Citizens Against Government Waste targets Sen. Thune/DM&E

Who are the other hobgoblins here? Sen. Coleman? Rep. Gutknecht?

Taxpayers Go Trick-or-Treating

Washington, D.C. Much scarier than the prospect of being haunted by the undead is the prospect of being spooked by a record $8.6 trillion national debt. In the Halloween spirit, Citizens Against Government Waste provides a list of who deserves taxpayer tricks and treats.

Trick: To Sen. John Thune (R-S.D.) for helping to secure a $2.3 billion loan from the Federal Railroad Administration (FRA) for a company for whom he was a lobbyist: the Dakota, Minnesota, and Easter Railroad (DM&E). Sen. Thune had earlier increased the FRA’s budget from $3.5 to $35 billion in apparent anticipation of the loan. With a poor safety record and revenues of less than $200 million, DM&E does not appear capable of making the annual $246 million payment, leaving taxpayers with the scary prospect of having to cover the shortfall.

The press release is here. See also David Williams' companion piece, "The Rail Subsidy That Could". In it he writes:

The loan makes no sense from a fiscal, security, or commonsense standpoint. The most confusing, and relevant, aspect to taxpayers is the financing. Currently, DM&E has revenue of less $200 million. According to BearingPoint (a strategic consulting firm), this loan would require an annual payment of $246 million on top of the $15 million from another loan. To put this number in perspective, the Chrysler bailout was valued at $1.5 billion. The numbers alone signal a red flag to stop this handout in its tracks. A senior manager at BearingPoint stated, "This loan finances a project with many financial uncertainties, ultimately calling into question whether or not DM&E can repay the loan."