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	<title>Comments on: justifying transit &#8220;subsidies&#8221;</title>
	<atom:link href="http://westnorth.com/2007/08/11/justifying-transit-subsidies/feed/" rel="self" type="application/rss+xml" />
	<link>http://westnorth.com/2007/08/11/justifying-transit-subsidies/</link>
	<description>an irregular view on cities</description>
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		<title>By: Patrick</title>
		<link>http://westnorth.com/2007/08/11/justifying-transit-subsidies/#comment-17389</link>
		<dc:creator><![CDATA[Patrick]]></dc:creator>
		<pubDate>Sat, 24 Sep 2011 23:32:39 +0000</pubDate>
		<guid isPermaLink="false">http://westnorth.com/2007/08/11/justifying-transit-subsidies/#comment-17389</guid>
		<description><![CDATA[A unique way to look at subsidies. I&#039;m personally a champion of the positive effects of urban rail transit, and never quite made some of these connections. Thanks for the write up!]]></description>
		<content:encoded><![CDATA[<p>A unique way to look at subsidies. I&#8217;m personally a champion of the positive effects of urban rail transit, and never quite made some of these connections. Thanks for the write up!</p>
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		<title>By: Who pays, who gains from cycling? &#171; west north</title>
		<link>http://westnorth.com/2007/08/11/justifying-transit-subsidies/#comment-13515</link>
		<dc:creator><![CDATA[Who pays, who gains from cycling? &#171; west north]]></dc:creator>
		<pubDate>Sun, 16 Dec 2007 08:19:52 +0000</pubDate>
		<guid isPermaLink="false">http://westnorth.com/2007/08/11/justifying-transit-subsidies/#comment-13515</guid>
		<description><![CDATA[[...] As with transit, this introduces a significant market failure: since the primary benefits are external and the primary costs (for most people, the fear of being hit by a car and the additional time involved) are internal, it doesn&#8217;t &#8220;seem&#8221; to make sense for any individual to take up cycling &#8212; unless society (those who benefit most from having people cycle) creates incentives to do so. In other words, governments has a responsibility to subsidize &#8220;good&#8221; behaviors (those that create significant social/external benefits, like cycling and transit use) to better balance individuals&#8217; cost-benefit calculations &#8212; all while taxing &#8220;bad&#8221; behaviors (those with high individual benefits and high social costs), like driving. [...]]]></description>
		<content:encoded><![CDATA[<p>[...] As with transit, this introduces a significant market failure: since the primary benefits are external and the primary costs (for most people, the fear of being hit by a car and the additional time involved) are internal, it doesn&#8217;t &#8220;seem&#8221; to make sense for any individual to take up cycling &#8212; unless society (those who benefit most from having people cycle) creates incentives to do so. In other words, governments has a responsibility to subsidize &#8220;good&#8221; behaviors (those that create significant social/external benefits, like cycling and transit use) to better balance individuals&#8217; cost-benefit calculations &#8212; all while taxing &#8220;bad&#8221; behaviors (those with high individual benefits and high social costs), like driving. [...]</p>
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		<title>By: Woebegone budgets &#171; west north</title>
		<link>http://westnorth.com/2007/08/11/justifying-transit-subsidies/#comment-9179</link>
		<dc:creator><![CDATA[Woebegone budgets &#171; west north]]></dc:creator>
		<pubDate>Mon, 15 Oct 2007 21:19:37 +0000</pubDate>
		<guid isPermaLink="false">http://westnorth.com/2007/08/11/justifying-transit-subsidies/#comment-9179</guid>
		<description><![CDATA[[...] by the governor (and discussed here last year), appears to have disappeared into the muck. A city gas tax hike, and parking-meter increase, disappeared between last week&#8217;s rumors and this week&#8217;s [...]]]></description>
		<content:encoded><![CDATA[<p>[...] by the governor (and discussed here last year), appears to have disappeared into the muck. A city gas tax hike, and parking-meter increase, disappeared between last week&#8217;s rumors and this week&#8217;s [...]</p>
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		<title>By: paytonc</title>
		<link>http://westnorth.com/2007/08/11/justifying-transit-subsidies/#comment-7102</link>
		<dc:creator><![CDATA[paytonc]]></dc:creator>
		<pubDate>Thu, 20 Sep 2007 00:23:47 +0000</pubDate>
		<guid isPermaLink="false">http://westnorth.com/2007/08/11/justifying-transit-subsidies/#comment-7102</guid>
		<description><![CDATA[at the Reader, at the indirect invitation of Luke. Wanted to mention somehow my discovery of I-180, the world&#039;s most useless freeway (from Princeton to Hennepin, Ill., and carrying 2,000 ADT!), but it didn&#039;t fit in. Another deleted phrase: &quot;moving passengers typically does not return high profits. Warren Buffett, ruefully looking back at his investment in USAir, noted once that &#039;if a capitalist had been present at Kitty Hawk... he should have shot Orville Wright... the airline business has been extraordinary. It has eaten up capital over the past century like almost no other business... You&#039;ve got huge fixed costs, you&#039;ve got strong labor unions and you&#039;ve got commodity pricing. That is not a great recipe for success.&#039; &quot;


John,

I don&#039;t think I&#039;ll ever be able to convince you, and frankly I&#039;m beyond sick of wasting my time responding to online inanity, but I come to defend my good name. I only need the asthma meds on muggy, smoggy summer days. Where does the smog come from? Car tailpipes. Who pays for that inhaler? I do and my boss does; I bicycle, he takes the &#039;L.&#039;

Simply put, there are internal and external costs and benefits to all actions. Driving has high internal benefits and high external costs (although you write them off, these are in fact well proven). Transit has high internal costs and high external benefits -- there are many &quot;free riders&quot; who gain economically from transit, even if they don&#039;t use it. Thus, transit&#039;s balance sheet looks a lot worse: its benefits mostly accrue off its own balance sheet. Some of what we as a region gain from transit is enhanced productivity and incredible land value. It&#039;s hard to untangle these benefits, but suffice to say that the existence of Chicago (and thus its suburbs) can be seen as a singular external benefit of railroads (or at least the I&amp;M Canal, which was financed through selling land alongside the canal). Most of the railroad companies that serve Chicago long went bankrupt -- including the old street railway companies! -- but the properties that they gave access to have continued to appreciate in value. Hence, the world&#039;s only profitable subway system is Hong Kong&#039;s -- not coincidentally a subsidiary of a giant real estate corporation.

The CTA&#039;s costs were shown by the Auditor General to be roughly in line with its peer systems, although they are rising quickly and service quality is lower. However, contract privatization (again, it&#039;s never going to make money) has not proven a panacea wherever it&#039;s been tried, whether the Hired Truck Program here or Railtrack or Metronet in the UK.]]></description>
		<content:encoded><![CDATA[<p>at the Reader, at the indirect invitation of Luke. Wanted to mention somehow my discovery of I-180, the world&#8217;s most useless freeway (from Princeton to Hennepin, Ill., and carrying 2,000 ADT!), but it didn&#8217;t fit in. Another deleted phrase: &#8220;moving passengers typically does not return high profits. Warren Buffett, ruefully looking back at his investment in USAir, noted once that &#8216;if a capitalist had been present at Kitty Hawk&#8230; he should have shot Orville Wright&#8230; the airline business has been extraordinary. It has eaten up capital over the past century like almost no other business&#8230; You&#8217;ve got huge fixed costs, you&#8217;ve got strong labor unions and you&#8217;ve got commodity pricing. That is not a great recipe for success.&#8217;&#8221;</p>
<p>John,</p>
<p>I don&#8217;t think I&#8217;ll ever be able to convince you, and frankly I&#8217;m beyond sick of wasting my time responding to online inanity, but I come to defend my good name. I only need the asthma meds on muggy, smoggy summer days. Where does the smog come from? Car tailpipes. Who pays for that inhaler? I do and my boss does; I bicycle, he takes the &#8216;L.&#8217;<br />
Simply put, there are internal and external costs and benefits to all actions. Driving has high internal benefits and high external costs (although you write them off, these are in fact well proven). Transit has high internal costs and high external benefits &#8212; there are many &#8220;free riders&#8221; who gain economically from transit, even if they don&#8217;t use it. Thus, transit&#8217;s balance sheet looks a lot worse: its benefits mostly accrue off its own balance sheet. Some of what we as a region gain from transit is enhanced productivity and incredible land value. It&#8217;s hard to untangle these benefits, but suffice to say that the existence of Chicago (and thus its suburbs) can be seen as a singular external benefit of railroads (or at least the I&amp;M Canal, which was financed through selling land alongside the canal). Most of the railroad companies that serve Chicago long went bankrupt &#8212; including the old street railway companies! &#8212; but the properties that they gave access to have continued to appreciate in value. Hence, the world&#8217;s only profitable subway system is Hong Kong&#8217;s &#8212; not coincidentally a subsidiary of a giant real estate corporation.</p>
<p>The CTA&#8217;s costs were shown by the Auditor General to be roughly in line with its peer systems, although they are rising quickly and service quality is lower. However, contract privatization (again, it&#8217;s never going to make money) has not proven a panacea wherever it&#8217;s been tried, whether the Hired Truck Program here or Railtrack or Metronet in the UK.</p>
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		<title>By: paytonc</title>
		<link>http://westnorth.com/2007/08/11/justifying-transit-subsidies/#comment-6333</link>
		<dc:creator><![CDATA[paytonc]]></dc:creator>
		<pubDate>Sat, 15 Sep 2007 09:14:40 +0000</pubDate>
		<guid isPermaLink="false">http://westnorth.com/2007/08/11/justifying-transit-subsidies/#comment-6333</guid>
		<description><![CDATA[at Zorn&#039;s blog. Where do these ignoramuses come from?

Okay, I&#039;m officially beyond tired of pointing this out several times a day: the Texas Transportation Institute pegs mass transit&#039;s time savings to Chicago area drivers at $1.6 billion a year! That&#039;s &lt;i&gt;twice as much&lt;/i&gt; as the region spends &quot;subsidizing&quot; mass transit -- and doesn&#039;t even begin to count countless other benefits of mass transit that you take for granted. For instance, state spending on transit generates far more local economic activity than spending in any other sector of the economy. In fact, a recent study about transit service cuts in Philadelphia calculated that &quot;saving&quot; $100M through transit cuts would cost local governments nearly twice as much in lost tax revenue.

Your gas taxes pay for roads, but they sure don&#039;t pay for my asthma medication. (The asthma hospitalization rate for neighborhoods along the Dan Ryan is four times higher than the national average.) Gas taxes also don&#039;t pay for fire trucks and hospital bills when a child gets run over in a hit-and-run. Gas taxes don&#039;t pay to mitigate the 19 pounds of carbon dioxide produced by that gas -- just that one cost is worth $1.61 (per gallon!) under Sweden&#039;s carbon tax. Gas taxes don&#039;t pay to keep aircraft carriers stationed in the Persian Gulf. Gas taxes didn&#039;t pay for the Deep Tunnel sewer system, which was only needed after suburban sprawl paved over the whole of Cook County. Gas taxes pay for roads that could be 90% smaller if all they carried was commercial and emergency traffic. Your gas taxes and tolls, according to any fair study of &quot;the full costs of driving,&quot; amount to a small fraction of what driving costs our society -- the taxes should be anywhere from $1 to $5 more per gallon if they did.

Why shouldn&#039;t fares go up? Perhaps they should go up some, but since you don&#039;t ride transit, you&#039;d never realize that the cost of a CTA cash fare (assuming &quot;doomsday&quot;) has gone up nearly 60% since 1998, even while the cost of driving (according to AAA) has actually declined 10% since then. We as a society (and thus our government) have an economic, environmental, and social interest in not only providing transit, but in fully utilizing that investment (i.e., convincing people to ride it) -- raising fares while the cost of driving declines sounds like a stupid way of doing that.

I don&#039;t even ride transit all that much, but having lived in cities that weren&#039;t built around transit, I appreciate that having transit allows Chicago to be the compact, lively, interesting city that it is. If I wanted to live in a sprawling, traffic choked dump -- and if mass transit collapses, that&#039;s what we&#039;ll be left with -- you think I&#039;d have chosen to move here?]]></description>
		<content:encoded><![CDATA[<p>at Zorn&#8217;s blog. Where do these ignoramuses come from?</p>
<p>Okay, I&#8217;m officially beyond tired of pointing this out several times a day: the Texas Transportation Institute pegs mass transit&#8217;s time savings to Chicago area drivers at $1.6 billion a year! That&#8217;s <i>twice as much</i> as the region spends &#8220;subsidizing&#8221; mass transit &#8212; and doesn&#8217;t even begin to count countless other benefits of mass transit that you take for granted. For instance, state spending on transit generates far more local economic activity than spending in any other sector of the economy. In fact, a recent study about transit service cuts in Philadelphia calculated that &#8220;saving&#8221; $100M through transit cuts would cost local governments nearly twice as much in lost tax revenue.</p>
<p>Your gas taxes pay for roads, but they sure don&#8217;t pay for my asthma medication. (The asthma hospitalization rate for neighborhoods along the Dan Ryan is four times higher than the national average.) Gas taxes also don&#8217;t pay for fire trucks and hospital bills when a child gets run over in a hit-and-run. Gas taxes don&#8217;t pay to mitigate the 19 pounds of carbon dioxide produced by that gas &#8212; just that one cost is worth $1.61 (per gallon!) under Sweden&#8217;s carbon tax. Gas taxes don&#8217;t pay to keep aircraft carriers stationed in the Persian Gulf. Gas taxes didn&#8217;t pay for the Deep Tunnel sewer system, which was only needed after suburban sprawl paved over the whole of Cook County. Gas taxes pay for roads that could be 90% smaller if all they carried was commercial and emergency traffic. Your gas taxes and tolls, according to any fair study of &#8220;the full costs of driving,&#8221; amount to a small fraction of what driving costs our society &#8212; the taxes should be anywhere from $1 to $5 more per gallon if they did.</p>
<p>Why shouldn&#8217;t fares go up? Perhaps they should go up some, but since you don&#8217;t ride transit, you&#8217;d never realize that the cost of a CTA cash fare (assuming &#8220;doomsday&#8221;) has gone up nearly 60% since 1998, even while the cost of driving (according to AAA) has actually declined 10% since then. We as a society (and thus our government) have an economic, environmental, and social interest in not only providing transit, but in fully utilizing that investment (i.e., convincing people to ride it) &#8212; raising fares while the cost of driving declines sounds like a stupid way of doing that.</p>
<p>I don&#8217;t even ride transit all that much, but having lived in cities that weren&#8217;t built around transit, I appreciate that having transit allows Chicago to be the compact, lively, interesting city that it is. If I wanted to live in a sprawling, traffic choked dump &#8212; and if mass transit collapses, that&#8217;s what we&#8217;ll be left with &#8212; you think I&#8217;d have chosen to move here?</p>
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