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It's Time to Reconstruct America's Interstate System

Reconfiguring our regional highway system for today's economy

Samuel Staley
June 30, 2006

As the nation celebrates the 50th anniversary of the Interstate Highway System, some are marking the event as a symbolic end to one of our largest and most successful public construction programs. The highway system is built out and "mature," they say, allowing the nation to move on to other important public projects. Unfortunately, they're wrong.

The U.S. highway system is in its infancy, a 20th century design poorly suited to the transportation needs of the 21st century. Rather than seeing the end of a national infrastructure effort, we're just beginning to grapple with the trillion dollar task of how to reconfigure, rebuild, and redesign it in the face of the competitive pressures of a global economy.

The interstate highway system was conceived prior to World War II, officially proposed in 1944, and finally funded in 1956. Initially, Congress expected the program to cost $28 billion through 1969, but this was revised upward to $42 billion in 1965. The final estimate, according to John Fischer at the Congressional Research Service writing in 21st Century Highways, was $128.9 billion.

Despite these high costs, the benefits were hard to dismiss. Brookings Institution economist Clifford Winston estimates the rate of return on highway investments in the 1970s was 15 percent as businesses took advantage of improved and better connected road system to reduce transportation costs. Others have estimated the benefits might have been as high as 30 percent during those early years.

This was the economic heyday of the system though. Winston, for example, estimates the rate of return plummeted in the 1980s and 1990s to just 5 percent.

Understanding why is easier than one might think. In 1982, at the point the highway system was essentially completed, Los Angeles was the only urban area in the U.S. where travelers faced an average annual delay of 40 hours or more. By 2003, after interstate highway construction largely ceased, 25 urban areas faced congestion averaging 40 hours of delay or more each year. Almost 100 million people—one third of the national population—live in these regions, slowing life and the economy. And the trends aren't going the right way.

What's the solution? Building more capacity is one obvious need. Travel demand has outstripped road building by 3 to 1 since 1980. Simply bringing capacity up to current levels of demand will go a long way toward reducing congestion.

But this is only part of the solution, and perhaps not even the most important. Simply laying more asphalt won't pave our way out of our slowing productivity and congestion mess. We need to pay a lot more attention to what kinds of roads we build, where we build them, and when they get built.

This is a bigger job than most people realize. In essence, it calls for a whole scale reconfiguration of our regional highway system.

The basic design of the current system�its DNA�was established by the federally funded Interstate Highway System laid on top of incremental expansions of local roads. This established a "hub and spoke" design, where large volume highways (spokes) would funnel people into a central employment center (the hub). Often, an outer beltway (rim) was created to connect the spokes leading to the hub.

This highway system served the needs of the mid-20th century city well when most people still worked and lived in the central city. The post-World War II era of suburbanization changed all that.

Now, fewer than 20 percent of travelers during peak periods are commuters. Most of those trips are not even going into the central city. Suburb-to-suburb trips dominate travel patterns. Central cities are no longer the economic drivers of regional economic growth. Indeed, the growth of suburban cities and "edge cities" has created more balanced regional economies.

Our transportation system and network needs to be similarly balanced. The hub and spoke system isn't suited for a modern economy where technology and employment allows for flexibility and decentralization, and where travel decisions are based on personal needs accommodated by the customized travel flexibility offered by the automobile.

Fortunately, we have better and more effective tools than ever to address these issues. Rather than using grand highway plans to determine where the next road will be built, we can ask travelers. We can also have them pay for it.

Variable rate electronic tolling, for example, provides a fast, efficient, and effective way to gauge traveler interest in new facilities. By identifying a revenue stream—tolls—with a particular project, it also provides a mechanism for raising the capital necessary to significantly expand our nation's transportation infrastructure without raising taxes.

New innovations in highway design have also expanded our ability to increase traffic flows to the point where tunnels and elevated highways make economic sense and can be self-financing.

The idea that consumers will pay for services is relatively new in transportation circles, but works in almost every other part of the economy. We need to treat roads like other economic products and services, particularly now that we have the technology to make it happen. This will be the key to attracting the billions of dollars necessary to reconfigure and rebuild our regional transportation system. The result will be a more dynamic, consumer driven network more consistent with the needs of an urban economies and maintaining global competitiveness.

Sam Staley, Ph.D. is director of urban and land use policy at the Reason Foundation and co-author of the forthcoming book The Road More Traveled: Why The Congestion Crisis Matters More Than You Think, and What We Can Do About It (Rowman & Littlefield). An archive of his work is here and Reason Foundation's transportation research and commentary is here.


Samuel Staley is Research Fellow


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