(Source: NY Times)

WASHINGTON — Ray LaHood, the secretary of transportation, is not one to toot his own horn over how much he knows about planes, trains and automobile bailouts. On the contrary.

“I don’t think they picked me because they thought I’d be that great a transportation person,” Mr. LaHood says with refreshing indifference as to how this admission might play if, say, he were ever to bungle a bridge collapse.

Yes, transportation is Mr. LaHood’s day job, a post that a few days ago required him to attend a groundbreaking ceremony for a highway in New Hampshire, speak to a group about the dangers of tailgating trucks and discuss “bird strikes” on CNN.

But one of the astonishing things about Mr. LaHood, 63, is how limited his transportation résumé is, how little excitement he exudes on the subject (other than abouthigh-speed rail) and how little he seems to care who knows it. So why exactly did President Obama pick this former seven-term Republican congressman from Illinois to oversee everything that moves?

Mr. LaHood posits a theory. “They picked me because of the bipartisan thing,” he explained, “and the Congressional thing, and the friendship thing.”

The “bipartisan thing” and the “Congressional thing” are self-evident: Mr. LaHood is a Republican with close ties to Capitol Hill. One White House insider described Mr. LaHood as “a master of odd jobs,” whose knowledge of Washington allows him to take on assignments as varied as lobbying lawmakers on the budget and helping political novices in the cabinet navigate Beltway social rituals (“cocktail situations,” as Energy Secretary Steven Chu calls them).

In the White House, Mr. Chu describes Mr. LaHood, a former junior high school social studies teacher, as a source of “fatherly advice” for Washington newcomers like himself.

One “cocktail situation” occurred recently at the annual Gridiron Club dinner. Mr. LaHood was seated at the head table near Mr. Chu, and between Arne Duncan andTimothy F. Geithner, the education and Treasury secretaries. The men asked Mr. LaHood if they could flee the dinner before the interminable speechifying ended. No, Mr. LaHood counseled.

“I said, ‘Look, you’re window dressing,’ ” Mr. LaHood said. “ ‘You’re more of a prop. But it’s part of what we have to do.’ ” Mr. Chu and Mr. Duncan heeded the advice; Mr. Geithner did not.

(Source: The Infrastructurist)

The so-called peak oil debate has taken many twists and turns over the years. After long being an oddball survivalist preoccupation, the debate gathered mainstream momentum a few years ago as oil prices began a long ascent from around $30 per barrel to $147, where they topped out last summer. By the time a barrel of West Texas crude was rising eight bucks a day, scarcity seemed like the best and only explanation–that no matter how hard we tried, we couldn’t pump enough oil to meet demand.  OPEC cut production, inventories rose, and it seemed like, in fact, we had plenty of oil for the foreseeable future and the whole thing had just been hedge fund shenanigans.

Maybe not, Raymond James now cautions. “We believe that the oil market has already crossed over to the downward sloping side” of all-time total production, say analysts at the financial services company. While cautioning that nobody but historians can be sure, they believe production peaked in 2007 for non-OPEC countries (Russia, Norway, Mexico, etc.) and last year for OPEC (Saudi Arabia, Venezuela, Iran, etc.). “It is entirely intuitive to conclude that if both OPEC and non-OPEC production posted declines against the backdrop of $100/bbl oil–when the obvious economic incentive was to pump at full blast–those declines had to have come for involuntary reasons such as the inherent geological limits of oil fields.” In other words, we had a perfect environment for testing the peak oil hypothesis, and the results are in. We’ve peaked.

My reponse? Yawn. We’re all unemployed Prius drivers anyway these days. Oil is an anachronism.

The biggest immediate crisis would be in transporation, because that’s where most of our oil goes. When gas hit $4 per gallon last spring, the financial strain was hitting the breaking point for many households–particularly outer suburban households. The arrangement of many American cities started to look insane: Working class people commuting 50 miles by car each way to their jobs?

The answers in this scenario would have to be rapid. No 30-year development plans. Instead: find cheap and efficient ways of getting lots of people around, and find them pronto. As a start, that would mean making it much easier for people to ride bikes, take trains, and form van pools.

Peak oil has always been an eye-roller in the establishment debate. It’s not clear that Obama has ever even been *asked* about it.

(Source: Wall Street Journal)

General Motors Corp. is expected this week to accelerate talks with the United Auto Workers union and move toward closing about 2,600 dealerships.

 The giant auto maker also is likely this month to approach banks holding secured debt, hoping to work out terms to ease the company’s debt burden.

Reaching agreement on these fronts is critical if GM is to restructure outside of bankruptcy court.

The company has new leverage as it re-engages in talks, thanks to the bankruptcy filing last week by Chrysler LLC. But differences between the two auto makers mean that leverage can take GM only so far.

“The move with Chrysler signals to the GM creditors that bankruptcy is a viable option,” said Lewis Rosenbloom, a bankruptcy lawyer with Dewey & LeBoeuf. Mr. Rosenbloom’s firm does extensive work for GM and Chrysler. “The government is not just going to throw money at this without getting a consensual accord, so I think this is a harbinger of things to come.”

The Treasury Department has given GM until June to work out a restructuring plan and has indicated it may push the company into bankruptcy if the necessary deals don’t materialize.

GM’s hopes of staying out of court hinge on its ability to convince thousands of unsecured bondholders, owed $27 billion, to accept a small equity stake in the company in exchange for forgiving most of the debt. Several bondholders have said the equity exchange will fail if the terms aren’t sweetened.

(Source: Timesonline, UK)

Fiat last night set out its blueprint to reshape the global car industry, outlining plans to spin off a new company that will include General Motors’ European business and Chrysler.

 The Italian car manufacturer meets German ministers today to set out a plan that would bring GM’s Vauxhall, Saab and Opel into a company with Fiat’s core car marques, including Fiat, Alfa Romeo and Ferrari.

The company said last night that the possible new company, which would be floated, would have revenues of €80 billion (£71 billion) and an output of between six million and seven millon vehicles a year, which Fiat believes will give it the necessary scale to weather the crisis besetting the automotive industry. The proposed company would be the second largest car group in the world.

In Britain, unions have hinted that a Fiat takeover of Vauxhall would put at risk 5,000 jobs at Luton and in Cheshire. GM employs 300,000 workers worldwide.

GM has struggled to find a buyer for its non-core businesses as it seeks to avoid following Chrysler into bankruptcy. But Fiat faces some German opposition over its ownership of Opel, GM’s German subsidiary.

Sergio Marchionne, the chief executive of Fiat, will today meet the Economy Minister and the Foreign Minister of Germany. Karl-Theodor zu Guttenberg, the Economy Minister, warned that the German Government required a long-term strategy.

In an interview with a German newspaper, he said: “We will not enter into any financial adventure with taxpayer money. The concept must clearly show that Opel plants in Europe that are to be kept open will be secured over the long term.”

Angela Merkel, the German Chancellor, has suggested the German Government could offer loan gaurantees to help safeguard jobs at Opel.

Fiat wants to acquire Opel after its eleventh-hour deal last Thursday to buy an initial 20 per cent of Chrysler. The company believes that it needs a partner to reach the scale of production necessary to weather the crisis besetting the motor industry.

Fiat’s overtures to Opel quickly follow its agreement to enter a partnership with Chrysler after it emerges from bankruptcy. Fiat will share its fuel-efficient technology in return for gaining a stake that will eventually turn into a majority holding in the company. Chrysler filed for bankruptcy after creditors refused to accept a restructuring deal.

In its desperation to avoid following Chrysler into administration, GM has been attempting to offload its unprofitable, non-core assets.

Source: Tree Hugger)

 Is Enthusiasm for High Speed Rail Just Another Speed Addiction?

The world is a confusing place – no sooner do the governments of the world finally start taking high speed rail seriously as an alternative to aviation, and the environmentalists start complaining. First we had Obama’s massive investment in high speed rail, which Jim Kunstler (who else?) described as “perfectly f***ing stupid.”And now UK politicians are limbering up to support a significant upgrade of the country’s rail system – but John Whitelegg over at The Guardian says High Speed Rail is an expensive and counterproductive red herring:

Mileage-based tax expensive idea – HaroldNet ..I see that a congressional committee wants to put a mileage-based tax on cars and trucks. This would involve installation of expensive GPS devices in every …

Our view: Leave miles-traveled tax at the roadsideDuluth News Tribune – ‎Late last week in Washington, US Rep. Jim Oberstar touted spending half a trillion dollars to solve the nation’s transportation woes. …

Mileage Tax Discussion in Congress Helicopter Association International – ‎House Transportation and Infrastructure Chairman James Oberstar said he will push for a mileage-based tax on cars and trucks to pay for highway programs. …

Mileage-Based Tax Not the Answer to Our Nation’s Infrastructure Needs Americans for Tax Reform – ‎By the Numbers: WASHINGTON, DC – Today, Americans for Tax Reform (ATR) issued the following response to Rep. James Oberstar’s (D-Minn) call for a …

More Congress Critters Want To Track And Tax Your Driving Habits Techdirt – ‎For years, various state politicians have pushed the idea of a “mileage tax” for driving, and it’s never made much sense at all. Yet, just a few months ago, …

(Source: Washington Post)

Chrysler, one of the three pillars of the American auto industry, will file for bankruptcy today after last-minute negotiations between the government and the automaker’s creditors broke down last night, an Obama administration official said.

The federal government has already committed nearly $11 billion in stimulus money to help get road, bridge and environmental projects off the ground, administration officials told Congress on Wednesday.

“I believe we have already achieved enormous success,” Transportation Secretary Ray LaHood told the House Transportation Committee, giving a progress report on infrastructure money allotted under the $787 billion economic stimulus bill passed in February.

Lahood, a former Republican congressman from Illinois, told the panel his department had made decisions on $9 billion dollars in projects around the country out of Transportation’s $48 billion share of the stimulus package.  However, he was less specific about the jobs directly resulting from stimulus spending.

It was originally estimated that the $64 billion in the stimulus for infrastructure — for transit, high speed rail, aviation, federal buildings and Army Corps of Engineers projects as well as roads and bridges — would create or sustain 1.8 million jobs.

But so far, reports on new jobs were mostly anecdotal. The Transportation Committee said its survey of state and local transportation officials revealed that work had begun on 263 highway and transit projects in 30 states, putting about 1,250 workers back on the job.

D.J. Stadtler, Jr., chief financial officer for Amtrak, said it expected to produce about 4,600 jobs in the first year of the stimulus with investment of $1.3 billion.

Unemployment in the construction industry soared to nearly 2 million in March, about 21.1 percent compared with 13 percent a year ago.

Rep. John Mica of Florida, top Republican on the committee, questioned the job-creation effectiveness of the program, saying some projects might take three to four years to get off the ground. But he said he would withhold judgment, saying, “We have to give folks a pass at this juncture.”

The Government Accountability Office, in a report prepared for the hearing, also raised questions about the ability of states and Washington to track how the money is being spent. But it gave some states high marks for moving the money quickly.

(Source: The Infrastructurist)

(Source: Streetsblog)

Ultimately, SAFETEA-LU’s greatest failing may have been its failure to articulate a truly multi-modal vision for the nation’s surface transportation network. Essentially a continuation of 1950s-era policies, it repeated the same-old same-old about a need to complete the Interstate highway program, directing billions of dollars to state DOTs to pour asphalt and expand roadways. Nowhere did the legislation suggest a need to adapt to a future in which American dependence on automobiles and fossil fuels must be dramatically reduced. That’s the challenge faced by Congress today.

Less of this...

 Transportation funding from Washington has been heavily weighted toward highway spending ever since President Eisenhower first proposed the Interstate Highway Act in 1956. SAFETEA-LU, 2005’s federal transportation bill, was no exception. It provided $244.1 billionover five years, its revenues raised by the federal gas tax and directed to the Highway Trust Fund, which has both highway and mass transit accounts. $40 billion a year went to highways, most of which was used to expand and upgrade the Interstate highway system; some $10 billion went annually to mass transit.

The $10 billion in public transportation funds is distributed by the Federal Transit Administration (FTA) for a variety of uses. The FTA administers the urban areas program, which allocates money to metropolitan areas for transit system capital expenses, as well as a rural areas program that helps states pay for rural transit. SAFETEA-LU also included a fixed-guideways formula, aimed at keeping mostly older rail transit systems like those in Chicago or Boston in working condition. Finally, the New Starts/Small Starts program allowed the FTA to fund competitive grants for major capacity expansion such as new subway or bus rapid transit lines.

More of this...

 SAFETEA-LU provided for $40 billion in annual funding from the highway account, the traditional federal source for financing Interstate highways. But under the law, money from the account could actually be spent on more than just roads. Roughly $6.5 billion per year was allocated to the “Surface Transportation Program.” States were allowed to use this money to fund transit and “bicycle transportation and pedestrian walkways.” The “Congestion Mitigation and Air Quality Improvement Program” — about $1.7 billion a year — went to projects likely to reduce pollution, and specifically forbade funding “a project which will result in the construction of new capacity available to single occupant vehicles.”

There’s one problem, though. The federal government may allow such funds to be spent on non-auto uses, but that’s rarely the case.

That’s because, while each metropolitan area has a federally-mandated Metropolitan Planning Organization (MPO) whose role is to establish priorities for transportation investments, state departments of transportation have ultimate discretion over how national highway funds are used. The inevitable consequence? Asphalt-happy DOTs usually choose to invest highway funds in roads, even when MPOs advocate for improved transit or bikeways. According to Transportation for America, only five states — California, New York, Oregon, Pennsylvania, and Virginia — have taken advantage of the flexibility of these funds. The rest have spent the vast majority on auto infrastructure.

What’s more, SAFETEA-LU made it easy for states to build roads and hard for them to build transit projects. While funds for new roads were simply distributed to states based on a formula, new transit lines had to undergo the rigorous New Starts process — competing with other projects from all over the country — before winning a share of federal dollars. There was no such required audit for road projects.