The Importance of Productivity in National Transportation Policy

For years, transit funding advocates have claimed that national policy favors highways over transit. Consistent with that view, Congressman James Oberstar, chairman of the powerful House Transportation and Infrastructure Committee, wants to change the funding mix. He is looking for 40 percent of the transportation funding from the proposed stimulus package to be spent on transit, which is a substantial increase from present levels.

This raises two important questions: The first question is that of “equity” – “what would be the appropriate level to spend on transit?” The second question relates to “productivity” – “what would be the effect of spending more on transit?”

Equity: Equity consists of spending an amount that is proportionate to need or use. Thus, an equitable distribution would have the federal transportation spending reflect the shares that highways and transit carry of surface travel (highways plus transit). The most commonly used metric is passenger miles. Even with the recent, well publicized increases in transit ridership, transit’s share of surface travel is less than 1 percent. Non-transit highway modes, principally the automobile, account for 99 percent of travel.

So if equity were a principal objective, transit would justify less than 1 percent of federal surface transportation expenditures. Right now, transit does much better than that, accounting for 21 percent of federal surface transportation funded expenditures in 2006. This is what passes for equity in Washington – spending more than 20 percent of the money on something that represents less than one percent of the output. Transit receives 27 times as much funding per passenger mile as highways. It is no wonder that the nation’s urban areas have experienced huge increases in traffic congestion, or that there’s increasing concern about the state of the nation’s highway bridges, the most recent of which occurred in Minneapolis, not far from Congressman Oberstar’s district.

In addition, a substantial amount of federal highway user fees (principally the federal gasoline tax) are used to support transit. These revenues, which are only a part of the federal transit funding program, amounted to nearly $5 billion in 2006. Perhaps most amazingly, the federal government spends 15 times as much in highway user fees per transit passenger mile than it does on highways. Relationships such as these do not even vaguely resemble equity.

Moreover, truckers would rightly argue against using passenger miles as the only measure of equity. Trucks, which also pay federal user fees, account for moving nearly 30 percent of the nation’s freight. Transit moves none. Taking money that would be used to expand and maintain the nation’s highways will lead to more traffic congestion and slower truck operations – which also boosts pollution and energy use. This also means higher product prices.

Productivity: For a quarter of a century, federal funding has favored transit. A principal justification was the assumption that more money for transit would get people out of their cars. It hasn’t happened. Transit’s share of urban travel has declined more than 35 percent in the quarter century since highway user fee funding began. State and local governments have added even more money. Overall spending on transit has doubled (inflation adjusted) since 1982. Ridership is up only one third. This means that the nation’s riders and taxpayers have received just $0.33 in new value for each $1.00 they have paid. This is in stark contrast to the performance of commercial passenger and freight modes, which have generally improved their financial performance over the same period.

It’s clear spending more on transit does not attract material numbers of people out of cars. Major metropolitan area plans are biased toward transit but to little overall effect. At least seven metropolitan areas are spending more than 100 times more on transit per passenger mile than highways and none is spending less than 25 times.

The net effect of all this bias has barely influenced travel trends at all. Since 1982, per capita driving has increased 40 percent in the United States. Moreover, the increases in transit ridership (related to history’s highest gasoline prices) have been modest relative to overall travel demand. Transit captured little (3 percent) of the decline in automobile use, even in urban areas. Most of the decline appears to be a result of other factors like people working at home or simply choosing to drive less. It is notable that none of the transit-favoring metropolitan area plans even projects substantial longer term reductions in the share of travel by car.

The reason for this is simple. Transit is about downtown. The nation’s largest downtown areas, such as New York, Chicago, San Francisco, Boston, Philadelphia, Boston and Washington, contain huge concentrations of employment that can be well served by rapid transit modes. Yet relatively few Americans either live or work downtown. More than 90 percent of trips are to other areas where transit takes, on average, twice as long to make a trip – if there is even service available. Few people are in the market for longer trip times.

These policy distortions are not merely “anti-highway.” They are rather anti-productivity. This means they encourage greater poverty, because whatever retards productivity tends to increase levels of poverty. It would not be in the national interest for people to choose to take twice as much of their time traveling. By definition, wasting time retards productivity and international competitiveness. These are hardly the kinds of objectives appropriate for a nation facing perhaps its greatest financial challenges since the Great Depression.

For years, national transportation policy has been grounded in hopeless fantasy about refashioning our metropolitan areas back to late 19th Century misconceptions. It’s time to turn the corner and start fashioning a transportation strategy – including more flexible forms of transit – that make sense in our contemporary metropolis.

Resources:

Urban Transport Statistics: United States: A Compendium
http://www.publicpurpose.com/ut-usa2007ann.pdf

Regional Plan Spending on Highways and Transit
http://www.publicpurpose.com/ut-rplantransit.pdf

Wendell Cox is a Visiting Professor, Conservatoire National des Arts et Metiers, Paris. He was born in Los Angeles and was appointed to three terms on the Los Angeles County Transportation Commission by Mayor Tom Bradley. He is the author of “War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life.”