How Regulations Impede Economic Mobility

Why are Americans less likely to move to better opportunities than they used to be? The Wall Street Journal reports:

When opportunity dwindles, a natural response—the traditional American instinct—is to strike out for greener pastures. Migrations of the young, ambitious and able-bodied prompted the Dust Bowl exodus to California in the 1930s and the reverse migration of blacks from Northern cities to the South starting in the 1980s.

Yet the overall mobility of the U.S. population is at its lowest level since measurements were first taken at the end of World War II, falling by almost half since its most recent peak in 1985.

In rural America, which is coping with the onset of socioeconomic problems that were once reserved for inner cities, the rate of people who moved across a county line in 2015 was just 4.1%, according to a Wall Street Journal analysis. That’s down from 7.7% in the late 1970s.

One particular problem with today’s immobility is that people find themselves in areas where jobs are dwindling and pay tends to be lower. Why don’t they move to where the jobs are? This comprehensive article for the Journal by Janet Adamy and Paul Overberg points to a few factors:

For many rural residents across the country with low incomes, government aid programs such as Medicaid, which has benefits that vary by state, can provide a disincentive to leave. One in 10 West Branch [Mich.] residents lives in low-income housing, which was virtually nonexistent a generation ago.

Is Mobility a Right or a Privilege?

Michael Lind, a co-founder of left-leaning New America, is urging the federal government to create universal mobility accounts that would give everyone an income tax credit, or, if they owe no taxes, a direct subsidy to cover the costs of driving. He argues that social mobility depends on personal mobility, and personal mobility depends on access to a car, so therefore everyone should have one.

This is an interesting departure from the usual progressive argument that cars are evil and we should help the poor by spending more on transit. Lind responds to this view saying that transit and transit-oriented developments “can help only at the margins.” He applauds programs that help low-income people acquire inexpensive, used automobiles, but–again–thinks they are not enough.

Lind is virtually arguing that automobile ownership is a human right that should be denied to no one because of poverty. While I agree that auto ownership can do a lot more to help people out of poverty than more transit subsidies, claiming that cars are a human right goes a little to far.

The Terrible, Horrible, No Good, Very Bad Falling Gas Prices

A left-coast writer named Mark Morford thinks that gas prices falling to $2 a gallon would be the worst thing to happen to America. After all, he says, the wrong people would profit: oil companies (why would oil companies profit from lower gas prices?), auto makers, and internet retailers like Amazon that offer free shipping.

If falling gas prices are the worst for America, then the best, Morford goes on to say, would be to raise gas taxes by $6 a gallon and dedicate all of the revenue to boondoggles “alternative energy and transport, environmental protections, our busted educational system, our multi-trillion debt.” After all, government has proven itself so capable of finding the most cost-effective solutions to any problem in the past, and there’s no better way to reduce the debt than to tax the economy to death.

Morford is right in line with progressives like Naomi Klein, who thinks climate change is a grand opportunity to make war on capitalism. Despite doubts cast by other leftists, Klein insists that “responding to climate change could be the catalyst for a positive social and economic transformation”–by which she means government control of transportation, housing, and just about everything else.

These advocates of central planning remind me of University of Washington international studies professor Daniel Chirot assessment of the fall of the Soviet empire. From the time of Lenin, noted Chirot, soviet planners considered western industrial systems of the late nineteenth century their model for an ideal economy. By the 1980s, after decades of hard work, they had developed “the most advanced industries of the late 19th and early 20th centuries–polluting, wasteful, energy intensive, massive, inflexible–in short, giant rust belts.”

Morford and Klein want to do the same to the United States, using climate change as their excuse, and the golden age they wish to return to is around 1920, when streetcars and intercity passenger trains were at their peak (not counting the WWII era). Sure, there were cars, but only a few compared with today.

Move DC or Move Out of DC?

Washington DC has proposed an anti-auto transportation plan that is ironically called “MoveDC” when its real goal is to reduce the mobility of DC residents. The plan calls for reducing auto commuting from 54 percent to no more than 25 percent of all workers in the district, while favoring transit, cycling, and walking.

Click image to download the plan’s executive summary. Click here to download other parts of the plan.

The plan would discourage auto driving by tolling roads entering the district and cordon-pricing. Tolls aren’t necessarily a bad idea: as I explained in this paper, properly designed tolls can relieve congestion and actually increase roadway capacities. But you can count on DC to design them wrong, using them more as a punitive and fundraising tool than as a way to relieve congestion. Cordon pricing is invariably a bad idea, much more of a way for cities to capture dollars from suburban commuters than to influence travel habits.

The plan assumes that the district’s population will increase by 170,000 people over the next 25 years, which is supposed to have some kind of apocalyptic result if all of those people drive as much as people drive today. The district’s official population in 2010 was 602,000 people, a 155,000-person drop from 1970. While Census Bureau estimates say the district’s population is once again growing, it doesn’t seem all that apocalyptic if the population returns to 1970 levels.

The Census Bureau estimates that 54 percent of people employed in the district drove to work, while only 37 percent took transit in 2012. Since part of the MoveDC plan calls for discouraging people outside the district from driving to work in the district, it appears the goal is to cut that 54 percent by more than half. DC’s plan to discourage driving by taxing commuters through cordon pricing is more likely to push jobs into the suburbs than to reach this goal.

Congestion isn’t a serious problem in the district, mainly because the legal height limit prevents Manhattan-like job concentrations. Instead, the main congestion problems are on the highways entering the district. These problems can be solved through congestion tolls, which would encourage some travelers to shift the time they drive. Because road capacities dramatically decline when they become congested, keeping the roads uncongested would effectively double their capacity during rush hour, which ironically could allow even more people to drive to work. DC’s anti-auto planners won’t want to do that, which is why they are likely to focus more on cordon pricing than congestion tolling.

If reducing congestion isn’t the issue, then what is the goal of the anti-auto emphasis? MoveDC says it is “rapidly rising travel costs, and concerns about rising carbon emissions.” People deal with rising travel costs by replacing their cars less frequently and buying more fuel-efficient cars when they do replace them. MoveDC’s solution is to substitute high-cost urban transit for low-cost driving, even though transit actually emits more greenhouse gases per passenger mile than driving.

Mobility Is Freedom, Not an Invasion of Privacy

Mobility is freedom, or at least an important part of it. Yet earlier this month challenges to expansions of that freedom came from, surprisingly, the Mises Institute of Canada, Reason magazine, and American Enterprise Institute. The issues are new automobile technologies, specifically self-driving cars and improved road pricing, and the challenges came from people who clearly don’t understand the technologies involved.

Self-driving cars, says Roger Toutant writing for the Mises Institute of Canada, will lead to “a national, state-operated, computer network that will be used to achieve an Orwellian level of vehicular control and information sharing. …The implications are ominous. In the future, private spheres will be invaded and all movements will be tracked.”

“Boot up a Google car,” agrees Greg Beato of Reason magazine, “and it’s not so easy to cut the connection with the online mothership.” If you get into a Google driverless car, “you immediately start sending great quantities of revealing information to a company that’s already hoarding every emoticon you’ve ever IMed.”

It is appropriate to question new technologies, but the answer is that’s not the way these cars work. None of the self-driving cars being developed by Volkswagen, Google, or other companies rely at all on central computers. Instead, all the computing power is built into each car.

Which Is Greener?

Which uses less energy and emits less pollution: a train, a bus, or a car? Advocates of rail transportation rely on the public’s willingness to take for granted the assumption that trains – whether light rail, subways, or high-speed intercity rail – are the most energy-efficient and cleanest forms of transportation. But there is plenty of evidence that this is far from true.

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