Who Should Pay for Mass Transit? (Part Two)
In Part One I explained how modern liberal urban planners, as represented by the New York Times, have completely detached themselves from the underlying reasoning behind, and implications of, a government-run natural monopoly such as mass transit.
Exhibit B, also from the New York Times, demonstrates that “size matters not” —
When Senator Moynihan first proposed replacing the cramped and confusing corridors of Pennsylvania Station, the nation’s busiest transit hub, with an elegant, spacious, glass-enclosed station, he envisioned it being built with public dollars.But in the years since, officials have concluded that government cannot afford the cost — as much as $3 billion to rebuild Penn Station — and that the only way to finance a new station was to entice private developers to do it. In exchange, those developers would be allowed to build, in grand scale, around the new station.
How can it be that “the nation’s busiest transit hub” cannot finance its own relocation and expansion? Do economies of scale and the distinction between capital spending and current accounts somehow not apply to a large, long-term project like a train station?
If so, then every business school curriculum, indeed every introductory economics course, is 100% dead wrong.
George Will once mocked the first President Bush’s inaugural address in which he lamented that Washington “has the will but not the wallet.” Will rightly noted that Washington always has plenty of “wallet” and that the problem is instead usually one of finding the will.
This is that.
The money to rebuild “the nation’s busiest transit hub” is staring us in the face: the riders. If there are really so many of them (and there are), then spreading the cost of funding a capital account to build a new Penn Station across their fares should be a relatively straightforward — and not particularly burdensome — question of economics and accounting. We (by which I really mean “they” — the riders) have more than enough wallet.
The deficit is of course in the will — by which I mean political will. The people who ride New Jersey Transit, the Long Island Railroad and Amtrak are, as a group, middle class and therefore politically insulated from such an abominable notion as expecting them to pay for their own train station.
The question of offsetting the cost of a new Penn Station by selling land and development rights around the site to real estate firms (and, if so, then how much development, to whom and by what selection process) are all ancillary to the core question: When and why did expecting those who use a train station to be the ones who pay for it, rather than those who don’t use it (not to mention those who don’t even live or work near it) become The Impossible Dream?
Similar Posts:
- Who Should Pay for Mass Transit? (Part One)
- Who Should Pay For Mass Transit Searches?
- Prague Tourist Quote of the Day
- Should Subways Charge Peak & Off-Peak Fares?
- On NYC’s Subway Pricing Chaos
Filed under: Uncategorized
Good series, Kip. Just to be contrarian, I can think of a couple of ways that public transit might be a partial public good.
First, by replacing cars with buses and trains, public transit reduces air pollution. Clean air is a public good, and everybody benefits from it, including people who don't pay subway fares.
Of course, there are more direct approaches to the problem of air pollution, such as carbon taxes.
Second, when people switch from driving public streets to public transit, they make street driving faster and more efficient. If it makes sense to subsidize public roads, it makes sense to subsidize a method of making them more efficient.
This is a tricky area, however, because there is strong evidence that commuters hold congestion at a constant value. Take 10000 drivers off the streets with public transit, and 10000 new ones will notice that traffic is smoother and decide to switch to a job that requires a longer commute. I'm not a good enough economist to figure out who benefits from a subsidy under these conditions.
Why can't they afford $3B for Penn Station when the WTC Path/Subway station is $2.32B (temp + permanent)? Obviously the public lacks the will. (wikipedia.org/wiki/World_Trade_Center_Transportation_Hub">
(yes i do know the answer – anything WTC the public will
willinglypay for.)on a side note, i enjoy the confusing corridors &never understood the "we must replace Penn Station" mantra. too young to have visited White's original station, but i enjoy the vitality of the current station. yes it lacks the grandeur of Grand Central Station, but it's train station – i don't go there for esthetics, i go to catch the NJT back to Summit.
Making transportation artificially cheap encourages people to make extra trips, when they should perhaps be consolidating their travel, or even staying home. So, even if public transportation is "cleaner" than autos, it is certainly dirtier than not traveling at all.
Besides, public transportation does not necessarily lower pollution — especially outside the peak periods — when you consider all those nearly-empty trains an buses.
Now, even if cars are filthier than buses, then it should be recognized that there are other variables besides air pollution. Perhaps it is worth to have somewhat dirtier air as a trade-off for lower taxes — and reallocating labor and resources to uses that are more productive than public transportation.
Also, the congestion problem would disappear with realistic transportation prices and competition. We don't need to nationalize supermarkets to "solve" supermarket congestion; instead, we allow pricing and competition to take care of that.