Mass transit subsidies as stimulus

Matthew Yglesias contemplates the idea:

While President Obama is proposing both $35 billion in aid to state and local government and $50 billion in transportation infrastructure, the plan neglects to support operation of the mass transit infrastructure the country already has. Consequently, were the program to pass, a transit agency could find itself in the perverse situation of laying off bus drivers today even as it hires construction workers to build a train for tomorrow.

Yet not only are cutbacks a double-whammy to the labor market, layoff-prevention is considerably more “shovel ready” than even the most shovel ready new construction. Fare hikes, too, tend to take money out of the pockets of the most economically vulnerable citizens, forcing reduced spending on other goods and services.