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Cities, states coping with congestion are reaping big financial rewards
By Ted Balaker
Despite its massive $286.4 billion price tag, last year's federal transportation bill wasn't designed to beat back traffic congestion. Thankfully, the Transportation Department has just put gridlock in its cross hairs with a new plan that relies heavily on the user-pays principle and private highway financing.
And it's appropriate to take aim at congestion on this, the 50th anniversary of the interstate highway system. Early on, the system's chief architect promised it would take Americans "from anywhere to everywhere."
We might regard that vision as a tad outdated because new technology has given business a new kind of mobility. Armed with cell phones, laptops and BlackBerries, we can "be" almost everywhere without crawling into a car, train or plane. But good old-fashioned mobility — moving people, parts and products across physical space — still matters a lot. Just ask Austin, Texas.
Seven years ago, mounting traffic congestion helped prompt Austin-based Dell to expand in Nashville, Tenn., instead of its home town. "We lost 10,000 jobs that day," recalls state Rep. Mike Krusee.
The loss shocked Texas leaders into embarking on the nation's most ambitious congestion-reduction plan, which includes a privately financed $7.2 billion San Antonio-to-Austin-to-Dallas toll road.
Now Texas' commitment is paying off. South Korean-based Samsung recently decided to open a new $3.5 billion chip plant in Austin, which beat other locations, many of whom offered bigger tax breaks.
Initially, Samsung worried that congestion would slow its global production process — silicon wafers would be trucked from Austin to Dallas, then flown to South Korea for final processing. Surely, Texas' commitment to transportation helped seal the deal. But such happy endings are rare.
Most government officials greet mounting congestion with a shrug and inaction. During the past two decades, driving has nearly doubled, but our nation's roadway system has grown by only 4%.
As a result, congestion causes 3.7 billion hours of delays, wastes over 2.3 billion gallons of fuel and costs the economy over $63 billion a year. Congestion has gone from a background concern to what Transportation Secretary Norman Mineta calls "one of the single largest threats to our economic prosperity."
Surveys show that residents in various major metro areas list congestion as their No. 1 complaint. A recent analysis asked CEOs of Silicon Valley financial firms to rank their business concerns. Traffic congestion tied with high housing costs for the top spot — ahead of perennial business headaches like taxes and health care.
Our roadway system was designed for an America eager to spur interstate commerce but unaware of the coming boom in international trade.
Today in the Seattle area, congestion makes it harder to get shipments from sea to stores and distribution centers on land. As a result, Puget Sound ports have lost 12% of their market share in a six-year span. Truck traffic stemming from the ports of Los Angeles and Long Beach already swamps area freeways, and truck traffic is expected to grow 71% by 2030.
It's time to transform our transportation system from a drag on commerce to a facilitator of innovation. We must borrow good ideas, both homegrown and foreign. In Southern California, variably priced toll lanes — which control demand by increasing/decreasing the price to ensure freely flowing traffic — have actually abolished congestion in an extremely busy corridor.
France has shown ways around (and under) problems that many American leaders would regard as insurmountable. A missing link in Paris' A86 ring road has long created terrible congestion because officials were understandably hesitant to finish the road by building through portions of historic Versailles.
Instead of accepting congestion, as many U.S. cities and states have done, the French are filling in the missing link and preserving the historic space by building road tunnels beneath Versailles.
"Socialist" France has readily embraced market-based transportation innovations. The A86 tunnels are being built with private money, and France's 5,000-mile tolled motorway system is investor-owned.
Mineta said the U.S. "will never succeed in making today's traffic a thing of the past without the involvement of this nation's private sector." Some states, like Indiana, Virginia and Texas, have already come to this conclusion. More than $25 billion in private capital has already emerged for U.S. road projects in just a few states — and there's much more where that came from.
States should ensure that the "from anywhere to everywhere" vision for our transportation system flourishes in the 21st century by using public-private partnerships and tapping the private sector for much-needed new road projects.
After all, we cannot create the economy of tomorrow with an interstate transportation system that's stuck in the 1950s.
Ted Balaker is a policy analyst at Reason Foundation and author of a forthcoming book on mobility and congestion. An archive of Balaker's research and commentary is here, and Reason's telecommuting and transportation research and commentary is here.
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