Art Carden  

Baptists, Bootleggers, and Public Squalor: Light Rail Isn't a Good Public Investment

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About That High-Quality Insura... Liberalism unbound: Free lunch...

The Cato Institute's Randal O'Toole has recently released a Policy Analysis arguing that low-capacity light rail is a bad deal for cities. I found it especially interesting in light of Scott's post last week on "private affluence and public squalor," particularly as they relate to transportation infrastructure.

In brief, O'Toole argues that light rail is a bad deal, particularly in light of an alternative that can share infrastructure with cars and trucks (double-decker buses). O'Toole also notes that the projections made by rail supporters about ridership and the like are usually...let's say optimistic.

We get light rail because Baptist-and-bootlegger coalitions are enabled by ignorant voters (the link is to an EconTalk podcast in which Bruce Yandle explains the concept). The Baptists are environmentalists who see rail as a green alternative to automobiles and civic boosters who want economic development (which rail won't cause) or for their town to be a "world-class city" ("whatever that is," O'Toole asks). The bootleggers are the contractors and construction workers as well as land owners in downtown areas who will see demand for their services increase. This is further made possible by voters who don't grasp one of the first lessons of economics: resources are scarce, and they have alternative uses. Again, we're back to Frederic Bastiat's "What is Seen, and What is Not Seen": it's easy to see the shiny new rail line and say "that made us richer!" It's harder to see what we sacrificed in order to get that shiny new rail line.

Political incentives in transit are especially perverse. You get to write press releases and get your picture taken at a ribbon-cutting ceremony and have your name put on a plaque at the new train station that was built under your leadership. You don't get much recognition for making sure potholes get filled. Construction is overfunded, and maintenance is underfunded. Discussing maintenance problems in Washington, Chicago, and Boston, O'Toole writes:

Such maintenance shortfalls are almost guaranteed in a transport system that is not funded entirely out of user fees. Politicians love to support grandiose capital projects, especially if they can get some other level of government to fund them. That allows the politicians to bask in glory when the projects open for business. But they routinely underfund maintenance, as there is little political benefit in replacing a worn-out rail, brake shoe, or electrical signal, while accidents, delays, and other problems can always be blamed on someone else.

For almost all American cities, it's a mistake to try to green the planet and relieve congestion by building more rail. O'Toole's conclusion:

In the end, building new rail transit lines, at least in the Americas, is almost always a mistake. Putting the same amount of money to use in relieving congestion for everyone by undertaking such projects as coordinating traffic signals and building high-occupancy toll lanes adjacent to crowded highways would produce far greater benefits. Alternatively, providing the same transit capacity with buses instead of trains would cost far less.

ATSRTWT. It's a useful corrective to mistaken thinking about urban planning.



COMMENTS (8 to date)
Curtis L. writes:

When invoking the environmental part of it, don't forget David Owen. His EconTalk is one of the best ever.

PaulS writes:

One trouble, though, is that buses as they are normally run - stopping interminably at every second corner or even every corner - take forever to go hardly any distance. And they stop like that just because they can, and the disability lobby would probably howl at any other practice.

Double-deckers would be far worse, since in the name of "safety", people will no doubt be forbidden to change decks except while the bus is stopped. The lower deck will be overcrowded due to that inconvenience plus simply the climb itself, so a hundred people will wait forever at every stop for the slowest person to shuffle at a snail's pace to or from the upper deck, that being the only place where there's room.

On the other hand, no one (yet) tries to stop trains every 50 yards, so trains can get you somewhere. But... but, except in ultra-dense megacities, there's no conceivable justification for a comprehensive system of routes. So nearly every potential train user experiences an unsolvable last-miles problem.

Maybe the truth here is that when we speak of mass transit, we speak of something applicable to ultradense (read ultra-expensive) megacities and little else. By its very name it's about moving masses at the same time to the same spot. Except in places like Manhattan, that suits it mainly to an earlier industrial era when tens of thousands used to work at the same factory, most coming and going at the same "shift change" time.

Nowadays, people tend to be going in all directions - and even at large sites, they tend to come and go as needed - at all hours. It's not 1955 any more.

So is there any reason for any form of mass transit to exist in most places, seeing as how massed people all seeking to come or go at once are to be found at hardly any spot any more? Why even bother?

ThomasH writes:

Although sometimes second best is the best we can do, in general it's better to aim one best policy at each objective. CO2 emissions are better dealt with by a carbon tax and traffic congestion by a congestion tax. It is OK to consider among the benefits of a public investment its effects on CO2 emissions (probably pretty minimal) or its reduction in congestion, but these benefits cannot trump costs.

Buses (that do NOT stop too frequently) are probably the best option for most cities pending an increase in density great enough to make rail economical.

JKB writes:

Light rail is designed to rapidly move lawyers and government workers (politicians to clerks), who interact with each other through their work, from their palatial (depending on government worker class) estates in the countryside to their jobs in the dense urban core. It also is proposed to move people who aren't in the downtown of one city into the downtown of another city where they don't have reason to go, except for the aforementioned lawyers and government workers.

Pretty much everyone else moves laterally around urban centers except to partake of some of the recreation most downtowns have transitioned to offering. When traveling between towns within driving distance, others are often traveling from outer suburbs to outer suburbs to conduct business which involves needing to move physical items.

Maniel writes:

@Art,
Transportation is an area where the application of a little econ has the potential to go a long way. For example, congestion pricing can influence decisions on when to use roadways such that, as implied, congestion is mitigated.

@PaulS

… nearly every potential train user experiences an unsolvable last-miles problem.
There are distances and routes that I would prefer not to drive. Your comment is valid; however, I believe that market forces would eventually supply affordable solutions (e.g., Uber or innovative car rentals) for a few well-chosen routes (e.g., San Diego – Los Angeles – Santa Barbara – San Jose – San Francisco).

awp writes:

"For almost all American cities, it's a mistake to try to green the planet and relieve congestion by building more rail."

Actually since the feds pay for most of it why not take the "free" money. At the local level I am not sure it is a Baptist and Bootleggers issue.

Eric Falkenstein writes:

My town of Minneapolis is doing this. It's a disaster: funding comes from so many sources it seems free to advocates, buses would be so much more effective, they purposely avoid 'express' routes beacuse that would encourage 'sprawl', rendering it less flexible and slower than a car.

But it is free. The white elephant light rail from the Mall of America to Downtown charges a modest fee, but they never check if you have paid when you ride (I think they know zero is a good price point).

PaulS writes:

@Maniel especially

As you write, "I believe that market forces would eventually supply affordable solutions ... for a few well-chosen routes". That simply reinforces the point that transit is mainly a solution for already-ruinously-expensive megacities such as those named - and not so much for people of ordinary means who can't possibly afford $3500/month downtown pigeon coops, and, really, also can't afford exorbitant taxi (or taxi-like) rides to someplace outlying that actually offers affordable housing.

Note - taxis of one sort or another have existed for more than 200 years, and they've always been absurdly expensive for routine use by people of ordinary means. Regulators whose essential function is to entrench incumbents will keep it that way in the supposed names of "safety" and "insurance". Network effects will make the central transaction exchange - Uber or whatever - a monopoly that will siphon off whatever it can, keeping taxi-like service ruinously expensive in perpetuity. Of course, one might close off the siphon by effecting the transactions on some sort of peer-to-peer basis - but no, not on your life, because "safety".

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