State Senate Candidate Spotlights Cost of Federal Aid

June 7, 2010 at 6:15 am | Posted in Political | 2 Comments
Tags: light rail, norann dillon, sue jeffers

by Walter Scott Hudson

Calling into The Sue Jeffers Show on KTLK-FM in Minneapolis on Saturday, state senate candidate Norann Dillon shared an astute analogy for the hidden cost of state’s accepting federal money. The topic at hand was Minnesota’s expanding light rail system, the construction of which is highly subsidized by federal grants. Acknowledging the tendency of state legislators to regard available federal dollars as “free money,” Dillon compared a more common transaction.

It’s the reason my kids are always so impressed when they see the new mobile phones come out and they say, “Oh look! They’re free!” Well, there’s a reason why. Of course, the mobile phone companies want to give you the phone for free because that’s not where they make their money. They make their money on the ongoing service that you buy. The same is true from many of these capital projects, and light rail is an absolutely fantastic example. It doesn’t matter if the federal government comes in and pays every single penny of [the cost of constructing] the light rail line. All of the operating costs going forward are going to be ours to bear.

This is also why government cannot provide genuine economic stimulus with public-funded bailouts. A lump-sum spent today does nothing to fuel tomorrow. Jobs “created” by a capital project will be just as quickly lost upon completion, with no permanent change to overall economic conditions aside from increased public debt.

Dillon is running in Minnesota Senate District 43 against incumbent Democrat Terri Bonoff. The application of common sense economic principles, which people live by every day, is a centerpiece of Dillon’s campaign.

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