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Posts from the "Congestion Pricing" Category

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The Assumption of Inconvenience

Early this week, I noticed a number of my favorite bloggers linking to this Elisabeth Rosenthal essay at Environment 360, on the mysterious greenness of European nations. The average American, as it happens, produces about twice as much carbon dioxide each year as your typical resident of Western Europe.

Rosenthal attributes much of this difference to behavioral factors relating, it seems, to Europeans' unique tolerance of inconvenience. She writes:

But even as an American, if you go live in a nice apartment in Rome, as I did a few years back, your carbon footprint effortlessly plummets. It’s not that the Italians care more about the environment; I’d say they don’t. But the normal Italian poshy apartment in Rome doesn’t have a clothes dryer or an air conditioner or microwave or limitless hot water. The heat doesn’t turn on each fall until you’ve spent a couple of chilly weeks living in sweaters. The fridge is tiny. The average car is small. The Fiat 500 gets twice as much gas mileage as any hybrid SUV. And it’s not considered suffering. It’s living the dolce vita.

She later adds:

Also, in Europe, the construction of most cities preceded the invention of cars. The centuries-old streets in London or Barcelona or Rome simply can’t accommodate much traffic — it’s really a pain, but you learn to live with it. In contrast, most American cities, think Atlanta and Dallas, were designed for people with wheels.

What makes this particularly remarkable is that she opens the essay by discussing an experience she has in Stockholm, in which she insists on taking a taxi from the airport, which ends up being much slower and more expensive than the train.

Brad Plumer frames the piece as a fascinating read in light of the "lifestyle taboo," writing:

It's not considered the height of political savvy here in the United States to point out that European lifestyles are greener than our own. Don't expect that line in an Obama speech anytime soon. Too many facets of European life—the cramped apartments, the clotheslines for drying laundry—would likely strike suburbanites as inconvenient, burdensome, or even downright primitive...

Rosenthal wonders whether similar measures could fly in the United States: "I believe most people are pretty adaptable and that some of the necessary shifts in lifestyle are about changing habits, not giving up comfort or convenience." Maybe so, but this sort of talk still tends to be taboo in mainstream U.S. green circles. Josh Patashnik wrote a terrific piece for TNR last year on Arnold Schwarzenegger's brand of "pain-free environmentalism" in California—it's all just peachy to talk about swapping out coal-fired plants for solar-thermal stations, but ixnay on trying to rein in suburban growth or coax people into smaller homes.

I see several problems with Rosenthal's essay and with Brad's framing of it. One is that it's not really correct to attribute the huge gap in per capita emissions between America and Western Europe to the charming European habit of drying their clothes on clotheslines.

As Brad notes, power sources play a major role, whether one is talking about greater use of natural gas, the French nuclear industry, or Iceland's geothermal capacity.

Climate is extremely important. Western Europe is fairly temperate relative to much of America (and especially compared to the dirtiest parts of the country). In the same way, Californians are much greener than Texans, thanks to the moderate conditions along the heavily populated Pacific coast, which reduce the number of days on which home heating or cooling is needed.

But there are lifestyle issues involved, particularly where transportation and land use are concerned. Read more...

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Would Real Men Tax Gas? A Test for Tom Friedman

On Monday, Elana Schor highlighted a recent column from occasionally right New York Times columnist Tom Friedman, who once again rolled out one of his favorite policy prescriptions -- an increased gas tax. Friedman wrote:

400px_Thomas_Friedman_2005__5_.jpgTom Friedman (Photo: IvyGate)
According to the energy economist Phil Verleger, a $1 tax on gasoline and diesel fuel would raise about $140 billion a year. If I had that money, I’d devote 45 cents of each dollar to pay down the deficit and satisfy the debt hawks, 45 cents to pay for new health care and 10 cents to cushion the burden of such a tax on the poor and on those who need to drive long distances. 

The first and most obvious thing to point out is that it's far more likely that Tom Friedman's mustache will be elected president than it is that Congress will approve a five-fold increase in the federal gas tax, even one phased in over a decade or more.

There is a reason that gas taxes have not been increased in 15 years: expensive gasoline in America is incredibly politically unpopular, and not without reason. Increases in gasoline prices are painful for American households, precisely because the nation is so dependent on driving.

That's the tricky part. Prices need to be higher to reduce dependence on gasoline, but that very dependence makes price increases political suicide. What is needed is either an extremely gradual increase in gas taxes (on the order of the rate of inflation plus 1 percent per year), or increases in market prices (for which politicians will still be blamed), or an indirect levy of some kind that will act to reduce consumption.

A second point is that a $1 per gallon tax on gasoline and diesel fuel won't raise $140 billion a year for very long. Why? Because consumers respond to price shifts, and they respond a lot to large price shifts.

In 2007, the average, inflation-adjusted price of a barrel of oil was about $67 per barrel, and Americans consumed about 20.7 million barrels of oil per day. In 2008, the price of oil averaged about $91 per barrel (which translates into a gas price increase of about 60 cents per gallon), and consumption fell by more than 1 million barrels per day, to the lowest level since 1998.

The price goes up and consumption goes down, reducing the revenue one earns from the increase in price. What's more, the short-run demand response will often be mild relative to the long-run response.

Faced with an increase in the price of gas, households can't do all that much in the short term to respond. They may cut out unnecessary errands, or carpool, and if they live in an area with good transit access, they'll likely increase transit ridership.

But because of the household location decisions made in recent decades, most households will have few ways to reduce gasoline usage immediately. Consumption will fall, but not by much.

If months pass and the increase persists, then responses will grow more dramatic. Households will trade in gas-guzzlers for more efficient vehicles or buy bicycles. Consumption declines will increase.

And if increases are expected to be permanent, the long-run responses will be significant. Households may begin to choose home or job locations that minimize driving or that allow for use of transit, walking, or biking. Communities may begin designing themselves differently and increasing transit service.

And ultimately, consumption may fall to near zero.

That doesn't mean that driving will fall to zero. Read more...

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A Few Words on Transportation User Fees

We tend to have a few good laughs when Randal O'Toole fires up his Cato computer and weighs in on transportation issues. It's hard to take seriously a man who thinks that having the government tax people to build something which it then gives away for free is the libertarian ideal.

record_gas_prices_large.jpgDo federal gas taxes really charge "users" of the highway? (Photo: CAP)
But occasionally O'Toole provides an opportunity to discuss some interesting aspects of the transportation planning process and learn from his errors. And so we turn to his latest policy paper, which was released yesterday. Therein, he writes:

The Interstate Highway System accomplished all of this [construction of the system] without any subsidies. Federal highway user fees paid for 90 percent of the cost of the system, and state highway user fees covered virtually all of the remaining 10 percent.

This brings up an interesting question: What is a user fee? Common sense would suggest that a user fee is a fee paid by a user of something in order to use that something. A common example might be a train fare. When one wants to ride a train, one purchases a ticket. One doesn't purchase a ticket if one doesn't want to ride the train, and one doesn't ride the train without a ticket. A ticket is specifically meant to extract a fee from a potential user, that that user might then be allowed to use the train.

So do gas taxes count as highway user fees? Well, one might pay gas taxes even if one never uses highways. You pay the gas tax on gas used to drive down local roads or private driveways, or to power lawnmowers and tractors that never even see publicly-funded blacktop.

And one can use highways without ever paying gas taxes. Anyone able to obtain a vehicle powered by natural gas or electric batteries or canola oil can ride on the federal highway system for thousands of miles and never pay one cent to do so.

So gas taxes are not user fees. Indeed, the lack of actual user fees is one reason American highways suffer from severe congestion problems; when you give away something valuable for free -- like scarce highway space -- it ends up seriously over-consumed.

As a thought experiment, let's consider a world in which federal gas taxes functioned more like a user fee. That is, let's imagine that when drivers fill up, they pay a federal gas tax only on the gasoline consumed while driving on federal highways. That's still not really a user fee, but it's a little closer.

Read more...
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Obama Admin Declines to Consider New Funding for Transportation

Having entertained legislators' own ideas about how best to fund future transportation spending, the House Ways and Means committee turned to representatives from the administration and key interest groups today to hear their thoughts on the matter.

The administration's view could not have been much clearer -- this business is all very important, but we're not ready to commit to anything at this time.

Roy Kienitz, the Department of Transportation's Undersecretary for Policy, made it quite clear that the administration is not prepared to support any of the new funding mechanisms proposed -- not a VMT tax, not indexing the gas tax to inflation, and not taxes on imported oil and refined gasoline.

Kienitz did leave the door open to a tax on trading of oil futures, which he said the administration would have to investigate thoroughly. A key concern is that in a world where oil is traded on global markets, such a measure would simply shift trading off of American soil.

Why the stubborn refusal to engage in the funding debate? Ostensibly, the administration is reluctant to adopt new taxes or fees amid recession.

But this explanation rings hollow. Congress could easily delay the time at which revenue-raising measures take effect until 2011 or later, as is being done with funding mechanisms in the health reform bills under consideration.

The president must know this. A reasonable assumption is that he simply does not want to have a tax debate at this time, not with other key priorities involving new tax burdens also being considered.

Read more...
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LaHood: NYC’s Congestion Pricing Money Still There for the Taking

Speaking at an event in Midtown yesterday morning, Transportation Secretary Ray LaHood let it be known that New York City can still claim hundreds of millions of dollars in federal transit funding -- if local lawmakers implement congestion pricing. NY1 reports:

The city was slated to receive about $350 million in federal transportation funds to implement the plan, but it was was stalled by State Assembly Democrats in Albany.

LaHood said the money is still there if lawmakers change their minds.

"The money that was going to be provided for that particular project is still at the Department of Transportation," said LaHood. "If New York got its act together around that kind of opportunity, I think we would look at it."

Most of that $354 million would have gone toward transit enhancements targeted for areas underserved by subways. Citing, in large part, their distrust of the MTA to spend congestion pricing revenue wisely, state legislators turned down the offer from George W. Bush's DOT and killed the proposal last April.

Here we are a year later, and Albany just passed a toll-free MTA financing package that leaves the agency's capital plan largely unfunded. Congestion pricing would go a long way toward filling that gap, and self-styled watchdogs Malcolm Smith and Richard Brodsky say the new bill will make the MTA "transparent and accountable" to their liking. So if Barack Obama's DOT comes back with that $354 million offer, would NYC's state legislators still walk away from all those transit improvements for their constituents?

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Does the State Senate’s MTA Plan Pass Environmental Muster?

brodsky.jpgWhere's the Assembly's eco-warrior when you need him?
The Municipal Art Society came out with a report yesterday urging New York State to start analyzing greenhouse gas emissions in its environmental review process (SEQRA). MAS argues that the policy could be adopted without changing existing laws, which raises an interesting question to ponder on this Earth Day afternoon: Would the State Senate's latest MTA funding plan pass muster if it were subject to an EIS that factors in climate change?

The MTA rescue package does not, in fact, fall under the purview of SEQRA, even though it's probably the most important piece of climate policy that the state legislature will consider this year. The Senate's latest stab would keep the trains and buses running for a few more months, but it's an eco-stinker compared to the Ravitch plan and any other package that includes road pricing or tolls on currently free bridges.

Let's go back to the spring of 2008. Remember all the carping from Richard Brodsky and other state legislators about congestion pricing not going through the SEQRA process? That was regarding a policy projected to take 112,000 cars off the road each day. Now we have an MTA funding plan getting serious consideration that would create worse traffic bottlenecks and more incentives to drive, but so far not even a peep about environmental consequences from Albany.

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If Gridlock Sam Was President…

gridlocksam.jpgA bit of pre-Election Day fun: Here's a mock state-of-the-union speech drafted for the next President by "Gridlock" Sam Schwartz. Combining some ideas from Barack Obama's platform with some that no candidate would utter during a presidential campaign, he lays out a plan for infrastructure investment and how to pay for it:

The National Infrastructure Bank will assemble a portfolio of projects for investment by the public and private sector. I will follow the formula developed by the renowned economist Felix Rohatyn so that any project seeking over $75 million in federal support would be required to submit a proposal to the bank. The submission would include the contribution to be made by the state and local governments, user fees and a plan for maintenance. The bank would then decide to fund the project outright, or through credit guarantees for state bonds or loans against future revenues from user fees and other sound financial strategies.

The federal government will favor cities that introduce congestion pricing. A recent study by the Brookings Institute found that more than $100 billion could be raised annually by road pricing in the 98 largest metropolitan areas. We will adopt the previous administration’s call for a dedicated Metro Mobility (MM) Program (pdf) for metropolitan areas with populations greater than 500,000. These are the battle grounds for congestion, fuel inefficiencies and production of greenhouse gases.

The gas tax is a dinosaur (pun intended). As long as it remains a flat tax at 18.4 cents per gallon and gas consumption decreases (a goal of my administration) it will be a dwindling source of revenue. I propose that the tax, like most other taxes, be indexed against the sale price. This way, when foreign influences raise the price of gas, some revenue will be returned to the taxpayers in public works projects. I propose a 5 cent/gallon increase over present levels, the first increase since 1993, to generate about $10 billion annually. But, if the price of gas goes down, and I hope it does, the tax will go down accordingly.

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High Gas Prices Won’t Cure Gridlock

2589176850_1534965ef6.jpg It's the New Math: a dollar-a-trip rise in the cost of fuel for a car trip to Manhattan is cutting traffic almost as much as Mayor Bloomberg's eight-dollar toll plan would have done.

Too good to be true, right? But that's the slant of the front-page headline in today's Times, "Politics Failed, but Fuel Prices Cut Congestion":

Soaring gas prices and higher tolls seem to be doing for traffic in New York what Mayor Michael R. Bloomberg's ambitious congestion pricing was supposed to do: reducing the number of cars clogging the city’s streets and pushing more people to use mass transit.

The article reports that traffic on MTA bridges and tunnels within the city and the Port Authority's Hudson River crossings was down this spring by 4-5 percent compared with a year ago -- within hailing distance of the 6.3 percent drop sought by the mayor's plan.

Good news, but how much of the decline is due to the price of gas and how much to the toll increases that took effect around the same time?

Read more...
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If Congestion Pricing Fails, Rest Assured, There’s Always Plan B


Copenhagen-based Flickr photographer Zakkalicious tells us that this cartoon was originally published in the May 1933 issue of Toy World magazine and also appeared in David Herhily's 2004 book, "Bicycle."

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Fidler Waxes on “Haves” and “Have-Nots”


In this five-minute speech, delivered at the Stonewall Democratic Club in Manhattan and captured by The Politicker, Council Member Lew Fidler draws on the 2005 mayoral campaign of Freddy Ferrer to rehash the old saw that congestion pricing would create a city of "haves" and "have-nots."

"This is its stated purpose. This is exactly how it's supposed to work, so there's no debate on this point: it allocates your ability to enter the heart of our city by who can and can not afford it."

Again, Fidler betrays his windshield perspective. Of course congestion pricing will not keep a single person from entering Lower Manhattan, as long as they can walk, bike, or pay the (up to) $2 transit fare. And, as has been stated ad nauseum on Streetsblog, the city is already stratified, only in reality the "haves" have cars and/or parking placards while the "have-nots" have MetroCards.

Judging by the tepid reception Fidler gets here, his audience seems to get this, even if the councilman does not.