Mar 24 2014

Sunday Train: Car Subsidies & Ebbing Vehicles Miles Travelled

(2 pm. – promoted by ek hornbeck)

Earlier this month, the philly.com from the Philadelphia Inquirer carried a story, Drop in traffic on area highways forces review of plans. It cites several “area” road funding decisions based on assumptions of growing traffic, which turned out to be false:

  • A $2.5b New Jersey Turnpike widening justifiedm in 2005, by projections of a 68% increase in traffic volumes over the coming 25 years … where turnpike traffic in 2013 is only 90% of 2005 levels
  • The Pennsylvania Turnpike Commission undertook to provide up to $900m in annual funding for other roads around the state, based on projections of Turnpike traffic growth of 3% to 5% … while to date, there hasn’t been any appreciable traffic growth
  • The Scudder Falls bridge taking I-95 over the Delaware River was a four lane bridge that the Delaware River Joint Toll Bridge Commission decided in 2003 to replace with a nine-line $328m bridge based on projected traffic increases of 35% by 2035 … and to date, that growth in traffic has not yet materialized

The article poses the question of “whether” the traffic growth that went away following the Panic of 2008 and which hasn’t shown up in the ensuing Depression of 2008 to, optimistically, 2015, might not ever turn up.

Well, it probably won’t. And that raises the follow-up question, what are we going to do about it?

On Being Puzzled that After Things Change, They Are Different

It is instructive to follow the reactions to people within the Road Building Establishment to questions from Inquirer Staff whether the motor vehicle traffic growth might not be coming back:

“If these trends continue, it would definitely change the way we need to plan for our transportation future,” said Chris Puchalsky, associate director of systems planning at the Delaware Valley Regional Planning Commission. “But I think the jury is still out on that . . . we need two or three more years of data.”

Traffic predictions for the planned new Scudder Falls Bridge over the Delaware River between Bucks and Mercer Counties were revised downward in 2010, said Joseph Donnelly, spokesman for the Delaware River Joint Toll Bridge Commission. And yet another traffic study, costing $452,128, was ordered in October, to get a better handle on future traffic and revenue. But Donnelly said a new bridge was needed, regardless of how projections may change, because “the bridge has trouble handling the traffic it has now.”

Likewise on the $2.5 billion widening of the New Jersey Turnpike between Exits 6 and 9, according to Turnpike Authority spokesman Thomas Feeney. “Even if traffic volumes on the turnpike remained flat forever, the widening would have been necessary,” Feeney said. “That widening area is one of the worst bottlenecks on any highway in New Jersey. . . . The additional capacity is needed today, and the benefits are going to be immediately apparent to drivers as soon as the project is completed this November.”

Its unclear whether this is going to continue, and we needed those projects anyway. The challenge, of course, is that when funding is based on asking cars to pay some share (though, of course, less than half) of the costs that they impose upon the transport system, the ability to pay is different if we project ahead from the present day, as opposed to projecting ahead based on 20th century experience.

This is a particular challenge for the State of Pennsylvania because, as the article notes, in 2007 Pennsylvania adopted a plan to fund road and transit projects at levels of up to $990m/year, based on expected rising Turnpike traffic levels and the planned conversion of I-80 into a toll road. You know the saying that “two out of three aint bad”? Well, on the two assumptions Pennsylvania’s policy was based on, they are zero for two … and yes, that’s bad.

Inquirer staff interviewed the Dean of the Rutgers School of Planning and Public Policy, who laid the difficulty in forecasting traffic growth on two factors:

  • the preferences and behavior of Millenials, who are on average less enamored with driving than generations that came of age in the 20th century; and
  • weak economic growth since the start of the 2007-9 Recession.


The Millennial Generation and Social Technology

There had been a string of articles over the past year on Millennials and their relationship to the automobile. The Atlantic asked on 13 May , 2013, Millennials Lead the Trend to Less Driving, But What Happens As They Get Older?. The American Realtor magazine explained to their realtor audience on 2 August, 2013, How Millennials Move: The Car-Less Trends. On 9 August, 2009, Time posed the grossly oversimplified question, The Great Debate: Do Millennials Really Want Cars, or Not?. Forbes blog contributor Michelle Maynard on 24 January, 2014 summarized the results of ZipCar sponsored polling in terms of priorities: Millennials in 2014: Take My Car, Not My Phone.

According to the Atlantic:

It is unquestionably true that Americans are driving less today than we did just a few years ago. Sometime around 2004, our addiction to driving – expressed on a graph in the decades-long steep expansion of “vehicle miles traveled” – took a turn in the opposite direction. Per capita, we began to drive fewer miles each year than we had the year before. As the U.S. population has continued to grow, our collective miles traveled by car has begun to stagnate.

It’s not entirely clear, though, exactly why this has happened or whether the downturn will continue, two questions intimately tied to the behavior of Millennials as they age. Twenty-something Americans drive about 20 percent less today than their parents did in their 20s. But is that because of the recession? High gas prices? A lasting shift in consumer demand? What will happen to today’s 20-year-olds as they enter their 30s, raise families, and consider moving to the suburbs?

From the generational-cohort marketing perspective of the American Realtors magazine:

“For baby boomers, owning a car was a coming-of-age, life-stage thing,” explains Rebecca Ryan, founder of Next Generation Consulting in Madison, Wis. “The coming-of-age toy for the next generation is the smart phone.”

Several factors contribute to millennials’ negative perceptions of cars. “One is the expense,” says Ryan. “Millennials are the most unemployed generation, and their college debt compared to that of their baby boomer counterparts is exponentially higher. Millennials also believe cars are ecobombs – that they’re inheriting a planet that’s totally messed up, and they don’t want to contribute to it. The final kiss of death for cars? You can’t text and drive. All these things together create a perfect storm against cars.”

Note that in marketing, the phrase “X group believes”, is normally best understood as a shorthand for, “relative to other groups, this group is more likely to believe …” … so not “100% of Millennials believe cars are ecobombs”, but “Millennials are more likely than other generational cohorts to believe that cars are ecobombs”.

The Salon puff piece tells us:

You can basically look at anything used to characterize millennials to explain the trend. According to the mix of economists and travel behavior analysts consulted, young Americans are driving less because cars no longer symbolize freedom, as cellphones have taken their place. They’re no longer synonymous with masculinity – more women than men in the U.S. have driver’s licenses. They’re kind of complicated (“You can’t open the hood and get to know it the way you used to”). Shopping and socializing take place more and more online, while biking and walking to work – and even for fun – is on the rise. Cars, not to mention insurance, maintenance, parking and gas are all really pricey, while underemployed millennials have student loans to think about.

And finally (that is, passing over the hot mess that is a Time “Great Debate”), in the polling by ZipCar:

The study, commissioned by Zipcar ZIP NaN%, the car-sharing company, and provided exclusively to Forbes on Friday, shows that nearly 40 percent of millennials believe that losing their phone would be a bigger hardship than losing their automobile.  They also believe it would be a greater tragedy (so to speak) than losing access to a desktop or laptop computer, or a TV set.

That compares with only 16 percent of people age 35 and up who think losing their phones would be more difficult to take than losing access to those other things. In fact, more than 40 percent of people 35 and up believe losing their cars would be the hardest aspect of their lives to give up. Only one-quarter of the millennials surveyed agreed that a car comes first.

In other words, we can understand the mobility represented by the automobile and prized by twenty-somethings in the second half of the 20th century as being in part the freedom to go to place that other people are going to, to meet and socialize … where for the Millennials, coming of age in the age of cellphones, its ability to stay in touch via cellphone that is the first priority. Indeed, there is a critical mass of cellphone use in a social group where its not necessary to hang out in predictable places at predictable times ~ whether the American Graffiti cruising on main street or the 90’s hanging out at the Mall ~ in order to stay in touch, which can make it impossible to work out where “everybody” is, unless you too are into the cellphone social network that “everybody” uses.

Which makes the car a rival for the money to spend on the first priority, rather than being the first priority in its own right.

Greater freedom from the need to hang out in habitual places at habitual times in order to stay in contact with a social group also strengthens the stronger preference on being able to get to an interesting variety of places to hang out. And that may be part of the increased preference among Millennials to live in active urban centers, as opposed in suburban settings. Indeed, even if, as the Atlantic speculates, there may be an increased desire to live somewhere other than the urban center as Millennials age and a larger share of the generation are establishing families of their own, there is no particular reason to believe that they will wish to live in a suburban setting organized in the 20th century pattern, enforced by 20th century zoning rules, parking mandates and other subsidies for driving


Can We ‘Revert To Normal’ Growth On The Old Model?

In the Atlantic piece (see first block quote in the previous section), we also see the fingerprints of some of the same attitude reflected in the philly.com piece above: sure, things have changed, but won’t they have to change back, sooner or later? ‘Some say it will, some say it may not, we are just reporting on the debate’.

The Atlantic piece considered three scenarios. In the first, with the coming wave of Baby Boomer retirement, vehicle miles traveled take a notch down from its 20th century pattern. However, if we assume Millennials in their thirties drive as much as Baby Boomers did in their thirties (despite not driving in their teens and twenties as Baby Boomers did), and we assume a resumption of the average economic growth of the second half of the twentieth century, then assumed driving only takes a notch down, growing, but from a lower base and eventually at a slower pace.

The second and third scenarios are projections of two different trends. In the second, there is an ongoing decline in vehicle miles traveled per capita that roughly matches the group in the population, so vehicle miles traveled are roughly constant. In the third, the decline is more rapid.

However, what is is omitted from this scenario is consideration of whether it is feasible to “change back”. This is most striking in the conclusion of the Atlantic piece:

Millennials will inevitably wind up driving more than they do today as they age. This is virtually always true of people in their 20s as they enter their 30s and beyond. Certain stages of life demand more use of a car than others. But the question is: by how much? And by how much compared to their parents?

This may well be true of the leading “wave” of the Millennial generation, since they will have to make their way using a transportation system that is built to force people to drive. However, it is quite certainly not necessarily true of the whole of the Millennial generation, since over the coming generation we have ample opportunity to invest in sufficient alternatives to driving that later waves of the Millennial generation are never forced to drive in the same way that previous generations were.

After all, while many people in the generations of the second half of the 20th century adored driving as teens and twenty-somethings, no such large group of people have monolithic attitudes, and many were less enchanted. Under the circumstances they found themselves, however, there was quite often no alternative, even for a number of those which were less enchanted with “Auto Uber Alles”.

Some of the allure of driving in the second half of the 20th century was driven by incentives in which financial transfers were made from those who drove less, or not at all, in support of those in the outer fringe suburbs who drove the most. As the outer suburban subsidy recipients grew as a share of the population, and central urban populations who were taxed to cross-subsidize the outer suburbs declined as a share of the population … the ability of that subsidy system to offer the benefit of having someone else pay for the outer suburban transport system is under severe stress.

This means that the ability to cross-subsidize outer-suburban driving is squeezed on both sides, with more outer suburban hands outstretched to receive their transport welfare, and fewer urban and inner suburban residents available to have their pockets picked to provide that transport welfare. That points toward charging outer suburban residents the full costs that they impose upon the transportation system.

Even with cheap gasoline, outer suburban living would always have been incrementally less attractive if outer suburban residents had had to pay their own way. Add to the unaccustomed experience of paying their own way, the fact that the cheap petroleum has largely been pumped out of the ground and consumed, and the long term price of gasoline will only increase, and we can conclude that going back to “the way things were before” is not really an option.

The techno-cornucopia vision for fixing this is the electric car, in which the extra cost of gasoline is capitalized into the extra cost of an expensive battery to allow a flexible range of alternative energy sources to be tapped to power the car. However the techno-cornucopia doesn’t resolve the problem that we cannot finance the road network that we have. Indeed, in the short and medium term it makes it worse, since the current system for drivers to pay a minority of the costs that they impose on society is to tax their fuel, and “filling up” at home from the power company entirely sidesteps paying even that minority of the costs of driving.

Suppose that economic growth as robust as we had in the second half of the 20th century cannot be based upon a transport system as heavily automobile dependent as the one we had in the second half of the 20th century. That points strongly toward something like the third of the three scenarios, since the inability of the “Auto Uber Alles” system to deliver widespread prosperity undermines one of its original sources of political power.

I recall Republican Ohio Governor “Jobs and Roads Rhodes” when I was younger. But if “Jobs” follow along from alternatives to driving, that sets up a political terrain in which large number of Millennials face being “forced” to drive as they enter their thirties with, “No. Build an alternative so we don’t have to.”

As discussed many times in the Sunday Train, including 30 June 2013 in Sustainable Real Estate Development is Good for the Economy and Other Growing Things and 1 December 2013 in Sunday Train: ‘the successful communities are going to be the ones who get rail.’,  those alternatives can be forged. While technological innovation to support these alternatives is always welcome, they can be forged based on existing technology.

What we required, fundamentally, is to reform the social institutions that “force” people to drive … and so the most critical resource that we lack is the political will to move ahead on a national basis.

However, as discussed last week, there are still local communities that continue to sow the seeds of sustainable transport development, so if our nation ever does choose to reform the institutions that it forged for the circumstances of a century gone by, and recast them into institutions that can serve us in the century ahead, we will have a growing body of experience to draw upon.


Conclusions and Considerations

As always, any topic in sustainable transport is on-topic in the Sunday Train. So feel free to take about CO2 emissions reduction, energy independence, suburban retrofit and reversing the cancer of sprawl over our diverse ecosystems, or the latest iPhone or Android app to map you bike ride. Whatever.

And on this particular topic, what do you think would be the most effective way to get started in making the transition from the obsolete “Auto Uber Alles” system to a sustainable 21st century transport system in the area where you live?

The Sunday Train doesn’t really leave the station until you jump in and join the conversation so … All Aboard!

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