Could Pension Savings Fund High-Speed Rail?

Joe Mathews
Connecting California Columnist and Editor, Zócalo Public Square, Fellow at the Center for Social Cohesion at Arizona State University and co-author of California Crackup: How Reform Broke the Golden State and How We Can Fix It (UC Press, 2010)

Before this week, California had a $60 billion-or-so problem. It was called the high-speed rail, Phase 1.

That’s a rough estimate of the money California would need to complete the project that it now wants to start – and doesn’t currently have.

Where would it come from? The feds don’t have it. Private investors aren’t interested.

But Jerry Brown was on the case.

He and the Democrats made a deal on pension legislation. And lo and behold, projections show it would save state and local governments up to $60 billion over 30 years.

Boom! Problem solved. Just take the pension savings and dedicate that money to high-speed rail.

Isn’t it wonderful?

Now, some cynics see long-term projections as fundamentally unreliable. But don’t believe that for a second.

Anything is possible when a visionary governor and leaders look beyond the near-term numbers and today’s declinist thinking, and instead embraces the big picture and the long term. In the long term, numbers work. Because while pension legislation doesn’t save much if anything now, long-term projections show that there will be big pension savings. And while there aren’t riders or enough money for high-speed rail now, in the long term projections are healthy.

So let’s do it.

What could go wrong?

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