"If you're not into autonomous cars, you're not in the game"

Raymond LaHood Photo: Eyal Yizhar
Raymond LaHood Photo: Eyal Yizhar

Former US Secretary of Transportation Ray LaHood tells "Globes" about his future vision for transportation.

When the then President-elect Barack Obama presented the Republican Ray LaHood as Secretary of Transportation in his new administration in December 2008, he was keeping one of his election campaign promises. "When I began the appointment process," Obama had said, "I was committed to finding the man most suitable for the job regardless of his political party. The appointment of Ray very much reflects this bipartisan spirit, a spirit that we must adopt anew."

LaHood, a Congressman who represented the 18th District of Illinois from 1995 to 2009, and canceled his plans to retire from politics and move to the private sector following the appointment, emphasized the same message. "I've many times stressed that once the elections are over, we must put aside our party guidelines and work together for the benefit of US citizens. That's the approach that the president-elect had adopted and that's the approach that I will also adopt as Secretary for Transportation."

The agreement between the two politicians, despite the deep political chasm in the US is not surprising. Obama, born to a white mother and Kenyan father, grew up in the tolerant atmosphere of Hawaii and has always had the ability to bridge between divides. Writing in his biography of Obama, the former New Yorker editor David Remnick described how Obama won the vote to become editor of the Harvard Law Review because he was popular with students across the political spectrum. Obama excelled in genuine attentiveness to his Republican colleagues, even after his appointment to the job, Remnick recounts.

LaHood, born in Peoria, Illinois, has Lebanese roots on his father's side and German ancestry on his mother's side. His parents ran a restaurant. He is known as a moderate politician, constantly seeking the consensus between the parties in order to promote important issues. Two years ago, he published his political autobiography "Seeking Bipartisanship: My Life in Politics," in which he describes the political dynamics in Washington D.C. in order to pinpoint the obstacles to progress and suggest solutions.

Throughout his political career, LaHood has stood out by maintaining an independent line, somewhat distinct from the Republican party's official line. Even when he was starting out, and stood for Congress in 1994, he was one of two Republican candidates who dared to sign on the "Contract with America," a plan formed as part of the campaign by the parties strongmen including Newt Gingrich who after the elections became Leader of the Republican Majority in Congress.

"I decided it was too much of a gimmick for me," LaHood told "Globes." There were 10 clauses in the Contract with America, and I voted for nine out of ten of them. The clause that I didn't like was about tax cuts because we had a huge deficit. I said that we must repay our debt before making tax cuts."

His consistent support for raising taxes earned him a very low rating over the years from Republican organizations like the "Club for Growth" and "Citizens Against Government Waste," which monitor the work of Congressmen.

The tax issue was not the only one on which LaHood stepped out of the party line. In 2005, because of his reservations about the harm to individual liberties, he voted against the renewal of the Patriot Act, enacted by the Bush administration in the aftermath of 9/11. In October 2008, less than a month before the presidential elections, he criticized the style of Republican vice-presidential candidate Sarah Palin who had hinted in her campaign speech that Obama was a traitor supported by terrorists, and he stressed that her charges were not correct. Palin's words had provoked strong condemnation of Obama and even calls to "kill him."

On November 6 2008, two days after the elections, LaHood called his friend Rahm Emanuel, who is today Mayor of Chicago but back then was a fellow Illinois Congressman. He congratulated him on the election victory and wished him luck in the job he had decided to take as White House Chief of Staff. Emanuel told LaHood that his name had come up as a candidate for Obama's cabinet and he was wondering if he was determined to retire from politics. Seven weeks later, which Lahood describes in his book as an especially tense time, he was unveiled as the next Secretary of Transportation. His first choice of job in the cabinet would have been Secretary for Agriculture.

You worked for more than four years with Barack Obama, how would you describe him and his achievements?

"First of all, he is very smart. He studies and reads and is helped by others to seek counsel and he tries to do what he thinks the American people agree with: a health system for all Americans, which is a good thing, to pull out of Afghanistan and Iraq, he changed US energy policy and tried to do many other things. On some things he succeeded and on others he found it difficult because he was dependent on Congress."

What were the main things in which you were involved during your term as Secretary of Transportation?

"The number one issue was safety. What I said in every speech that I made was that for thousands of people who traveling in cars, buses, trains and planes, the only thing they don't think about is safety. In my term of office 49 people died in a plane crash in Buffalo, New York and I tell you that all 49 of them thought that they would land safely in Buffalo."

"What we tried to do in four and a half years was to stress to people - whether bus or truck companies, airlines or railway companies - the most important thing that they can do is make sure that every employee from ticket sellers to inspectors, must understand that safety is their number one priority."

"In the first two years of our administration, Congress enacted economic incentive laws worth $870 billion, mainly to pull the economy out of crisis. The Ministry of Transportation received $48 billion over two years (above the regular budget). $26 billion for highways and bridges, $8 billion for urban transportation systems, $1 billion for airports, $8 billion for developing rapid railways systems for the US; thus we had a major advantage for initial work with a budget of $48 billion and I'm very proud of the fact that everything was agreed and there was no dispute about this. The money put a lot of people back to work and that was wonderful in a period of major unemployment.

"The second thing that the Obama administration undertook was to insist on helping industries that were in dire straits with loans to General Motors and Chrysler. We assisted in pulling the automobile industry out of a very, very awful situation. We also helped the President implement the new standard for gas consumption of vehicles, 55.4 miles per gallon by 2025. We gave cash to people who wanted to change their car. We said, take $4,500 and buy a car that saves on gas."

What were your targets as Transportation Secretary as part of your budget?

"Fast trains, I suppose. We had a problem in persuading state governors to do this, because we needed them, and so ultimately California received the lion's share of the budget for fast trains. They are currently working on a fast train that can travel 225 miles per hour (350 kilometers per hour) between San Francisco and Los Angeles. In Illinois, between Chicago and St. Louis, we dealt with a lot of railway track. We gave a lot of money to Amtrack in this region. There are many place in the US with the need for railways and if the federal government doesn't provide the financing then there is no railway."

What did you learn about the relation between transport investment and results?

"When you invest in transportation, you invest in the people that are building the infrastructure, in other words, you are investing in workers. You are also investing within the context of the economy. If you build a fast interstate highway, then that has economic results. All the small businesses that you create such as gas stations, stores at underground railway stations, sandwich places, restaurants, you create works for those building the system, for those operating it, and for businesses that are built alongside the highways and railways.

What did you do as Transportation Secretary to solve urban transportation problems?

"We devoted a lot of time and energy to talks with mayors that wanted, for example, to mass transportation systems that were over 50 years old so that they could meet contemporary needs. We helped them buy new buses to transport people from their neighborhoods or upgrade light or electric railway systems. It helped mayors attract people to live in their neighborhoods because young people studying at college seek two things: affording housing from their point of view and good transportation systems."

Do you think Americans can wean themselves off private cars in the next decade or two?

"I don't think that Americans will give up their cars. They love cars and they'll always motor around. It may be that they won't need to own two or three cars but just one car, if they have other options. In some cities, it's impossible to get about without a car. In rural regions of America you have to have a car. In smaller cities you have to own a car. But in the big cities you can live without a car."

"To invest in mass transport"

LaHood, 72, has four children and 12 grandchildren. He has a B.A. in Education and Sociology and from 1971 taught civics in a public Catholic school. That work caused him to become more and more interested in the US political system. After teaching, he began a career as head of a district youth services bureau and from 1977-1982, he served as district administrative assistant to Representative Tom Railsback.

In 1982, he moved with his family to Washington D.C. to become administrative assistant and ultimately the chief of staff to US House Minority Leader Robert Michel, serving from 1982 until 1994. Michel preceded him as representative of the 18th District of Illinois. In 2015, LaHood's son Darin became the representative of the 18th District of Illinois.

As Secretary of Transportation, Lahood managed a $70 billion budget and 55,000 federal employees in land, sea and air transportation. During his term of office, 560,000 kilometers of highways were paved or altered, 20,000 bridges were repaired and close to 10,000 kilometers of railway tracks were laid or renewed. The issue of America's shaky infrastructure still motivates him and it is one of the only subjects that he takes time to tweet about and write articles on.

LaHood is co-chairman of the Building America's Future fund together with New York Mayor Michael Bloomberg, former California Governor Arnold Schwartzenegger and former Pennsylvania Governor Edward Rendell. The aim of the fund is to mobilize everybody to understand that massive investment in US infrastructures is necessary to promote the economy and quality of life in the US. LaHood currently works, mainly as an advisor, including to law firm DLA Piper. "I help companies that want to build transport systems and are thinking how to overcome the problems," he said.

In an article recently published by "Bloomberg," written with Prof. Norma Jean Mattei, President of the American Society of Civil Engineers (ASCE), they call for the investment of $2 trillion in US infrastructures by 2025, above regular investments. "If we fail in closing these gaps," they wrote, "Our global economic status will decline, we will endanger 2.5 million jobs, $3.9 billion in GDP, and we will cause businesses aggregate losses of $7 trillion."

The latest situation report published every four years by the ASCE, which was issued several weeks ago, gave the US a D for transport infrastructures, or a mark of 60, so that for example, there are an estimated 130,000 bridges in the US that are in a neglected condition. The issue of financing the upgrading of infrastructures, says LaHood, was one of the biggest challenges he faced as Secretary of Transportation.

"I would have wanted for there to be more cooperation with Congress in financing transportation, on a larger scale to what President Donald Trump is trying to do, which sounds positive and he has a large vision on infrastructures, and he is talking about investing $1 trillion. I hope that he persuades Congress to allocate the money. Some projects can be done in cooperation with the private sector. Perhaps it is possible to raise the tax on gasoline. In that way it would perhaps be possible to finance the interstate highway network. It's also possible to increase the number of toll highways. Perhaps five or six things together. If he does it, then we will have excellent land transportation."

How much do you propose raising the tax on gasoline?

"I would say ten cents per gallon, linked to the cost of living index, so we won't need to worry about updating it all the time. It works out a lot of money. With this we will finance highways, bridges, trains. I don't know whether Trump will adopt this. I've never ever met him. If people will be made enough to elect a Congress controlled by Democrats in the midterm elections, then the situation will change."

Tax on gasoline in the US currently stands at 20% of the overall price compared with 60% in Israel. Out of an average tax of 50 cents per gallon, 18.5 cents is federal tax and the remainder is a variable state tax depending on each state. This is a low rate of tax, which works out to federal revenues amounting to about $40 billion. LaHood's proposal is very conservative and would not be enough in his opinion for the required budget to improve infrastructures.

Do you think that Trump will succeed in obtaining $1 trillion from Congress?

"I think that if anyone can succeed in obtaining the financing then it is him. Everyone sees the infrastructure as a national priority. After the cancelation of Obama's healthcare plan (that has so far failed), the second priority of the new administration is lowering taxes. Then comes immigration policy, and after that, I hope, transportation."

Are there differences between Republicans and Democrats on transportation?

"The Republicans aren't mad about trains and they prefer to invest their money in highways and bridges. President Obama had a great weakness for fast trains. He invested $8 billion in developing them compared with zero investments in this area before him. That's one difference. Financing is another big difference. There is a dispute on how to finance major things. The Republicans don't want to put up tax on gasoline for cars, while the Democrats do wants to raise it. President Obama decided not to raise the tax."

It seems that on some issues you are more of a Democrat than a Republican?

"Those are your definitions. What I would say is that when you are in the business of attempting to develop a plan and find the financing, you must be realistic. President Ronald Regan in 1984, put up tax on gasoline, and he was the most conservative republican. President George Bush (the father), who was a one term president, put up tax on gasoline. Therefore, the idea of raising gasoline tax is not only a Democrat one. But it has to come from the White House. That's what is necessary for raising the money.

You served on the Transportation and Infrastructures Committee of the House of Representatives in the 1990s. What has changed since then?

"When I was on the Transportation Committee, it had 75 members, Democrats and Republicans. In the House of Representatives at that time 400 representatives tended to vote (out of 435) and in the Senate 80 (out of 100). All of us back then wanted to work together to repair highways and renew bridges; they want but there are no sources of financing. We'll see what President Trump does."

Is there a possibility of raising capital in the private sector?

"There's a plan to set up a private-public partnership. It's possible to go to the private sector, to venture capital entrepreneurs that have money and add federal and municipal money to that to finance large highway projects. I'm talking for example about the railway line that we pushed forward from downtown Washington to Dallas Airport. It's about 25 miles long and everything was with private finance and state money."

Israel is building light railways in Jerusalem and Tel Aviv but we're talking about a process taking 15-20 years until the network is complete and meanwhile Israel suffers from terrible jams. What would you recommend that the Israeli government do in the meantime?

"I would suggest investing in mass transit systems. It's worth visiting cities and learning from plans to price traffic congestion. You must visit cities with similar problems to see what can be done. It's not a simple matter because traffic congestion is a complicated subject and you have to convince people to cooperate."

"Some US cities put a major emphasis on bus networks, subway systems, metros, electrification, through to situations in which you pay, in effect, people not to come into the city with their private cars. New York did that but if you go into New York today you'll see that it is still jammed but there is major relief. It's possible to restrict the number of buses, especially in the big city centers. You can also restrict the number of cars in jammed city centers like New York and Chicago."

Which transportation vision would you propose for Israel?

"I think that you have smart people in this country, and these smart people must see what is happening in other places in the world regarding how you put together railways, what is happening with the technology, what is happening with autonomous cars, how much money Google and Apple are spending on this. From my point of view this is the next generation of vehicles. If you're not in this field, then you're not in the game. My viewpoint is that you must locate partners with venture capital that know how to lay railway lines, to operate electric trains, build highways or toll roads, and handle traffic congestion and all these things."

Could the autonomous car vision be too optimistic?

"Everybody is confronting this from Google to General Motors. If you go to Mountain View, California where Google carries out its development you'll see 25-30 cars and they say that in another 10 years we'll see them on the roads."

Due to your experience in government, do you think that will be an obstacle to this development?

"We have the new Trump administration that is canceling much of the regulation introduced by President Obama. Only as time passes will we know. They are committed to developing regulation for autonomous cars."

At a conference organized a month ago in Israel by DLA Piper, the law firm for whom LaHood acts as a consultant, and Israel's Herzog Fox Neeman law firm, he said that from his point of view, success in transportation would be if in 10 or 20 years the number of cars per family in the US will be reduced from more than two on average to just one due to the fact that there are other better alternatives. "There is a lot of money that have been invested in next generation transportation, of all types. In the US, a very major part of the next generation of transportation is based on trains. That's what people want and as Minister of Transportation, I traveled to 18 states to learn about the sector. We invested a lot in it."

Trump will be impeached? The Republican party is behind him

When LaHood is asked about the likelihood that President Trump will not complete his term of office and be impeached over the investigation of his connections with Russia or other scandals, he dismisses this with a wave of the hand and promises that the Republican party stands fully behind the president. That is to say at least for the first year during which he will be judged by his ability to implement two or three of his election pledges. "If Trump succeeds, then America succeeds," he says.

"These words are a little surprising when coming from somebody considered the left marker in his party. In his book, he criticized the inflexible ideology of the new generation Republican congressmen, "who probably live in a different world from me." A large part of these members of Congress, he wrote, "are not interested in Congress enacting legislation because any government action, by their definition, is bad for the country."

On the other hand, alongside the warm words of support that he got from President Obama for his policies, LaHood also included criticism of him in his book. "I don't believe that the White House was genuinely fully committed to a bipartisan approach in forming policy despite the words saying the opposite pf that the President said."

"President Obama relied almost exclusively on a circle of advisors in the White House. He never looked beyond this group for advice. He didn't do it even though other presidents placed great value of consulting with members of Congress. As time went by the President seemed to me to be more isolated, more isolated from people outside his internal group and less in contact with others."

Published by Globes [online], Israel business news - www.globes-online.com - on April 30, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

Raymond LaHood Photo: Eyal Yizhar
Raymond LaHood Photo: Eyal Yizhar
Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018