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Forging Early America’s Northeastern Backbone

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Forging Early America’s Northeastern Backbone


A review of The Northeast Corridor: The Trains, the People, the History, the Region, by David Alff, 280 pages, The University of Chicago Press (April 2024).

One mark of a great writer is an ability to produce beautiful prose even when describing life’s passing banalities. By way of example, I give you David Alff, herein describing Barack Obama’s view from the train that took him from Philadelphia to Washington three days before his first inauguration:

a washed-out collage of polyvinyl cable, cracked rebar, rigidized metal, and leafless trees beside the gray chop of the Delaware River. Cathedrals spired over rowhomes. Stone-crushing plants shouldered up against scrapyards and algal ponds. Freeways clogged with rigs and sedans…a place used to get to other places, an architecture of anticipation, an inglorious backdrop on which to project a perfected union.

The Northeast Corridor is packed with this kind of poetry. But I assure you this isn’t some art-house meditation on the rail-scarred earth of the mid-Atlantic. Alff has produced a proper history of the eponymous rail line from Boston to Washington, D.C. that became early America’s infrastructural backbone. And somehow, he managed to pack it into a book that’s scarcely more than 250 pages, despite also providing an abundance of memorable digressions into the arts of rail-station architecture, bridge construction, and tunnel blasting.

The Northeast Corridor

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All aboard for the first comprehensive history of the hard-working and wildly influential Northeast Corridor. Traversed by thousands of trains and millions of riders, the Northeast Corridor might be America’s most famous railway, but its influence goes far beyond the right-of-way. David Alff welcomes readers aboard to see how nineteenth-century train tracks did more than connect Boston to Washington, DC. They transformed hundreds of miles of Atlantic shoreline into a political capital, a global financial hub, and home to fifty million people. The Northeast Corridor reveals how freight trains, commuter rail, and Amtrak influenced—and in turn were shaped by—centuries of American industrial expansion, metropolitan growth, downtown decline, and revitalization. Paying as much attention to Aberdeen, Trenton, New Rochelle, and Providence as to New York City, Philadelphia, and Baltimore, Alff provides narrative thrills for history buffs, train enthusiasts, and adventurers alike. What’s more, he offers a glimpse into the future of the corridor. New infrastructural plans—supported by President Joe Biden, famously Amtrak’s biggest fan—envision ever-faster trains zipping along technologically advanced rails. Yet those tracks will literally sit atop a history that links the life of Frederick Douglass, who fled to freedom by boarding a train in Baltimore, to the Frederick Douglass Tunnel, which is expected to be the newest link in the corridor by 2032. Trains have long made the places that make America, and they still do.


Like so many other American creation stories, The Northeast Corridor delivers a star turn to Benjamin Franklin. It’s 1723, and the future Philadelphian is still in his late teens—a callow apprentice fleeing an internship at his brother’s print shop on the invented claim that he’d impregnated a “naughty girl.”

Franklin had nothing to do with the creation of America’s rail system, whose first tracks wouldn’t be laid until well into the next century. But the details of his teenage trip to Philadelphia, summarised by Alff based on an account contained in Franklin’s autobiography, do much to explain why future Americans would shoulder the high cost of laying track up and down their eastern seaboard’s ragged landscape: Getting around the United States in the days before trains was slow, dirty, and dangerous.

Franklin’s 1 October 1723 voyage began on the Battery docks, from which he set sail to New Jersey on a southbound ferry. Unfortunately, the ship’s sail was destroyed by a sudden squall even before escaping New York Bay. As the boat bobbed around, passengers grew seasick and parched. There was nothing to drink, Franklin reported, except “a bottle of filthy rum.”

Eventually, the damaged vessel made it to the coastal New Jersey town of Perth Amboy, where Franklin disembarked amid giant piles of shells discarded by local oyster rakers. From there, he set off inland toward Philadelphia, which lay at a distance of about 60 miles.

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At the time, American roads were still little more than bumpy paths, which often succumbed to floods, mud, and ice, according to the season. Even in good weather, Alff writes, “each rut and cobble rattled the ribs of passengers on plank-bench wagons slung over tar-greased wheels.” By the time Franklin made it to the eastern shores of the Delaware River several days later, he’d become so bedraggled that he found, “by the questions ask’d me, I was suspected to be some runaway servant.”

Even then, he still had a river crossing to manage, as the first bridge across the Delaware wouldn’t be built for another 83 years. And so Franklin joined the crew of a rowboat making a night crossing. The men got lost in the darkness, and so they all spent the wee hours on a frigid beach downriver, huddled for warmth around a fire fed with stolen fenceposts.

All in all, Franklin’s 90-mile trip from New York to Philadelphia took five days, a period during which he was imperilled by maritime disaster, thirst, hunger, food poisoning, bitter cold, and (at least twice) the possibility of arrest. By contrast, a modern rail traveller can make the journey from Manhattan to Philadelphia in less than an hour and a half.


The first working steam-powered railway locomotive was produced in 1804 by British inventor Richard Trevithick. While specimens of this new technology would soon make their way to the United States, it would take another quarter century before the first passenger rail services began operation.

A drawing of Richard Trevithick’s Coalbrookdale Locomotive, as he imagined it in 1802, two years before another (unnamed) locomotive he’d designed made history by powering a train along a tramway in Merthyr Tydfil, Wales.

The biggest challenge confronting America’s early railway visionaries wasn’t one that could be solved in a workshop: Their young country had no peacetime tradition of constructing public works that required large capital investments and crossed jurisdictional boundaries. States clung to their colonial-era grudges and rivalries well into the nineteenth century. Even the cities, Alff writes, saw their economic relationship with other municipalities in zero-sum terms, and so “paid less attention to each other than to the task of turning their hinterlands into cargo bound for Europe, Africa, the Caribbean, and Canada.”

While rail had long been used to move coal and other bulk commodities along private track at mines and factories, no one had any clear idea how this technology might be applied to mass-retail passenger transport. Potential investors weren’t even sure what they were being asked to finance:

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Was it a tool for miners? A portage patch between rivers? A winter workaround for frozen canal beds? Would tracks act like a mechanized [public] highway to which passengers brought their personal vehicles? Or would they behave like the Erie Canal, a state-owned conduit served by private barge lines? The age of iron and steam could not be answered until these administrative questions had answers.

And so, the first railroads laid in the United States were hyper-local operations, constructed by mechanically inclined eccentrics and dreamers. When a New Jersey-based army colonel named John Stevens set out to create what he hoped would be his country’s first passenger railroad in 1814, he marked the 26 miles between New Brunswick, NJ and Trenton by his own hand with rod and chain, snaking a pokey trail through northern New Jersey along the edges of creeks and farms.

A man ahead of his time, Stevens proclaimed in 1814 that he’d taken the first step in creating a route ‘between the different parts of our country, safe from the risks of the sea or the power of the enemy.’

A man ahead of his time, Stevens proclaimed that he’d taken the first step in creating a route “between the different parts of our country, safe from the risks of the sea or the power of the enemy.” (By this, he meant the British, as the War of 1812 had not yet formally ended.) Alas, the only actual track he ever laid was a tourist curiosity on the grounds of his Hoboken hotel. And even that tiny project ended in tragedy when a boiler explosion took his adult daughter’s life.

It was the completion of the aforementioned Erie Canal in 1825 that finally focused east-coast business interests on the necessity of railroads. By providing a navigable waterway connecting the Great Lakes to the Hudson River, the canal enshrined New York’s status as America’s dominant port, and so threatened to turn every other coastal city into a backwater. There’s a reason New Jersey and Maryland played such outsized roles in American rail history, Alff notes: Both are “squashed between larger states,” while lacking New York’s “drainpipe to the interior.”

An 1858 map of the New York State canal system, centred on the Erie Canal, which runs east from Lake Erie to the Hudson River, from which ships sail south toward New York City.

America’s first common-carrier railroad, the fabled Baltimore and Ohio, was created by a group of Baltimore businessmen seeking to restore “that portion of the Western trade which has recently been diverted from [us].” The enterprise wouldn’t make good on its name until 1852, when the company’s engineers finally laid track into the Ohio Valley. But the B&O would eventually go on to operate a sprawling rail network whose trains took travellers and trade goods to Pittsburgh, Cleveland, Columbus, Cincinnati, St. Louis, and Chicago before heading back east with freight wagons full of Midwestern coal.

1876 B&O route map. The depicted routes weren’t part of what came to be known as the Northeast Corridor, except that portion running south from Baltimore to Washington, D.C.

At the time the B&O began operation, horses were still sometimes used to haul rolling stock. (Indeed, one early proposal for a Boston-Providence line imagined each train being equipped with a “platform, placed on small wheels, on which the horse himself may ride when making long descents.”) But that changed soon after inventor Peter Cooper (of Cooper Union college fame) designed and built the first American-made steam locomotive, the Tom Thumb.

In 1829, the owners of Stockton and Company, a Maryland-based stagecoach line, challenged Cooper to an eight-mile race pitting horse against train. The horse won after the Tom Thumb suffered a mechanical malfunction. But the train had raced out to such a commanding early lead that spectators—the B&O’s owners included, apparently—were convinced that the time had come to put the horses out to pasture.

A Tom Thumb replica (left) alongside a 1937 B&O EMC EA/EB diesel locomotive.

But the great engineering marvels of the age weren’t the locomotives—which were essentially just mobile implementations of the same steam-based technology that Americans had used to “twirl boat propellers, drain copper mines, saw timber, and grind plaster of paris” for decades—but rather the bridges and tunnels required to get them past mountains and rivers.

Alff is listed as a professor of English at State University of New York in Buffalo. But given his evident fascination with transportation infrastructure, one might easily mistake him for an architect or civil engineer. Among the masterpieces of nineteenth-century American construction he details are the Canton Viaduct, a 600-foot-long hollow bridge over Massachusetts’ Neponset River that’s remained in continuous service since the mid-1830s; Washington Union Station; and the North River Tunnels, dug under the Hudson by the Pennsylvania Railroad (PRR) so that Manhattan passengers wouldn’t have to start their southbound voyages, Benjamin-Franklin-style, by sailing to New Jersey.

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A postcard image depicting an exhibit at the Jamestown Exposition of 1907, which provided visitors with promotional information concerning the Pennsylvania Railroad’s New York City river tunnels.

The Northeast Corridor can’t be classified as social history (also known as “history from below”), as Alff’s protagonists are gilded plutocrats such as J.P. Morgan and P.T. Barnum. Nevertheless, the author takes pains to educate readers about the backbreaking work that labourers and tradesmen poured into the Northeast Corridor, as in this fine passage about Canton, MA’s aforementioned viaduct, a blind arcade cavity wall built for the Boston and Providence Railroad:

Railroaders rarely sign their creations. The tracks they lay and the paths they embank remain anonymous. A railroad is not a novel or a fresco, but an artifact of many hands lost to time. [This viaduct] is the exception…If you park by the Honey Dew Donuts and walk down Neponset Street, you will come face to face with a stone wall full of strange graffiti: diamonds, triangles, plusses, hourglasses. Each mark belongs to an ancient masonic alphabet. Each scratch identifies, credits, and holds culpable whoever cut the stone. Each autograph signifies someone who built the corridor. Many masons carved granite in Canton in 1834. Over hilltops and cedar bogs carried the ring of bladed hammer on rock, the clop of oxen, the bray of horses, and the brogue of ballast crews. By day, Canton ravine echoed with the toil of Scotch and Irish immigrants, the new New Englanders replacing those Yankee farmers who fled west. At dusk, the workers retired to camps, where they drank so much beer and brawled so fiercely that the commonwealth militia twice deployed to quell riots.

Main image: 1977 photo of Canton Viaduct. Inset image: sample of mason’s marks visible on the structure’s exposed brick facing.

The golden age of American railroading ended following the Second World War, as air travel became the preferred form of long-distance travel for the wealthy, while the Interstate Highway System would go on to hollow out the middle-class market. In the peak year of the interwar period, Americans took 1.27 billion train trips. By the end of the 1950s, the annual total had dropped to about 400 million (and this in a country whose population had grown by about 60 percent during the intervening decades).

A preserved GG-1 electric locomotive at the Railroad Museum of Pennsylvania in Strasburg, PA. First built in 1932, the GG-1 was, in Alff’s words, “an instant art deco icon: lithe, sensuous, perfected. Its streamlined body symbolized a metropolitan northeast in postage stamps, paintings, and photographs.”

In the early 1970s, following a series of bankruptcies, unsuccessful mergers, and high-profile accidents, the federal government stepped in to save the industry from complete ruin through the creation of quasi-public corporations—Amtrak and Conrail—that would operate passenger and cargo service (respectively) on a national scale. During its postwar retrenchment era, the Corridor’s rural and exurban tributary system shrank, as unprofitable legacy spurs were ripped up and replaced by roads, strip malls, and tract housing. In the large cities, meanwhile, many of the original rail temples that once symbolised American wealth and progress, such as Philadelphia’s iconic Broad Street Station and Penn Station in New York, were abandoned to other uses.


The project of connecting Boston to Washington with a continuous rail line was completed in 1917, when Mohawk Skywalkers put the last rivet into New York City’s Hell Gate Bridge, spanning Wards Island and Queens. For the first time in history, passengers could ride the Corridor’s full extent without using a boat or hackney cart to hop from one rail line to another. (Trains were still required to swap out their locomotives for electric replacements at Manhattan Transfer in Harrison, NJ, however, as the North River Tunnel ventilation systems couldn’t accommodate steam engines—a practice that would continue until the full electrification of the Corridor’s southern half was completed in the 1930s.)

A 2023 photo of the Hell Gate Bridge, originally called the New York Connecting Railroad Bridge.

But even once completed, the Northeast Corridor would remain hobbled by the jigsaw-puzzle nature of its creation. As Alff emphasises, none of the original track-builders thought of their project as anything so grand as a “Corridor,” let alone one spanning 460 miles, eight states, and 108 stations. Over time, their lines did eventually push out toward one another, but only in the unconscious fashion of “houseplants toward sunlight.”

How Mohawk ‘Skywalkers’ Helped Build New York City’s Tallest Skyscrapers | HISTORY

Native American riveting gangs worked on the ‘high steel’ for iconic structures like the Chrysler Building, Empire State Building, Rockefeller Plaza and more.

This piecemeal approach wasn’t seen as critically problematic in the days when most trains didn’t move much faster than a man could run. (In the early 1830s, the B&O’s owners announced a $500 prize to the engineer who could provide a locomotive that would pull fifteen tonnes at fifteen miles per hour.) If a route had to be swung wide of a popular market or a local magnate’s estate, so be it.

But as trains got faster, and other transportation technologies began competing with rail, many of those local detours and delays evolved into costly bottlenecks—and some of them still slow American travellers to this day.

In this regard, Alff provides a case study set during the frenzied early days of the mid-Atlantic rail boom, when an upstart outfit called the Philadelphia & Trenton (P&T) petitioned government officials for the right to connect its humble upstate network to downtown Philadelphia by a direct route along the Pennsylvania side of the Delaware River. Fatefully, it was a path that would go straight through Kensington—a hardscrabble Pennsylvania town that has since become an equally hardscrabble Philadelphia neighbourhood.

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Detail from a 1912 railway map of Philadelphia’s environs, annotated with a red arrow to indicate the enduring dead end at Kensington, blocking southbound access from the former P&T line to the city’s downtown. Frankford Junction, through which southbound trains are still diverted west toward the Schuylkill River, is indicated with a blue arrow.

The P&T would soon be taken over by the larger and more powerful Camden & Amboy (C&A), whose owners combined the resources of the two companies so as to permit riders to travel on an almost-complete line from New York Bay to downtown Philadelphia. “All that stood between the Hudson docks and the heart of William Penn’s ‘green countie town,’” Alff writes, was tiny Kensington.

At the time, few imagined that the C&A wouldn’t get its way with local politicians, as the company was known to be generous (even by the corrupt standards of the day) with its bribes and kickbacks. As one journalist described the railroad’s business methods back in New Jersey, “there never was a more complete master anywhere of the destinies of a state than this monster monopoly.”

But the residents of Kensington, textile workers from Ireland not known for their quiescence, had other plans. These included a dedicated propaganda campaign featuring posters depicting a scowling anthropogenic C&A train maiming a child as it barrelled through Kensington. Accompanying text, appealing equally to class solidarity and Philadelphia’s municipal inferiority complex, warned residents that their beloved neighbourhood would soon become a “mere right of way” for avaricious Gothamites who regarded Pennsylvania as “a suburb of New York.”

On 27 July 1840, an angry Kensington mob (described at the time as “an immense gang of women”) routed a railroad-company work crew that had come to dig up North Front Street, and made a bonfire of their construction materials. When police arrived, rioters attacked them as well. At some point, the sheriff fled to a local tavern owned by the P&T’s President, one John Naglee—which the crowd promptly destroyed.

The outraged rail tycoons howled in protest, and called in every political favour they could. But their workers would never again return to Kensington. Even 27 years later, when a throughline was finally pushed through downtown Philadelphia, Alff writes, “its route avoided Kensington like yellow fever, skimming overtop the ward [at Frankford Junction], then crossing the Schuylkill River twice before wrapping back to City Hall. [To this day], trains sway through turns as their passengers pay for a nineteenth-century borough’s fight to save itself.”

A New York Times article listing the Northeast Corridor’s “Curviest Stretches.” Number one on the list is Frankford Junction, whose sharply angled turn reflects the C&A’s failure to push track through Kensington in the 1840s. In 2015, Frankford Junction was the site of an Amtrak train crash that resulted in eight deaths.

In the film version, as I like to imagine it, Kensington’s “immense gang of women” (presumably led by some suitably Erin Brockovich-esque character) plays the role of collective hero, with Naglee (think Paul Giamatti) playing the villain. But those riotous Irish-American garment workers may seem less heroic to anyone who regularly rides the Northeast Corridor. Thanks to the blockage at Kensington, the trip from Trenton to Philadelphia—a distance of less than 30 miles—takes about half an hour. That’s not so bad by comparison with Interstate 95, the Corridor’s traffic-clogged asphalt cousin. But by modern global standards, it’s quite slow. Japan’s Kyoto–Osaka route, which covers roughly the same distance, runs in as little as 12 minutes thanks to ruler-straight rights-of-way created in the 1960s, as Alff puts it, “free from the burdens of history.”

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Northeast Corridor maps, reprinted from The Northeast Corridor.

That phrase gave me pause because, as I see it, the source of the modern Northeast Corridor’s obsolescence isn’t too much history, but too little.

Over the last two centuries, great swathes of Europe and Asia have been destroyed by war and revolution—apocalyptic horrors that took hundreds of millions of lives and left whole urban areas in ruin. But those horrors also created blank slates on which later generations could build new kinds of cities and transportation networks. The American Northeast has never suffered cataclysm on anywhere near the same scale. Nor has it ever fallen under the sort of centralised top-down political order—of the type that’s managed the construction of high-speed rail in China, Japan, and many European countries—which allows leaders to suppress Kensington-style dissent in the name of the greater good. Like all of life’s treasures, peace and freedom come with a price. And when it comes to American rail travel, that price is measured in minutes and hours.


It would be unfair to suggest that the Northeast Corridor has entered a permanent state of decline. Since the introduction of Amtrak’s Acela service in 2000, riders have been able to travel the Corridor on what technically qualifies as “high-speed rail.” According to a 2005 source cited by Alff, Acela helped Amtrak capture more than half the combined air-and-rail market between Washington and New York, while Amtrak’s share of the Boston–New York market more than doubled, from 18 percent to 40 percent. The brand is sufficiently well-known that headline writers now speak of “the Acela Corridor” (though the term is primarily used as a term of abuse among conservatives).

Unfortunately, thanks to the dated nature of the Corridor’s infrastructure, these Acela trains are able to hit their 150-mile-per-hour (242 km-per-hour) top speed over just 11 percent of the track. And even that maximum pales compared to high-speed trains running comparably well-travelled routes in other wealthy nations.

And then there are the days when the trains don’t run at all. Three months ago, Amtrak lost power on ten miles of its track when one if its circuit breakers exploded near Midtown Manhattan, incapacitating an electrical substation serving tunnels under the Hudson River. The knock-on effects halted trains along the line from Massachusetts to Pennsylvania. According to federal legislators representing New Jersey, this was just one of nineteen instances during May and June in which Amtrak service disruptions created “serious delays” for riders on New Jersey Transit (which shares track with Amtrak).

As The New York Times noted in an August 21 article, a disproportionate number of route delays and cancellations originate with the line segment between Manhattan and Newark—which runs on an antiquated patchwork of electrical equipment, much of it originally built a century ago by the PRR using a 25 Hz traction power system that’s been obsolete for decades. According to Amtrak officials, implementing the full roster of repairs and improvements required by the Northeast Corridor would cost $100-billion and take 13 years to complete.

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East Japan Railway Company Shinkansen E5 series train photographed in 2019 at Morioka Station.

The fundamental flaw embedded in the Northeast Corridor is, in some ways, the fundamental problem embedded in America itself.

It’s a country that got very rich, very fast by giving wide berth to inventors and entrepreneurs—and by immigrating legions of skilled men and women who could turn their blueprints into reality. The Tom Thumb, Canton Viaduct, Hell Gate Bridge, and North River Tunnels are all testaments to that spirit.

But as demonstrated by America’s fall from global leader to laggard in the field of rail-service operation, the national qualities that lend themselves to the creation of one-off mechanical marvels and architectural wonders are very different from those required to rationally plan, build out, maintain, and modernise sprawling systems of infrastructure (or, for that matter, health care, schooling, and public assistance) on a regional or national scale. The former project, corresponding to the Northeast Corridor’s early years, can be accomplished by scattered geniuses and deep-pocketed investors—of which America has always had plenty. The latter, corresponding to the Corridor’s postwar decline, requires an active corps of competent, widely trusted, well-resourced central planners—of which America has comparably few.

Ultimately, that’s the reason why a train ride from Trenton to Philadelphia still takes almost half an hour; why New York’s Second Avenue Subway, originally proposed 104 years ago, still has only three stations; and why the country hasn’t built a major new airport since Bill Clinton’s first term.

I’m sure any American reading this could supply a multitude of other examples. What the Northeast Corridor makes clear is that this isn’t a new problem. It’s an existential failing that’s been riveted into America’s “architecture of anticipation” for almost 200 years.

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The director of the Congressional Budget Office—known for its gloomy national debt data—is very optimistic that a crisis will be avoided entirely | Fortune

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The director of the Congressional Budget Office—known for its gloomy national debt data—is very optimistic that a crisis will be avoided entirely | Fortune


Dr Phillip Swagel is an optimist, both by nature and when he looks at the U.S. economy.

This fact is perhaps at odds with what one might assume: Swagel is the director of the Congressional Budget Office (CBO), the nonpartisan agency that offers independent budgetary and economic analysis to Congress.

Very often—an inevitable occupational hazard—the subject of national debt and the interest the U.S. Treasury pays to maintain is its central focus. The numbers are eye-watering: Public debt stands at more than $39 trillion. The interest expense on that borrowing now exceeds $1 trillion a year. Indeed, the latest budget update from the CBO highlights that the government—according to preliminary estimates—paid out nearly $530 billion between October 2025, when the fiscal year starts, and March 2026. This equates to more than $88 billion in interest payments a month, or more than $22 billion a week.

The CBO’s figures are routinely cited by policymakers, think tanks, and lobbyists as alarming evidence that the U.S. needs to find a more sustainable fiscal path or risk dire straits.

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Swagel doesn’t subscribe to the notion that the U.S. will face a crisis of its own making. His justification is simple: He was at the Treasury during the 2008 financial crisis, and joined the CBO months before the COVID pandemic began. He has watched as the U.S. economy, seemingly against all odds, has clawed its way out of economic crises before.

That’s not to say Swagel isn’t a staunch advocate of setting the U.S. on a more sustainable fiscal path—rather, he trusts the people in power to do so when the time comes.

Why the optimism?

Among those concerned about national debt are notable names: JPMorgan Chase CEO Jamie Dimon, Federal Reserve Chairman Jerome Powell, and Bridgewater Associates founder Ray Dalio. Tesla CEO Elon Musk is also worried about federal spending and has endorsed a plan floated by Berkshire Hathaway founder Warren Buffett that would render members of Congress ineligible for reelection if they allow deficits to exceed 3% of GDP.

On the other hand, optimistic economists suggest that, despite the value of the debt, it’s not actually an issue: the bond market is holding steady, indicating a reliable market of buyers. Likewise, the U.S.’s own central bank buys huge swaths of the debt, meaning, in the simplest of layman’s terms, the economy can essentially print its own money. There are holes in this argument, not least the fact that Fed chairman nominee Kevin Warsh has suggested he would like to reduce the Fed’s balance sheet and may therefore be less inclined to finance borrowing.

Swagel’s positive outlook doesn’t rely on the argument that a crisis hasn’t happened yet, so therefore it never will: “[My optimism] is rooted in my experience,” Swagel tells Fortune in an exclusive interview in Washington D.C. “First being at Treasury during the financial crisis and seeing very difficult times and the country coming together with an effective response—not saying it’s perfect, lots of controversy—but it was effective.”

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“The second thing is policymakers are smart, they’re thoughtful. Interacting with members of Congress makes me optimistic. I know you read about all the squabbles … I’m completely aware of this, but the policymakers that are thinking about these things are thoughtful and effective. Not necessarily always effective at passing legislation, but that’s part of our political system, it was set up to make it difficult ot pass legislation.”

Decisions on the horizon

Swagel’s optimism that Congress will be pushed into action will be tested sooner rather than later, likely at some point in the next six years, he told Fortune. This is partly due to the fact that, according to the Committee for a Responsible Federal Budget (CRFB) both Social Security and Medicare will become insolvent within that time period.

“Making progress to address the fiscal trajectory would be a positive for the U.S. economy,” Swagel said. “Credible steps would lead to lower interest rates that would make the subsequent adjustment easier, there is a reward to virtue. It’s a positive thing, we can’t go on [with] the scolding narrative. My sense is that members of Congress understand the fiscal situation, it’s not that everyone single one has looked at our one-pager of numbers and understands the debt to the third decimal point, but they understand something needs to be done.”

“It doesn’t have to be done immediately, but at some point reasonably soon.”

Swagel is of the opinion that bond investors haven’t increased risk premiums not because they’re not worried about a fiscal crisis, but because they have priced in preventative action from Congress—in his mind “a vote of confidence that my optimism is not misplaced.”

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“As a country, we face up to these problems. It’s not happening now, I’m not sure it’s going to happen in the rest of this year or even the next year, or the next two years. But we will face up to it, and the market in some sense expects us to, because otherwise interest rates would be higher,” he explained.

The Cheesecake Factory

The role of the CBO, to some extent, is to provide policymakers with their options if and when they do choose to take action on federal deficits. It’s a menu not unlike the Cheesecake Factory, Swagel says: Large, inclusive of a range of modifications and options, and delivered without judgement.

“Right now it’s maybe a pick three, and you’re looking at a six or seven course menu,” joked Caleb Quakenbush, director of fiscal policy at the Bipartisan Policy Center, in an interview with Fortune. “The longer you delay, the more you’re gonna have to add to your tab, and those options become more expensive.”

Indeed, economists and analysts aren’t necessarily worried about the absolute level of government debt, rather the debt-to-GDP ratio. Depending on whom you ask, the debt-to-GDP ratio stands at around 122% of GDP at present. This measure demonstrates an economy’s spending versus its growth, and the risk associated with lending to a nation that isn’t growing fast enough to handle its spending. To rebalance that ratio, an economy could either cut spending or increase growth—the latter being by far the less painful option.

The growth option is becoming less feasible, Michael Peterson, CEO of fiscal think tank the Peter G. Peterson Foundation, told Fortune in an exclusive interview: “I think it requires government action because we’ve waited so long. We’ve added so many trillions, and the current deficit is so big at 6% that the level of growth you would need really exceeds what is feasible. 

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“Growth needs to be a part of it, but it’s sort of a vicious cycle. The longer we delay, the more debt we have, the slower growth is going to be. The more we get this under control, I think the greater optimism there is, interest rates go down, more growth comes from that. It’s sort of a virtuous or vicious cycle depending on your policy response.”



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12th Honor Flight Tallahassee returns home from successful trip to Washington D.C.

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12th Honor Flight Tallahassee returns home from successful trip to Washington D.C.


TALLAHASSEE, Fla. (WCTV) – Seventy-two veterans took a trip Saturday to our nation’s capital to visit memorials honoring their service in the armed forces.

This year marks the 12th trip to Washington, D.C. for Honor Flight Tallahassee.

Early Saturday morning, veterans and their guardians met to take a charter flight up to D.C.

Throughout the day, veterans were taken to the World War II memorial, as well as the Korean and Vietnam War memorials. The veterans also visited Arlington National Cemetery and the Tomb of the Unknown Soldier.

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The day ended with a wonderful welcome home celebration.

Our Jacob Murphey, Julia Miller, Taylor Viles, and Grace Temple accompanied the veterans, capturing moments from throughout the day.

The team will have live coverage from Washington, D.C. on Monday to share more from the day’s events.

We will continue to have coverage throughout the month of May, leading up to our Honor Flight special on Memorial Day.

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Washington, D.C

Storm Team4 Forecast: A chilly, gusty Sunday before a cool start to the week

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Storm Team4 Forecast: A chilly, gusty Sunday before a cool start to the week


4 things to know about the weather:

  1. Chances of rain in the morning
  2. Gusty Sunday
  3. Chilly Monday
  4. Temps will rise again through the work week

Download the NBC Washington app on iOS and Android to check the weather radar on the go.

After a nice and warm Saturday, changes arrive for part two of the weekend.

The first half of your Sunday will have a chance for showers. Winds will pick up with our next system and are expected to gust to about 20-30 mph. Cooler air will settle in, and lows Sunday night fall into the 40s.

Highs temps Monday will reach only into the mid to upper 50s.

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However, temperatures will rise through the week, so you won’t need your jackets every day.

QuickCast

SUNDAY:
Showers, then partly cloudy
Wind: NW 10-15 mph
Gusts @ 30 mph
HIGH: Lower 60s

MONDAY:
Partly cloudy
Wind: NW 10-15 mph
Gusts @ 25 mph
HIGH: Upper 50s

Stay with Storm Team4 for the latest forecast. Download the NBC Washington app on iOS and Android to get severe weather alerts on your phone.



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