Urban Returns

"No road we built in Texas paid for itself."

From Streetsblog Capitol Hill:

Over the past two days at the Congress for the New Urbanism Project for Transportation Reform conference, attendees have called for reform at local, regional, and national levels. In a panel debate about the future of transportation funding and the role of regional planning through MPOs, several speakers argued that the foundation of transportation and development funding had to be systematically overhauled.

Mike Krusee, [AC: former] chairman of the Texas House of Representatives Transportation Committee, said that financial problems were more significant than environmental, though they should be tied together in the same discussion.

"The reason there's not a new transportation bill is because there is no money. We've hit the wall of unsustainability on how we finance the transportation system," he said.

Krusee asserted it was urgent and necessary to understand the nature of this broken financial apparatus and to develop solutions to fix it. In Texas, he said that, on average, it cost the state 20-30 cents per person per mile to build and maintain a road to the suburbs, yet drivers only pay on average 2-3 cents per mile through the gas tax, vehicles fees, etc.

"What we found was that no road that we built in Texas paid for itself," said Krusee. "None."

The expense to build roads and utilities further and further from the urban cores not only drove costs to unsustainable levels, it created an imbalance in who paid for growth. Over the past 50 years, Krusee argued, the federal government used tax money that came by and large from cities to subsidize roads to areas without access otherwise.

"City dwellers have subsidized the land purchases and the development costs out in the suburbs," said Krusee. What's more, the gas tax, which city dwellers pay when driving on city roads, but which goes to freeways largely outside of urban cores, is "a huge transfer of wealth from the cities to the suburbs to build these rings."

Krusee said building the interstate system was initially a good thing, because if facilitated interstate commerce and increased the productivity of cities. Now however, because of congestion caused by ever longer commute patterns, system productivity is in peril. "What's happened is the federal government has basically reneged on the deal. By subsidizing highways out to the suburbs, it's no longer efficient for truck traffic, for goods and services and people to move between cities in the United States because those roads have been hijacked by all the commuters."

Krusee, by the way, represented suburban Williamson County.

Krusee's assessment matches TxDOT's own internal assessment.  (This actually should be no surprise since Krusee's committee relied on TxDOT for data.)   TxDOT, for example, concluded that the 15 miles of SH 99 from I-10 to US 290 will cost $1 billion to build and maintain over its lifetime, while only generating $162 million in gas taxes -- just 16% of the total cost.

Some of us get swept up in the rhetoric sometimes, but roads aren't unmitigated evils.   Obviously, we need roads.  Just as obviously, I think, we will continue to need new roads.   But new roads should be built only where drivers are willing to pay for the new capacity.   And the only way to gauge that demand is to price existing roads properly; the revenue they generate will tell us when it is time to add to add that capacity.

Cross-posted at Austin Contrarian. Comments there.

Path dependence

Ryan Avent has had some back and forth with Tyler Cowen and Will Wilkinson over roads and rail.  Tyler and Will acknowledge that, yes, our reliance on roads rather than rail has been influenced by long-standing government subsidies.  But by now we have sunk so much into roads, and have built up so much road infrastructure, that the marginal cost of adding to our road network is much lower than creating a viable rail network from scratch.  In other words, our past investments have had a lock-in effect, and there's no wishing it away.  

Ryan responds that Tyler and Will are committing the "sunk costs" fallacy, but I'm not sure that's right.  Past investments matter a lot because they have generated network externalities.   One million dollars spent extending an already extensive network is often worth more than one million sunk to build a network from scratch.  

But Ryan is right that past investments in suburban infrastructure do not require us continue throwing up barriers to denser developments:  

In practice, the US is far from done building.  Tens of millions of new homes will be built in the coming decades.  Hundreds of billions of dollars will be spent on transportation infrastructure.  The current built environment has, as a result of decades of government policy, taken on a rather suburban, auto-centric tilt.  So what?  No one is suggesting that we tear down all of that and replace it with something entirely new.  I, and others, are suggesting that making it easier (or, you know, legal) to build in a denser, more walkable fashion would be advantageous.  Similarly, given the burden of maintaining such a large and costly road infrastructure, it might be wise to devote a larger share of dollars for new construction to substitute technologies.

And bear in mind that a technology's lock on the market is not always as secure as it seems.  A small initial advantage allowed VHS to dominate the videotape market, all but squeezing out Betamax.  But it did not save VHS from the DVD, even though a vast infrastructure had been created to support VHS:  video players, Blockbuster, video cameras and a complete library of titles.  All wiped out by a superior technology.   

Now imagine the government had subsidized VHS to help it fend off insurgencies from new technologies.  At best, many of us would still be stuck with an inferior technology.  At worst, there would be no DVD.  The government should let these things work themselves out in the marketplace; that's the true libertarian position.

All of this means that the government should let denser development happen.  Stop the  subsidies and tax policies -- including subsidies to new highways -- that encourage shifts to the suburbs.  There are perfectly sound economic arguments for investing in rail lines in some situations; make those investments.  Many home buyers, probably most, will continue to settle in the 'burbs.   But we can't anticipate shifts in technology.  Nor shifts in preferences or energy costs.  We think we can.  But we really, really can't.   If the housing market would continue down today's path anyway, fine, but the government shouldn't lead it by the nose.  

(Cross-posted at Austin Contrarian.  Comment there.)

Yet another entry about high-speed rail

The national bloggers continue to debate the feasibility of a high-speed rail link between Houston and Dallas.  Up to bat:  Megan McArdle.

I think reasonable people can disagree about the feasibility of HSR, especially since we're just trading  back-of-the-envelope calculations of HSR's costs and benefits.  Although I've argued HSR opponents underestimate the benefits to business-class passengers, in the interest of fair and balanced coverage, let me point to Richard Green's discussion of a more rigorous effort to tote up the costs and benefits.  The authors of that particular study give HSR the thumbs down.

And while I'm in a contrary mood, let me suggest one other potential cost of a Houston-Dallas line.

Everyone agrees that in order for such a line to succeed, it must draw airline passengers to rail.  Lots and lots of airline passengers.  If the airlines lose, say, half of their Houston-to-Dallas traffic, they will have to cut the number of flights between Houston and Dallas.  Obviously.  Many consider that a feature, not a bug.

But what about the effect on other routes?  American is able to offer service from Dallas to virtually every American city because of the huge number of passengers flowing into DFW every day.  Cutting that inflow will reduce the economies of scale that support so many flights.  Ditto with Southwest out of Hobby.    Houston is a huge feeder for DFW, if the number of Bush-to-DFW flights is any indication.  Similarly, Love is a huge feeder for Hobby, judging by the 24+ daily flights.  Networks can be delicate things.  Shrinking one route could sicken other segments. 

HSR could very well make it easier to get from Houston to Dallas and vice versa.  But it could very well make it harder to get anywhere else.   

Cross-posted at Austin Contrarian; comment there.

Self-parody

Sometimes I think Randal O'Toole is putting us on.  He reacts to Frumination's calculation of the highway and parking capacity Manhattan would need to replace it's rush-hour subway capacity.  O'Toole's alternative?  Buses, of course:

Many 40-foot bus can carry 64 passengers (42 sitting, 22 standing, which means a higher proportion sitting than on a subway). Spaced five bus lengths apart, 11 buses per minute can cruise down a highway lane carrying more than 42,000 people per hour. That means fewer than 10 new lanes would be needed to carry the people now taking subways — and those 10 lanes would take up a lot less space than the 22 subway lines.

This can be further reduced by assuming that some people will time shift. During the 8 to 9 am hour, the average subway car carries 108 people, but in the afternoon peak hour the average subway car carries only 87 people. If some of the 108 people in that morning hour time shifted to the 7 or 9 am hour, then even fewer bus lanes would be needed to carry people into Manhattan.

Randal should have finished his calculations.  Forty-foot buses can cruise down a highway at 11 buses per minute only if they are averaging almost 30 mph.  But buses traveling into Manhattan could not approach that speed because once they got to Manhattan, they'd have to exit the freeway onto crowded local streets.  The ensuing bottleneck would back up bus traffic for miles.

Worse, Randal ignores the sheer amount of space his buses would occupy once they got to Manhattan.  It would take 6,250 buses to move 400,000 commuters.  At 40 feet per bus, 6,250 buses would take up 47 linear miles of street space -- if they were lined up nose-to-tail.  (94 miles if we allow one bus-length between buses.)  Manhattan is only 13.5 miles long.

And this ignores that commuters would need another bus network once they got to Manhattan, because express buses couldn't drop commuters at their final destination. 

This is absurd.  Randal must understand this, because he generously allows that buses might not be able to replace the entire subway capacity:

If there were no federal subsidies to New York City transit, it is possible that the subways would decline and not be entirely replaced by buses. If so, downtown Manhattan might lose some of its allure as a job center. Would that be so horrible? A lower-density Manhattan might have had less attraction as a terrorist target. It would save taxpayers money. And people would get to their work faster, as (thanks largely to its high proportion of transit commuters) New York has the longest average commuter times of any urban area in the nation.

It sounds to me like getting rid of the subway might benefit everyone except, of course, downtown property owners. And that is really what rail transit is all about: transferring wealth from millions of ordinary taxpayers to a few downtown property owners, rail contractors, and transit agency officials and employees.

Let's ignore that highways and bridges are also a subsidy to property owners.  (Is he factoring these capital and maintenance costs into his bus fares?)  Let's also ignore that all of the boroughs and suburbs served by the subway are much more valuable thanks to their accessibility to Manhattan. 

It's clear that Randal simply doesn't understand the concepts of increasing returns and agglomerations.  New York metropolitan residents are willing to endure longer commutes, pay higher commercial rents and housing costs, and fork over a good chunk of their income in taxes because they receive at least that much value from living in or close to the city.   New York City is a wealth-generating machine, and that is largely -- if not entirely -- due to a bunch of highly productive people crowding together.  Density begets productivity, and rising productivity is ultimately the source of rising wealth.   Turning Manhattan into Jacksonville or any other low-density city would destroy vast amounts of wealth.  Subway subsidies are trivial by comparison.  Most New Yorkers understand this, which is why you don't hear them argue for the elimination of the subway but instead leave that to an "economist" from Oregon.

(Cross-post at Austin Contrarian.)

Links

1.   Frumination works out the highway and parking capacity Manhattan would need to replace its morning rush hour subway capacity:

At best, it would take 167 inbound lanes, or 84 copies of the Queens Midtown Tunnel, to carry what the NYC Subway carries over 22 inbound tracks through 12 tunnels and 2 (partial) bridges. At worst, 200 new copies of 5th Avenue. Somewhere in the middle would be 67 West Side Highways or 76 Brooklyn Bridges. And this neglects the Long Island Railroad, Metro North, NJ Transit, and PATH systems entirely.

Of course, at 325 square feet per parking space, all these cars would need over 3.8 square miles of space to park, about 3 times the size of Central Park. At that point, who would want to go to Manhattan anyway?

See the neat map at the bottom of his entry showing how much land Manhattan would have to devote to parking.  Commuters of course would abandon Manhattan long before things reached this state.  But Manhattan would not be Manhattan in either case.  

Pointer from a reader.

(NB: Tyler Cowen thought this was interesting enough for a link . . . to Kottke, who merely quoted a snippet of Frumination's entry.  Jerk.  (Cowen, not Kottke.))

2.  A Detroit neighborhood reverts to prairie (images from DetroitYES):

(H/t the Urbanophile.)

3.  Professor Chris Nelson, Director of the Metropolitan Research Center at the University of Utah, projects  that the homeownership rate will fall to 63.5% by 2020, sparking intense demand for rban infill and redevelopment.   (Via Calculated Risk; no link to paper available.)

I think our homeownership rate is too high, a result of tax subsidies and land-use policies.  It ought to drop.  But it won't drop by several percent.   Richard Green, a professor at the Marshall School of Business at the University of Southern California (and no conservative), fisks Nelson's study. 

Tipping points

Here are a couple of interesting pieces on  the "tipping point" theory of racial segregation.

Why do racially-segregated neighborhoods exist and persist?  The standard explanation  is that whites don't like to live near, say, African-Americans; when African-Americans start moving in, whites start moving out.  Real estate agents steer whites away from African-American neighborhoods and vice versa.  And let's not forget the legacy of de jure segregation, which herded African Americans into a few neighborhoods; residential patterns typically change slowly.  The standard explanation relies on more or less overt, conscious racism.

There's clearly some of that going on.  Most cities -- Austin included -- had either de facto or de jure rules that relegated African Americans to just a few, exclusively African-American neighborhoods.  Although I consider Austin as a fairly racially tolerant place today, it is still  strikingly segregated:

Back and forth

It never surprises me to hear suburban commuters bash congestion tolls.  But I am surprised when a sophisticated transit blogger bashes them.  Yonah Freemark, who writes the very good the transport politic, is the guilty party.  He and Ryan Avent have been going back and forth and back again.  

Yonah's objection is equity:

A huge percentage of the U.S. population pays far too much for transportation; to put it simply, most working adults have no choice other than to own a vehicle and often to drive it dozens of miles every day. Making driving more expensive is a great way to devastate the already impoverished.

It’s true, tolling highways would save “money, time, lives, and emissions.” But it would also sacrifice the mobility of a large segment of America, because the reduced congestion would be a result of the poor and the middle class choosing not to drive because of expense, not because of choices made by the wealthy.

He argues that our public transit systems are too underdeveloped in most places to cure this inequity.

Ryan responds with several good points, but I want to elaborate on why the regressivity argument leaves me cold.

First, congestion tolls are less regressive than toll opponents claims.   The low-income do pay tolls, which means they value the time savings more than the price of the toll.   Plenty of low-income drivers take the toll lanes on SR 91 in California, for example.  The reason many do is that they have little flexibility in their schedules.  They have to be at work or at the daycare center at a specific time.  To compensate for congestion, they must leave much earlier to guarantee a timely arrival.  They thus suffer two types of costs:  scheduling delays and travel delays.  (The value of scheduling delays is very hard to measure, which means that studies like the TTI report almost surely understate the cost of congestion.)  Affluent professionals often have more flexibility.

Second, tolls encourage a number of shifts.  Yes, shifts to transit, which seems to be Yonah's main concern, at least when the transit system is underdeveloped.  But they encourage other shifts, too.  Shifts to other routes and shifts to other times.   Commuters are the least likely to be nudged to other routes or times.  The most sensitive are those who use congested roads for local trips.  Take the soccer mom who hops in the SUV and enters a congested highway to get to the grocery store a mile down the road.  She imposes enormous costs on others.  Tolls make her internalize those costs and nudge her to use the local streets. 

Perhaps this is regressive.  But it doesn't evoke much sympathy from me.  A congestion toll is a charge for getting in everyone else's way.   Behind every claim of regressivity is the assumption that drivers are entitled to get in everyone else's way even when it is not worth all that much to them. 

And that leads to my last point.  The regressivity argument wouldn't move me even if it were true. This is one of those cases in which our desire for efficiency should trump our concern with regressivity.

Here's an apt analogy.  An amusement park owner decides to throw open the gate to all comers on a first-come, first-serve.  Naturally, a long line forms.  But this isn't a typical line where newcomers go to the back of the line.  No, in this queue, newcomers elbow their way to the front of the line and force everyone behind them to wait a little longer.  

Naturally, chaos ensues.  No one leaves for the park knowing how long it will take to get in.   There is "queue rage" and general aggravation.  The park owner loses business.  And many low-income parents find themselves worse off because they have a smaller window of free time and dislike the chaos and aggravation as much as anyone else.  (I've always thought it patronizing to assume that low-income drivers put such a low value on their time and aggravation.)

Now, in the real world, the queue would never work this way.  Those at the rear of the line would use informal sanctions (fist fights) to deter queue jumpers.  And, in fact, there would be only a short  line to get into the park in the first place because the owner would charge for admission.

But this is exactly the crazy system we use to ration highway access.  For whatever reason, our cultural norms have evolved to tolerate a free-for-all.  In almost every other situation we ration scarce goods using price.  Sure, that's regressive in the sense that the poor have less money to spend on things.  But we tolerate some regressivity elsewhere because we recognize that (1) the gains in efficiency outweigh the equity concerns; and (2) there are better ways to ensure an egalitarian distribution of wealth than creating artificial shortages, chaos and mayhem.

Regressivity is not the be all and end all.

Punching above its class

The Texas Transportation Institute has issued its annual report on congestion in American cities.  As usual, Austin doesn't do well, punching well above its class.  Tthe average Austin traveler experienced an annual delay of 39 hours in 2007.    That's up from 32 hours in 1997, although no worse than 2006.   

Ryan Avent puts the Austin figures in perspective:

The average traveler in the New York metro area faces 44 hours wasted per year, for instance, while the average traveler in Los Angeles loses 70 hours per year to congestion, even though New York’s metropolitan population is much, much larger than LA’s.  More interesting still, Austin and Raleigh aren’t that far behind New York with 39 and 34 hours wasted annually, despite the fact that both metro areas have less than two million people while greater New York is home to 20 million people.

TTI also calculates the percent of peak period travel that is congested.   Austin again fares poorly -- its roads are congested for 70% of the peak travel period: 

By comparison, Dallas's roads are congested for only 66% of the peak travel period.  Houston is marginally worse at 73%.   Austin's peers include New York (69%), Detroit (71%) and Baltimore (69%).  

One has to wonder what damage Austin's congestion has wrought to downtown.   Businesses want to locate where their employees can get to them, and high peak-period congestion means that commuters must fight traffic to get to work most of the time.   I suspect Austin's downtown suffers more heavily from peak-period congestion than any other employment center in the area since MoPac and I-35 -- the principal commuter routes to downtown -- are the two most congested roads in the area.     Eventually we must recognize that our congestion will  stunt downtown's growth.   We wil lose the economies of scale and agglomeration benefits that a vibrant downtown would  yield.

You know, of course, that there is only one solution.

$160 per trip

That's the social cost that Charles Kamonoff, an NYC environmental/transportation analysist, believes each driver who enters Manhattan's central business district imposes on other drivers.  Via Felix Salmon: 

After crunching the numbers, he calculates that on a weekday, the average car driven into Manhattan south of 60th Street causes a total of 3.26 hours of delays to everybody else. (At weekends, the equivalent number is just over 2 hours.) No one car is likely to suffer excess delays of more than a few seconds, of course, but if you add up all those seconds for the thousands of affected cars and trucks, it comes to a significant amount of time.

Many of those hours are very valuable things, especially when you consider big trucks, staffed with two or three professionals, just idling in traffic. Komanoff calculates (check out the “Value of Time” tab) that the average vehicle has 1.97 people in it, and that the average value of an hour of saved vehicle time south of 60th Street in Manhattan on a weekday is $48.89. Which means, basically, that driving a car into Manhattan on a weekday causes about $160 of negative externalities to everybody else.

I can't vouch for Komanoff's numbers or his methodology. Given the sheer complexity of the traffic dynamics in Manhattan -- which are much more complicated than the traffic dynamics of a single highway -- I would treat his estimate skeptically.

That said, his estimate doesn't seem outrageously high to me. The basic point is sound:  we severely underestimate how many people we delay when we enter a congested network of roads.  If you've ever tried to make the trip crosstown Manhattan in the middle of the day, you understand just how much delay one driver can cause.

Komanoff recommends congestion pricing.  A good idea.  But he also proposes making buses free, which is a bad idea (and one floated in Austin occasionally). 

One problem is that a free bus would be a magnet for the homeless looking for a cool place to hang out.  That sounds callous, I know, and perhaps it is, but in that case you'd never see a large switch from cars to buses, so what would be the point?

The other problem is that both bus and rail can be congested, too.  If you've ever taken a packed No. 3 around ACL, you understand this perfectly well.  There is a cost to standing up on a jerky bus for 20 minutes, squeezed in among a bunch of strangers who may or may not practice good hygiene.  This is a genuine cost of congestion.  In fact, it is probably too high a cost for most of the drivers around here, who would much rather be stuck in traffic in a cool, comfortable car.

If we price roads but not buses or trains, then the buses or trains will be too crowded (at least in Manhattan and DC, if not in Austin) and we simply will have shifted the cost of externalities from drivers to bus and train riders.  This certainly does not mean that buses and trains must pay their own way.  But it does mean pricing them with the interests of both drivers and non-drivers in mind.

What does blogging crowd out?

Matthew Kahn wonders whether blog reading crowds out book reading.  He believes there are two types of blog readers:  the nerdy "Wikipedia" types who like variety and suffer from slight attention deficit order, and the "deep readers" who want to dig deep in a few subjects.  He speculates that books are substitutes for the Wikipedia nerds and complements for the deep readers.

I read more books since I've started reading blogs.  I don't buy more books, but I read more of the books I do buy.  I've always bought books on impulse but then let them sit on a shelf.  The real reason I read more books now, I think, is that I blog myself.  Books stimulate ideas for new posts, of course.  But, more importantly, I can only say the same thing a few times without getting bored.  I long ago exhausted my own stock of ideas so I have to rip off others'.  

What does my blogging crowd out?  Baseball.  Football.  I used to watch two or three baseball games a week.  I don't anymore.

Some TV, but, honestly, not that much.  My prime TV watching time has always started at 10 pm with the Simpsons.   I used to watch TV before 10, but I can't really remember what I watched, so I guess I'm watching TV more "efficiently."

Blogging crowds out some work.  I used to hustle harder for new business when I was slow.  I haven't sat down to estimate my lost earnings from blogging -- that might make me quit (blogging, that is, not work).  Still, work is work; there hasn't been too much to take from there.

I think my blogging has mostly crowded out dead time.  I don't know whether I used to just sit around staring blankly at a wall or what, but when I do the math, the time I spend on blogging and reading exceeds -- by a lot -- the time I used to spend on activities since crowded out.