A storm is brewing in the Sunshine State. With the Floridian economy and state budget on the precipice of pandemonium, the state government is accepting a federal grant to construct a high-speed rail. This rail will not only fail spectacularly, but also create catastrophic costs for taxpayers, thus jeopardizing Florida’s esteemed position as a beacon of low taxes.

Tampa

After wasting the past year bitterly battling for healthcare reform, the Obama Administration now claims that it will focus on employment, as if that were not the intent of last year’s $862 billion stimulus. The Administration assured Americans that the so-called stimulus would keep the unemployment rate below 8%, but a year later it was over 10%. In addition to the usual self-congratulatory rhetoric, teleprompter-fed lectures, deceitful claims, and fallacious depiction of opponents that accompany any Obama initiative, the Administration is attempting to put a new spin on its failure by touting some of the stimulus’ most impressive projects. Projects about which the Administration is especially enthusiastic are the high-speed rails across the country, particularly between Tampa and Orlando. Although the Administration considers this rail a success story, it is actually an impending disaster for Florida, and an example of how stimulus spending will burden state budgets.

The best policy to increase employment during a recession is to let the business cycle work naturally, allowing depressed markets to purge excesses and find their bottom. Any action taken to expedite recovery should be to benefit the supply-side of the economy, such as tax-rate cuts or deregulation. Naturally, Obama will not do this, and will likely do the opposite. Since his presidential campaign, Obama has been terrorizing businesses, investors, and entrepreneurs with the threat of anti-growth policies, such as the stimulus, cap and trade, and healthcare reform. Frightened by Obama’s radical rhetoric of redistribution, this productive class is reluctant to take any risks – investing or expanding, for instance – which means employment will stay stagnant.

To increase employment – what last year’s stimulus utterly failed to do – Obama is demanding even more government spending. While most of last year’s stimulus spending went to bail out state and local governments, this year projects more infrastructure projects. Obama is championing a high-speed rail in Florida – between Tampa and Orlando – to illustrate such infrastructure spending. Descending from on high in D.C. to Tampa, the change god pontificated about the virtues of the rail to a congregation of local acolytes.

Florida, a decisive swing state, as well as a battlefield in the war between the GOP’s liberals – Governor Charlie Crist, who betrayed his party to embrace the stimulus and Obama himself – and conservatives – former Speaker of the House Marco Rubio, currently leading in polls – is a fateful place for Obama’s stimulus to make its last stand. If it succeeds, the Obama agenda will be vindicated, its critics shamed and silenced. If it fails, however, Obama’s ambitions will suffer a mortal blow, limping along to die an ignominious death in 2012. Of course, Keynesian policies have been failing spectacularly since the New Deal, and there is no reason to assume that Obama’s oratory will negate the laws of economics ensuring their demise.

The Obama Administration estimates that the high-speed rail will cost $1.25 billion, but this is certainly wrong. Florida’s Department of Transportation estimates $3.5 billion, and a 2009 Government Accountability Office report suggests that costs could be $51 million per mile, totaling $4.28 billion. Since the federal government has only granted its projected $1.25 billion to Florida, Floridian taxpayers will be responsible for the expected cost overruns.

Politicians regularly trout out high-speed rails for different reasons, and this year it is to “create jobs and generate and economic activity.” Of course, these would not be real jobs created in the private sector, but taxpayer-funded jobs protected by politics. In 2014, when the project is completed, the construction jobs will disappear, and the only thing left behind will be needless new costs for Floridians.

The Tampa-Orlando high-speed rail will serve no useful purpose, cost far more than expected, and burden Floridians with new taxes that will jeopardize Florida’s success.

Tampa and Orlando are completely arbitrary destinations; there is no relationship between Tampa and Orland to justify connecting the two. Orlando residents are not regularly traveling to Tampa – to cheer on the 3-13 Buccaneers, for example – in significant numbers. Orlando may be a popular vacation destination due to its amusement parks, but Tampa residents do not visit Disney World any more than anyone else in the United States. Based on this rationale, Orlando could just as logically be connected to Lewisburg.

Driving the 84 miles between Tampa and Orlando takes about 90 minutes on I-4, a federal highway through each city. A high-speed rail would make the trip 30 minutes faster. Rails make more sense when built over long distances – like they are in Europe and Japan – not between two close cities in the same state. Even if the rail only costs Obama’s rosy $1.25 billion, spending that much for a slightly-faster 84-mile drive is wasteful.

Although riding the rail would yield gas savings, there is not enough regular traffic between the two cities to make a meaningful difference. Saving a Tampa family the cost of gassing up the minivan every summer does not justify such an expensive endeavor. Furthermore, without a car, visitors to each city must either call a cab (negating any gas savings) or impractically trudge around town. If the rail connected Tampa to Disney World, this flaw might not be so bad, but Disney is several miles outside of downtown Orlando.

In addition to financing the high-speed rail’s busted budget, Floridian taxpayers will also be responsible for operating and maintaining the rail. Floridians understand this, and so have voted three times – as recently as 2004 – to reject plans for a high-speed rail. Floridian voters are against the rail because they know it is impractical, expensive, and would threaten their state’s unique appeal. Florida’s warm weather and beautiful beaches are not its only attractive quality. Low taxes – no income or estate tax, for example – have promoted strong economic growth, making Florida one of the most prosperous states in America. Over-taxed residents from other states (like New Jersey) move to Florida to avoid oppressive tax rates, and businesses invest in Florida because their after-tax return is higher there than elsewhere.

Property and sales taxes were Florida’s main source of government revenue, but have been undermined by the housing crisis and recession. Last summer, Florida struggled to balance its $66.5 billion budget, relying on $4.7-billion stimulus bailout, as well as a new revenue from tobacco taxes and gambling. Given the precarious condition of Florida’s economy and budget, new multi-billion dollar spending should be out of the question, yet that is exactly what the high-speed rail will bring. Construction of the rail is not financed beyond the federal grant of $1.25 billion, which means the state will raise taxes or cut spending to afford the rail. Once the rail is built, Floridian taxpayers will also be responsible for the maintenance and operation of the rail, which will require additional revenue or savings. The most recent budget dispute, however, suggests that the government is more likely to increase taxes than decrease spending.

Florida has succeeded because its low taxes encourage investment and expansion. Projects like the high-speed rail, however, threaten Floridians with higher taxes, compromising the state’s economic growth. A state income tax on “the rich” to pay for the rail, for example, would diminish Florida’s appeal to businesses, investors, and other over-taxed Americans. Instead of moving to or investing in Florida, they would select states where they have the sense not to punish their most productive citizens. Fortunately, Florida is currently one such state, though it is poised to forfeit that advantage. Rather than clamoring for stimulus funds it cannot handle from D.C., Florida should continue to uphold its pro-growth policies, trusting the free market to triumph over the central planning of politicians. An even-faster trip to Disney World may be a child’s dream come true, but its cost is an adult’s worst nightmare.

As if this were not bad enough, White-House court jester Joe Biden described this multi-billion train wreck as mere “seed money” to lay the foundation for more federal meddling in Florida, such as another connecting rail to Miami. An expensive and useless catastrophe careening towards taxpayers, the high-speed rail may darken Florida’s sunny future.