Excuse Me While I Drive on Subsidies

The prevailing view amongst many conservative politicians, as well as the highway industry (surprise, surprise) is that highways pay for themselves through user fees. We've written about that claim on several occasions, most recently here.

The U.S. Public Interest Research Group (U.S. PIRG) has recently released a report on the issue, entitled "Do Roads Pay for Themselves?" The report examines highway funding in depth, and points out several elements of the cost of highways that usually don't receive attention. Additionally, it provides a resounding ‘no’ to the question in the title.

To begin with, the most well-known and utilized highway user fee – the gas tax – actually uses a questionable definition of 'user'. Streetsblog DC has a good analysis of this conundrum, with several examples of how people can pay the gas tax without ever being users of highways. Any gas that is purchased for lawnmowers, for example, does not end up being used on the highways.

There is also the case of gas being purchased for a car that never leaves local or private roads. In general, there is no direct connection between the taxes one pays for gas and how much they use the highways. The key word here is ‘direct’, because highway advocates often fall back onto claims that property taxes are an indirect form of user fees, since roads and highways connect properties. This is an argument for another post, however.

After examining the fact that user fees (even with the vague definition of ‘user’) only cover 51% of highway funding, the U.S. PIRG report then discusses the significant effects of highways that are not as discussed as they should be.

Framing arguments over highway expansion by only looking at funding is an approach with a very limited scope. As Chuck Marohn of Strong Towns has said, the questions in highway expansion often don’t begin with ‘should we build…’ but instead begin with ‘where can we find funding to build…’

The costs of roads and highways are not limited to construction, as U.S. PIRG points out, because they also incur costs to the environment through pollution. Another cost they incur is encouraging and enabling suburban sprawl, which carries a host of costs to the environment and the economy.

These are indirect costs, but they merit consideration when we discuss roads and the funding they require.

The U.S. PIRG report, along with statistics from the Federal Highway Administration, makes it clear that roads do not pay for themselves. This means that the open road, much as conservatives attempt to idolize it (especially above other modes), is subsidized.

As William Lind, author of Moving Minds: Conservatives for Public Transportation, said in an interview with Grist, “a lot of the incoming Republicans will have bought the libertarian line, that transit is subsidized and highways are not. Factually, that couldn't be more wrong.”

In a political environment where ‘subsidy’ is an evil word, conservatives should own up to the fact that highways are subsidized before making their arguments. Relying on false pretenses is dishonest and (policy-wise) counter-productive. Sadly, it’s something of a political norm.

Posted in Transportation | Related Topics: Roads & Highways  Fuel Tax 

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