The Tyranny of Free Parking

Should big-city governments be giving valuable city property to its wealthy residents for a pittance? The answer to that is not dependent upon political party or ideology, it would seem, yet it remains the standard practice nearly everywhere.

The property in question consists of the parking lanes in neighborhoods and main thoroughfares, and the cost of this giveaway is immense: Besides the loss in foregone revenue it adds greatly to traffic congestion, depresses demand for businesses in those areas, and contributes to pollution.

None of these are apparently sufficient to convince the supporters of these types of regulations who tend to be in charge of big cities like Washington, DC, where I live, to change this policy, so let me add another reason to do away with this: Giving away street parking is incredibly regressive. (for context, DC charged $25 a year for a neighborhood parking permit when off-street parking spaces go for $3,000 a year)

As I discussed in my recent Regulation Magazine piece and Cato Podcast, supporters of these types of regulations often justify nearly free street parking in these places as a necessary giveaway to help poor people who live in the neighborhood. The problem is that few poor people live in these neighborhoods and those who do usually do without an automobile. For instance, of the dozen cars parked on my street last night were three Mercedes, two BMWs, three Lexuses, and a Jaguar. Not the typical cars of the underprivileged trying to eke out a living.

This collection of pricey autos are not a random snapshot, either: the dirty little secret is that most cars are stored on the street and not parked. A majority of cars parked in my neighborhood don’t move in a typical week: they are baubles for their wealthy owners to be used on the occasional road trip or a weekly grocery run. There are also a number of vans in our neighborhood being used to store property of their owner. It’s certainly cost-efficient: the cheapest storage space nearby is $90 a month, and $1,000 buys a late model van that can be coaxed into running on occasion. Putting one’s winter clothes or surplus books or other paraphernalia in a nondescript van permanently parked in front of one’s apartment is cheaper and more convenient.

On-street parking is so cheap that there are area hotels without a garage that offer valet parking. They merely park the guests’ cars on the street for it and pay the parking tickets, which are still below what they charge their guests.

Giving away on-street parking engenders a fierce competition for every spot. It also creates a critical mass of people fearful of even more competition for their on-street parking spots, which results in stiff opposition of every new housing development proposed. The free parking lobby occasionally succeeds in stopping certain developments but at a minimum it can slow new construction and increase the legal costs of proceeding. Invariably this opposition results in developers being forced to construct smaller buildings with less housing, which is one reason that housing prices remain so high in major metropolitan areas. That’s doubly good for the car owners, since they benefit from the parking access and higher real estate prices, but it’s bad for the middle and lower-income who can’t afford to buy.

In Washington DC this banal parking policy also hurts the poor by screwing up mass transit as well. The parking shortage created by this artificially low price pressures the city to allow parking in every conceivable spot. As a result, buses that go through this heavily-traveled route find it difficult to traverse this corridor. Parked cars abut most bus stops, making it difficult for buses to get in and out of the space. In other places the plethora of parked cars slows traffic to a crawl during rush hours. In essence, the city lengthens the commute of low-income minorities in order to help a paucity of wealthy car-owners.

Urbanists have decried the impact of “free” parking for some time–Donald Shoup’s The High Cost of Free Parking made a quiet sensation amongst this crowd when it appeared a decade ago. But there’s one aspect of it that the good-government types tend to overlook: It’s that it benefits the rich at the expense of the poor.

There are many reasons the government should reduce how much parking is available in urban areas and charge a market price for the parking it does allow, but the fact that it would lead to an incredibly progressive outcome ought to be acknowledged–and used to confront those who have made reducing inequality their cri de coeur yet advocate for the status quo.