New York MTA Hurt by Rising Fuel Costs
by Lewis DerkinsJuly 23rd, 2008, 5:11 pm
Today, Streetsblog commented on the way rising fuel costs and declining revenues are contributing to a $900 million budget shortfall with New York’s MTA.
Writer Ben Fried points to possible solutions:
In the face of these numbers, why are Paterson and Bloomberg trying to blame a potential fare hike on the MTA alone? Maybe it’s impolitic to remind people of the $500 million dollars congestion pricing would have funneled to transit every year. But even if the city and state want to hold out as long as possible before they pony up, right now there’s legislation currently stalled in Congress that would deliver $237 million to New York City’s transit system. Let’s hope that yesterday’s rally for transit at City Hall spurs more local electeds to pressure the feds — this means you, Senators Schumer and Clinton — to revive the Saving Energy Through Public Transportation Act.
What’s funny about this paragraph is that ten posts below it is an “analysis” from Aaron Naparstek lambasting highways as the last bastion of socialism in America.
So, what exactly isn’t socialist about taking $500 million from cars and giving it to a mass transit system that can’t cover its own costs? What exactly is different between the government propping up mass transit to the tune of $237 million and the government investing in highways that 88% of Americans use to commute?
“But cars are bad, so we shouldn’t pay for them” – never mind that without the funds cars raise, mass transit wouldn’t exist. 15.5% of your gas tax pays for mass transit - sssssshhhhhhhh, that’s a dirty little secret.
I also like the internal inconsistency in the logic behind congestion pricing – we will tax cars to bail out MTA, but the tax exists to alleviate congestion, so it will remove cars from the roads, and decrease revenues from the tax, making MTA’s problem even worse because they will have more riders and even less revenues. Brilliant! Thanks for those awesome solutions.
I hate to say “I told you so,” but unfortunately, I did.
Posted in Bridges, Congestion Pricing, Fines, Gas Taxes, Highways, Mass Transit, Spending |
I’m no expert, but doesn’t an increase in commuters (riders of public transit) mean an increase in paying fares? Subsequently, a slight fare hike would drastically increase revenue. Probably not enough to stop being subsidized, but that has more to do with administrative and bureaucratic costs than anything else.
Also, as far as I understand it, gas tax is paid by the distributor, not the consumer. So revenue from gas taxes only go down if distributors are buying less gas, which doesn’t seem to be the case. I mean, gas doesn’t expire for about 90 days, right? So why wait to buy gas at a hire price? Most places buy it now and sell it later.
Anyway, this is a complicated issue, but I don’t think the solution is to bash commuters. Maybe they shouldn’t bash drivers, but in this economy tempting to blame someone. Anyone.
Ryan -
An increase in riders won’t necessarily solve this problem - you have to remember two things:
One, Increased riders need increased services (more trains).
Two, MTA already has this problem despite a record ridership that is straining the system.
This problem is already leading to fare hikes, and that’s the point in contention in the Streetsblog post - they don’t want a fare hike because they want the congestion tax to cover it. But if you take those cars away, you’re going to decrease revenues from the congestion tax and you’ll have to raise the fares anyway - probably more so because you’ll need to exponentially expand the system.
On your gas tax piece - it doesn’t really matter where the tax is levied since the costs are passed on to the consumers. If consumers buy less gas, distributors will also buy less gas - they’re not going to buy a huge surplus of gas that they can’t sell. I think you’re saying they can just buy it and sit on it until they sell it, but again, I don’t need to buy new gas until I sell the gas I have, so either way, less gas is sold.
I’m also not trying to bash mass transit riders - in another comment to you I mentioned that I bike sometimes. When I don’t bike, I take mass transit. I almost never drive to work. I would like to see mass transit in DC expanded.
The point of this post is to call out the hypocrisy of Streetsblog saying that public funding of one mode of transportation is “socialist” while public funding of another is not. If we’re talking about socialism - which idea runs more in line with personal freedom: individual flexibility and choice, or having to plan on a scheduled dictated by others and dependant on their service? My whole point is that Streetsblog is ridiculous over this.
I don’t have time to discuss your various misconceptions about autos vs. transit in a blog comment, but the tax base to support transit would come from other sources if the magnitude of the automobile/highway system was a fraction of its current size. In California, most tax support for transit comes from a 0.25% setaside from state taxes, and from local option sales taxes in most large counties.
I’d like to see you argue in detail with the information presented at http://www.livablestreets.com/streetswiki/costs-of-travel, which is based on work by Professor Vukan Vuchic of the University of Pennsylvania and others.
I have no objection to people driving when and where they want to, but the playing field needs to be leveled to reflect the actual social and other costs incurred. But of course, this is America, where people wonder “whats a tradeoff??” and think they have entitlements to cheap gasoline and “free” parking…
Michael -
You must be new to this site. We’ve talked about “free parking” and “true costs” many times.
I will look at Professor Vuchic’s analysis though, and I will post a review of it. It will probably take me a couple of days.
As for your tax base argument - I fail to see what that has to do with a criticsm of another article that points out that less cars on the roads means less tax revenue from congestion pricing, which will make the problems for mass transit worse if they’re dependant on those revenues to offset fuel costs.
Mass transit users feel much less of their “social costs” than auto users do. They only pay for about 25% of the up front cost of mass transit here in DC. That’s before you add in the polution that the power plant that generates the power comes in. It doesn’t count the inrceased congestion that metro causes - people like to build and congregate around the lines, which makes traffic worse. It doesn’t count the land that the government seizes to build the lines. It doesn;t count the noise and the crowds. It doesn’t count the lost time and inconvenience of waiting for trains, and the corresponding loss of efficiency.
The argument that mass transit has no costs is simply not true, and the costs that people use to try to skew drivers is often based solely in wild speculation - for instance, how much does a pound of carbon emissions really cost? How do we know? Who values it, and how?
I can see from your tone that you’re highly opinionated, and seem nearly as oblivious to facts as my current favorite sparring partner, Randal O’Toole http://www.ti.org/antiplanner. I’ve read enough of your site to see that you like to deny a lot of things. You also have a way of misunderstanding things, such as the “social costs” of transit. Yes, there are some, but they pale in comparison with the negatives of automobiles.
As for your critique of Vuchic, we’ll see how you do.
Michael D. Setty,
Instead of announcing that Derk is “oblivious to facts,” why don’t you elaborate on what facts you’re talking about, and exactly how Derk is wrong.
Another thing. Dropping a link to a Streetswiki page or the work of some professor - while informing us that you “don’t have time to discuss [our] various misconceptions” - that doesn’t fly here on Commuter Outrage.
If you want to come on and make an argument with details and evidence and logic, we’ll be more than happy to read carefully, think long and hard, and give you a thoughtful answer.
But this business of breezing in and dropping a link to some egghead’s tome, and then - C YA! - that gets no respect here. Why not at least summarize Vuchic’s main point, and give a few examples?
Judd:
I stand by my comments about your site’s general lack of obliviousness to facts, often even those put up by “your side.” See below. I’d like to lurk some more and see how you do, before I spend any more time answering you, as opposed to “The Antiplanner” for example (e.g., Randal O’Toole and his buds).
For Derk, he has been commenting away on Streetsblog making the tiresome argument they should also be considering the benefits of automobiles, not just their negatives. So here’s some substance: http://www.joelschwartz.com. See Schwartz’s 2006 Powerpoint: The Social Benefits and Costs of the Automobile. In this presentation, one of the more interesting slides makes the important point that in Europe, at virtually every level of per capita GDP, annual miles per capita is about 40% less than in the U.S. To an extent, this effect is certain
In the same presentation, Schwartz also points out that the total automobile related costs found by U.C. Davis researcher Mark Delucci in 1995 dollars was around $2 to $4 trillion annually, while the net benefits of automobility were calculated to be around $6 trillion to $11 trillion annually, including imputed “consumer surplus” and the economic value of trucking. Which begs the question, why the heated emotional arguments against “full cost pricing” that auto critics like myself, for example, make at forums such as ti.org/antiplanner/?p=472#comments. You’ll note that No. 48 in the comment thread states:
Here in SF Bay area MTC Metropolitian Transportation Commission is proposing increasing the costs of driving five times by fees to get people out of cars. There is a war on the auto.
No! Us “car haters” just want to properly mitigate the negative impacts of automobility, which is backed up by the work of both Delucci and Schwartz!! If the benefits are so huge, $3-$5 trillion/year (2008 dollars+/-) is fair payment to mitigate the problems of automobility, presuming the benefits are $8-$15 trillion/yr (2008 dollars+/-).
To fix a type, to continue the thought.
In Europe, the lower miles per capitais probably partly a function of geography, e.g., shorter distances compared to the U.S., but most of the 40% difference from the U.S. is certainly a function of higher density cities and suburbs, reinforced by high gasoline taxes that were imposed at an early date. Such high gasoline taxes made economic sense, given the fact that Europe had little indigenous oil that was accessible by early and mid-20th century technology (as opposed to the North Sea discoveries exploited by England and Norway beginning in the early 1980’s, now rapidly depleting).
[…] Commuter Outrage has this fine bit about Congestion Taxing today as well. […]
Gotta love the CO.
Hiss Kaag back again. I am working on something big.
Details to follow over the next few days……..
Michael -
To respond to one point you make about the Delucci study:
“automobile related costs found by U.C. Davis researcher Mark Delucci in 1995 dollars was around $2 to $4 trillion annually, while the net benefits of automobility were calculated to be around $6 trillion to $11 trillion annually, including imputed “consumer surplus” and the economic value of trucking. Which begs the question, why the heated emotional arguments against “full cost pricing” that auto critics like myself, for example, make”
If you’re asking me why I’m against full cost pricing - my answer is that those two numbers are not independant of one another.
A large part of the social benefit that you mention - which is huge - is dependant on costs being low so that drivers can drive. From a total point of view - this is an optimal solution if increasing costs would decrease your benefits. You want to maximize benefits and minimize costs.
My problem with a lot of the anti-car argument, and I’m not saying that I’m pigeonholing you one way or the other, is that they are trying to take cars off the roads, not make them pay their costs.
These people are oblivious to the benefits side of the equation, and look at only the costs. They want to force more of the costs on the drivers, not to reach a true optimality where the benefits are as high as they could be while costs are as low as they could be, but to get drivers out of cars, which will decrease benefits and simply displace many of those costs elsewhere.
Roads are a great example - anti-car arguments say that cars don’t pay their costs because general fund taxes pay for local roads, but those roads won’t go away if all of the cars do. Everyone can switch to bicycles and the roads would still need to be there for the bicyclists and emergency vehicles, so these punitive policies only hurt the overall system.
A large part of the social benefit that you mention - which is huge - is dependent on costs being low so that drivers can drive. From a total point of view - this is an optimal solution if increasing costs would decrease your benefits. You want to maximize benefits and minimize costs.
For whom?
Your logic makes sense for the many beneficiaries of subsidies and other concessions this society makes towards driving, but not from a societal or ecological point of view–which I think are more important at this time in U.S. and world history (man-caused global warming is real whether you “believe” or not; e.g, Monckton is a proven crank and idiot.) You need to more explicitly explain your logic because in light of other things society also values, your logic appears to be a political judgment and makes me think many of the alleged “benefits” of automobility are strictly personal. I’m not questioning the seductive lure of automobiles, that’s stating the obvious, but I also think the alleged “freedom” and “autonomy” offered is mostly an illusion, particularly given the massive technostructure that comes with it. Adolph Hitler got a lot of political kilometerage (sic) out of his “people’s car” pandering shtick before World War II, for good reasons by his reckoning that that has nothing to do with real liberty or freedom for the “people.”
A good exploration of this fundamental, potential lethal conflict in your point of view versus mine is explored in a 2006 paper by Sudhir Chella Rajan, “Automobility and the liberal disposition” located here. I’d like to see what you think is wrong with Rajan’s analysis, given your obvious your political preferences to keep the costs of “happy motoring” well below its actual social and ecological costs. I think the facts related by Rajan strongly support mine.