Imagine a group of competing real estate agents circling around a block in midtown Manhattan looking for an empty lot to build a new office building on. As their search comes up fruitless, some of them decide to expand their search to a few extra blocks on the periphery, while others, in their growing state of agitation, start to push and shove their competitors out of the way.
If you think that such a ridiculous spectacle could never take place, not least because finding an empty lot in the center of a busy metropolis is an impossible task, then consider how road space for car storage and vehicular traffic is allocated today in almost all of the world’s cities. Curb space tends to be drastically underpriced compared to the market price by city governments.
But that is just one of the many ways that motorists are getting away with not paying for the full cost of the public goods that they consume.
Counting the costs
The social costs associated with private vehicles are immense. According to the World Health Organization, there were 1.3m traffic deaths globally in 2013, and somewhere between 20m and 50m people sustained traffic related injuries, with many becoming disabled.
But these figures do not account for the full lethal potential of motor vehicles. Vulnerable road users in most countries are forced into modifying their behavior to reduce the carnage by accommodating lawless drivers – for example, by relinquishing their right to have priority at a crosswalk. Sadly, for most people on foot this has become almost instinctive.
The most damaging effect of all of the pernicious outcomes, though, is the one that is the hardest to quantify: the opportunity cost of all of the walking and biking trips that do not occur because of the fear of being run over by an automobile. Cities should be designed, and laws enforced, with the goal of creating “8-80 Cities:” anyone, including eight year-olds and 80 year-olds should be safe and comfortable walking around or riding a bike.
Private motorised transport also plays a critical role in another of the world’s great health crises, the rise of obesity. Here, too, the damaging effects become compounded. A sedentary lifestyle is unhealthy for the motorist, but by forcing others to also utilize some form of transportation that does not involve any physical exertion, the social costs are multiplied.
The Overseas Development Institute, a British think tank, reported in a 2014 study that the number of overweight or obese persons in the world has exceeded 900m, with particularly alarming increases in the developing world. Since 1980, overweight and obese rates have doubled in China and Mexico, with North Africa, the Middle East, and Latin America having already reached rates that are comparable to that of Europe as a whole. Without major reforms, rates in the developing world, where traffic laws are typically poorly enforced and roadways frequently lack shoulders or sidewalks, are likely to get worse.
There are other more literal costs involved in car-dominated cities: motor vehicles have an insatiable appetite for space. In London, around 80 per cent of all public space is dedicated for roads and parking spots, a figure that is typical for large cities around the world.
In 2014, designer Mikael Colville Anderson tracked how much of cities is given over to cars, pedestrians and cyclists. This is Paris.
Reserving the majority of the world’s most valuable public real estate for vehicles adds up to a colossal hidden cost. It is estimated that, in San Francisco, just the parking spots on public streets represent a real estate value between $8bn and $35bn.
Instead of using this space to store empty metal boxes or to enable drivers to engage in the least efficient mode of urban transportation, these spaces could be used as parks, outdoor seating areas, bike lanes, sports fields, impromptu venues for musicians, or could serve any of a myriad of other functions.
Even more importantly, by restricting private motorised transport, cities could become denser while maintaining livability: this would allow more workers from the countryside to move to the world’s urban conglomerations, and harvest the improvements in productivity and increases in welfare that take place as cities become bigger.
So – motorists occupying such highly prized public spaces should be forced to pay the full market value for them.
In economics, an externality refers to a situation where the actions of one actor impose a cost or a benefit on somebody else. Single-occupant motor vehicles in urban areas create large negative externalities for everyone else.
These externalities include both costs that are more local in nature, such as congestion, collisions, noise, smog, and other types of pollution, and costs that are global in their reach, including climate change, oil dependence, and suburban sprawl.
In an ideal world, a road charging system would be in place that accounts for all negative externalities by charging drivers for using public roads, with the price dependent not just on location but also on time of day. Even a few years ago, this would have been considered fanciful, but GPS-based technology allows such a system to be set up quickly and inexpensively.
A few cities have implemented rudimentary road pricing schemes. In London, since 2003 drivers pay a £11.50 congestion charge on weekdays to enter the center city. In 2015, three economists at the Management School at Lancaster University compared collision rates within and near the congestion zone in London to a control group of 20 other cities in Britain. The researchers found that, on an annual basis, the number of collisions declined by one-third within the congestion zone after 2003, while miles driven within the charging zone decreased by only 14 per cent.
A car leaves London’s congestion charge zone in 2006. Image: Getty.
The rate of collisions even declined by about 15 per cent in the widest spillover zone, defined as a 4km wide circle around the congestion zone, showing that the congestion charge has not dispersed traffic, or danger, to the surrounding areas. The bicycle collision rate dropped by a striking 80 per cent – from 22.7 collisions per miles cycled to 4.6 (although some of the decline can be attributed to more cycling in general).
Others of the world’s metro areas have pioneered promising innovations in traffic management. In the Netherlands, the bicycling infrastructure is so well developed that biking from one address to any other address in the country is always convenient and safe. Within Dutch cities, cycling is prioritised over motor vehicles, and the physical infrastructure is designed in such a way as to make lawbreaking by drivers difficult.
In Amsterdam’s historical districts, the bike paths running alongside the busier roads are always on an elevated platform when crossing in front of side streets, creating a substantial speed bump for turning drivers. The side streets have frequent, uniform speed bumps that make speeding a near impossibility. Parking is expensive and parking enforcement is vigorous.
Under Dutch law, motorists colliding with cyclists are presumed to be at-fault, unless it can be established that the collision was unavoidable. The result has not been injustice promulgated upon drivers, but a massive reduction in collisions that has made Dutch streets some of the safest in the world. In many Dutch neighborhoods, signs announce that automobiles are to be considered as guests.
This is the way that it should be: the law should place a much higher level of responsibility on those who wish to pilot a multi-ton metal object with the potential power output hundreds of times that of a human being through a neighbourhood than on those who are out walking or cycling.
But complicated traffic laws have been invented for the benefit of drivers. A driver should not be allowed to make the assumption that others out on public streets have the capacity or maturity to be able to abide by those same rules. The reason the young, the infirm, or those with a bevy of medical conditions are not allowed to have a driver’s license is exactly because driving requires a higher level of both physical and mental cognizance.
And what about the mispriced curb space, the effects of which were described at the beginning of this story? A 2006 study has found that, in the afternoons and evenings, on average 28 per cent of drivers on Prince Street in the Soho neighborhood of Manhattan were looking for a parking spot. This not only adds to the congestion; it also leads to an inefficient allocation of parking spots by rewarding those who least value their time to hang around the longest until a spot opens up. Parking at the curb, which is the most convenient solution, should be more expensive than parking in a nearby garage – but in American cities, it is usually the other way around.
Several years ago, San Francisco embarked on an ambitious project to revolutionise the management of parking spots. Under a program known as SFpark, in seven pilot zones, the city has implemented demand-responsive pricing to open up at least one parking spot on each block, with the goal of eliminating circling and double-parking.
The price for parking can vary between 50 cents an hour to $6.25 an hour. The new system is not only a major benefit to motorists, who can now expect to reliably be able to find a parking spot upon arrival, but also to nearby businesses as the number of customers whose parking needs are accommodated can be maximised.
Crowded buses in a typical urban environment are maddeningly delayed by all the private vehicles that clog the roads. When the few are allowed to hold up the many, the public policy failure is exasperating.
What makes this policy all the more detestable is that distances in urban areas are typically short, so if public transportation were given a priority, all residents could get to their destinations much faster. For example, the distance in Manhattan from 96th Street to downtown New York is less than seven miles – a journey that an express bus or a street car could easily cover in a short period of time if cars were not blocking the way.
The Brazilian city of Curitiba has pioneered the bus rapid transit (BRT) system, providing convenient and fast urban mobility at a much lower cost than building underground subway lines. The system combines dedicated bus lanes in the center of the road with ingenious refinements to maximise speed: passengers pay their fares before boarding, the floors of the buses line up evenly with the bottoms of the attractively designed bus stop shelters, and buses are given priority at intersections.
Other cities in Latin America and elsewhere have adopted similar systems, with Bogota having an especially widespread network of BRT buses that carry 2.2m passengers daily.
Another BRT system: this one’s in the Johannesburg township of Soweto. Image: Getty.
Stopping the carnage
The AAA Foundation, a research institute committed to advocating policies that reduce traffic fatalities and injuries, has performed a study to determine the likelihood of a pedestrian being killed or injured when struck by a motor vehicle traveling at various speeds. The results were eye-opening: relatively slight differences in traveling speeds can produce hugely divergent outcomes. At 20mph, the risk of death is 7 per cent, at 25mph it is 30 per cent, and at 30mph it is 50%. If the vehicle is traveling at 40mph, then the risk of death reaches a staggering 80 per cent.
Studies such as this showcase the importance of reducing speed limits as advocated by groups such as “20’s Plenty for Us,” an activist group in the United Kingdom made up of volunteers. Thanks to their efforts, “more than half of the largest 40 urban authorities in the UK have a policy of setting 20mph as the default for all their streets”.
But it is not enough to codify lower speed limits into law: those lower speeds must be enforced. Countries with strict traffic enforcement, typically making widespread use of automated speed cameras, enjoy the lowest rates of road fatalities per 100,000 residents in the world. Switzerland, with 3.3 traffic deaths per 100,000, one of the lowest rates of any jurisdiction, has strict enforcement where not only steep fines but license suspensions are also commonly meted out to offenders.
The best systems utilise two cameras to calculate an average speed for drivers over a given distance based on automated number plate recognition technology (this system is sometimes referred to as “section control”). After 40 per cent of Italian freeways were equipped with cameras to calculate the speed of motorists for distances between 10 and 25 km, the total number of collisions declined by 19 per cent and deaths decreased by 51 per cent.
Best of all would be a system based on GPS technology that would automatically detect the location of a vehicle, and electronically limit the speed to the maximum legal speed on that particular section of the road. This system would provide the best of all worlds: full compliance with the law, maximum protection for pedestrians and other vulnerable road users, and at the same time drivers would not need to worry about being fined by inadvertently breaking speed laws. The technology is available, it is inexpensive, and policymakers should implement this system expeditiously.
Undoubtedly, if the cost of driving were to incorporate all of the negative external costs that private vehicles impose on others, driving would become less affordable, and some may be priced out of the market, at least at certain times of the day. But if externalities are not fully accounted for, then driving is being subsidised. The key question then becomes: should governments subsidise the cost of driving, either for all motorists or only for those who would find driving otherwise to be unaffordable?
Cameras monitor in traffic at the Norrtull entry to Stockholm in November 2005. Image: Getty.
The major branches of political thought diverge greatly on the degree to which they assign to the state responsibility for ensuring that all citizens are able to lead a dignified life and for providing a safety net for those in need. More social democratically inclined states frequently provide cost-free or subsidised education, health care, public transportation, nutritional needs, or, in lieu of provisions in kind, give out direct cash transfers to their poorest citizens. Even by the broadest definition of social provisions, driving cannot be included in this list. If the use of public space is going to be subsidised for some purpose, then surely letting a poor person build his home in a parking spot would be a more worthy endeavor than letting a richer citizen leave his automobile in the same location.
Particularly in the United States, the lack of transportation choices is a major burden on the poor. It is enormously inefficient and expensive to have to carry 4,000 pounds of metal around every time a person wishes to move from one spot to another, but in much of the US, even in areas where cost-effective alternatives could be set up, that is exactly what everyone is forced to do. Low income households are frequently cut off from access to jobs or career opportunities due to a lack of public transportation. According to the Brookings Institute, on average only 30 per cent of the jobs are within a 90 minute commute by public transportation for a worker in a US metro area.
Must Do Better
For much too long, drivers have gotten away with not paying for the damage that they unleash on societies, both due to nefarious official policies and due to the tolerance that authorities have shown towards lawless and dangerous behavior. Urban residents are forced to bear the burden of these flawed policies. A revolution in traffic management in the world’s cities is needed.
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