On Infrastructure, Time to Dump the Ideology

Commentary, Trade, Transportation, Uncategorized, Wendell Cox (historic)

This article first appeared at National Review Online found here.

President Obama has proposed a new $50 billion infrastructure program that would expand and repair highways and transit systems, while refurbishing airport runways and implementing long-overdue air-traffic-control reforms to improve the reliability of air travel.

Few details are available at this point. The funding for the program is not clear. The allocation of funding to the various sectors (roads, rail, and airports) is not known. Without that information, no comment can be made on funding. However, there is a more fundamental question: Is it a good idea? Given the performance of Washington in recent decades on these issues, and especially based upon the inclinations of the Obama administration and the Congress, there is plenty of reason for concern.

Access, Mobility, and Economic Growth: It is a well-known fact that there is a strong relationship between access and mobility in our urban areas and economic growth. A number of researchers have shown that, generally, urban areas experience more job creation and better economies if their citizens can reach a higher percentage of the jobs in the area in a certain amount of time (such as 30 minutes). The reason for this is obvious — larger labor markets are more efficient, and that’s good for jobs and the economy.

Transit: Yet Washington has been more concerned about ideology than economic growth. A strong anti-automobile constituency has developed, claiming that transit is a replacement for cars. Their efforts to force people out of cars and into transit have been a manifest failure, though their funding success has been something to behold

For decades, federal transportation funding increasingly been committed to transit systems and not used to provide highway expansions that would accommodate the growth in road traffic. In 2008, transit accounted for nearly 25 percent of total federal highway and transit spending. This is disproportionate and much higher than transit’s share of transportation, which is barely 1 percent of the nation’s surface travel and 0 percent of its freight movement.

This additional funding for transit has not produced a corresponding rise in transit ridership. Since the federal government started using highway user fees (the gas tax paid at the pump) for transit (1983), costs have risen strongly, even after adjustment for inflation. The net effect is that each $1.00 in new funding from gas taxes and the taxpayers has purchased only $0.60 in value. By comparison, transportation costs in other sectors have generally declined relative to inflation.

Over the past 25 years, the federal government has spent more than $100 billion on transit. The reward has been a reduction of at least one-third in transit’s share of urban travel. In only one of the many urban areas in which the federal government has funded expensive new rail systems has the share of travel by transit risen more than one percentage point.

High-Speed Rail: Equally worrying is the ideological commitment of Obama and Congress to high-speed rail. This “sexy” form of intercity transport can certainly consume money. The proposed California system would take nearly all of the $50 billion all by itself. A principal problem with high speed rail is that it provides nothing new in terms of transportation capacity that cannot be provided far more cost-effectively by the airline system.

Roads: Roads are the real losers in the ideological battle. Obama and the Congress operate from a presumption that people “choose” to travel by automobile and that if only given the choice they would travel by transit. There are a multitude of problems with this naivety. The most important is that transit generally takes about twice as long as travel by car. Any serious diversion of travel from cars to slower transit would retard economic productivity,  because it would reduce the number of jobs that could be accessed by people in a specific period of time. Further, it is not possible to replicate the speed of the automobile by expanding transit at a cost that can be remotely afforded. Our own research  indicates that such a transit system would require more funding than the gross personal income of an urban area every year. The plain, undeniable fact is that automobiles and roads carry nearly all urban travel (even in the New York metropolitan area, automobiles represent nearly 90 percent of road and transit travel). The problem is that, constrained by anti-automobile ideology, the nation has ignored the highway expansions that are necessary to promote job creation and economic growth.

It is time to dump the ideology and focus on getting America moving again. Washington, in its present form, is unlikely to do that.