transit

Helping People Reach Jobs

What is the best way to help low-income people – a group that disproportionately includes blacks and Latinos – get access to jobs? That question is certainly not answered by a report from left-wing think tank Demos. The report is aptly titled To Move Is to Thrive, but its subtitle, “Public Transit and Economic Opportunity for People of Color,” gives away its real agenda: more subsidies to the transit industry.

Written by Algernon Austin, the author of America Is Not Post-Racial, the report observes that “people of color” are less likely to own cars and more likely to be transit-dependent than white people. But Austin ignores the obvious and best solution, which is to give low-income people (regardless of color) access to cars. Instead, his report promotes “transit-focused infrastructure projects” in minority neighborhoods.

Since 1970, this nation has spent hundreds of billions of dollars on transit infrastructure projects. These projects have been disproportionately directed towards middle-class neighborhoods because middle-class people are the ones who pay for them through their taxes and the ones whose political support is needed to build them.

At the same time, the high cost of these projects has often forced transit agencies to cut bus service to low-income neighborhoods. This has happened in Atlanta, Los Angeles, the San Francisco Bay Area, and numerous other places, often resulting in overall declines in transit ridership.

The New York Times Is Wrong About Transit’s Effect on Urban Development

The New York Times has once again published a report claiming that transit hubs are a “growing lure for developers.” The Times published a similar story eight years ago, and I quickly showed that subsidies from tax-increment financing (TIF) and other government support, not transit, was what stimulated those developments.

So has anything changed since then? Nope. The first development described in the recent story by Times reporter Joe Gose is Assembly Row, in the Boston suburb of Somerville. Is it subsidized? Yes, with at least $25 million in TIF along with other state funds. Far from being “free money” as its advocates claim, TIF steals from school districts and other agencies that rely on property taxes to subsidize developers.

Then Gose mentions Chicago’s Fulton Market, downtown Kansas City, Austin, and Denver’s RiNo neighborhood. Fulton Market just happened to receive at least $42 million in support from the city of Chicago, much of which comes from TIF

Supposedly a new streetcar sparked a revitalization of downtown Kansas City. But could it be that revitalization was due more to Kansas City’s twenty-four downtown TIF districts?

Gose doesn’t specify a particular neighborhood or development in Austin, Texas. Of course, Austin is one of the fastest growing cities in America, so anything that’s open for development is going to be developed. But not satisfied to let the market work, Austin has heavily bought into the use of TIF districts. Transit is an afterthought in Austin, carrying less than 1 percent of the passenger travel; the city’s sole rail line was a huge flop that cost way more than expected and now carries fewer than 1,500 round-trips per weekday.

Denver’s RiNo neighborhood–RiNo being short for River North–is growing thanks to at least $44 million on infrastructure improvements in that neighborhood, plus additional TIF funds for special projects.

In Washington, DC, Gose mentions a $3 million project “in Washington’s fast-growing Capital Riverfront neighborhood.” That’s the same neighborhood that received at least $198 million in TIF subsidies.

An Electrifyingly Bad Decision

Transportation Secretary Elaine Chao’s decision to give $647 million to California to electrify a San Francisco commuter rail line tells states and cities across the nation that they should plan the most expensive and wasteful infrastructure projects they can and the Trump administration will support them. The Caltrains electrification project had no political, economic, social, or environmental justification, so Chao’s support for the project despite its lack of virtues does not bode well for those who hoped that the Trump administration would take a fiscally conservative stance on infrastructure and transportation.

The California project had already been funded by the Obama administration, but it was a last-minute approval by an acting administrator who immediately then took a high-paying job with one of Caltrains’ contractors. When Chao took office, every single Republican in the California congressional delegation asked her to overturn the decision, and she agreed to review it. Even some Democrats opposed the project, meaning there was far less political pressure to fund it than many other equally wasteful programs.

Caltrains carries just 4 percent of transit riders in the San Francisco Bay Area, and based on the dubious claim that electric trains would go a little faster than Diesel-electric trains, the environmental assessment for the project predicted that electrification would boost ridership by less than 10 percent. It would save no energy and have a trivial effect on air pollution. 

Instead, the main purpose of the Caltrains project was to wire the way for California’s bloated high-speed trains, which at least initially would use the same electric power to get to San Francisco. Normally, high-speed trains would not use the same track as ordinary commuter trains, but the costs of the high-speed rail project have risen so much that the state’s rail authority is cutting corners wherever it can. One result is that the project, if it is ever completed, won’t really run trains at high speeds for much of its route.

10 Reasons to Stop Subsidizing Urban Transit

As the Trump administration debates whether to help fund a $1.75 billion transit project in California that will do almost nothing to increase transit ridership, it is time to reconsider whether transit should be subsidized at all. Here are ten reasons to end those subsidies.

1. It’s the most costly transportation we have

In 2015, the transit industry spent $1.15 to move one person one mile, of which $0.87 was subsidized. No other major form of transportation is so expensive or so heavily subsidized. Auto driving cost about 26 cents per passenger mile of which subsidies were 2 cents. Flying was about 16 cents a passenger mile of which subsidies were also about 2 cents. Intercity buses cost about 12 cents a passenger mile of which subsidies were about 3 cents.

Other than transit, the most expensive passenger transport was Amtrak, which cost about 53 cents per passenger mile in 2015 of which 19 cents was subsidies. Not coincidentally, Amtrak is also government owned, suggesting that government ownership either makes transportation more expensive or government is stuck with the obsolete clunkers in the urban and intercity transport markets.

2. Subsidies haven’t increased ridership

Federal subsidies to transit began in 1965, when transit carried 60 trips per urban resident. Since then, federal, state, and local subsidies have exceeded $1 trillion (in today’s dollars), yet annual ridership has dropped to 40 trips per urban resident. Ridership responds more to changes in gasoline prices than to increased subsidies.

Since federal subsidies began in 1965, transit ridership has declined from 60 annual trips per urban resident to 40.

3. Few use it and fewer need it

In 1960, when most of the nation’s transit was private (and profitable), 7.81 million people took transit to work. By 2015, the nation’s working population had grown by nearly 130 percent, yet the number of people taking transit to work had declined to 7.76 million.

The share of households that owns no vehicles has declined from 22 percent in 1960 to 9 percent today, while the share owning three or more vehicles has grown from 3 percent to 20 percent.

In 1960, 22 percent of American households did not own a car and transit subsidies were partly justified on the social obligation to provide mobility to people who couldn’t afford a car. Since 2000, only 9 percent of American households don’t own a car, so the market of transit-dependent people has dramatically declined.

Half the households with no cars also have no employed workers in the households. Of the 4.5 percent of workers who live in households with no vehicles, well under half–41 percent–take transit to work, meaning transit doesn’t even work for most people who don’t have cars.

Why Few Americans Use Transit

In 1964, most transit was privately owned, earned a profit, and was used by the average urban American 60 times a year. Then Congress passed the Urban Mass Transportation Act, offering capital grants to cities that took over their transit systems. Since then, most transit has been municipalized, we spend nearly $50 billion a year subsidizing it, and today the average American rides transit just 40 times a year.

Transit advocates complain that Americans have some sort of irrational love affair with their automobiles. But Americans have excellent reasons not to rely on transit. Here are nine of them.

1. Transit is slow.

Most transit is much slower than driving, and a lot of transit is slower than cycling. While the average speed of driving in most American cities is more than 30 mph, and in some it is more than 40 mph, the American Public Transportation Association’s Public Transportation Fact Book admits that the average speed of rail transit is just 21.5 mph while the average speed of buses is 14.1 mph. That doesn’t count the time it takes to get to and from transit stops.

2. It doesn’t go where you want to go.

Most transit is oriented to downtown, a destination few people go to anymore as less than 8 percent of urban jobs and 1 percent of urban residences are located in central city downtowns. If you don’t want to go downtown, transit is practically useless as hub-and-spoke transit systems can require hours to take you to destinations that are only a few minutes away by car.

3. It’s expensive.

The transit industry claims that transit saves people money. But the truth is that, for most people, it costs a lot less to drive than to ride transit. Transit fares in 2015 averaged 28 cents a passenger mile. That’s less than the cost of driving if you count all the costs of owning a car and are the only person in the car. But if you already own the car, the cost of one more trip is less than 20 cents a mile, and you save even more if you carry any passengers.

Trump’s Trillion-Dollar Infrastructure Plan

On the campaign trail, Donald Trump promised to spend twice as much on infrastructure as whatever Hillary Clinton was proposing, which at the time was $275 billion. Doubling down again in a speech after winning the election, Trump now proposes to spend a trillion dollars on infrastructure over the next ten years.

President Obama had proposed to fix infrastructure with an infrastructure bank, though just where the bank would get its money was never clear (actually, it was perfectly clear: the taxpayers). Trump’s alternative plan is for the private sector, not taxpayers, to spend the money, and to encourage them he proposes to offer tax credits for infrastructure projects. He says this would be “revenue neutral” because the taxes paid by people working on the infrastructure would offset the tax breaks. In short, Trump is proposing tax credits in lieu of an infrastructure bank as a form of economic stimulus.

America’s infrastructure needs are not nearly as serious as Trump thinks. Throwing a trillion dollars at infrastructure, no matter how it is funded, guarantees that a lot will be spent on unnecessary things. As Harvard economist Edward Glaeser recently pointed out in an article that should be required reading for Trump’s transition team, just calling something “infrastructure” doesn’t mean it is worth doing or that it will stimulate economic growth.

Infrastructure more or less falls into three categories, and Trump’s one-size-fits-all plan doesn’t work very well for any of them. First is infrastructure that pays for itself, such as the electrical grid. Private companies and public agencies are already taking care of this kind, so if Trump’s plan applied to them, they would get tax credits for spending money they would have spent anyway. That’s not revenue neutral.

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.

America’s Socialized Transit

On the heels of a National Transportation Safety Board (NTSB) report that found that Washington Metro “has failed to learn safety lessons” from previous accidents, Metro general manager Paul Wiedefeld will announce a plan today that promises to disrupt service for months in an effort to get the lines safely running again. While ordinary maintenance can take place during the few hours the system isn’t running every night, Wiedefeld says past officials have let the system decline so much that individual rail lines will have to be taken off line for days or weeks at a time to get them back into shape.

The Washington Post blames the problems on “generations of executives and government-appointed Metro board members, along with Washington-area politicians who ultimately dictated Metro’s spending.” That’s partially true, but there are really two problems with Metro, and different parties are to blame for each.

First is the problem with deferred maintenance. The Metro board recognized that maintenance costs would have to increase as long ago as 2002, when they developed a plan to spend $10 billion to $12 billion rehabilitating the system. This plan was ignored by the “Washington-area politicians who ultimately dictated Metro’s spending” and who decided to fund the Silver and Purple lines instead of repairing what they already had.

Second is the problem with the agency’s safety culture, or lack of one. According to the NTSB report, in violation of its own procedures, Metro used loaded passenger trains to search for the sources of smoke in the tunnels. Metro at first denied doing so, then said it wouldn’t do it any more. But Metro’s past actions sent a signal to employees that passenger safety isn’t important.

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