cities to Duluth Northern Lights Express. Local planners also believed they could reel in hundreds of millions of dollars for the project from the transit-friendly Biden administration, then flush with cash from the $1.2 trillion Bipartisan Infrastructure Law.

Now, that optimistic moment feels many miles away.

What happened is that both state and federal government either ran out of cash or decided to stop throwing cash at these cost-ineffective schemes.

Last December, Minnesota Management & Budget announced that, just two years after forecasting a budget surplus of $18 billion for the 2024-2025 biennium, it was forecasting a deficit of $5.1 billion in 2028-2029. In 2024, the federal government ran a deficit of $1.8 trillion which the Trump administration is making some moves, however imperfect and contradicted by others, to get under control. Paying for that $1.2 trillion of “infrastructure” spending was part of what gave us an annual inflation rate of 6.6% in September 2022.

Whether in the form of taxes out of your paycheck or reduced purchasing power at the grocery store, we pay for government spending one way or the other. With luck, this bill in D.C. will pass, and we will have a little less to pay for.