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Lack of mobility impacts taxpayers, employers, and housing market
By Ted Balaker
Tell a Californian that traffic congestion is a problem and you probably won't even elicit a blink. Californians know congestion is awful and they're certainly not shy about complaining about it. Any one of us can rattle off the ways congestion frustrates our own lives, but we're less likely to step back, add others' frustrations to our own, and consider the full extent of the problem. Today commuters, customers and businesses shape more and more of their activities around what used to be considered just an everyday irritant. Californians know congestion is awful, but it may be even worse than we realized.
Congestion in our state's major metropolitan areas has long been bad-Los Angeles and San Francisco frequently sit atop the Texas Transportation Institute's annual worst-congestion list and San Diego has cracked the top 10. Over the past two decades, the problem has grown much worse. According to TTI, congestion is up 160 percent in San Francisco, 150 percent in Los Angeles, and nearly 600 percent in San Diego.
Naturally businesses want to cater to their customers, but now all sorts of businesses are forced to cater to congestion first. Blue collar plumbers and repairman try to reach as many customers as possible but congestion stands in their way. White collar professionals, from salespeople to realtors, face similar headaches. Most of us fight congestion on our way to and from work, but these people do battle with it all day long. Congestion makes it harder for would-be buyers and sellers to connect and it also shrinks labor pools.
Shrinking labor pools often hurt high tech, financial, and other specialized operations most. According to a recent survey, Silicon Valley financial companies fingered congestion as their number-one headache—even ahead of longstanding business headaches like taxes, regulations, and health care costs.
Employers who require workers with specialized skills want to be able to draw from as large a labor pool as possible for, unlike fast food restaurants and certain other businesses; they cannot just hire whoever's nearby. Yet before they hire a promising applicant, employers must be sure that person can actually get to work reliably. Congestion isn't just frustrating because it slows us down. It's frustrating because from day-to-day we don't know how much it will slow us down. This element of unpredictability wears on commuters and employers. In San Diego some high tech employers have decided they simply won't look at resumes from those who live north of the I-5/I-805 interchange and the infamous bottlenecks it causes.
Expensive housing—another common feature of California life—combines with congestion to make a bad situation worse. "[One reason] we do not have enough talented people to service our clients is that most of our employees spend an hour driving each way to and from work," remarks the CEO of a Santa Monica accounting firm in a Center of Economic Development report. "We pay our people very well, we put money, golden handcuffs on them, and they still can't afford to live here on the Westside. It is a harder sell now than ten years ago to recruit from out of state."
Congestion and high housing costs make it harder to recruit from out of state and they also give homegrown businesses more reason to leave. In recent years our state legislators have whipped up many bills that take aim at the trickle of jobs that go overseas, but lawmakers who fear offshore outsourcing should pay closer attention to the currents of jobs and capital that flow within our borders. Many of us have seen the billboards Nevada has planted in California. Over an image of a worker with a black eye, one billboard reads, "Will your business be terminated? Nevada to the rescue." Nevada has no corporate income tax, no personal income tax, lower workers' compensation costs, and more affordable real estate.
When Dell computers cited congestion and decided to expand in Nashville instead of Austin, Texas learned that transportation troubles can also push businesses to other states. "We lost 10,000 jobs in one day," recalls Texas State Rep. Mike Krusee, who has since helped Texas embark upon our nation's most ambitious congestion-cutting effort.
Dell's decision shocked Texas into making a commitment to improving mobility, but, like most of the rest of the nation, California continues to dawdle. State leaders dubbed 2006 the "year of transportation," but in terms of tangible reform it's been no different than any other year. For example, there has been little recognition of the success private-sector roadway funding has enjoyed in places as varied as Texas and France. The Golden State considers going deeper in debt to fund infrastructure, but still lacks the legislation necessary to make use of private sector financing. We cannot afford to slide back into complacency.
Lawmakers often fail to appreciate the mobility-congestion give-and-take. Mobility gives economies vitality that is gradually taken away by congestion. When people, products, and ideas cannot churn freely an urban area becomes more segregated. It behaves less like a dynamic metropolis that draws on the talents of all its denizens and more like a collection of isolated hamlets.
Reason Foundation has responded by initiating the Mobility Project (see www.reason.org/mobility), a long-term, nationwide effort to help stimulate urban economies by improving mobility and cutting back congestion. The Mobility Project incorporates ideas from a wide range of scholars and presents comprehensive policy recommendations that will help our cities realize their full potential.
Too often lawmakers and voters seem resigned to mounting congestion. Indeed few metropolitan areas are actually intent on cutting it back—making a commitment to slow congestion's growth is usually all they hope to do. Yet congestion isn't like gravity. It's not an unstoppable force. Across the world cities have adopted innovations—some small-scale, some large—that quell congestion. The trick is mustering the political momentum necessary to cobble these innovations together and reinvigorate urban life.
Ted Balaker is the Jacobs Fellow at Reason Foundation and co-author of a forthcoming book about mobility and congestion (Rowman & Littlefield). An archive of Balaker's research and commentary is here. Reason Foundation's California research and commentary is here and Reason's transportation research is here.
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