California transportation consultant Stanley Hart says that automobile
subsidies guarantee that Americans will continue commuting long distances in
their cars. Why? Because so much of the expense of driving a car is
hidden.
Americans tend to view insurance, depreciation, and maintenance as “fixed”
costs of operating a car. Meanwhile, roads and parking are taxpayer subsidized,
and viewed by motorists as “free,” leaving only the cost of gasoline as a
“variable” expense perceived to increase with the use of the car. “Because the
price of driving appears to be low, demand for trips is high,” says Hart.
“Traffic congestion, inevitably, rises to the intolerable; it becomes the only
effective restraint on driving.”
Meanwhile, says Hart, underpricing automobile use diverts patronage away
from transit systems. “In most American cities, as a result, we have the worst
of all worlds. We have two unsatisfactory transportation systems; a failed and
abusive automobile/freeway system on the one hand, and an inadequate and
bankrupt bus transit system on the other. The freeway system fails because of
too much demand; the transit system because of too little. The subsidies for
both systems, competing for the same patrons, come from the taxpayers’
pockets.”
Subsidies for automobile driving have created distortions in the law of
supply and demand. Hart suggests a remedy for correcting them: increase the
gasoline tax to $5 per gallon, just above that of most European countries. Even
though the gasoline tax increase could be offset by corresponding reductions in
property, sales, and Social Security taxes, Hart recognizes the
near-impossibility of his proposal being adopted. Noting that one American in
six works in the automobile/truck/highway sector, he says “the automobile has
become entrenched in our economy, in our psyches, and in our physical
surroundings.” – N.E.
This article appears in August 11 • 1995 and August 11 • 1995 (Cover).