My latest Record column is on the public subsidies for highways:
Taxpayer Money Should Fund Transportation Efficiently
Today’s lesson in economics: When something good is free, people take more of it. But if it’s the government handing out the free lunch, you better believe you’re paying for it. Space on provincial highways like Highway 401 is one such free lunch, and it’s often painfully clear to motorists that this space is in high demand. Much of that demand is thanks to the taxpayer subsidy for highways.
Insufficient road capacity has been a perennial problem ever since we started driving everywhere and choosing where to live based on road connections. The perennial solution has been to add new roads and widen, widen, widen — neighbourhoods and the environment be damned. It hasn’t worked, however, thanks to the phenomenon of induced demand. Once a busy highway is widened, it only takes a few years before people move in to new, cheap houses further out along a clear commute — and the highway gets congested again. Taxpayer money is thus spent to turn the problem of traffic congestion into two problems: traffic congestion and more infrastructure to maintain.
As crumbing bridges across North America can attest, we haven’t even kept up with the maintenance of our existing road network, much of it built in the 1960s and 1970s. Every new overpass is an overpass that has to be replaced in 40 or 50 years. Every new lane of roadway is an extra lane to repave every several years. More space on the roads results in more driving, leading to the lost productivity costs of congestion and more injuries sustained and lives lost in the lane of duty (with attendant emergency response costs). And, of course, more driving costs the environment through desperate oil production, carbon release and air pollution. Highway spending nets us a much larger bill than we bargain for.
The financially sustainable solution to congestion requires providing transit that is sufficiently good to attract drivers. Transportation by rail uses fewer resources to carry more people, and arguably in more comfort. The infrastructure requires less maintenance, lasts longer, and is lighter on the environment and public health. All costs considered, train service is less expensive than building and maintaining more highway space.
Commuters’ decisions are based mostly on the personal costs and benefits of the choices available to them. They have no great love of driving on busy highways (even free ones), but they can’t take an alternative that doesn’t exist. When presented with serious alternatives to driving, commuters flock to them in droves. The popularity of commuter rail, such as GO trains, indicates that plenty of people would choose to get to work by train.
Instead of spending double-digit billions on further highway expansion, Ontario should funnel transportation funds into train service, such as GO train extensions to Kitchener and to Cambridge, the Waterloo Region light rail project, and frequent and fast train service on the Quebec City-Windsor corridor. With good alternatives in place — which could even be as simple as dedicated bus lanes — Ontario should implement dynamic user fees on limited-access highways to pay for upkeep and to eliminate congestion.
Some would take the train and others would take the bus on those same highways. Yet others would move closer to work — like the three-fourths of Waterloo Region commuters who travel less than 10 km to work (and who currently subsidize those long highway commutes). Of course, occasional and regular users who find the highway worth paying for would have a faster, congestion-free commute.
Limited-access highways are at best a wasteful kind of transportation infrastructure, but when congested they are a tragic waste of economic resources. If we believe in subsidizing transportation systems, we should be doing so efficiently, and doing it to improve overall quality of life.