On the DM&E: How many times do conservatives need to say, "No, no and no"?

From Steve Forbes:

Fiscal--and Ethical--Train Wreck

The routine abuse in the congressional appropriations process is highlighted by an ongoing effort to force the federal government into granting a multibillion-dollar giveaway to a small, private railroad, the Dakota, Minnesota & Eastern Railroad (DM&E). The owners want to expand the line to carry coal from Wyoming's Powder River Basin to the Midwest.

The demand for coal is surging, and the owners of the DM&E want to cash in on the boom. But instead of turning to the private sector for financing, the railroad asked its onetime lobbyist and now senator, John Thune (R-S.D.), to help out. Thune obliged. He has been pushing for the Federal Railroad Administration (FRA) to give his former client a $2.3 billion loan to build the 262-mile extension, this for an outfit with revenues under $200 million. Servicing this debt will come to almost $250 million a year.

This carrier is no stranger to government largesse. Three years ago it got itself a $233 million loan from Uncle Sam. Yet DM&E's safety record is, to put it charitably, spotty, with a main-track accident rate eight times the national average.

Senator Thune slipped this $2.3 billion earmark into the pork-heavy 2005 transportation bill. With no debate and no hearings, Thune got the FRA's Railroad Rehabilitation & Improvement Financing Program increased tenfold, from $3.5 billion to $35 billion. Moreover, points out the Frontiers of Freedom Institute, a free-market foundation, "Thune also modified the loan criteria to benefit only one company, setting in place provisions for the loan to be granted to his former employer with no collateral and no payments for six years." The public has been barred from examining the loan application and the company's finances.

It's not as if Wyoming's rich coal region is not being serviced. "Rail service is already being provided by two larger and superior railroads, which have invested private funds in most of their ventures. The government should not prop up a weak competitor," notes the National Taxpayers Union, a citizens' group working for low taxes and on whose board I sit.

The Bush Administration wants to terminate the railroad loan program. Congress, especially now with the Democrats in control, is not likely to go along. At the very least, the FRA should not give final approval to the loan on the grounds that the DM&E manifestly lacks the necessary creditworthiness.

But one must not underestimate the resourcefulness of pork-loving pols. Citizens Against Government Waste, a taxpayer watchdog, ruefully and rightly calls Senator Thune's efforts a twisted version of the children's story The Little Engine That Could.

The article is here.