Transportation – Market Urbanism http://marketurbanism.com Liberalizing cities | From the bottom up Thu, 31 May 2018 20:23:23 +0000 en-US hourly 1 https://wordpress.org/?v=4.9.6 https://i2.wp.com/marketurbanism.com/wp-content/uploads/2017/05/cropped-Market-Urbanism-icon.png?fit=32%2C32 Transportation – Market Urbanism http://marketurbanism.com 32 32 3505127 The “Old People Need Cars” Argument- Myth or Fact? http://marketurbanism.com/2018/05/23/the-old-people-need-cars-argument-myth-or-fact/ Wed, 23 May 2018 20:08:58 +0000 http://marketurbanism.com/?p=10061 The needs of the aged are often a political football in disputes over transportation policy.  On the one hand, defenders of low-cost parking and other car-oriented policies argue that older people all need cars because they can’t be bothered to walk.  On the other hand, smart growth types argue that we will all be too […]

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The needs of the aged are often a political football in disputes over transportation policy.  On the one hand, defenders of low-cost parking and other car-oriented policies argue that older people all need cars because they can’t be bothered to walk.  On the other hand, smart growth types argue that we will all be too old to drive someday, so we need to end the reign of car dependency.

One way of examining the issue is to find out whether seniors in fact drive more than everyone else.  Happily, the 2016 American Community Survey comes to our rescue here.  In Manhattan where I live, there are just over 129,000 senior-headed households with no car, and just over 36,000 with a vehicle available.  So contrary to car-lobby conventional wisdom, only about 22 percent of senior-headed households have a car.  How does that compare with other age groups?  On the one hand, only about 25,000 out of 200,000, or 12 percent, of millennial-headed households (that is, households headed by someone under 35) have a vehicle.  But among Manhattan households headed by persons between 35 and 64, about 28 percent (just over 109,000 out of just over 386,000)  have a vehicle- more than senior-headed households, to my surprise.

So I rate the “Old People Need Cars” claim as Mostly False: most seniors here in Manhattan don’t have cars, even though they are more likely to own cars than millenials.  On the other hand, the latter fact suggests that seniors are rarely physically incapable of using cars.

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Mini review: Suburb, by Royce Hanson http://marketurbanism.com/2018/01/17/mini-review-suburb-royce-hanson/ Wed, 17 Jan 2018 15:40:50 +0000 http://marketurbanism.com/?p=9543 Suburb: Planning Politics and the Public Interest is a scholarly book about planning politics in Montgomery County, a (mostly) affluent suburb of Washington, D.C.  The book contains chapters on redevelopment of inner ring, transit-friendly areas such as Friendship Heights and Silver Spring, but also discusses outer suburbs and the county’s agricultural areas. From my perspective, […]

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Suburb: Planning Politics and the Public Interest is a scholarly book about planning politics in Montgomery County, a (mostly) affluent suburb of Washington, D.C.  The book contains chapters on redevelopment of inner ring, transit-friendly areas such as Friendship Heights and Silver Spring, but also discusses outer suburbs and the county’s agricultural areas.

From my perspective, the most interesting section of the book was the chapter on Friendship Heights and Bethesda, two inner-ring areas near subway stops.  When landowners proposed to redevelop these areas, the planning staff actually downzoned them (p. 56)- and NIMBYs fought the planning board, arguing that even more downzoning was necessary to prevent unwelcome development.

These downzoning decisions were based on the staff’s “transportation capacity analysis”- the idea that an area’s roads can only support X feet of additional development.  For example, Hanson writes that Friendship Heights “could support only 1.6 million square feet of additional development.” (p. 62).   Similarly, he writes that Bethesda’s “roads and transit could handle only 12 million square feet of new development at an acceptable level of service.” (p. 75)

Thus, planning staff artificially limited development based on “level of service “(LOS) .  “Level of service” is a concept used to grade automobile traffic; where traffic is free-flowing the LOS is A.  But the idea that development is inappropriate in low-LOS places seems a bit inconsistent with my experience. Bethesda and Friendship Heights zip codes have about 5000-10,000 people per square mile; many places with far more density seem to function adequately.   For example, Kew Gardens Hills in central Queens has 27,000 people per square mile, relies on bus service, and yet seems to be a moderately popular area.

Moreover, the use of LOS to cap density has a variety of other negative effects.  First, places with free-flowing traffic tend to be dangerous for pedestrians; for example, if an arterial is at LOS A, cars travel over 35 mph and thus create a high risk of injury or death to walkers.  Second, when people and jobs are excluded from transit-friendly places such as Bethesda, they do not disappear.  Instead, they migrate elsewhere- often to more car-dependent places, increasing regional auto traffic.  Third, policies that limit housing anywhere reduce the regional supply of housing, thus affecting regionwide housing costs.

At any rate, this book’s value for market urbanists is to show what planners really do.  Sprawl supporters often paint zoning as a reflection of the market, and planners as pro-density ideologues.  But in fact, planners often seek to split the difference between developers who seek to create housing and jobs, and nearby homeowners who want less of both.

 

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Liberty Machines™ http://marketurbanism.com/2017/12/31/liberty-machines/ http://marketurbanism.com/2017/12/31/liberty-machines/#comments Sun, 31 Dec 2017 17:26:16 +0000 http://marketurbanism.com/?p=9436 During an urbanist twitter free-for-all last week, the thoroughly awesome term “liberty machines” was used to describe the virtues of the car. The claim was made that cars let individuals go wherever they want, whenever they want and are therefore a ‘freedom enhancing’ form of transit.  This isn’t the first time I’ve heard this argument in […]

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During an urbanist twitter free-for-all last week, the thoroughly awesome term “liberty machines” was used to describe the virtues of the car. The claim was made that cars let individuals go wherever they want, whenever they want and are therefore a ‘freedom enhancing’ form of transit


This isn’t the first time I’ve heard this argument in libertarian(ish) circles. But it doesn’t tally with my experience and I’m not sure it makes any sense even within its own premise.

A Personal Anecdote and a Couple Thoughts

When I learned to drive way back when, it was in the great state of Texas where driving is basically a necessity. In that context, getting my license (and being economically fortunate enough to have access to a car) was certainly liberating for me after a fashion.

Thinking back, though, I enjoyed far less mobility as a car bound teenager in suburban Houston than I do now living in Oakland, California. I walk to the grocery, take BART to work, bike to the gym, catch a Lyft to go out, and/or drive myself when the occasion demands. Most of my trips are multimodal and the integration of transit modes affords me far more freedom of movement than car use alone ever could.

The biggest reason for this is that single occupancy vehicle use doesn’t scale as a stand alone system. Unpriced roadways are prone to hitting congestion points and, as readers of this blog are probably aware, adding lanes doesn’t helpWhen roads become clogged, and there are no viable alternatives, a reliance on cars becomes a constraint. And to respond to the idea that mass transit relies on government subsidies and car use does not…the technical term for that would be factually incorrect. Mass transit is more than capable of paying for itself and let’s just say highways don’t exist in the state of nature. 

Houston Traffic, aka my personal hell

Returning to this idea of ‘freedom enhancing’ transit, a reliance on cars has got to be the worst of all options. Besides the congestion problems, there are distributional impacts as well. If you’re too young or too old to drive, you’re reliant on those who still can. Not to mention the fixed overhead of car ownership is a regressive burden on the least well off.

So…is there a case for the car as the pro-liberty choice in transit? Not as far as I can see. And while #libertymachines is an incredibly tweetable hashtag, it’ll have to remain ironic for now.

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The Distorting Effects of Transportation Subsidies http://marketurbanism.com/2017/12/14/distorting-effects-transportation-subsidies/ http://marketurbanism.com/2017/12/14/distorting-effects-transportation-subsidies/#comments Thu, 14 Dec 2017 13:15:04 +0000 http://marketurbanism.com/?p=9121 Subsidies to transportation tend to lengthen supply and distribution chains. Large corporations are artificially competitive against smaller, local firms.

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by Kevin Carson

This article won the 2011 Beth A. Hoffman Memorial Prize for Economic Writing.

Although critics on the left are very astute in describing the evils of present-day society, they usually fail to understand either the root of those problems (government intervention) or their solution (the operation of a freed market). In Progressive commentary on energy, pollution, and so on—otherwise often quite insightful—calls for government intervention are quite common. George Monbiot, for instance, has written that “[t]he only rational response to both the impending end of the Oil Age and the menace of global warming is to redesign our cities, our farming and our lives. But this cannot happen without massive political pressure.”

But this is precisely backward. Existing problems of excess energy consumption, pollution, big-box stores, the car culture, and suburban sprawl result from the “massive political pressure” that has already been applied, over the past several decades, to “redesign our cities, our farming, and our lives.” The root of all the problems Monbiot finds so objectionable is State intervention in the marketplace.

In particular, subsidies to transportation have probably done more than any other factor (with the possible exception of intellectual property law) to determine the present shape of the American corporate economy. Currently predominating firm sizes and market areas are the result of government subsidies to transportation.

Adam Smith argued over 200 years ago that the fairest way of funding transportation infrastructure was user fees rather than general revenues: “When the carriages which pass over a highway or a bridge, and the lighters which sail upon a navigable canal, pay toll in proportion to their weight or their tonnage, they pay for the maintenance of those public works exactly in proportion to the wear and tear which they occasion of them.”

This is not, however, how things were actually done. Powerful business interests have used their political influence since the beginning of American history to secure government funding for “internal improvements.” The real turning point was the government’s role in creating the railroad system from the mid-nineteenth century on. The national railroad system as we know it was almost entirely a creature of the State.

The federal railroad land grants included not only the rights-of-way for the actual railroads, but extended 15-mile tracts on both sides. As the lines were completed, this adjoining land became prime real estate and skyrocketed in value. As new communities sprang up along the routes, every house and business in town was built on land acquired from the railroads. The tracts also frequently included valuable timberland. The railroads, according to Matthew Josephson (The Robber Barons), were “land companies” whose directors “did a rushing land business in farm lands and town sites at rising prices.” For example, under the terms of the Pacific Railroad bill, the Union Pacific (which built from the Mississippi westward) was granted 12 million acres of land and $27 million worth of 30-year government bonds. The Central Pacific (built from the West Coast eastward) received nine million acres and $24 million worth of bonds. The total land grants to the railroads amounted to about six times the area of France.

Theodore Judah, chief engineer for what became the Central Pacific, assured potential investors “that it could be done—if government aid were obtained. For the cost would be terrible.” Collis Huntington, the leading promoter for the project, engaged in a sordid combination of strategically placed bribes and appeals to communities’ fears of being bypassed in order to extort grants of “rights of way, terminal and harbor sites, and . . . stock or bond subscriptions ranging from $150,000 to $1,000,000” from a long string of local governments that included San Francisco, Stockton, and Sacramento.

Government also revised tort and contract law to ease the carriers’ way—for example, by exempting common carriers from liability for many kinds of physical damage caused by their operation.

Had railroad ventures been forced to bear their own initial capital outlays—securing rights of way, preparing roadbeds, and laying track, without land grants and government purchases of their bonds—the railroads would likely have developed instead along the initial lines on which Lewis Mumford speculated in The City in History: many local rail networks linking communities into local industrial economies. The regional and national interlinkages of local networks, when they did occur, would have been far fewer and far smaller in capacity. The comparative costs of local and national distribution, accordingly, would have been quite different. In a nation of hundreds of local industrial economies, with long-distance rail transport much more costly than at present, the natural pattern of industrialization would have been to integrate small-scale power machinery into flexible manufacturing for local markets.

Alfred Chandler, in The Visible Hand, argued that the creation of the national railroad system made possible, first, national wholesale and retail markets, and then large manufacturing firms serving the national market. The existence of unified national markets served by large-scale manufacturers depended on a reliable, high-volume distribution system operating on a national level. The railroad and telegraph, “so essential to high-volume production and distribution,” were in Chandler’s view what made possible this steady flow of goods through the distribution pipeline: “The revolution in the processes of distribution and production rested in large part on the new transportation and communications infrastructure. Modern mass production and mass distribution depend on the speed, volume, and regularity in the movement of goods and messages made possible by the coming of the railroad, telegraph and steamship.”

The Tipping Point

The creation of a single national market, unified by a high-volume distribution system, was probably the tipping point between two possible industrial systems. As Mumford argued in Technics and Civilization, the main economic reason for large-scale production in the factory system was the need to economize on power from prime movers. Factories were filled with long rows of machines, all connected by belts to drive shafts from a single steam engine. The invention of the electric motor changed all this: A prime mover, appropriately scaled, could be built into each individual machine. As a result, it was possible to scale machinery to the flow of production and situate it close to the point of consumption.

With the introduction of electrical power, as described by Charles Sabel and Michael Piore in The Second Industrial Divide, there were two alternative possibilities for organizing production around the new electrical machinery: decentralized production for local markets, integrating general-purpose machinery into craft production and governed on a demand-pull basis with short production runs and frequent shifts between product lines; or centralized production using expensive, product-specific machinery in large batches on a supply-push basis. The first alternative was the one most naturally suited to the new possibilities offered by electrical power. But in fact what was chosen was the second alternative. The role of the State in creating a single national market, with artificially low distribution costs, was almost certainly what tipped the balance between them.

The railroads, themselves largely creatures of the State, in turn actively promoted the concentration of industry through their rate policies. Sabel and Piore argue that “the railroads’ policy of favoring their largest customers, through rebates” was a central factor in the rise of the large corporation. Once in place, the railroads—being a high fixed-cost industry—had “a tremendous incentive to use their capacity in a continuous, stable way. This incentive meant, in turn, that they had an interest in stabilizing the output of their principal customers—an interest that extended to protecting their customers from competitors who were served by other railroads. It is therefore not surprising that the railroads promoted merger schemes that had this effect, nor that they favored the resulting corporations or trusts with rebates.”

Reprising the Role

As new forms of transportation emerged, the government reprised its role, subsidizing both the national highway and civil aviation systems.

From its beginning the American automotive industry formed a “complex” with the petroleum industry and government highway projects. The “most powerful pressure group in Washington” (as a PBS documentary called it) began in June 1932, when GM president Alfred P. Sloan created the National Highway Users Conference, inviting oil and rubber firms to help GM bankroll a propaganda and lobbying effort that continues to this day.

Whatever the political motivation behind it, the economic effect of the interstate system should hardly be controversial. Virtually 100 percent of roadbed damage to highways is caused by heavy trucks. After repeated liberalization of maximum weight restrictions, far beyond the heaviest conceivable weight the interstate roadbeds were originally designed to support, fuel taxes fail miserably at capturing from big-rig operators the cost of pavement damage caused by higher axle loads. And truckers have been successful at scrapping weight-distance user charges in all but a few western states, where the push for repeal continues. So only about half the revenue of the highway trust fund comes from fees or fuel taxes on the trucking industry, and the rest is externalized on private automobiles.

This doesn’t even count the 20 percent of highway funding that’s still subsidized by general revenues, or the role of eminent domain in lowering the transaction costs involved in building new highways or expanding existing ones.

As for the civil aviation system, from the beginning it was a creature of the State. Its original physical infrastructure was built entirely with federal grants and tax-free municipal bonds. Professor Stephen Paul Dempsey of the University of Denver in 1992 estimated the replacement value of this infrastructure at $1 trillion. The federal government didn’t even start collecting user fees from airline passengers and freight shippers until 1971. Even with such user fees paid into the Airport and Airways Trust Fund, the system still required taxpayer subsidies of $3 billion to maintain the Federal Aviation Administration’s network of control towers, air traffic control centers, and tens of thousands of air traffic controllers.

Eminent domain also remains central to the building of new airports and expansion of existing airports, as it does with highways.

Subsidies to airport and air traffic control infrastructure are only part of the picture. Equally important was the direct role of the State in creating the heavy aircraft industry, whose jumbo jets revolutionized civil aviation after World War II. In Harry Truman and the War Scare of 1948, Frank Kofsky described the aircraft industry as spiraling into red ink after the end of the war and on the verge of bankruptcy when it was rescued by the Cold War (and more specifically Truman’s heavy bomber program). David Noble, in America by Design, made a convincing case that civilian jumbo jets were only profitable thanks to the government’s heavy bomber contracts; the production runs for the civilian market alone were too small to pay for the complex and expensive machinery. The 747 is essentially a spinoff of military production. The civil aviation system is, many times over, a creature of the State.

The State and the Corporation

It’s hard to avoid the conclusion that the dominant business model in the American economy, and the size of the prevailing corporate business unit, are direct results of such policies. A subsidy to any factor of production amounts to a subsidy of those firms whose business models rely most heavily on that factor, at the expense of those who depend on it the least. Subsidies to transportation, by keeping the cost of distribution artificially low, tend to lengthen supply and distribution chains. They make large corporations operating over wide market areas artificially competitive against smaller firms producing for local markets—not to mention big-box retailers with their warehouses-on-wheels distribution model.

Some consequentialists treat this as a justification for transportation subsidies: Subsidies are good because they make possible mass-production industry and large-scale distribution, which are (it is claimed) inherently more efficient (because of those magically unlimited “economies of scale,” of course).

Tibor Machan argued just the opposite in the February 1999 Freeman:

Some people will say that stringent protection of rights [against eminent domain] would lead to small airports, at best, and many constraints on construction. Of course—but what’s so wrong with that?

Perhaps the worst thing about modern industrial life has been the power of political authorities to grant special privileges to some enterprises to violate the rights of third parties whose permission would be too expensive to obtain. The need to obtain that permission would indeed seriously impede what most environmentalists see as rampant—indeed reckless—industrialization.

The system of private property rights . . . is the greatest moderator of human aspirations. . . . In short, people may reach goals they aren’t able to reach with their own resources only by convincing others, through arguments and fair exchanges, to cooperate.

In any case, the “efficiencies” resulting from subsidized centralization are entirely spurious. If the efficiencies of large-scale production were sufficient to compensate for increased distribution costs, it would not be necessary to shift a major portion of the latter to taxpayers to make the former profitable. If an economic activity is only profitable when a portion of the cost side of the ledger is concealed, and will not be undertaken when all costs are fully internalized by an economic actor, then it’s not really efficient. And when total distribution costs (including those currently shifted to the taxpayer) exceed mass-production industry’s ostensible savings in unit cost of production, the “efficiencies” of large-scale production are illusory.

Kevin A. Carson


Kevin A. Carson

Kevin Carson is a senior fellow of the Center for a Stateless Society and holds the Center’s Karl Hess Chair in Social Theory. He is a mutualist and individualist anarchist whose written work includes Studies in Mutualist Political Economy, Organization Theory: A Libertarian Perspective, and The Homebrew Industrial Revolution: A Low-Overhead Manifesto, all of which are freely available online. Carson has also written for such print publications as The Freeman.

This article was originally published on FEE.org. Read the original article.

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The Rent is Too High and the Commute is Too Long: We Need Market Urbanism http://marketurbanism.com/2017/11/27/rent-too-high-commute-too-long/ http://marketurbanism.com/2017/11/27/rent-too-high-commute-too-long/#comments Mon, 27 Nov 2017 13:55:00 +0000 http://marketurbanism.com/?p=8949 Why is the rent so damn high? And why does it take hours to commute from cheap, plentiful housing to modern economy jobs? If you are living in a big city in America, you likely face this problem. And it isn’t just an American problem: From Ireland to New Zealand to The Philippines, the rent/commuting […]

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Dense Development Around Tokyo Transit

Why is the rent so damn high? And why does it take hours to commute from cheap, plentiful housing to modern economy jobs? If you are living in a big city in America, you likely face this problem. And it isn’t just an American problem: From Ireland to New Zealand to The Philippines, the rent/commuting crisis is hitting the 21st century hard, right in the big cities where most of the economic growth is coming from, and where most of the jobs are. Meanwhile, in the economically blighted regions of America, everything seems to be falling apart, with lead in the tap water, crumbling roads, and municipal bankruptcy for thousands of towns and cities a very real possibility.

But it doesn’t have to be this way. There are a few cities that seem to have figured out how to match a futuristic tech economy with futuristic transit and housing for the masses. And there are many small towns around the world that don’t face insurmountable backlogs of infrastructure repairs. What are they doing different? Why is the price per square foot for living space in Tokyo a third of what it is in Boston or San Francisco?  Both cities have similar incomes and geographic constraints. Why is it an enormous scandal in Japan when trains leave a few seconds off schedule, while in America it is normal for your bus or train to be an hour late or never show up at all? Chalking this up to cultural differences is an easy explanation, and may have some weight, but I submit that the underlying laws of human economics do not vary based on culture, and there is much that we can learn from looking abroad.

For Americans, the story begins in the nineteenth century when most of the country’s infrastructure was privately owned, as described in the paper “From Privies to Boulevards: The Private Supply of Infrastructure in the United States During the Nineteenth Century.” As a stand-in for all infrastructure, from highways to subways to sidewalks, let’s discuss sewers as a starting point. The main complaint at the time was that private sewer companies were not expanding fast enough: “Indeed, the main criticism leveled against private suppliers at the time was not poor service per se but a reluctance to expand to outlying areas.”

This frustration led to municipal regulation, subsidy, and eventually municipalization of the sewer systems: “By 1902, no city with a population of over thirty thousand still had a private sewer company.” Service began expanding to all areas of the city, and soon even small towns followed suit and were municipalizing and rapidly expanding their sewers, and nearly all their formerly private infrastructure. Problem solved, right?

Which brings us to Lafayette, Louisiana, the 200th largest city in the US, with a growing economy and a public infrastructure system that’s growing even faster. Charles Marohn, an infrastructure consultant, was hired to figure out why the city’s backlog of repairs was growing longer every year, and whether there were any solutions. His analysis is quite morbid:

Except for a small handful of North American cities – literally five or less – Lafayette provides an insight into why your city has no money. Problems have solutions. Predicaments have outcomes. What is happening in Lafayette is not a problem; it’s a predicament…When we added up the replacement cost of all of the city’s infrastructure — an expense we would anticipate them cumulatively experiencing roughly once a generation — it came to $32 billion. When we added up the entire tax base of the city, all of the private wealth sustained by that infrastructure, it came to just $16 billion.

There is simply no way that Lafayette will be able to maintain the infrastructure it has built, and Lafayette’s story is America’s story. How did the great infrastructure bubble occur? The core of the problem is about decision making process: How does a municipality decide whether to make a particular expansion of its infrastructure?

Back in the days of private infrastructure, a company would determine whether a given sewer expansion was profitable by adding up the expected sewer fees and determining whether they were greater than the long-term maintenance costs.  i.e., was the investment profitable? With democratic municipalities, the decision-making process is quite different.

In a nutshell, the political economy of our democratic municipalities revolves around homeowner control. The main negotiation is one between the homeowners and the public employees, with some influence from developers, and even less from renters who are typically not very involved with their local government. The incentives of the homeowners are to lower taxes to as great a degree as possible while at the same time maintaining a well-funded public school, one of the main determinants of home price.

This is easily accomplished by allowing two types of construction: More single family homes in the same price range as existing homes, and new commercial property that yields a revenue stream without associated public school costs. Projects that are almost always opposed are ones that increase density in areas that don’t require new infrastructure, due to the NIMBY principle: It is an extremely rare thing in American politics post-WWII for an already built neighborhood to become more dense than they already are. Downzoning is the norm, and upzoning is an atypical exception. Before zoning took hold of America post-WWII, the normal development pattern was for the town center to be where almost all of the new development happened, and this is how towns grew into cities. After zoning, this process stopped: Once a neighborhood was even partially built out, it was typically downzoned so no new construction could occur.

Furthermore, homeowners care about the future of their towns for the next few years until they sell, but not beyond that. The story goes like this: A new shopping mall or cul de sac is proposed. The developer offers to pay for the initial install of the infrastructure, and for a decade or two there is new tax revenue with minimal costs, and everything is going fine. But then the town’s maintenance obligations kick in. Even in Homeowners Associations (HOAs) that are supposedly infrastructure self-sufficient, when the infrastructure reaches the end of its life cycle, there is nearly always a bailout of the HOA by the town. And the long-term unprofitability becomes glaringly apparent. In Detroit, it looks like abandoned neighborhoods. In Flint, it looks like poisoned water. And Detroit and Flint aren’t special, they just implemented these fiscally unsustainable development patterns a few decades before other cities, and indeed there are thousands of cities and towns that are already starting to look more and more like Flint.

The lack of a market feedback process produces forcibly sprawled, fiscally unsustainable cities and towns. The infrastructure-efficient urban core is downzoned, preventing any growth upward, and growth outward is heavily subsidized by flat infrastructure rates. A cul de sac might have 50 feet of street pipe per resident, whereas an apartment building might have 5 feet, but the residents in both locations pay the same. This is a subsidy to sprawl paid for by those who live densely and efficiently. Transit infrastructure is no different: Road construction can never keep pace with economic growth, and we get congestion and potholes, long commutes to where the housing is, and not enough housing where the jobs are.

The only way to begin designing our cities better is to admit that democratic socialism is very bad at city design. If there is a solution to our infrastructure woes, it is to incorporate more market feedback into the system, to avoid infrastructure boondoggles, and enable dense, efficient development. And some cities around the world show the path forward. Japanese mass transit infrastructure is a good case-in-point.

Over the past few decades, nearly all of Japan’s mass transit has been privatized. The trains are funded by fares, but more importantly, by the private rail companies’ real estate holdings. The rents from high rises constructed around the station pay for the operation of the rail line, which increases rents around the station, in a feedback mechanism. The profit/loss calculation determines how much housing construction should occur near which rail stations, and where the rail system should be expanded to next. As noted above, this has produced high-tech, high-speed trains that service nearly all of the 30 million or so folks in the Tokyo metro area.

And the rent is much cheaper, which is precisely related to the transit scheme above: In America, the socialist transit networks have very shallow penetration, with only a small fraction of the population living within walking distance of a rail stop. The trains don’t go to where the housing is, and the housing isn’t built where the trains are. Because land use is decided democratically, towns won’t approve high-density zoning by train stations, and so while many transit systems own quite a bit of developable land near train stations, they aren’t allowed to build on it. This means they can’t fund expansion of the rail system with these funds, and furthermore, even if you dump tons of money onto these transit systems, they don’t have the profit/loss mechanism to determine where the new stations should go.

And this is why Tokyo has futuristic trains and housing prices of around $339 per square foot, while in Boston prices are $661/sqft.  You have to be wealthy to afford one of the prized, scarce apartments within walking distance of transit, while the masses spend hours every day driving to the far corners of the metro area where housing is quasi-affordable.

The rent is too high, the commute is too long, the water is poisoned, and there are no easy answers.  But the first step is for Americans to learn from the successfully affordable and accessible cities of the world.  Ironically, these successful cities are typically more market-based in their planning decisions than the supposedly hyper-capitalist US.  Central planning for bread always produces bread lines, central planning for roads always produces congestion, and central planning for housing always produces a housing shortage and rising rents. Americans know they don’t want their bread from the government, but until the same attitude is adopted toward infrastructure, we will all be desperately waiting in long queues for stale crumbs.

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“Curb Rights” at 20: A Summary and Review http://marketurbanism.com/2017/11/21/curb-rights-at-20-a-summary-and-review/ http://marketurbanism.com/2017/11/21/curb-rights-at-20-a-summary-and-review/#comments Tue, 21 Nov 2017 15:04:52 +0000 http://marketurbanism.com/?p=8930 At 4:30 am, alarms on my cellphone and tablet start beeping, just enough out of sync to prompt me to get up and turn them off. By 5:00 am, I riding as a passenger along an unusually sedate New Jersey Turnpike, making friendly conversation with my driver and survey partner to make sure he stays […]

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People sitting on a bus

At 4:30 am, alarms on my cellphone and tablet start beeping, just enough out of sync to prompt me to get up and turn them off. By 5:00 am, I riding as a passenger along an unusually sedate New Jersey Turnpike, making friendly conversation with my driver and survey partner to make sure he stays awake. At 5:30am, as most of the city sleeps, we find a drab concrete picnic table outside the bus depot and chow down on our cold, prepared breakfasts. Around us, buses are revving up and their drivers are chatting and smoking cigarettes. At 5:50 am, we find our bus and introduce ourselves to our driver for the day. All of the Alliance drivers seem to be Hispanic. Our run begins. You wouldn’t expect it, but the first run is always the sweetest. The riders trickle on, making it easy to approach them, and unlike the typical 8:00 am rush hour rider they are usually friendly and receptive to my request. I approach them and mechanically incant “Good morning Sir/Ma’am. Would you like to take a survey on your commute today for NJ Transit? It will only take a few minutes of your time.” My partner sits in the front, tallying the boardings, exits, and survey refusals. We will spend the next eight hours zigzagging across the New York City metropolitan area, asking harried riders about their commute.

For the past month or so, this has been my part-time job: surveying bus riders about their origins, destinations, and travel preferences for NJ Transit. The job is just engaging enough that I rarely have time for sleeping or class readings, but has enough slow periods that my mind can wander on the question of bus planning. Although I am not authorized to read any of the surveys that I collect, it is clear that many of the people I am surveying have a tough commute. In many cases, they are disabled and/or evidently quite poor, wearing uniforms characteristic of low-wage service positions. Their circumstances leave them dependent on the bus for access to work. Often they mention how this bus ride, which may run more than an hour, is only one chain link in their broader commute. While the average bus rider is receptive once they find out you are not trying to sell them anything, it is more than clear that they are under a fair amount of stress. The general crumminess of their lot, and the incredible importance of making it better for their sake, often leaves me thinking about how we could improve bus service and transit broadly. For this reason, I decided to pick up and read a bus planning book that is a mainstay in market urbanism book recommendations, Curb Rights: A Foundation for Free Enterprise in Urban Transit. With the book turning 20 this year, it seemed worthwhile to draft up this short summary and review along the way.

Curb Rights, by Daniel B. Klein, Adrian T. Moore, and Binyam Reja, is an attempt to develop a market alternative to status quo bus planning. Published in 1997 by the Brookings Institution Press, the book arrived at a time of great enthusiasm for privatization and deregulation, and the authors’ prescriptions reflect this fact. In the following review, I will broadly sketch out their argument and conclude with a few of my broader critiques. This review is broken out into three broad sections: First, the challenge facing transit today as the authors see it (addressed in Section One of the book). Second, recent attempts to address this challenge through new regulation or deregulation (addressed in Section Two of the book). Finally, the solution proposed by the authors, namely a system of urban curb rights (addressed in Section Three of the book), as well their broader recommendations for transit policy (addressed in Section Four of the book). This review concludes with some critiques of their system and reflections on the continuing relevance of their ideas for 2017, 20 years after its publication.

The Trouble of Transit in an Automobile Dominated World

The key challenges facing transit, as Klein et al. see it, are the now unquestionable dominance of the automobile and the general mismanagement of public transit. Unusual for a book about transit planning, Curb Rights begins provocatively with a chapter titled “The Triumph of the Automobile.”[i] Early on, the authors point out that in 1990 over 90% of Americans commuted by private automobile. While these numbers have declined somewhat in the intervening 20 years, there is still little question that Americans prefer private automobiles for commuting and personal trips.[ii] Whatever your personal predilections about travel are—personally, I commute exclusively by bicycle and don’t own a car—it isn’t hard to see why: private automobiles are great for short trips, don’t involve any waiting or transfers, offer door-to-door service, guaranteed seating, and even storage space. Traffic congestion and car crashes notwithstanding, they are also generally reliable, safe, and comfortable.[iii] As the authors see it, the main drawbacks of the private automobile—traffic congestion and air pollution—could easily be addressed using congestion pricing and pigouvian emission taxes, respectively.[iv]

While some of this shift from transit to private automobile was likely inevitable, Klein et al. lay a fair share of the decline of transit at the feet of public mismanagement. Most urban transit systems were, after all, privately managed as heavily regulated monopolies up until the 1950s and 1960s. The deal was simple: municipalities would provide private companies with a portion of the right-of-way and a guaranteed monopoly over transit along a specified route, and in exchange private operators would own and operate the transit line subject to heavy public regulation of fares, stops, and frequencies, among other things. While private automobiles siphoned off some riders, the authors point to deferred capital investment due to rationing during World War II, the inability to cut unprofitable lines or frequencies, and the inability to freely adjust fare as important reasons for the wave of private transit bankruptcies in the post-war era.

While the Urban Mass Transit Act of 1964 provided local governments with funds to take over private transit companies, the situation only worsened in the decades to come.[v] The share of commuters using transit fell from 12.6% in 1969 to 5.1% in 1990.[vi] During this same period, operating costs per passenger trip have increased by a startling 175%, largely owing to increases in labor compensation.[vii] Between 1960 and 1990, transit management transitioned from mild unprofitability to heavy dependence on subsidies, with over 70% of revenue coming from public coffers.[viii]

Why has public management been so ineffective at turning around the fortunes of transit? Here Klein at al. offer two major critiques of public management: the Hayekian Critique and the Public Choice Critique. The heart of the Hayekian Critique is as follows: it is difficult, if not impossible, to efficiently centrally plan a multi-faceted and constantly changing system like urban transit.[ix] As the economist F. A. Hayek observed in a different context, relevant knowledge related to consumer route, speed, and comfort preferences, and the price tradeoffs these consumers face, is widely distributed among riders and is not easily accessible to planners.[x] While the survey project I am involved in is one such attempt to address this issue, a 25-question survey can only gather so much information, and only that information that planners already see as important. Every few surveys, a respondent will tell me something valuable that wasn’t asked about on the survey—often their perceptive ideas about how to improve the service. I nod and listen and promise to pass the information along, but in reality, this information is lost.

There is simply no way that a single agency could collect and integrate such knowledge about unique and changing local conditions. To collect and use this knowledge, as the economist Israel Kirzner explains, we require a process of competitive entrepreneurial discovery.[xi] That is to say, we need a system in which easy entry and exit and the profit motive allow and incentivize entrepreneurs to collect local knowledge about what commuters need and test this knowledge in a competitive marketplace. While it is easy to observe the lack of incentives facing public transit agencies, these agencies are almost certainly doomed to provide less than optimal service given their inability to exploit the knowledge produced by the discovery process that is a byproduct of trial-and-error entrepreneurial activity.

Even if we assume that public transit agencies could collect perfect knowledge about the needs of consumers and opportunities for optimization, they may face conflicting incentives that lead them to produce suboptimal service. The authors refer to this as the Public Choice Critique.[xii] Consider: what is the purpose of a public transit agency? To enhance intercity mobility? To renew and maintain certain neighborhoods? To connect suburbs? To minimize environmental impact? Vague comprehensive plans and idealistic transit advocates often muddle these purposes, leading to poor results toward any given end. Compare this situation to the singular incentive of private operators: to turn a profit by efficiently serving customer needs.

Even where policy makers provide their transit agencies with a clear goal, internal and external special interests may further meddle with the operation of the public transit agencies. As William Niskanen observed, the personal goals and poor incentives facing leaders within public agencies often lead to overprovision of the service in question, inflated costs, and reduced efficiency.[xiii] Then, of course, there are the conflicting purposes of powerful external groups, including public sector unions, manufacturers, and developers, which often conflict with the actual needs of local residents. Together, the Hayek Critique and the Public Choice Critique paint a picture of public transit agencies that are in many cases unable and/or unwilling to efficiently provide riders with the best possible service.

Failed Attempts at Creating a Competitive Transit Market

Before setting out their proposal, Klein et al. turn to failed attempts to address the declining status of transit through expanding markets. The authors examine three alternatives to the status quo: jitneys, edge transit services, and bus privatization.[xiv] Jitneys, essentially informal taxis, burst onto the scene in 1914, picking up waiting riders from streetcar stops in a process known as interloping.[xv] During their heyday jitneys functioned as a competitive private transit market, operating along routes but without schedules. This dramatically reduced streetcar revenues, prompting municipal officials to prohibit them. At the time of publication in 1997, jitneys and informal taxis were still common, particularly among low-income migrant communities. The descendants of jitneys live on today as commuter shuttles and carpooling services, although these services are often heavily regulated and strictly limited.[xvi] Today, ride-sharing services like Uber and Lyft almost certainly fill many of these functions. But any attempt to reintroduce traditional jitneys—following a route but without a schedule—would need to contend with the problem of interloping, which could bankrupt scheduled services, and the threat of jitney cartelization, which would eliminate the benefits of a competitive jitney market.

The authors also turn to the mixed results of bus privatization and deregulation in the United Kingdom. The 1985 Transport Act privatized and deregulated all bus lines in the UK outside of London, allowing bus lines to use any stop they choose so long as they post and adhere to official schedules.[xvii] While this change lowered operating costs, dramatically scaled back tax expenditure on transit, and expanded service access, it also failed to reduce bus fares as intended. What kept fares from falling? Given that bus lines didn’t have exclusive access to riders at certain stops, new companies could schedule their stops minutes before competitors, stealing their riders in a process known as schedule jockeying. This prompted a tit-for-tat process of schedule changes that undermined the customer experience and led to administrative waste. In response to this threat, bus companies would often temporarily operate high, inefficient frequencies to keep out competitors, a process known as route swamping. This unhealthy competition over riders lead to greater consolidation and waste, which undermined fare reductions. In a prelude to their titular prescription, the authors point out that possessing rights to the riders at certain stops during certain times of day, or curb rights, could have avoided this issue.

Reviving Transit Markets Through Curb Rights

In the final third of the book, Klein et al. turn to the question of how learn from the mistake of the past to stimulate a private competitive bus market. In characterizing the challenges facing bus transit, Klein et al. draw a conclusion that is key to their proposed solution: attempts to create a competitive market of transit entrepreneurs through unsophisticated jitney legalization or bus deregulation can eliminate or seriously hinder the ability of private bus operators to offer scheduled, route-based service. The missing ingredient, as the authors see it, is a system of publicly and privately managed curb rights.

The key investment made by route-based, scheduled bus operators is in their bus stops. Beyond buses and staffing, a major cost for any bus operator is to make prospective riders aware that if they stand at a specified location at a specified time of day, they will receive comfortable and efficient transportation to a designated location. The goal is to create a level of service such that, when a bus comes through, there will be enough customers waiting to make the line profitable. However, in an under-regulated market, jitneys can easily come along and take those waiting riders and their fares, essentially expropriating the returns to the bus operator’s investment. In thick markets, where even with jitneys interloping there are still enough customers for bus lines to break even, this isn’t an issue. But in thin markets, where buses are drawing just enough passengers to break even, jitney interloping can kill scheduled bus routes. This in turns leads to fewer customers waiting at what were once bus stops, in turn killing the jitney market and reducing mobility overall. As in the case of UK bus deregulation, competing private bus lines can also have the same effect.

Once we realize that these the passengers standing at a stop are the results of investments made by bus operators, the need for curb rights becomes clear. Without them, rational bus operators won’t invest in high quality service, information dissemination regarding route schedules and fares, or high quality bus stops, knowing that jitneys or competing bus lines can come in and snag the returns to their investment. In short, the authors envision these curb rights as the exclusive right to pick up passengers at certain locations at certain times of day. These curb rights on public right-of-ways would be administered by public officials and would be auctioned off, encouraging bus operators to do the difficult work of finding the most efficient curbs for their routes and rearranging themselves as local conditions change. Separate “jitney commons” would offer curbs on which jitneys could freely pick up waiting passengers. This would keep competitive pressure on bus operators and provide greater choice for customers, without the standard problems related to interloping.

Beyond this basic framework, the authors are forthright in their agnosticism about the details of how the system would work. How far would curb rights zones need to be from each other? How would public officials prevent bus monopolies? Would bus operators or traffic police enforce curb rights? The authors leave these questions to be resolved by a distributed process of municipal trial-and-error. Klein et al. conclude by suggesting eight further policy suggestions.[xviii] They include general deregulation of transit services, privatization of public transit agencies, ending federal involvement in transit, keeping transit planning local, creating curb rights systems, instituting highway pricing, using individualized rider vouchers for equity goals, and reforming taxi regulation.

Concluding Thoughts

In some ways, the transportation landscape in 2017 is dramatically different than it was in 1997. The introduction and subsequent explosive growth of ride-sharing companies like Uber and Lyft has led to something of a jitney renaissance. This has in turn led to the relaxation or gradual elimination of twentieth century taxi regulation in many cities, making door-to-door transit easier than ever. Unlike the jitneys of yore, today ride-sharing does not depend on interloping and may in fact support transit by providing “last mile” service.[xix] Further, unlike in 1997, many more people are living in cities, bicycling, and working from home in 2017.[xx]

In other ways, the transportation landscape in 2017 still looks very much the same as it was in 1997. Road tolling and emissions taxes remain uncommon in the U.S., and congestion taxes are virtually non-existent, meaning that commuting via private automobile remains underpriced and thus disproportionately popular. While some states and cities are exploring mileage-based fees and congestion taxes, these proposals are still only in their early phases.[xxi] Transit ridership has effectively remained flat during this entire period and in many cases may be falling.[xxii] Finally, against the suggestions of Klein et al., many cities continue to heavily regulate and/or prohibit private transit options, including route-based jitneys, private buses, and commuter shuttles.[xxiii]

I came out of the book feeling like the authors slightly overplay their hand. Yes, proper pricing of private automobiles, a competitive transit market, and vouchers for select groups could obviate the need for public transit services in low- and medium-density cities. But what about the needs of high-density cities? While open to being surprised, I remain skeptical that competitive bus markets alone can service the high job densities seen in many legacy cities. How would this competitive market interact with publicly managed rail? How could rail be integrated into a private transit market? What is the role of bus rapid transit? The authors leave these answers largely answered, beyond calling for the full privatization of all public transit.

On the other hand, I admire the authors’ creative attempt to develop a “property rights” approach to stimulating private transit markets. It is evident that we underprice private automobile use, especially in heavily congested areas. Getting this right could lead to an influx of commuters into transit, an influx that public transit agencies today simply aren’t equipped to handle.[xxiv] Even without this influx, it is clear to my mind that the riders who I encounter while surveying deserve the greater choice, improved service, and lower fares that are only likely to come from the introduction of a competitive transit market. Toward this end, I appreciate the project of Curb Rights and hope to see more creative, economically literate thinking of this kind among transit planners and entrepreneurs.

[i] Klein, Daniel B., Adrian T. Moore, and Binyam Reja. Curb Rights: a foundation for free enterprise in urban transit. Washington, D.C.: Brookings Institution Press, 1997. p. 7

[ii] Passenger Travel Facts and Figures 2016. Report. Bureau of Transportation Statistics, U.S. Department of Transportation. 2016. 20.

[iii]  Klein et al., Curb Rights, 9.

[iv] Ibid., 8.

[v] Ibid, 11.

[vi] National Transportation Statistics. Report. Bureau of Transportation Statistics, U.S. Department of Transportation. 1995.

[vii] Baumol, William J. “Macroeconomics of Unbalanced Growth: The Anatomy of Urban Crisis.” American Economic Review. 57 (June). 415-426.

[viii] Office of Management and Budget. “Guidelines and Discount Rates for Benefit-Cost Analysis of Federal Programs.” Circular A-94. 1992.

[ix]  Klein et al., Curb Rights, 17-21.

[x] Hayek, F. A. “The Use of Knowledge in Society.” American Economic Review, XXXV, No. 4; September, 1945. 519–30.

[xi] Kirzner, Israel M., Peter J. Boettke, and Fre?de?ric E. Sautet. Competition and Entrepreneurship. Indianapolis, IN: Liberty Fund, 2013.

[xii] Klein et al., Curb Rights, 22-29.

[xiii] Niskanen, William. Bureaucracy and Representative Government. Chicago; Aldine-Atherton. 1971.

[xiv] Contracting out bus service is also very briefly discussed.

[xv] Klein et al., Curb Rights, 33-46.

[xvi] Klein et al., Curb Rights, 47-61.

[xvii] Ibid., 62-72.

[xviii] Ibid., 119-125.

[xix] “Last Mile (Transportation).” Wikipedia. September 16, 2017. Accessed October 21, 2017. https://en.wikipedia.org/wiki/Last_mile_(transportation).

[xx] US Census Bureau. “Biking to Work Increases 60 Percent Over Last Decade.” May 08, 2014. Accessed October 21, 2017. https://www.census.gov/newsroom/press-releases/2014/cb14-86.html.

[xxi] Pevto, Mary, Bob Sallinger, and Adriana Voss-Andreae. “Portland Leaders Have a Choice: Increased Congestion or Courageous Leadership (Guest opinion).” OregonLive.com. September 15, 2017. Accessed October 21, 2017. http://www.oregonlive.com/opinion/index.ssf/2017/09/portland_leaders_have_a_choice.html.

[xxii] Walker, Jarrett. “Researchers! Why is US Transit Ridership Falling? — Human Transit.” Human Transit. March 18, 2017. Accessed October 21, 2017. http://humantransit.org/2017/03/researchers-why-is-us-transit-ridership-falling.html.

[xxiii] Berliner, Dana. “How Detroit Drives Out Motor City Entrepreneurs.” Institute for Justice. January 1997. Accessed October 21, 2017. http://ij.org/report/how-detroit-drives-out-motor-city-entrepreneurs/.

[xxiv] Smith, Max. “Metro Ridership Drops 12 Percent; $125 million Revenue Shortfall Projected.” WTOP. February 21, 2017. Accessed October 21, 2017. https://wtop.com/tracking-metro-24-7/2017/02/metro-ridership-drops-12-percent-125-million-revenue-shortfall-projected/.


 

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Cities Should Not Design for Autonomous Vehicles http://marketurbanism.com/2017/11/13/cities-should-not-design-for-autonomous-vehicles/ Mon, 13 Nov 2017 15:18:08 +0000 http://marketurbanism.com/?p=8900 Coauthored with Emily Hamilton Last week, the autonomous vehicle company Waymo began testing cars in Chandler, AZ with no employees sitting in the front seat. While Waymo is busy creating systems of vehicle-mounted sensors that allow cars to safely navigate existing urban infrastructure and obstacles, some cities are pursuing plans to build “smart streets” that […]

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Coauthored with Emily Hamilton

Last week, the autonomous vehicle company Waymo began testing cars in Chandler, AZ with no employees sitting in the front seat. While Waymo is busy creating systems of vehicle-mounted sensors that allow cars to safely navigate existing urban infrastructure and obstacles, some cities are pursuing plans to build “smart streets” that broadcast information about roads and potential hazards to autonomous vehicles. The American history of auto-centric infrastructure demonstrates that building specific infrastructure for autonomous vehicles may have long-lasting negative consequences.

Waymo’s cars rely on both detailed maps and car-mounted lidar sensors that “see” the world around them in order to follow their route and to to avoid collisions. While the current technology is very safe, car-mounted sensors remain imperfect. As Tim Lee points out, there are reasons that Waymo launched in Chandler: its sunny weather, wide streets and minimal pedestrian traffic. Fully autonomous vehicles will need even better sensors than those that are currently available to drive safely in snowy conditions and in places with less regular streets that may confuse a vehicle’s sensors.

Some analysts have advocated for publicly-provided smart streets and smart intersections that could limit the need for vehicle-mounted sensors and, perhaps, speed the adoption of autonomous vehicles. My colleague Brent Skorup has this view:

Car-mounted sensors often confused by road materials (a shift from dirt to gravel or asphalt), reflective buildings, bridges, or even the weather. Roadside sensors not only mitigate these problems, but also reduce the computing load on car-mounted systems, because the vehicles have to make fewer snap decisions.

There’s a way to get this information to vehicles quickly and accurately. Just as lawmakers and city planners started laying asphalt, installing streetlights, posting speed limits, and zoning property to accommodate Henry Ford’s cars, we need to design roads and infrastructure for the self-driving generation of vehicles.

Atlanta recently unveiled a “smart corridor” that pushes information about the environment to cars. The plan is for a driverless bus line to eventually carry passengers along the city’s North Avenue. Cities are just beginning a rollout of infrastructure designed for autonomous vehicles, but in the past two years Waymo engineers have increased threefold the distance that its sensor’s can see while reducing the cost of these sensors by 90 percent.

By the time driverless buses have completed testing on Atlanta’s smart corridor, driverless taxis that don’t rely on any specific infrastructure may already be commonplace in Phoenix. Google’s earlier models of self driving cars have already logged millions of miles in Washington, Pittsburgh, California, and other parts of the country with very good safety records.

As we’ve already seen with the rapid advancement in sensor technology, autonomous vehicles and the technologies that make them possible will be constantly upgraded and changed in a competitive market. The long lag between legislative proposal, vetting, and implementation necessary for public projects means that “smart” street technologies will likely be outdated by the time city governments roll them out.

Autonomous cars are likely to be better off relying on each other than on fixed infrastructure. As autonomous vehicles capture a larger share of road traffic, they will be able to crowdsource extremely-detailed, real-time maps of urban roads. Each member of the network will benefit from the information provided by other vehicles and would likely provide its own data in exchange for access.

Those who support investment in smart streets have observed that map-dependent autonomous vehicles will not function as well in lower traffic suburbs or rural areas. They’re right, but we should learn from the disastrous history of subsidizing suburbs at the expense of urban areas. Should municipalities succeed in creating infrastructure that benefits autonomous vehicles, they will be in the business of shaping where people live and how they make their transportation decisions under a new technology. Current technology may allow autonomous vehicles to work best in heavily traveled urban areas, but it should be left to entrepreneurs to overcome these challenges in less trafficked places, or suburban and rural residents should bear (reap) the full costs (benefits) of their lifestyle decisions.

Likewise, municipal investments in smart streets will have their own unintended consequences that policymakers are unlikely to foresee or respond to after they arise. If policymakers think that additional infrastructure is needed for autonomous vehicles to function efficiently, they would do better to allow competing companies to install it at their own expense. This would avoid locking in outdated technologies and make consumers and autonomous vehicle companies more likely to internalize the costs their transportation use that public provision would otherwise impose on the general public.

Supporters of smart streets have argued in favor of using them to implement demand-based congestion pricing, to optimize efficiency at intersections, and to route vehicles through cities more quickly. But there’s little reason to think that city governments would take advantage of this capability. Congestion pricing in other urban areas has proven politically toxic. Leaders in San Francisco and Washington, DC each decided to never fully activate their expensive smart parking systems grids because of their they fear of political fallout from pricing parking spots based on supply and demand.

Rather than looking to municipalities to implement congestion pricing for smart cars, driverless taxi companies may be in a better position to internalize congestion costs and charge for them. Coupled with a price system, the networked vehicles will allow their passengers to cooperate and reach their destinations more quickly and safely.

Instead of catering to the newest transportation trends, planners can focus on allowing human-centric development to flourish and let autonomous vehicle designers work within the constraints this creates. Waymo’s rapid progress in producing better sensors at lower costs demonstrates that the remaining technical challenges facing autonomous vehicles will be surmountable in a short time period.

While technological hurdles remain, the larger obstacles for widespread adoption of autonomous vehicles will be legal and cultural. Human drivers, pedestrians, and cyclists don’t follow the letter of the law. Rather they follow norms that generally allow people to get where they’re going safely. Police officers and judges enforce the rules on the books with these norms in mind. Autonomous vehicles, however, will follow the letter of their programming. An autonomous car will respect a 25-mile-per-hour speed limit on a wide avenue when all the human-driven vehicles around it are going 50. Once autonomous vehicles become prevalent, pedestrians will know that they can safely cross in front of them, legally or illegally. Autonomous vehicles will slow to a crawl when human drivers merging in front of it cause the autonomous vehicle to violate tailgating rules, and so on. Existing rules will need to be changed to better reflect actual driving practices so that autonomous vehicles can safely coexist with human drivers.

Waymo’s Arizona debut demonstrates that a policy environment of permissionless innovation is the only necessary condition for the adoption of autonomous vehicles. Cities can best accommodate the coming revolution in transportation by putting the onus on tech companies to find ways to make their products work with existing infrastructure and by allowing cities to grow organically as technologies evolve.

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How Suburban Parking Requirements Hold Back Downtown http://marketurbanism.com/2017/08/03/how-suburban-parking-requirements-hold-back-downtown/ http://marketurbanism.com/2017/08/03/how-suburban-parking-requirements-hold-back-downtown/#comments Thu, 03 Aug 2017 13:00:50 +0000 http://marketurbanism.com/?p=8716 You wake up thirty minutes before your alarm, jerking up after having a nightmare about a car crash. Reluctantly, you clean up, eat breakfast, and hop into your car. Work is only three mile away—easy biking distance—and there are 15 or so people in your neighborhood who work where you work—enough for a commuter bus […]

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A large, empty parking lot

You wake up thirty minutes before your alarm, jerking up after having a nightmare about a car crash. Reluctantly, you clean up, eat breakfast, and hop into your car. Work is only three mile away—easy biking distance—and there are 15 or so people in your neighborhood who work where you work—enough for a commuter bus make sense. But alas, the city required the developer to provide two parking spaces for your townhouse and the cost is hidden somewhere in your mortgage, so why not use it?

After spending thirty minutes traveling three miles on the freeway—at least we live in the Golden Age of Podcasting, right?—you arrive at your suburban office park and pull into the garage. The parking is “free,” meaning that your pay has already been docked to cover the cost of the space, so why not use it?

Your girlfriend calls shortly after lunch, asking if you want to go on a double dinner date with her friends to a new BBQ place downtown. You agree to join. You’re starving—you left lunch at home and it’s just too time consuming to drive to a decent place—so you hustle downtown. You arrive first, only to find out that there is only on-street parking. Downtown is, after all, exempt from parking requirements, and since street parking is “free,” it’s impossible to find a space during dinner time.

You call your dinner partners—each of them is driving separately from work—and suggest another BBQ place downtown that offers subsidized garage parking. This place is a little more expensive, since the restaurateur has to cover some of the cost of offering parking, but you’re all hungry and don’t want to deal with the headache of cruising for street parking. Eventually you all meet and enjoy a nice meal, speculating about how traffic and parking has gotten to be so bad in your city. Later that night, sitting in traffic on the way home, you write a review of the BBQ place on Yelp: “Delicious food. Friendly service. No free parking. 2 stars”

Minimum parking requirements ultimately hold back even otherwise walkable neighborhoods. As has been extensively documented in the academic literature, minimum parking requirements drive up the cost of housing, drive down the density of cities, and generally lead to a lot of wasted land and capital. To put it bluntly, they make urban life next to impossible wherever they are binding, or above whatever the market would naturally provide.

Some planners and policymakers seem, aware of this issue, have carved out areas of town where there are no minimum parking requirements. Take the case of Houston: while the city generally has very relaxed land-use regulation, it maintains conventional, restrictive minimum parking requirements in vast swaths of the city. But to make urbanism viable in at least some part of the city, policymakers have removed all parking requirements from the city’s downtown. There should be way less parking than outside of downtown, right?

Unfortunately, that’s not the case. Like nearly all U.S. downtowns, Houston has acres and acres of surface parking and parking garages in its downtown. Then surely, since minimum parking requirements aren’t present, all this parking must be a reflection of market demand, right? Not exactly.

Consider the wholly conventional story I told at the beginning of this post. In Houston, parking is required at nearly every house, townhouse, apartment, office building, and factory. Had our hero convinced his girlfriend and her friends to go to a BBQ joint outside of downtown, there would have been “free” parking there too. At every stage of the average Houstonian’s day, they are provided with what looks like free parking. Of course, the “free” parking at home is bundled into a mortgage or rent. The “free” parking at work is skimmed off of your salary. The “free” parking at restaurants is bundled into the price of your meal.

This uniquely American arrangement has unfortunate results: Since you are paying for parking—one of the most substantial costs associated with urban car-ownership— almost no matter what, you may as well use it. With parking costs off of the table, you only have to consider the cost of owning and operating a car, which is fairly competitive with transit fares, especially given the added speed and comfort of a private car.

In this way, minimum parking requirements help to make car dependence the norm, regardless of special regulatory carve outs for certain areas of town. Are you really going to go through the trouble of figuring out and riding transit on the odd day that you visit downtown? Unless your city’s transit is amazing—and if you’re in the U.S., it probably isn’t—that’s pretty unlikely. You are going to drive there, and if the business doesn’t have parking, you will either pass it over or complain about it. Hence the acres of surface parking and blocks of parking garages in otherwise liberalized downtowns.

This is why we can say non-required downtown parking isn’t exactly the result of “the market.” If I am a restaurateur and I want overwhelming car-dependent Houstonians to visit, if I am a business owner and I want to attract talent from all over town, or if I am a developer and I want my residential tower to appeal to most prospective residents, the fact remains the same: I basically have to provide parking. Non-market forces—minimum parking requirements everywhere else in the town—have inflated the demand for parking, building up the expectation in the minds of residents of unlimited, unpriced, immediately available parking wherever they go.

Cities, as they exist today, are shaped by an entangled mess of decades of conflicting federal, state, and local policies. As urbanists start untangling and scrapping these distortionary policies and liberalizing our cities, they should avoid giving up halfway and conceding to baloney about the status quo reflecting “revealed preferences.” Surely, there is some degree of demand for downtown parking. But until we eliminate minimum parking requirements in the vast majority of the city, there is really no way of knowing. Anyone who wants to allow great urban neighborhoods and great downtowns to emerge and survive should press for on the citywide elimination of minimum parking requirements.

 

Note: I don’t mean to pick on Houston. In fact, I really like Houston, which is why I talk about it. Plus, they have great urbanists there who are working hard on these issues and might actually ease up on citywide parking requirements!

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