Fallout: The Financial Crisis

NJ-NY tunnel cancellation not good for the long-term

Jeremy Hobson Oct 8, 2010
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Fallout: The Financial Crisis

NJ-NY tunnel cancellation not good for the long-term

Jeremy Hobson Oct 8, 2010
HTML EMBED:
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TEXT OF STORY

Kai Ryssdal: Until yesterday afternoon, the biggest public works project in the country was a new train tunnel underneath the Hudson River from New Jersey into Manhattan. Today, it’s just a hole in the ground. The governor of New Jersey has put the kibosh on a plan that would have more than doubled rail capacity under the Hudson into New York. It’s just too expensive, the governor said.

Marketplace’s Jeremy Hobson has more on now what that cancellation means for the region’s economy, both short term and long term.


Jeremy Hobson: At stake in the short term are thousands of construction jobs. But Bob Yaro, who heads the Regional Plan Association, says the real problem comes down the road.

Bob Yaro: All of our competitors around the world are making these investments, and they’re making them now, because they need the jobs in the short term, but they also need the economic capacity in the long term.

Yaro says New Jerseyans who opt out of the increasingly difficult commute will take an economic hit: Salaries in Manhattan are 60 percent higher than they are across the river. And he says the tunnel would have boosted New Jersey’s home values.

Robert Paaswell directs the City University of New York’s Institute for Urban Systems. He says the Big Apple will take a hit too, because the city’s economy thrives on interaction.

Robert Paaswell: If you have a place where you can see your lawyer, and see your banker, and see your printer, and see your chief engineer — and then go out for your pastrami sandwich, that’s a very attractive kind of place.

Today, the federal transportation secretary met with Governor Christie. The governor now says he will re-think his decision over the next two weeks. For his part, Bob Yaro is holding out hope.

Yaro: This is going to be needed. It’s going to happen. If they do it 10 years from now, it’ll cost twice as much. So short-term gain, long-term loss to the taxpayers of New Jersey.

Even New Yorkers were upset. Here’s Mayor Michael Bloomberg speaking at a “Wait Wait… Don’t Tell Me!” taping at Carnegie Hall last night.

Michael Bloomberg: Today, the governor of New Jersey cancelled another tunnel.

Chorus of boos from audience

Peter Sagal: Yes I know. Governor Christie — yeah we don’t like that.

We call that a Bronx cheer.

In New York, I’m Jeremy Hobson for Marketplace.

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