But at a cost, critics say - specifically, 44,000 jobs that might have been created, 22,000 cars left on the highway and an unrealized $30,000 bonus in real estate value for every New Jersey home located near a train stop.
"It really would have been a transformative project for land use in New Jersey," said Peter Kasabach, executive director of New Jersey Future, a group that promotes sustainable growth. "It would have set the tone for the next 50 to 100 years."
Other urban experts said the region will do fine without the tunnel, which at $9 billion to $14 billion was the nation's most expensive public works project. New Jersey is far less dependent on New York City for jobs than it was decades ago, urban planning expert James Hughes said.
"Some of the dire forecasts that not having that new tunnel is going to bring economic calamity are a bit overstated," said Hughes, the dean of Rutgers University's Bloustein School of Planning and Public Policy.
Besides the anticipated new jobs and cars that wouldn't have clogged rush-hour traffic, the tunnel would have eliminated 67,000 tons of car exhaust a year, officials said. It also would have jump-started stalled development projects to renovate New York's Penn Station and build office space nearby, they said. Planners are pushing for the massive renovation and a residential and office complex to be built over rail yards on the Hudson riverbank.
"Everything gets impacted by this," said Richard Anderson, president of the New York Building Congress, which represents design and construction firms. "This goes to the heart of not only our capacity, but our will to do major projects."
Christie, a rising star of the Republican Party, says he's trying to get his debt-ridden state to hew to fiscal reality. So after rejecting offers of more federal help that he said didn't go far enough, he pulled New Jersey out of its $3 billion commitment, scrapping the project.
He said Thursday that he wanted to invest more money in New Jersey's intrastate transportation system, but that other partners would have to chip in more.
"If it's to benefit the region," he said. "Then the region has to pay - not just New Jersey."
The federal government and Port Authority of New York and New Jersey each committed $3 billion and New Jersey $2.7 billion plus cost overruns, which were estimated to be somewhere between $1 billion and $5 billion. Construction began last year, but Christie halted it when he first considered ending the project.
Politicians have become increasingly wary of committing to multibillion-dollar public works, said Barry LePatner, author of a book about the aging infrastructure in the U.S.
Other projects in doubt include a train system in Hawaii, high-speed rail lines in the Midwest and a highway tunnel to replace the earthquake-damaged Alaskan Way Viaduct in Seattle.
"We are facing a crisis," LePatner said. "If we hope to maintain our No. 1 position in the world we cannot let further deterioration of our infrastructure continue."
The real culprits, LePatner said, are construction firms that go billions of dollars over budget.
In New Jersey, commuters and the businesses near train stations said they were disappointed.
"It certainly would benefit me, because more trains means more people using mass transit instead of driving to the city," said Darrel Young, who owns a convenience store near the Long Branch station. "More mass transit riders means more people in the area, and hopefully they'll stop by for coffee, food, whatever."
In Westfield, a bedroom community west of Manhattan, real estate agent Harvey Tekel said he had hoped the new tunnel would ease congestion and allow New Jersey Transit to start direct trains from his town to Manhattan. The train line that runs through town currently terminates in Newark, where Manhattan-bound riders have to change trains.
When the rail authorities introduced a direct train in nearby Short Hills, housing values soared, he said.
"Town by town, these places become much more desirable when the commute becomes better," Tekel said.
Already, a bridge, a system of ferry boats, two tunnels for cars and two for trains connect New Jersey and Manhattan, carrying 360,000 New York-bound commuters during the morning rush. Experts say that all those modes of transport now accommodate about as many people as they can. With an additional tunnel, there could be twice as many passengers on the NJT trains.
New Jersey Future's Kasabach fears if the federal money once committed to the project is instead spent on rail lines to improve connections to Manhattan from Long Island and its northern suburbs, it could put New Jersey at a further disadvantage for attracting residents and businesses.
Manhattan Borough President Scott M. Stringer sent a letter Thursday to federal Transportation Secretary Ray LaHood asking for the federal government's share of the tunnel cost to be used instead for other projects to improve train and subway service in the city.
Rutgers' Hughes cautioned that the sunny projections about how many more jobs could be created by a trans-Hudson tunnel might be inflated. Many of them predate the Great Recession that began in 2007, he said.
A few generations ago, New Jersey's dependence on New York City for jobs was much greater. In 1950, Hughes said, New York City had more than twice as many jobs as New Jersey. Now, New Jersey has more.
And, he said, plenty of new jobs in Manhattan might be in areas that aren't easily accessible from a new station on West 34th Street near Penn Station, where the tunnel would have emerged.
One of the busier New Jersey stations is in Asbury Park, an old resort town that's been trying desperately to redevelop.
Mayor Ed Johnson said he can feel the commuters' pain. He spent a decade traveling daily from Asbury Park to New York for work and his partner still does, catching a train that leaves before 6 a.m. and not getting home until after 8 p.m.
Still, he said, he agrees with Christie's decision to stop the tunnel project now, deeming it unaffordable.
He said his community will still work on "transit villages" putting housing close to the station. But now, he said, they'll be geared more toward people whose train commutes stay in New Jersey. ---
Mulvihill reported from Trenton, N.J. Associated Press writers Angela Delli Santi in Moorestown, N.J. and Bruce Shipkowski in Long Branch, N.J., contributed to this story.