Public Transit: Worthwhile Investment?

Posted on April 01, 1997 | Type: Policy Report | Author: John Semmens
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EXECUTIVE SUMMARY

Should taxpayers pay to fund expansions in existing public transit? That is the question facing city governments throughout the Phoenix metropolitan region. Admittedly, the purported benefits of expanded public transit are seductive: reducing traffic congestion, improving urban air quality, helping the poor and promoting a community's prosperity. The following report examines each of these claims in detail and finds that public transit cannot make a cost-effective contribution to any of these objectives.

Congestion. In order to relieve congestion, public transit will have to lure drivers from their cars in significant numbers. This would be contrary to over 50 years of declining ridership. Since World War II ridership has declined by about two-thirds, from 23 billion annual trips to around 8 billion in recent years. Even in the central city, over 90% of the travel is made in cars. Even the poor do most of their traveling in cars. In the $15,000 and under annual income category, 80% of the travel is in cars. Transit's share of travel in the Phoenix metropolitan region, while not in as precipitous a decline as in the rest of the nation, is not growing. Data from 1980 through 1996 indicate that transit's share has never reached even 1% of the total travel.

Pollution. Since public transit spends a lot of money to lure a few people out of their cars, it is not a very cost-effective way to reduce urban air pollution. Transit ranks near the bottom of the list in terms of cost-effectiveness in reducing air pollution. Rail transit ranks dead last, costing hundreds of thousands of dollars per ton of pollution reduction. The magnitude of the impacts for transit measures is also small. Regardless of whether bus or rail is employed, the impacts are all projected to be less than 1%.

Economic Growth. Public transit "investment" is an inefficient way to help the economy. Federal spending on public transit since 1965 can be credited with assets and returns that currently support about 900,000 jobs. However, if the same money had been "spent" on a cut in corporate tax rates for example, the economy could theoretically have supported seven million more jobs than it currently does.

Unfair Subsidies. Contrary to what its supporters claim, public transit is more heavily subsidized than automobiles. The net subsidy for autos is around 17 cents per person-mile. For busses it is 40 cents per person-mile and 35 cents per person-mile for rail.

There are more cost-effective ways than mass transit to solve urban transportation problems:  congestion pricing of highways, targeting high emission vehicles or simply improving the coordination of traffic lights.  Spending more money on public transit would impose real losses on the economy.  Funds siphoned-off into ineffective public transit weaken the economy, cost jobs, and lower the standard of living.  Clearly, voters would do well to think before rushing to board the transit "bandwagon."

Read Public Transit here.

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