Brookings Study Calls for Toll-X Pricing

February 2, 1999

Brookings Study Calls for Toll-X Pricing

Originally published in issue 36 of Tollroads Newsletter, which came out in Feb 1999.


Subjects:tolling transit mode shares optimum
politics of cars automobility anti-car politics


Sources:Clifford Winston James Dunn


Brookings Study Calls for Toll-X Pricing

A study at the Brookings Institution says present US transp policies of free roads and subsidized state-run transit produce huge waste and inequity. It calls for toll-express (X) pricing on roads and privatization of bus and rail in American cities. It says these measures will produce net benefits of at least $10 billion annually. Reported in the book “Alternate Route” by Winston and Shirley (W&S), the pathbreaking modeling exercise estimates the costs and benefits of present financing of urban transp, then develops the outlines of a more efficient urban transp arrangement.

W&S used an aggregate model of traveler behavior combining mode and departure time choices by five distance categories of commute for the 116 largest cities of the US, using census data. Travelers were assumed to choose the mode and departure time that jointly maximizes their utility, and from travel patterns the researchers derived travelers value of time and the net costs and benefits of each mode (table above).

Value of time varies enormously with distance of commute, the study finds, with the highest values being those who commute 11-25mi (see table above) – of interest to traffic and revenue forecasters.

The model was used to find optimal tolls per half hour time period for various cities. (Sample in table at right) A highly limiting assumption was that the present road system would remain as-is. In fact a more market-oriented highway service sector could have an incentive to invest in enhancing capacity in many of the high toll corridors, bringing down W&S’s peak tolls to about the cost of extra capacity. Motorists would have higher out of pocket expenses but the utility of their journeys would rise with better traffic flow and as taxpayers they would benefit.

The modeling also assumed that local roads would not be subject to congestion-related tolls, only the motorways, and that only single occupant autos would be tolled. To the extent congestion tolls were extended to trucks, carpools and lesser roads, net benefits would be much higher.

Given those limiting assumptions tolls vary enormously form city to city and the modeled average for the 116 cities is quite modest with a peak of 6.4c/mi in the busiest half-hour.

Transit waste

The present setup of transit produces net consumer benefits less than taxpayer subsidies, according to W&S, so it produces net social losses of around $6b in 1990. Single auto use, by contrast, produces consumer benefits of $162b and a government surplus of $22b for total net benefits of $184b. Carpools also produces major net benefits: $22b (Seee table p1).

W&S say that a smaller role for transit might produce positive net social benefits but these are only likely to be achieved if it is privatized and made competitive. Present transit extensions tend to involve net social loss, they estimate. They say there is no justification for transit subsidies. A major problem of present transit is its extremely low usage, which makes it much more expensive per trip than an auto. Per-seat-mile costs of autos are slightly higher than rail or bus but the average load factor of bus is 0.14, rail is 0.18, and the car around 0.37, enabling the car to produce a less expensive passenger-mi traveled. . Add the greater door-to-door speed, lack of transfers, goods carrying and other quality advantages of the auto, and no wonder the mode competition is no contest for the vast majority of urban trips. Slightly greater pollution costs of the auto do not shake it from its place as the most socially efficient mode, W&S say. Privatization would help transit compete by driving down costs and increasing load factors, but further shrinkage of its mode share is projected.

“Alternate Route” argues against large regional transp bodies. They have a greater tendency than small local bodies to expand route coverage into the sparsely settled fringes in order to extend their taxing power, and they introduce major new cost burdens into transit systems, suggest W&S.

(2) “The Auto Its Enemies & Politics...”

If the Winston & Shirley book is the economics of urban transp, James Dunn’s “Driving Forces” is the companion book on its politics. Dunn a political science prof at Univ Rutgers-Camden NJ argues that US transp policy has come heavily under the influence of an extremist ‘vanguard’ which overlooks the benefits most Americans get from their automobiles and vastly exaggerates the ability of government to change mode share away from it.

Dunn says that the auto-highway system has a “very comfortable fit” with US political traditions and administrative capabilities. It can be developed and improved incrementally and pragmatically. Changes can be made piecemeal in various kinds of partnerships. Different levels of government can be involved, and benefits are seen for a variety of interests and the public.

The emerging anti-auto vanguard however feels toward it a “kind of Old Testament moral and esthetic aversion” and do not genuinely want to solve its admitted problems. They see it as a problem not for its results, but in and of itself, Dunn says.

The political scientist detects in the anti-road/pro-transit lobby a fundamentalist religious or ideological element: “New rail transit systems are like the cathedrals of the middle ages. They rose not because they were necessary to everyday life here and now... but because they were the physical embodiment of the high aspirations of the cities moral leaders. So the anti-auto vanguard keeps alive the sacred promise of a purer community and a more sustainable way of life.” (p111)

The notion of sustainability has been suggested by its critics as calling into question the position of the automobile but Dunn has sharp words on that: “The auto system has been nothing if not sustainable for about a century now. In America it has survived depressions, wars, energy and pollution crises, foreign industrial competition, and a thirty year campaign of intellectual vilification and political attacks by a group of determined enemies. In every country that permits its citizens to own cars, the auto soon becomes the most popular form of transp with people scrambling to own a car in spite of high taxes and bad roads. In light of this intense popularity and durability, and in light of the premature predictions of the auto’s demise, calling an as yet nonexistent future system with fewer autos more sustainable... would be laughable if it were not so successful a ploy in shaping the policy debate.... The concrete costs and benefits of moving toward this nebulous notion are poorly... and tendentiously presented... Sustainability is rhetoric designed to portray the vanguard’s anti-auto preferences as the wave of the future, thus enhancing the acceptability of its elitist agenda among policymakers and opinion molders.”(p174)

Dunn sees the call for regionwide transp planning supervised by US govt agencies as “a new and convenient venue for the vanguard – an environment in which they can operate comfortably shielded from public opinion and in a position to enhance the impact of their ideas beyond the weight of their numbers.” (p161)

He is not critical of road pricing as such but sees the enviros embrace of it as tendentious: “The vanguard has picked up on road-use pricing as one way to make the auto pay more of its ‘true social costs.’ The last thing it wants however is a new system that merely makes the traffic flow more smoothly. Its idea is to add (environmental) charges...”

Dunn believes the anti-road push has little chance of succeeding because implementation of their agenda would “require regulations so intrusive, taxes so high, and central planning so comprehensive as to be beyond the pale of American experience...” (p19) However they are a serious distraction from positive thinking. And they divert energy and resources away from pragmatic improvements in the way we deploy the car.

This is important reading for its analysis of the destructive anti-road-’n-car gang. It is written with a flare unusual in modern academe. These are both important books. Order them now, please! In paperback they are a steal. (Clifford Winston & Chad Shirley “Alternate Route: Toward Efficient Urban Transp” Brookings ISBN 0-8157-9382; James A. Dunn “Driving Forces: the Automobile, its Enemies, and the Politics of Mobility” Brookings ISBN 8157-1964 800 275 1447)

Further Reading

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