September 4, 2004

USE IT? PAY FOR IT:

Driving Takes Its Toll (OWEN D. GUTFREUND, 9/04/04, NY Times)

[W]e need to reconsider the road not taken. We must stop encouraging over-dependence on oil by under-pricing our roads and hiding the true costs of highway driving. Of course, to impose new gas taxes on top of the recent spike in prices may be politically impossible. But if oil prices drop, we should be ready to raise gas taxes. In the meantime, we should expand the use of tolls to finance expressways.

The toll roads built in the 1940's and 1950's still exist, although some have been converted to free highways. But instead of removing tolls from these roads, as is occasionally suggested, we should go in the other direction. All of our major Interstates, across the country, should have tolls that are high enough to defray the full costs of building and maintaining the highway network and also high enough to make us change our driving habits.

We don't have to bring back the frustrating traffic bottlenecks at old-fashioned tollbooths now that the logistics of collecting tolls have been greatly simplified by systems like E-ZPass, FastLane and SmartTag. But by permanently raising the artificially low cost of driving, we could encourage people to drive fewer miles and to place a higher value on fuel efficiency, ultimately reducing our dependence on imported oil.

Instead of letting drivers onto our expensive, world-class highway system free, we should charge a fair price by imposing more and higher tolls, and raising gas taxes much higher, permanently. Otherwise, our insatiable need for petroleum will continue to distort our foreign policy, to undermine the stability of our economy and to damage the environment.


It's an elegant consumption tax.

Posted by Orrin Judd at September 4, 2004 9:38 AM
Comments

As long as the tolls MUST be used only for the highways on which they are charged, and not put into the state's general fund, or, as with the Golden Gate Bridge District, kept high so as to subsidize ferries and buses and other things that have little to do with the relieving congestion.

Posted by: Raoul Ortega at September 4, 2004 10:35 AM

You'd have a fight with representatives from states that have large rural areas, where residents often think nothing of hopping on the Interstate and driving 50 to 100 miles to the nearest big city to get things not avilable in their smaller towns. That would make a Senate vote to institute tolls problimatical (even though the House is the more conservative body right now, most of its members represent urban/suburban areas with alterative highway options).

On the other hand, if it does look like it's going to be approved, I'd buy a lot of stock in whatever company licenses the E-Z Pass technology.

Posted by: John at September 4, 2004 10:57 AM

Reinstate the 55 MPH Max. and implement tolls only to the extent they offset the highway infrastruture maintenance/rebuilding costs.

Implementing higher fuel taxes as prices lower would make sense. At some point, if consumption were actually reduced, the tax increases might be offset by lower fuel prices. At that point a target price could be established and maintained by offsetting tax increases and decreases.

All of this might change some of the thinking against opening up the ANWR.

Posted by: genecis at September 4, 2004 11:10 AM

Actually, the only real change we can make is to impose a special surcharge of say 100% on the sale of new passenger vehicles including SUVs(stupid useless vehicles) which get less than 30 MPG through the usage the vehicle is most likely to undergo. A Prius wouldn't get 30 MPG if it were bought by someone in midtown Manhattan and a Ford Taurus would get 30MPG in Wahoo, Nebraska.

Posted by: Bart at September 4, 2004 11:24 AM

Living in western New York, I'm not going to disagree with toll-roads, but there is one thing I want taken out of this discussion: If our oil economy was magically transformed tommorrow to something internally derived, say nuclear power or whatever, our foreign policy will still be "distorted" by petroleuum as long as Asia and Europe, and everywhere else, depends on oil for their economies too. Perhaps it would turn down the volume on the OPEC bongo drums, but it would still be the tune everyone dances to... That said, I like tolls because they directly connect the cost of transportation to its users, instead of filtering it through state and federal income taxes. However, when have income taxes been lowered because a toll went in place?

Posted by: Mike at September 4, 2004 12:26 PM

Gasoline taxes might amount to the same thing as a toll, and be easier to collect. With the new electonic tolls I'm no longer as sure of that as I used to be...

Posted by: mike earl at September 4, 2004 1:03 PM

I'd rather pay gas tax than tolls. The electronic systems mean that, potentially, someone knows a heck of a lot about where you go. One obvious, and justifiable use: to identify speeders by checking the timestamps and locations of toll payments. The speeding ticket could be added right on to the monthly toll bill.

Posted by: Bill Woods at September 4, 2004 4:35 PM

Ah, my brethren on the Right: what government services should be free? The one's we use.

Posted by: oj at September 4, 2004 7:18 PM

Gas prices recently hit euro 1.26 per liter in the Netherlands (a large part of this price is tax and other levies). Despite the high price of gas, several other car taxes, daily traffic jams and one of the best public transport systems in the world people (including me) still prefer their cars to the alternatives.

Making a significant cut in oil consumption (>5%) would require such draconian measures that economical harm would be unavoidable and the results of the next election pretty predictable.

Technology has advanced to the point that there are no rational arguments against either drilling for oil or natural gas in environmentally sensitive areas or nuclear power.

Posted by: Daran at September 4, 2004 11:24 PM

Neoclassical economics has no method of valuing the network, which is often -- certainly in the case of roads -- the most valuable segment of the asset.

The roads create far more value then their cost. I cannot quantify that, but if you lived in Virginia 35 years ago, as I did, when it did have toll roads, though not many; and compared it with Virginia today, you would not doubt the balance.

Posted by: Harry Eagar at September 5, 2004 6:00 PM

**2**

Posted by: at September 18, 2004 9:09 PM
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