Public Transit Is Off-Track

Public Transit Is Off-Track

Randal O'Toole Fall 2009

America faces many environmental challenges, ranging from energy shortages, pollution, and greenhouse gas emissions to disappearing wildlife habitat. While these problems may be real, special interest groups provide predetermined solutions that do not reflect reality. One special interest that illustrates this point is the public transit lobby. Increased funding for mass transit is sold as the way to cure everything from obesity to global warming.

Massive Costs

Transit serves the important purpose of providing mobility for people who lack access to automobiles, or prefer not to drive them. Forty-five years ago, private companies met that need by operating a profitable (if declining) industry that served most major American cities.

In 1964, however, Congress passed the Urban Mass Transit Act, offering federal capital grants to public transit agencies. Within a few years, most cities purchased the private companies that operated transit and began pouring huge amounts of tax monies into transit.

The visible result was that new buses replaced old, light rail and subways replaced buses. Of course, taxes were increased to pay for all of these things. The practical results, however, were negligible. Per-capita ridership continued to decline. If it increased some years, it did so mainly in response to high gasoline prices, rather than anything transit agencies did to attract new riders.

In 1964, for example, the average American rode transit more than 60 times a year. By the late 1990s, it had fallen below 40 trips per year. By 2008, thanks to high fuel prices, it rose to 46 trips per year. But if past fuel shortages are any guide, Americans’ long-run response to higher gas prices will be to buy more fuel-efficient cars.

Charles Lave, the late University of California Irvine economist, pointed out that the huge increase in spending on transit, combined with negligible increases in transit ridership, meant a “large decline in the industry’s productivity.” If transit productivity had just remained constant since 1964, the cost of operating transit systems would be at least 40 percent lower.

“It’s uncommon to find such a rapid productivity decline in any industry,” said Professor Lave. “Nor is there anything inherent in the transit industry that creates decline. Among privately owned bus companies, productivity rose 8.3 percent over this period.”

The Public Transit Lobby

Today, thanks to the efforts of the well-funded American Public Transportation Association, many elected officials are convinced that mass transit uses significantly less energy than cars, and that spending more money on mass transit will lure significant numbers of people out of their cars.

Both assumptions are wrong. In 2006, the latest year for which data are available, the Department of Energy estimated that the average car used 3,512 British thermal units (BTUs) of energy per passenger mile. Meanwhile, the Federal Transit Administration’s National Transit Database reveals that public transit used 3,444 BTUs per passenger mile. The gap is little more than a rounding error.

Since 1990, federal, state, and local governments have poured more than $200 billion in capital funds—mostly from highway user fees—and another $200 billion in operating subsidies into transit systems. Yet, total transit ridership grew slightly slower than the nation’s population growth.

Indeed, the real problem with transit is that it has too much money. Awash in “free” federal money, transit agencies buy buses that are bigger than they need, or embark on ambitious plans to build expensive rail systems.

Portland’s Rail Lines

Cities such as Portland, Oregon receive enormous positive publicity for their rail transit programs. The city opened its second light rail line in 1999, a third one in 2001, and a fourth in 2004. The city also installed a downtown streetcar line in 2001. For this it receives regular accolades from the likes of The New York Times, which calls it “the city that loves transit.”

Portland’s elected officials also love mass transit. Specifically, they love the rail contractors who make healthy donations to their political campaigns. However, the voters rejected a tax increase to build more rail transit in 1998. The elected officials built the new lines anyway.

Predictably, the addition of the new rail lines failed to entice new mass transit customers. Census data reveal that, between 2000 and 2007, more than 70,000 new Portland-area commuters started driving to work. Meanwhile, the number of commuters taking transit to work actually declined. Even among commuters with jobs downtown—traditionally the heart of transit usage—transit commuting declined.

Greenhouse Gasses

Portland’s electric-powered rail lines get most of their power from hydroelectric dams, so their greenhouse gas emissions are low. But building the lines used enormous amounts of energy and released huge volumes of greenhouse gases. The environmental impact statement for Portland’s most recent rail line noted that it would take decades of operational savings to make up for the greenhouse gases released during construction.

Rail transit agencies in regions that rely largely on fossil fuels to generate electric power can’t even honestly say that their operations reduce greenhouse gas emissions. For example, in 2006, rail transit systems in Baltimore, Cleveland, Denver, Miami, Philadelphia, and Pittsburgh emitted more greenhouse gases per passenger mile than the average SUV, while the Washington, D.C. subway, and light rail lines in Dallas and Salt Lake City emitted more greenhouse gases per passenger mile than the average car.

Rail transit tends to use less energy than buses, but building a new rail line does not mean the transit system will save energy. The problem stems from the shorter bus runs to the train stations, or “rail feeder routes.” Because many rail riders prefer driving to the rail station over taking a bus, the feeder routes often run nearly empty. Thus, many transit agencies end up using more energy per passenger mile after opening new rail lines.

Public vs. Private

Part of the problem stems from the fact that most Americans are subsidizing transit bureaucracies.

A sharp contrast can be drawn between public transit buses and private intercity buses. Transit buses rank alongside SUVs as the nation’s least energy-efficient vehicles because they run, on average, five-sixths empty. By contrast, the more crowded intercity buses rank among the most energy-efficient motorized modes of transportation in America, consuming far less energy per passenger mile than the most efficient rail lines.

The reason for this is clear. Transit agencies, hungry for tax revenues, seek to tax the largest area possible. In return for their tax spoils, they must provide transit service to every tax-paying community, even those that have three cars in every garage and have little interest in public transportation.

Private bus companies, by contrast, have a powerful incentive to only provide routes where they can fill their buses and spend the least per passenger mile on fuel.

Solutions Based on Goals

If environmental conservation is our desired result, rather than blindly subsidizing mass transit, we must set tangible goals.

If the goal is to provide mobility for people who lack access to an automobile, our federal or local governments should provide transportation vouchers. Such vouchers could be used for any public conveyance, from taxis to transit to intercity trains to the airlines.

If the goal is to reduce the deleterious environmental impacts of driving, we must focus on the cars, not substitutes for them. If 85 percent of Americans’ time spent traveling takes place in a car, and only 1 percent of travel time is spent in mass transit, reducing the effects of driving by a small amount will have a more significant impact than increasing transit by a large amount. This is the “law of large proportions,” said Professor Lave, which means “the biggest components matter most.”

Learning from Air Pollution

Similar choices were necessary in America’s battle against toxic air pollution. In the late 1960s, the air in many American cities was darkened with pollution. Congress passed the Clean Air Act and created the Environmental Protection Agency (EPA) to enforce new laws. The EPA required auto manufacturers to use new technologies to reduce pollution. The agency also encouraged cities to adopt policies to discourage driving and increase transit ridership.

Four decades later, the technical solutions to pollution have produced fantastic results. Though Americans drive three times as many miles today as they did in the late 1960s, our cars collectively produce only about a third as much toxic pollution. Both cars and the air get cleaner ever year.

Meanwhile, the behavioral solutions failed. Not a single American city can claim that its transit, land-use, or other transportation policies reduced per-capita driving by even 1 percent.

Railroaded by Washington

Failing to learn this lesson, Washington is poised to redouble these mistakes. Congress now seeks to increase diversions from highway user fees into transit. At the same time, the Barack Obama Administration proposes to build 8,500 miles of high-speed intercity rail lines. Based on projections from various state transportation agencies, the cost of the proposed system will be close to $100 billion. Political demands to extend the system could easily increase the cost to more than $500 billion.

While the Interstate Highway System costs about $425 billion, gas taxes and other highway user fees cover 100 percent of that cost. By contrast, nearly all of costs of high-speed rail will have to come from ordinary taxpayers who will rarely, if ever, ride the trains. Indeed, while the average American travels 4,000 miles per year on the interstates, the average American will travel less than 60 miles per year on the administration’s proposed high-speed rail system.

Those who ride the rail will not be helping the environment. The administration claims that its high-speed rail will reduce greenhouse gas emissions by 6 billion pounds a year, an amount equal to only 0.05 percent of our total greenhouse emissions. Moreover, this figure assumes, for example, that automobiles in 2025 will only be 85 percent as energy efficient as would result from the implementation of President Barack Obama’s own fuel economy standards. Meanwhile, it also assumes that trains will operate 70 percent full, when in fact Amtrak corridor trains fill only 51 percent.

Correcting these assumptions suggests that high-speed trains will increase rather than reduce greenhouse gas emissions.

Making a Difference

Those who want to save energy in intercity travel should emphasize intercity buses rather than trains.

Those who want to save energy in urban travel should encourage privatization of our transit systems, because private operators will have much more powerful incentives to be energy-efficient than transit agencies that rely on tax dollars for three-fourths of their funding.

Those who truly want to save energy should focus on making automobiles more energy efficient. This means more than just smaller cars. Traffic congestion wastes nearly 3 billion gallons of gasoline each year, and simple, low-cost techniques such as traffic signal coordination can relieve congestion, save more energy, and do more to reduce pollution and greenhouse gas emissions than the most massive investments in either urban or intercity rail.

America can spend hundreds of billions in a nearly futile attempt to make collective transportation attractive enough to reduce time behind the wheel. Or it can invest wisely in technical solutions that will reduce the environmental impacts of that driving. The choice we make in the next few years will have an enormous impact on the environment.

Randal O’Toole is a senior fellow with the Cato Institute and author of The Best-Laid Plans: How Government Planning Harms Your Quality of Life, Your Pocketbook, and Your Future (Cato Institute, 2007).