walton@ametek.UUCP (11/11/86)
To: cit-vax!mcgeer@sirius.berkeley.edu
In Poli-Sci V6 #97, you write:
In the first place, did the factories precede the transit lines, or
the transit lines precede the factories? In the second place, the
very best system of rapid transit in the world is decentralized,
and privately owned and operated. It sits in your garage and mine,
and it's a damned sight better way to get from A to B than any
transit system I've ever ridden on...
I think this point deserves some expounding on; this mild diatribe was
inspired at least in part by a recent Auto Club study calling for the
construction of 400 miles of new freeway (at a cost of $20 billion) in
Southern California by the year 2000. Why is it that, even though an
automobile driven by a single person is clearly less efficient (uses
more resources) than mass transit, it is often both cheaper and more
pleasant, especially when a fair valuation of one's own time is used?
There is only one answer: Massive Government Subsidies. During
the Carter administration, Congress debated the trucking deregulation
bill (which included an increase in interstate truck taxes). At the
time, All Things Considered did a series of interviews with various
local transportation officials. The mayor of Indianapolis stated that
direct taxes on vehicles paid only about 1/3 of the cost of building
and maintaining roads in his city, with the remainder coming from
general funds. The secretary of transporation of Georgia cited a
study done by his state which showed that trucks caused 95% of the
wear on roads, yet even with the higher truck taxes the trucks would
only be paying about half of the maintenance costs.
But such things aren't even the largest subsidy. The largest one
of all is that the Government owns the land on which the roads are
built and will not sell it, even for a good price. If the roads were
privately owned, the users of the roads would have to pay the owners
at least as much as the owners could receive by leasing the land on
which the road sits to someone else for another purpose. For the
interstates in the Western deserts, this would be very little. For
the freeways in downtown LA, this would be a huge amount, much more
than drivers currently pay the Government for use of the roads.
Evidence: parking in downtown Los Angeles during an 8-hour work day
now costs about $200 per month in a garage which holds perhaps 200
cars in a space the size of a large midtown intersection. That is a
lot of money.
Yet we hear from the Libertarians and from the Auto Club that mass
transit cannot be built unless it is self supporting. To which I
reply: bring on your libertarian free transportation market! Let ALL
forms of transit have a price which accurately reflects the cost of
providing it. You may be surprised at the results, though.
-Steve Walton
-------mcgeer%sirius.Berkeley.EDU@UCBVAX.BERKELEY.EDU (11/11/86)
To: ametek!walton@csvax.caltech.edu
Foo. Charging owners of private automobiles the full cost of
building and maintaining the roadways is hardly a free market economy.
The roadways are a classic example of "neighbourhood effect"; every
one of us derives benefit from the roads, whether we drive an
automobile or not. Virtually every good that you purchase travels
some part of its journey from field or factory to store via truck;
ambulances, police cars and emergency vehicles of all sorts use and
require an extensive road network. Given that, the road network will
exist anyway. The marginal cost per automobile is pretty small. In
sum, the roads perform a variety of useful services besides getting
people from A to B. All mass transit does is get people from A to B
slowly, and in discomfort. The only beneficiaries are the small
minority of individuals for whom the mass transit system's service
nearly approximates an automobiles.
-- Rick
-------walton@ametek.UUCP (11/11/86)
To: cit-vax!sirius.Berkeley.Edu!mcgeer
It is not at all clear that the roads would exist in the absence of
government action, or that they represent a "neighborhood effect."
If, for example, trucks were charged the full amount for their use of
the roads, it might turn out that railroads were more economical. As
it stands now, truck transport receives an indirect government subsidy
of uncertain size.
The price of a product at the market should include the entire
cost of its production, including raw materials and transportation.
Otherwise, the price does not accurately reflect various products'
costs. This distorts the market, since in an ideal market prices are
a primary source of information about competing product. Use by
emergency vehicles (which is a very small fraction of total use) could
be included in the cost of police, ambulance, and fire fighting
services.
The marginal cost per automobile [for roads] is pretty small.
No, it isn't, at least not anymore. The Auto Club of Southern
California just called for the construction of 400 miles of new
freeway here by 2000, at a cost of some $20 billion. This is over
$1000 per automobile. Do you think this would happen if the city
announced its intention to bill each car owner $100 per car per year
for the next 15 years to finance these roads' construction? I don't.
In contrast, a study done by another private group and reported in the
LA Times Op-Ed page a few months ago found that a commuter rail system
of similar length could be build for $350 million. I firmly believe
that such a rail system should be privately owned and operated, by the
way. The RTD, which operates the buses here, does not seem to know
about modern management techniques such as firing people who don't do
their job.
In sum, the roads
perform a variety of useful services besides getting people from A
to B. All mass transit does is get people from A to B slowly, and
in discomfort. The only beneficiaries are the small minority of
individuals for whom the mass transit system's service nearly
approximates an automobiles.
In LA, at least, every person who rides a bus (or rides a bike as I
do) is about one fewer car contributing to the noise, congestion, and
pollution in the area. Surely those who drive benefit from this.
Granted that it is difficult to quantify their benefit, but it is
real. Before I started riding my bike to work, I took the bus. It
was not terrible; in fact, it was rather nice to have an hour or so
each day to read in peace and quiet. I mean, I love my two-year-old
son dearly, but he can interfere with my love of books. I'm really
only bicycling now in order to force myself to exercise.
A large part of the mass-transit-vs.-automobile problem is that
most people do not accurately calculate the cost of driving. If you
include gasoline, insurance, maintenance, depreciation, and a moderate
interest rate on the purchase price, even a modern subcompact costs 30
to 40 cents per mile to drive, assuming 10,000 miles per year. I can
do the ten miles to work on the bus for 95 cents--a bargain at twice
the price, as they say.
On another subject, I was intrigued by your comment about the
"neighborhood effect," which is what I believe economists typically
call "public goods." Keith Lynch and others, including me, had a bit
of an argument over whether public goods exist, whether national
defense is a public good, and whether public goods should be funded by
mandatory contributions to the government (read taxes). Where do you
stand on this?
Steve
-------jim@ll-xn.ARPA@oswald.UUCP (12/23/86)
In a recent article, ametek!walton@csvax.caltech.edu writes: > > Why is it that, even though an automobile driven by a single person >is clearly less efficient (uses more resources) than mass transit, >it is often both cheaper and more pleasant...? There is only one >answer: Massive Government Subsidies... It is quite true that automobile and *especially* truck traffic is subsidized in this country. The obvious solution is to raise road taxes to reflect true costs. After the massive rise in oil prices in the '70's, people still preferred driving their cars. A road tax increase wouldn't stop people from driving either. However, if trucks were forced to pay for the road damage they cause, they might well lose a lot of traffic to trains, ships, air, etc. >The largest [subsidy] of all is that the Government owns the land on >which the roads are built and will not sell it, even for a good >price. If the roads were privately owned, the users of the roads >would have to pay the owners at least as much as the owners could >receive by leasing the land... This is not a subsidy. The land owners are paid, in cash, when the land is condemned. They are paid the fair market value, which includes the 'present value' of all the future lease payments you refer to. > Yet we hear from the Libertarians and from the Auto Club that >mass transit cannot be built unless it is self supporting. To which >I reply: bring on your libertarian free transportation market! Let >ALL forms of transit have a price which accurately reflects the cost >of providing it. You may be surprised at the results, though. I second the call for a free transportation market. I think mass transit would come in a distant second to the private automobile. -- Jim Olsen ...!{decvax,lll-crg,mit-eddie,seismo}!ll-xn!oswald!jim -------