“Traditionally, transportation projects of this magnitude can rely on the federal government as a funding partner with grants of up to 50 percent or higher. The Legislature and the voters of California, in approving Proposition 1A, assumed significant federal participation – 1/3 of the total cost. With a federal contribution for these extensions, its share of the total funding for the Silicon Valley to Central Valley line would still be only 25 percent of the total investment, far below the norm,” the report states in section 6, which details long-term funding strategies, assumptions and plans.

But based on what’s happened in Washington in recent years, the notion that “traditional” federal support for major transportation projects will help California secure more funding doesn’t seem grounded in reality. The prospect of Congress earmarking funds to help one state build a bullet-train network seems unlikely for two reasons.

‘Monumental waste of precious transportation dollars’

One reason is specific. House Republicans, led by Majority Leader Kevin McCarthy of Bakersfield, have been critical of the California project for years. They’ve cited the decision to give more than $3 billion in 2009 stimulus bill funding to the state as an example of wasteful stimulus spending and highlighted missed deadlines for starting construction. McCarthy co-authored a January 2015 op-ed for the Sacramento Bee spelling out his implacable opposition:

The current plan for high-speed rail is nearly twice as expensive as promised to California taxpayers. The projected travel times and fares have nearly doubled. The plan bears no resemblance to the one put before voters in 2008. One analysis after another has raised these red flags, but supporters in Sacramento refuse to admit that fundamental flaws exist and continue to press on, no matter the cost.

 

These objective reviews expose a business plan flawed at its core – unrealistic ridership numbers, a ballooning price tag (just last year, the California High-Speed Rail Authority increased its cost estimate for a Central Valley segment by $1 billion) and private investment that is still nowhere to be found. …

 

This is not what voters envisioned when Proposition 1A was presented to them. It is now clear that this project remains wholly unviable and is a monumental waste of precious transportation dollars that would be far better spent on roads, light rail and traditional heavy rail.

By Katy Grimes

I hope you don’t need $1,635, because that is what the average tax increase will be on the majority of Americans.

According to the Congressional Budget Office, 80 percent of American households with incomes between $50,000 and $200,000 will be out more than $1,600 next year. And that’s just the starter.

The much hyped last-minute fiscal cliff deal negotiated Jan. 1 between Vice President Biden, Senate Minority Leader Mitch McConnell, R-Kentucky, and President Barack Obama, cuts only $15 billion in spending but increases tax revenues by $620 billion. The 41:1 ratio of tax increases to spending cuts is no deal for Americans.

The tax increase is primarily due to the expiration of a payroll tax cut, according to the Tax Policy Center in Washington.

While the bill, known as the American Taxpayer Relief Act of 2012, will protect millions of middle-class taxpayers from tax increases set to take effect this month, it will increase tax rates on wages and investments for households making more than $450,000 a year.

This is the first time in more than 20 years that a huge tax increase has been approved with GOP support.

The measure, which addressed the tax increases while holding off sequestration cuts and the debt ceiling, passed with the support of 85 Republicans, including the Speaker who took the unusual measure of casting a vote, and 172 Democrats.

The Deal adds to the deficit

The smelly Senate deal to avoid the “fiscal cliff” will add approximately  $4 trillion to the deficit, according to new  the CBO, and achieves minimal deficit reduction in the early years.

“For a family making median income, they’ll notice an additional $3,500 dollar income tax increase,” Fox News reported. “27 million Americans will be subject to the alternative minimum tax, and additionally, the death tax will increase to 55 percent for estates of $1 million and over.”

The extension of lower tax rates for taxpayers, and the addition of only a patch to the insidious Alternative Minimum Tax would add more than $3.6 trillion to the deficit over the next decade, the CBO said.

Other individual, business and energy tax extenders will add another $76 billion to the deficit.

The latest extension of unemployment benefits will cost $30 billion.

The “doc fix”, a one-year payment patch for physicians who treat Medicare patients, would add $25 billion to the deficit through fiscal 2022.

Pork-laden deal

One of the most egregious aspects of this bad deal is how much pork was stuffed into the bill.

* Perks for Hollywood: special expensing rules for certain film and TV productions

* special tax-exempt financing for New York Liberty Zone, an area around the site of the World Trade Center.

* extension of American Samoa economic development credit

* Green energy — nearly a dozen provisions in the bill would extend green credits and green incentives for plug-in electric vehicles, energy-efficient appliances, biodiesel and renewable diesel, and other alternative energy initiatives.

* The legislation also would kill the part of Obama’s 2010 Affordable Care Act designed to let millions of elderly and disabled people get help at home rather than be placed in institutional care, which tends to be more expensive.

Democrats acknowledge that the insurance initiative known as the Community Living Assistance Services and Support program, or CLASS, is financially flawed but they had argued it should be fixed rather than ended.

The House voted to repeal that provision 11 months ago.

* No $8 per gallon milk: the “dairy cliff” was avoided. Measures to prevent a steep increase in milk prices were averted.

I can hardly wait.

See the Final Vote Results