Fondness for over-regulation may undercut Biden’s infrastructure plans from the start
President-elect Joe Biden has laid out an ambitious transportation and infrastructure agenda. Much of the public focus has been on the large “stimulus” subsidies proposed in Biden’s campaign messaging and the green tint on his proposals. But relatively little has been said on regulatory matters, which may prove critical to the Biden administration’s efforts to implement its agenda, given expected Republican control of the Senate and potential difficulty in passing spending bills. Importantly, if the Biden administration adopts a conventional Democratic pro-regulatory reflex, its transportation and infrastructure policy aspirations are likely to fail in the same manner that the Trump administration’s “Infrastructure Week” became a running joke.
The first place to watch the Biden administration’s moves will be mass transit. Consistently operating in the red even during good times, public concern about coronavirus transmission has devastated mass transit ridership. In 2020, local mass transit systems have posted year-over-year declines of 70 percent in New York, 76 percent in Washington, and 86 percent in San Francisco as of Nov. 1, according to data compiled by the Bureau of Transportation Statistics.
Despite the current uncertainties related to telecommuting and residential land-use patterns, the Biden campaign promised to aggressively subsidize zero-emission mass transit projects in cities with populations of 100,000 or more. But Biden also promised to aggressively use Reagan-era “Buy America” procurement regulations, which grant preference to U.S.-manufactured goods purchased in part with federal funding.
The problem is that many of the electric buses and trains that American transit agencies want are manufactured by overseas firms. Thus, to fulfill his promises on mass transit, Biden would need to issue a record number of Buy America waivers to allow for the federally-subsidized purchase of foreign transit vehicles and equipment, something that may not sit well with some key allies — like those in organized labor.
Similarly, a tension exists between Biden’s promise of a “second great railroad revolution” and regulations designed to benefit organized labor. During the Obama administration, the Federal Railroad Administration proposed a rule that would have imposed crew-size minimums on trains operating on the national rail network. Despite the Obama administration’s admission that the proposed rule was not supported by safety evidence, and its subsequent withdrawal by the Trump administration, the Biden campaign indicated it aims to revive regulations setting minimum train crew sizes.
One problem is that such a rule would prevent future automation-spurred cost efficiencies from being realized in the railroad industry, thereby disadvantaging railroads relative to their primary competitors in over-the-road trucking. More recently, perhaps in recognition of this contradiction, the Biden transition website removed its promise for a “second great railroad revolution” and its plan for a nationwide high-speed passenger rail network. As President-elect Biden’s pick for White House Chief of Staff, Ron Klain, recently told Politico, the Obama administration’s high-speed rail push was a political failure.
Another regulatory example worth following involves automated vehicles. The National Highway Traffic Safety Administration (NHTSA) during both the Obama and Trump administrations adopted a light-touch approach to automated vehicle safety and performance regulation. This had less to do with a desire to limit regulation and more to do with how these regulations are created. Auto safety regulations generally incorporate technical standards and standardized test procedures created by private standards-developing organizations in lieu of writing government-unique standards. Those technical standards and accompanying test procedures are still being developed. And a recent RAND Corporation report found that experts believe automated vehicles may need to achieve a fleet penetration rate of 20 percent to 30 percent before enough data can be analyzed to competently regulate automated driving systems. But some activists reject this growing consensus, instead demanding automated vehicle regulations today — before technical understanding has reached appropriate levels.
As they say, “personnel is policy,” so whomever Biden selects to helm the Department of Transportation and serve within NHTSA will likely determine the level of regulatory competence on issues like automated vehicles and rail. Thus, as the Biden transition team continues to develop its policy agenda and vet potential senior political appointees, it should closely examine its transportation and infrastructure promises in the context of regulatory policy. Failure to do so will likely result in a failure to keep those promises.
Marc Scribner is a senior transportation policy analyst at Reason Foundation, a libertarian think tank that has advised multiple presidential administrations on infrastructure issues. Scribner has testified before Congress at the invitation of both Democrats and Republicans on issues including highway revenue collection, traffic congestion management, and airport financing.