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Tim G

In Australia (and especially Brisbane) we seem to be moving more and more to a user pays system on new road builds. Housing estates tend to pay for the local roads and many new road projects have tolls. This is good.

What is not good is that the road lobby continually complain about this. As a public transit user I don't ask that my use of transport be oversubsidised, I merely ask that private transit users not be as oversubsidised as they demand. I especially can't understand why it is usually the more right wing users who expect the government to subsidise them the most.

What other government service has quite the same ridiculous funding blindness as roads? Could you imagine the furore if eg. shipping companies demanded subsidised access to our ports. Yet this is exactly what the road lobby do any time they're hit with close to the real cost of their pastime.



And what about the operating costs of highways? As just one example, I suspect a large fraction of police departments are devoted to enforcing traffic laws. Law enforcement on transit tends to get counted in the transit budget, but law enforcement on roads and freeways gets counted against the law enforcement budget.

@Tim G: I find that the populist sort of right wingers tend to love subsidies that help them and hate subsidies that help others. And, while I don't know about Australia, the "funding blindness" you describe does happen in the US outside of the context of roads. States and municipalities often end up giving significant tax breaks, loans, or outright subsidies (including using the power of eminent domain) to developers, corporations looking to build a headquarters or major campus, or sports teams looking for a subsidized stadium. It's argued that they have to do this to compete against other states and municipalities to attract companies or sports teams, but it can and does get to the point where they end up spending more money on subsidies than they'll ever get back in tax revenue.


But governments DO fund dredging and other assorted infrastructure for ports, right? Gotta keep 'em coming here or they'll go to...Norfolk or wherever.

Just like transit, roads are, to at least some extent, a public good. Roads provide space between buildings, allow for light and air. They allow police, medical, fire emergencies, buses, and public works and service vehicles. Non-drivers should get all of this from roads, but if we purely pay in gas tax and auto fees, these folks won't pay any. At some point, of course, there's the marginal capacity only for private motorists. So are we only talking about highways? When do streets begin and highways end? There's a considerable amount of gray area, esp. in suburbs where main road are perpetually upgraded to the point of expressway design. (It's my contention that when a suburban road reaches a certain number of lanes, traffic, and speed, it has past the point of no return and should become fully grade-separated. This is usally only an inevitability if one doesn't plan a real street grid, but I digress.)


@CroMagnon: The problem is not that roads are subsidized. Like you said, they're a public good that we all benefit from. The problem is that many people refuse to accept that these subsidies exist, and so money is often spent on roads even when it would be better spent on transit.

Tim G

Good luck trying to offload in Norfolk but I do see your point. I'm totally OK with some subsidy for roads, just as I am for other things. I simply find it ironic that the biggest supporters of subsidised traffic seem to be people who ostensibly disagree with government subsidies.

And if all road users paid fairly then all users of roads would pay through incidental costs. With the current system all people pay for roads which some use constantly and others use minimally. And that's ignoring the social engineering (through geography) inherent in road planning. Anyone who buys cheap housing near a toll-free major freeway has simply offloaded some of their costs to other people.

The current payment system is poor but the technology exists to make it better. Petrol taxes are good for paying for environmental damage but poor for paying for land use/repair etc. Flat road taxes are unfair on infrequent users who end up subsidising frequent users. Congestion charges and more complex GPS based tolling are a far fairer system which ensure that the user pays.

Of course overall a compromise between user-pays and public good is required. But good governmence should require that this is based on value for money, a metric where roads often fail.


Is there any work on this question from academics who have more standing as unbiased analysts? PIRG doesn't qualify on neutral predisposition any better than the Heritage Foundation, which has its own report on the question posted here: http://www.heritage.org/research/reports/2009/06/federal-transportation-programs-shortchange-motorists-update-of-a-usdot-study

Alon Levy

The PIRG numbers are completely lifted from the FHWA. The numbers exclude local roads that are ineligible for gas tax funding, so actual road subsidies are a lot higher, though how much is hard to say.

The closest thing to a full account is a Keep Texas Moving study that got wiped from the Internet and exists only in web archives. The key phrase to Google is "Asset value index." The conclusion is that, fully amortized, the best performing Texas roads recover 50% of their costs through gas taxes, and some recover 16%.


Rail and bus transit carry people. Roads carry good and people. Rail and bus transit require the services of unionized workers. Other than maintenance crews, roads do not.


Rail freight movement is a largely private endeavor. Railroads pay income and property taxes on their holdings.

Trucking freight operates on a "socialized" road system in which they pay a small fee to operate on (and do much of the damage to roads). The roads they operate on do not pay property taxes on the land they consume as they are mostly public goods.

The inequity of our transportation market is vast and unfair. How can we know what's the best method of travel if the costs are not properly borne?


Rail freight may be a private endeavor but I recently heard rail expert Terry Whiteside say that Amtrak pays 90% of the track repair and maintenance for the rail lines through Montana and North Dakota. These lines run one passenger Amtrak train each way every day and dozens of freight trains a day on the same tracks. My first thought was no wonder Amtrak is always broke.


I suppose indirectly, sales tax on motor vehicles could be considered a user fee for roads to some extent. On the other hand this is a fee paid whether the vehicle is driven or not, so it is an inefficient way of subsidizing roads compared to a usage-based fee. Certainly usage-based fees (gas tax and road tolls) alone do not come close to paying for road infrastructure.

Otso Kivekäs

You are omitting one important cost of traffic: accidents. in Helsinki the cost off accidents is about twice the yearly budget of maintaining the streets.

Of course this depends on the value of human life. In western countries it tends to be defined so high, that even one death may change equations in local level. In Finland the theoretical price is calculated to 1,7 million euro ($2,26M).

Alon Levy

In the US the theoretical price is calculated as $4-5 million, for insurance purposes.


I suppose indirectly, sales tax on motor vehicles could be considered a user fee for roads to some extent. On the other hand this is a fee paid whether the vehicle is driven or not, so it is an inefficient way of subsidizing roads compared to a usage-based fee. Certainly usage-based fees (gas tax and road tolls) alone do not come close to paying for road infrastructure.

Sales taxes levied specifically on motor vehicles, yes.

General sales taxes, no--a general tax on goods and services is not counted as a vehicular "user fee" when it happens to be incidentally levied against vehicles, or their fuel, parts, or related services like repair and maintenance.

And likewise, quite a few analyses treat excise taxes on fuels as a "user fee"; this is only appropriate to do when the excise tax is on top of any general sales tax. Otherwise, only the difference between the two can be considered a "user fee"--many states levy the excise tax but exempt fuel from the general sales tax.

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