My main concern is that with tolls that high that only people with a lot of money can afford them (I make six figures but I doubt I would ever pay $40 for a toll. I would need much more money). These are also often the most influential people so they may think that everything is OK because they can afford the toll and never suffer in traffic. I think the same is happening with health care. Most people in Congress have enough money and get a nice insurance plan so they don't even understand how bad the US health system is for people in the lower incomes. They think it's perfectly fine and no need to change anything.
It's very problematic when in a society the people at the top never experience life the same way regular citizens do.
Exactly. Creating separate "deluxe" and "plebe" lanes only ensures that the quality of the latter degrades, because no-one with money and power sees any problems or is forced to care about them.
You see this same problem with public vs. private schools (public schools get ignored and degrade when everyone with means avoids them), the "projects" (in which quality of life is allowed to degrade as various factors lead to police disengagement), and many public transit systems (politicians can afford to drive/be driven and thus are blind to the issues faced by obligate transit users).
Arguments equating high-toll roads with "first-class airplane seating" or (I shit you not) "Bitcoin mining" (there's a candidate for @shit_hn_says) completely miss the mark by ignoring that these domains are market-driven (e.g. the quality of a SECOND-class airplane seat is still a function of the market). This is not true for freely-available (or subsidized) public anything (schools, housing, public transit, etc.)
I think there is a 1st principles economic rationale that agrees with you.
In a nutshell, you need to get down to the "utility" concept. It's used (for example) to theoretically prove/support the idea that free exchange is always beneficial for both parties.
Putting prices onto otherwise unrestricted resources likewise optimizes for utility, especially if there are tragedy of the commons issues. The catch is that utility is measured in dollars.
Price systems increase efficiency by introducing trade-offs. If you don't really need to use the road you won't, because there's a cost to it. But (like you say), this trade-off is different for different people. For rich people, $40 is always worth it. For the middle class, $40 might be worth it if you can get home in time for date night. For poor people, $40 means you can't afford a date night this week. It's never worth it.
Basically, dollar-utility conversion is different for people with more or less money. To call this a utility-efficient outcome, you need to concede that a poor person's family dinner time is worth less. That's obviously false. We can't measure utility in dollars, if we have inequality.
On top of all that, roads are not "full" markets. This is not a free market solution. You can add a price system. but you don't have supply side effects. Prices don't reflect marginal costs of commuting, because there isn't competition. Price signals don't control supply, or lead to more supply. Even if supply wasn't exogenous in practice, the fixed/marginal cost ratio would make the "market" unresponsive anyway. This is not really a "free market" vs "public good" because free market just isn't an available option.
I would like to see some less idealistic economists take over on these issues. One interesting option is creating a fake "currency" for fast lanes. Ideas that assume people's time, enjoyment of the road and transport needs are equivalent. You probably can't take money entirely out of the equation, but there are ways of doing this without handing out benefits to the wealthy at the expense of the poor.
I would like to see some less idealistic economists take over on these issues. One interesting option is creating a fake "currency" for fast lanes.
If poor people don't have enough money, then we should give them money instead of fake currency. Giving them fake currency reduces utility.
If we give them money they can buy whatever they want/need the most. If we give them scrip that can only be used on one thing then they have to buy that even if they would value it less than something else.
If it is some fake currency, say, HOV-credits, that is distributed on a monthly basis, equally, to everyone, then to a first approximation, you're providing for equivalence in capacity to pay. You can choose to spend, or not spend, your HOV-credits, on any given day.
This also offers the opportunity for rationing, as it's possible to increase or decrease the allocations based on net usage.
If the credits expire after some time, say a few months, then there's the ability to bank them, but not indefinitely. This is not a form of perpetual wealth accumulation.
The argument could be made for either making the credits transferable, so that those less wealthy in other regards could sell them for other units of trade, or not, and/or to set limits on such transactions.
All of this occurs independent of actual currency, though there would be an overall budget to the programme.
And it accomplishes the goal of setting an opportunity cost to highway travel, and congestion, which could itself be varied according to circumstances (higher charges at peak hours / during high-congestion events, lower off-peak or when uncongested).
Then there's the question of interactions with alternative transit, telecommute, or similar schemes.
1) If your roads are being overused you can easily ration that by raising the dollar price.
2) What is wrong with wealth accumulation? If credit recipients would rather do that than drive on roads they should be able to do so. They's how they get less poor!
3) If they credits are transferable then you are effectively giving people money. Just in an ass-backwards and overly confusing way.
All depends on what problem you are trying to solve.
IMO, the problem is "how do we allocate road so that high utility use gets precedent over low value use, without defining high/low value as 'rich/poor person wants to get from a to b'"
Expiring credits is an idea, as are a lot of options. Designed markets are a devil-in-the-detail endevours. A market is a good tool for this job, that's why economists and wonks like tolls. But, not every market needs to be the market. In this case, The Market is probably worse than the no market free-for-all.
Raising the HOV-units price provides equal purchasing capacity amongst all drivers.
I mentioned the option of transferability for completeness. I'm not advocating for or against it. I am noting that it would change the dynamics somewhat.
Your #2 is a rather more involved and tangential discussion. Historically, it has a strong tendency to end in tears, or worse.
3) You're giving them things that cost you nothing to produce which they can then sell for money.
I actually think this was a bit of an aha moment for me re: cryptocurrency and government.
It's possible for a government to setup a market for a public good, create a currency for that good and distribute that currency equally to people. All without spending actual currency(ignoring administrative costs of setting up a blockchain).
The value of the public good for people then determines the USD exchange rate, but poor people are never excluded from using the good and at the same time you are not massively inflating the money supply.
edit. In fairness, nothing about this requires a cryptocurrency/blockchain. It's more a general argument in favor of governments charging for public goods by creating custom (maybe fiat) currencies which they distribute equally to all citizens.
There might be administrative and/or psychological benefits to running all these custom currencies on blockchains.
I disagree. We have all the technology and processes we could ever need to distribute and charge people dollars for things.
Creating a whole new kind of currency with its own special rules is a huge undertaking. Not to mention the ongoing pain-in-the ass cost to every citizen when they have to carry around and think about a new special kind of money that can only be used for one thing.
The tech isn't the problem, it's that the avalibility distribution that is imposed on roads is the same as the income distribution. In a way it creates the same problems as removing net neutrality.
If you did that with roads, what's stopping the upper income distribution from excluding everyone else from entire cities? A gated community concept might scale to an entire upperclass city with a private airport, hostpital, and 1000$ entry fee to keep out the poor. This might even effectively reduce overall costs for the municipality since homeless and property crime would be greatly reduced.
On the other hand if other currency is used, it makes everyone easily trackable.
I think the dumb pipes model still has some advantages.
I'd focus more on one of my other punts above: ways of drawing a correspondence between traffic and congestion, on the one hand, and alternative transit options (buses, rail, cycling, telecommuting, etc.) on the other. Market pricing signals fail to provide the coordination many of these options require. Typically, planning-based approaches are required.
I like driving, but I'm very bad at managing the stress associated with owning a car, finding a parking spot, sitting in congestion, trying to be there in time (speeding to gain a few minutes that makes no sense), hence I don't have a car.
And I wouldn't live in a place that requires one.
And I can't understand how the US is so deep in the hole with regards to mass transit / public transport, commute time, etc.
Sure, I know, it's a classic coordination problem, and I'm probably very biased by having access to a very cheap and efficient public transit network.
The problem in this case is not really "not enough money" in an absolute sense. To use the fast lane in a floating price system, you need to outbid the rest of the people. IE it's a function of income distribution.
You'd need to solve inequality. That's a great thing to do, but meanwhile we can just fix fast lanes separately. ...just in case inequality still exists in 10 years.
The issue here is that you are prioritizing using "the fast lane in a floating price system" as the most important thing when for a lot of people that will not be the case.
They might rather spend that money on housing, or education or chewing gum or who the hell knows what.
The utility maximizing choice it to let them make their own decision as they know more about their preferences than you do. You making that decision for them destroys utility.
I don't know why the downvotes, you make valid points.
I think what you say is true, but not in the context of this specific scenario. This scenario starts with a public good that is freely available to all.
In the free-for-all, everyone has equal access to the good. The total value of that is somewhat diminished in theory, because the lack of a price system causes overconsumption ... traffic jams.
In the price system, there is a luxury option. In principle, options are good. If you really want to travel fast, you can for a price. In practice though (because income distribution), most of that negotiation does not happen within one person debating if he really wants that fast lane today. There will be some people (wealthy) for whom it is almost always worthwhile and others for whom it is never worthwhile.
What I am arguing is that calling this highest value use is just false.
Choice here does not extend to substitutes. You don't get anything for taking the slow lane.
This is why I'd like to see some less theoretically pure economists tinker with this. It's possible to create a system where what you say is true. This one is impractical, but one example could be a system where fast lane drivers pay slow lane drivers. Ie, negative pricing.
Maybe you earn fast lane credits for taking the slow lane, to be used in lieu of £40. That way all commuters get a taste.
Seems to me that increasing the toll price with increasing levels of road usage would be the best way to ensure that those of lesser means still have access to the express roadway.
Example: Using the express roadway once a month is $10/use. Using it 100 times is 50/use.
This is similar to how California tries to restrict water usage by the wealthy.
Agree that dollars are not the ideal measure of utility, primarily because of of diminishing marginal returns as you get more wealthy. But they are pretty good for the majority.
Appealing to a right to an egalitarian "family dinner time" is also not terribly convincing. There are plenty of rich people who don't care much about family dinner time. There are plenty of poor who would eagerly spend half their day's wages to make it home on time.
Also, I'm not sure I buy the whole no competition argument regarding highways. The competition are the non-toll highways and driving on streets. There are several free options, and a paid option. The paid option has to compete against the free ones by setting a price that corresponds to the value it provides. If all roads were a toll road, then that would be a monopoly and a broken market, but this one seems okay.
I don't think that's fair. I'm not making an emotional appeal. I'm making (or attempting, at least) a rational one.
You can put it in diminishing marginal value terms, but I'm basically saying the same thing with fewer assumptions. Family time (or TV time or whatever) is an example to demonstrate that utility does not scale with money.
On the whole poor people commuting enjoy their free time, pleasant commutes and the other things at stake just as much as rich people. That's a fairly intuitive point.
Given that, the price that does not correspond to the value it provides^, inasmuch as income is unequally distributed. It corresponds to the wealth of the person making a decision and the value it provides.
The value of the fast lane is fairly evenly distributed between commuters. Everyone wants to get home. Everyone hates traffic. There are differences, but they're not huge on average.
What isn't evenly distributed is income. Therefore the sorting that this mechanism does is a little bit of utility based sorting and a lot of income based sorting.
If income was more even, there would be an argument for such a system. Given the actual distribution, the system is probably utility destroying.
Tolls are just a revenue raising mechanism, not an efficient allocation one.
I see your point now. I think you could go further with it. Arguably, a poor person who has never been on an airplane would get far more "utility" from a flight on a private jet than someone who flies every day. So one could argue (a stretch), that the poor, and not the rich, should ride that toll road if it would increase total happiness more.
But that seems ridiculous, and I think the issue here is that we're conflating capitalism with utilitarianism. Utilitarianism strives to maximize utility, i.e., total happiness. Capitalism strives for efficient use of scarce resources. They often overlap, but they are fundamentally different concepts.
Going back to the example, I buy your argument that tolls are a crude way of maximizing utility. However, they are a good way of putting a scarce resource (fast commuting time) to economic use.
A lot of liberal market ideas (Smith, Ricardo, etc) are essentially utilitarian. That is, they use utilitarian arguments to prove their points, so they're basically tied into the same assumptions. Ricardo's theory of comparative advantage is pure utilitarianism, and is the classical economics "proof" that trade is efficient. To this day, the most important theory of trade.
Efficiency in economic theory is almost all utility efficiency. The If not, what does efficiency? I guess you could say that in this case it's about maximizing revenue from willing payers. That's ok, but calling it efficiency is misleading.
When you say putting a scarce resource to its (most productive) use, what do you mean if not the enjoyment and benefit of its users?
Incidentally, there is a cool example of an artificial market for allocating food to US food banks. It uses a highly. Manipulated fake currency, with negative pricing and competitive bidding to improve "efficiency." The trick to making it work was all about being willing to define utility in non monetary terms.
Stating efficiency in dollar terms can lead to circular logic.
Utilitarians have struggled for decades to properly define "utility". The approach Bentham took (the father of utilitarianism) is completely different from John Stewart Mills, also a giant in utilitarianism. "Utility" is a far more vague concept than "efficiency".
Maximizing efficiency is less complex than utilitarianism. Capitalism strives for efficient allocation of resources based on supply and demand, i.e., what people have and what people want, it makes no promises on maximizing total happiness or equitable distribution.
For a utilitarian "putting a scarce resource to its (most productive) use" would indeed be to provide the maximum amount of enjoyment. But for a capitalist, it's simply the amount that someone is willing and able to pay for it.
I know some free market proponents use utilitarian ideas to make their point, and there is overlap, but they are a bad fit. Utilitarianism is a moral theory based on maximizing total good. Capitalism is an economic system that seems to have worked more than most other systems. There are moral arguments for capitalism, but they are based on individual freedom, not collective happiness.
> There are plenty of poor who would eagerly spend half their day's wages to make it home on time.
How does that not drive a person insane? Let's assume an 8 hour workday (so this would be a $10/hour job). How would you feel if you knew that after working your first 4 hours of the day, you basically aren't making any more money for the next 4 hours: all the money you make from that point on will be spent on getting home early. Why not just go home after your first 4 hours? You'll be home even earlier than when you take the $40 toll road, and you bring home the same amount of money for half the hours worked?
It seems to me that if you are regularly spending half your day's wages just to make it home on time, you are urgently in need of a different job (either closer to home or with different hours).
I'm surprised by your surprise, this insanity happens all the time. Parents miss baseball games, kids birthdays, and anniversaries because they are stuck in the office or at the plant. People work underpaid jobs for years with the hope that if they stick it out, they might get their reward. Parents sacrifice their entire lives to give their children a better shot.
The world is tough and trade-offs between time, money, and future opportunity are constantly being made at every income level.
> On top of all that, roads are not "full" markets. This is not a free market solution. You can add a price system. but you don't have supply side effects.
The solution is to auction road capacity and use the auction proceeds to fund maintenance of that road and construction of others. Besides being vastly more efficient (from a market perspective) than an arbitrary fixed rate, it also means that resources are allocated towards roads more efficiently (if your fund allocation mechanism makes some sense).
Yes, but that's not an auction: one bidder raising over another.
You might be able to do this in a two-at-a-time case, with two lanes of cars. Problem is that the lane behind the car that consistently underbids is being affected by a third party's decision.
It seems that there's a problem with the feedback/response cycle in one-at-a-time pricing systems. The more effective systems approach is to set a scheduled or contingent pricing, perhaps at 10-15 minute increments, minimum. A regular schedule (as with peak / off-peak rail or transit schedules) is another option.
You've misunderstood GP - the $40 is not being taken from the hypothetical poor person - it's a 'get home in time for date night' product being sold for $40, so not affording date night means not doing it; not spending the $40.
The ability to afford food for the week is then unaffected, as it would be if the figure were $4 or $400.
However, this does impact gas, which could be significant if the difference in time is large enough.
(This is assuming that the poor person is not driving e.g. a (more expensive, fewer available as used) hybrid car that can idle in traffic without wasting gas)
> My main concern is that with tolls that high that only people with a lot of money can afford them...
Yes, the toll is high, but only during peak usage hours. And there are other routes to take (that low income people presumably have been already using).
In general, progressively pricing services is a mistake. Instead, we should be progressively supplementing incomes (minimum income, negative income tax, commuter cards, etc.) until people can afford market-priced bills, goods, and fees. Until we approach problems this way, end-consumers don't really feel the impact of discrepancies in costs.
Consumers aren't dumb. If they see the bus is $5 but the toll is $20 because that's the actual demand-based market price, they'll change their commute habits, change what they'll pay in rent, the prices of homes, the lobbying of their representatives for more public transportation, and so on.
Lobbying of local city council isn't expensive. It mostly involves time: contacting them, writing letters to local media, forming online groups to organize the neighborhood, etc.
The price of homes and rent are actually really important. If low-density housing is much more expensive, it should be reflected in the cost of living for those places. If having the entire city on the same 9-5 commuting schedule is expensive, it should be reflected in the cost of driving during rush hour.
Now, granted, raising the price of commuting 10000% overnight isn't fair. But introducing and phasing in tolls during peak hours is a step in the right direction in my opinion. Housing prices will slowly adjust. Employees will gradually convince employers to allow more flexible work arrangements or give raises to compensate. The indirect effects of these changes are highly desirable. But realizing them is stalled while the inefficient and unsustainable practices are subsidized like this.
> Lobbying of local city council isn't expensive. It mostly involves time
Time is something poor people have very little of, as they generally spend most of it trying to make money to make ends meet.
(This is something I've often seen poorly understood: some people seem to think that because a rich person makes more money, their time is "worth more" to them. Nothing could be further from the truth. Each hour of a poor person's time spent gaining income has a significantly higher impact on their quality of life than the same for a rich person.)
> Time is something poor people have very little of, as they generally spend most of it trying to make money to make ends meet.
I'm not talking about forming a DC lobbying firm. I'm saying they should ask Councilman Chalmers about these problems at the soccer game, after church, at the grocery store, at the Fourth of July fireworks display, or wherever she tends to be. One of the advantages of local government is that it doesn't take piles of money or tons of energy to speak your mind.
And, yes, I've been poor, so I know how things work. And, while young and poor, I have seen plenty of blue collar (at best) folks speaking out at town hall sessions, etc. The show Parks and Rec makes fun of blue collar citizen activism quite a bit, actually. They generally portray them as crazy, loud, and stupid while Leslie Knope (or someone) puts up with them. If they all said "we need a bus line running more often down Grand Ave", the message would get across.
> If they all said "we need a bus line running more often down Grand Ave", the message would get across.
That kind of activism requires time and energy that those working multiple jobs to feed their kids do not have. Doubly so if there is someone on the other side opposed to expansion of the bus routes (either due to NIMBYism or tax aversion or what-have-you).
That you see blue-collar people at town halls doesn't negate my point that doing so is expensive for them, and relatively more so than for the local well-off NIMBY.
They haven't raised the price of commuting at all, because the only people that have to pay the toll are solo drivers, and this road was not previously available to solo drivers during rush hour.
> In general, progressively pricing services is a mistake. Instead, we should be progressively supplementing incomes (minimum income, negative income tax, commuter cards, etc.) until people can afford market-priced bills, goods, and fees.
OP acknowledges this and proposes an (albeit vague) solution.
Tolls aren’t a market priced good. Treating them like one is just misusing the mechanism, with the net result being the people getting to use the road are chosen roughly to be the wealthiest people who want to.
There are other resource allocation schemes besides giving resources to the wealthiest, for example by giving resources to the least wealthy. Or, as I suggested elsewhere, giving “highway passes” away by random lottery to everyone (with win probability set so that the expected number of winners is the correct number of road users).
It's a market with a fixed supply, but other markets like that work just fine. For example, the USA has a fixed amount of land, and that is sold at a market, and has settled on mostly reasonable rates.
Market rates for land in desirable place are anything but reasonable. I have no idea how you came to the conclusion you did, but in actual desirable places, land is unaffordable to all but the very wealthy.
Road capacity is a scarce resource, and it should be allocated with a market mechanism like every other resource. You can then take the economic gain created by the increased efficiency and tax it to provide more public transit services.
Ouch! Regulating infrastructure purely by market mechanisms is an ugly anti-pattern that is well-known for decades, if not centuries.
Among others, this creates an incentive to keep the resource scarce and to not invest into maintaining and expanding it. Why? Because the lowest level infrastructure is a natural monopoly: Even if it was technically feasible (put wires next to existing wires, put pipes next to existing pipes, put streets next to existing streets), nobody can afford to do this. The lowest level infrastructure is only efficient if shared.
And for this simple reason, it only works well as long as the lowest level infrastructure is public good. This is true for all basic needs: water (pipes, sewer), electricity (wires), transportation (streets, rail roads) and even the internet (wires, radio masts and towers).
The debate about the latter one is also known as net neutrality. But it's really just a special case of the general pattern - if you accept internet as a basic need in today's world.
On top of that public infrastructure, a free market can and should evolve. But note that it will only be a free market if the basic layer access is non-discriminatory, which in particular means that it is easy for newcomers to get in. Otherwise you have maket distortion from day one, and all arguments about market mechanisms are moot. Which is unfortunately the reality in many areas, although its badness varies from country to country.
That's what gas taxes are for. Living near a freeway you are better off if they reduced congestion. Increasing congestion increases pollution as cars accelerate and break more frequently etc.
Fuel taxes are a very crude tool, road tolls are much better instrument to actually regulate the behavior you care about.
If you raise fuel taxes because there's too much congestion that's going to equally affect someone who lives in some rural area where congestion isn't an issue at all, and someone who's driving down a busy freeway every day contributing to congestion.
You also raise the price of gasoline, which has other uses that have nothing whatsoever to do with road transport.
If you want to discourage specific behavior you should tax that specific behavior, not tax something one or two steps removed from the behavior you care about.
You could have regional fuel charges. However, you don't want to discrage driving in a specific place you want to reduce it everywhere to reduce pollution everywhere.
PS: People often say you can't out build congestion, but the data in no way supports that argument. D.C. Metro area for example has horrible traffic, but just looking at road layout the failures are obvious.
Discouraging driving in general is one thing with one market price, discouraging driving where it leads to congestion is another thing with a higher market price.
Not all vehicles that cause congestion even use gasoline, which is another reason for why trying to solve congestion with higher fuel taxes is a bad idea. Your Tesla is just as bad for congestion as a gas guzzler.
Even ignoring that, regional fuel charges don't fix the problem. There's plenty of big cities where you can drive in specific areas or at specific times without causing any congestion problems, which is why it makes sense to charge road tolls on specific roads at specific times.
Vehicles can also drive to different regions to fill up, which becomes a big problem of arbitrage if you try to make the regions too granular.
Congestion already has it's own price directly in increased travel time. Which pushes people to use optimal routes to a destination. However, routing around congestion increases pollution via trip length. So you want to increase peoples ability to go from A > B, not hinder peopling moving from A > B with increased cost.
PS: We want higher mileage people to get electric cars, so having no transit tax actually efficiently promotes higher mileage people from making the switch first. It's just one of many subsides associated with electric cars, but we will eventually just charge based on odometer readings.
> Congestion already has it's own price
> directly in increased travel time.
Which is clearly not enough, as detailed in the article. If people only had to pay with their own time they would, and the road would be congested, hence the high toll. This is basic supply & demand.
You just keep asserting that people should pay for their pollution, I agree! But that's not always the maximum price you should pay.
> charge based on odometer readings.
Which would be another case of not charging based on the actual cost. You could drive your street legal car around in circles on a private track, and you should pay almost no road tax, but someone who exclusively uses public roads should pay more. Under this scheme you'd pay the same for both cars.
> Which is clearly not enough, as detailed in the article.
40$ is actually close to the market rate of time saved for a large percentage of people driving on that road. So, you might not think costs that don't evenly map to dollars as equivalent, but clearly the market disagrees.
> around in circles on a private track.
Easily tracked and an exception could be made, but most people would not feel the savings as worth the effort. Remember laws are thousands of pages long first and second order objections can easily be included.
PS: In effect every road in the US is a toll road, you might not agree with the prices and exceptions but people still pay billions.
Pressure to take transit, coupled with few transit stations and low-rise/single family zoning around those transit stations, is worse: now instead of sitting in traffic, commuters with the least access to premium real estate must walk the furthest.
> Among others, this creates an incentive to keep the resource scarce and to not invest into maintaining and expanding it.
Price signals are exactly the sort of thing that can be used to optimize (and fund) the maintainance of infrastructure. Right now roads are placed and funded by fiat, which is why they’re often located nonsensically or in highly irregular states of repair.
I'm a really market-oriented guy, but I have concerns about wealth's distorting effect on markets. That is, the "cost" of an item is much less to a wealthy person than to a non-wealthy person.
Billionaire Bob can spend $100,000 on a whim, but Pauper Paul can't scrounge $10,000 for life-critical health-care. Or after a natural disaster, market theory says equilibrium prices rise to balance demand, but prices cannot rise enough so that Bob hesitates to buy all the ice for his drinks, pricing Paul out of buying ice to keep his insulin cold.
It almost feels like there needs to be some fixed currency that everyone gets equal amounts of per day and that can be exchanged for the really important things. But then some people will accumulate that currency, and we're back to wealth distortions.
Making fees and fines dependent on income is a good way to get incentives right. In Germany for example health insurance is based on your income, not a fixed amount like here.
I believe that health care in the US is subsidized to some degree by people with higher income.
—- Medicare payroll taxes are proportional to salary.
—- Low income people that use hospitals generally don’t end up paying for their surgery and care which is passed on to people that do pay their bills.
—- Big pharma offers heavy discounts to low income patients for expensive drugs resulting in higher costs for the rest of us.
—- Under the current Afforadable Care Act free/low cost insurance is provided by raising taxes on the upper income people.
I don’t know what’s the best way to improve the system; I just wish the costs, who was paying for it, and where the money was going was more transparent. It appears that it is intentionally designed to be inscrutable.
But only up to a certain point: the tax is only on the first 50k EUR or so of your salary, and there is a minimum charged (about 100 EUR/mo.) no matter how little you make.
No, they should just improve the economy and supplement income (minimum income, negative income tax) to ensure that everyone can afford the cost of living, $40 tolls included.
Both the "fake money" and the "cost scales with income" are great ways to extend the applicability of markets to areas without currency or to minimize wealth effects.
Food stamps are equivalent to cash. A true rationing program as proposed would prevent you from using cash. This creates black markets which is why it is bad.
The resources people need: ice to cool insulin, food, healthcare, day care, basic housing, etc. are not scarce, or at the very least scarcity is fixable for little money.
Merely that they idea that everybody can't have it, and there it must be rationed by economic means is a little crazy.
We can't all have private jets; but efficiency gains in food production suggests we can easily produce enough food. We are choosing not to distribute it.
That works for this one example, where the government is selling something, effectively creating a tax on people willing to pay to save time.
But most market exchanges do not involve the government (except sales tax). The government can't efficiently capture the excess funds Bob is willing to spend on ice to provide ice for Paul (though the increased price should provide great incentive for people to increase the supply of ice...)
> It almost feels like there needs to be some fixed currency that everyone gets equal amounts of per day and that can be exchanged for the really important things.
Votes could be that, but they too are depreciating.
> Or after a natural disaster, market theory says equilibrium prices rise to balance demand, but prices cannot rise enough
This happened recently in Texas not because of a market failure, but because Texas has “anti-gouging” laws that prevent people from raising prices around a disaster, which entirely predictably had the effect of people being unable to get what they needed (wood, water, etc.) during Harvey.
"A well-known gouging case involves the invisible hand actions of John Shepperson. After the Hurricane Katrina disaster, John bought 19 generators, rented a U-Haul truck, and drove 600 miles from Kentucky to Mississippi. In return for his efforts and risk, he hoped to sell the generators at double his purchase price. Instead, he was arrested for price gouging, spent 4 days in jail, and the generators were confiscated. It’s a tricky issue: while Mr. Shepperson’s morality can be debated, his initiative would have unequivocally added supply and made some people better off. We all are charitable, of course, but how many of you would have rented a truck and driven twelve hundred miles round trip to sell generators for the price you purchased them?"
Usually yes, but when one or a few suppliers are the sole source of a resource it’s not that simple. Especially when that resource is very widely used for a huge variety of applications. That’s becaus the benefit to society isn’t simple captured in the monetary cost.
Consider police vehicles, ambulances and utility maintenance vehicles. Does anybody really think they should have to pay tolls? A real market forces purist would say yes, but in reality passing along those costs efficiently isn’t practical. Similarly in theory all roads could be toll roads, but the cost of raising those tolls would massively increase the cost of the road infrastructure, driving up tolls in a vicious cycle. The gas tax is a reasonable compromise by taxing road use indirectly, it doesn’t capture the differing costs of different segments of roads and the demands on them, hence tolls on specific roads. So in the real world you can’t just treat everything like a nail and hit it with a market forces hammer. It’s a powerful and useful tool, one of the best we have, but still needs to be wielded responsibly with an eye to the intended outcome.
While it varies there are toll bridges and roads where emergency vehicles must pay. It helps that they are electronic tolls where the vehicle does not have to stop.
History has shown that in many cases, it's finding an efficient way to measure and charge for a resource which is the real breakthrough to utilizing the resource.
If the electricity meter hadn't been invented, or cost millions of dollars, it's doubtful your home would even have electricity today.
Very true, but that’s a fact regardless of whether market forces are a send to determine price. Ideally they should, because markets are usually good at determining relative value, but not always as for example in the case of industrial pollution. Eventually over hundreds of years we are beginning to implement some ways of factoring that onto market costs, but it’s been a long and painful process and there’s still a long way to go. For most of that time direct regulation has been the only workable answer, figuring out how to factor it into markets would have been too late.
A big reason of income gap is opportunity gap. We keep widening the opportunity gap by adding 'fast lanes' to people who can afford it, rather than improving the situation for all. In this particular case, perhaps, there is no short term solution to improve for all but it makes me little sad anyway.
Ability to pay is not the only way to ration scarce resources, neither is it proven to be the best in all scenarios: this is why you can’t pay to bring your court date forward
Or even just to hand it out as yearly lump sum all citizens: than even the poorest person can afford the tolls, as long as they use the average amount or less of road capacity.
The problem with _not_ charging any money for road capacity is that you are still rationing, but now the price is measured in people's willingness to waste time in traffic. And that time is just that, wasted. The money collected can be re-routed to other purposes.
Well... the mechanism is prices. A market machaninism, but not really a market in the full sense...
Anyway the result of this mechanism are fairly predictable. Fixed, scarce, resource. Price system. Unequal distribution of wealth/income. Most of the scarce resource will be allocated to the wealthy, who will outbid the rest.
At present, the non market price-like mechanism is generally time, and all people get 24 hrs per day.
The lack of market mechanisms for organ donations has lead to an huge undersupply of them in the United States. It's literally causing a massive number of people to die that wouldn't under a more market oriented system.
I live in DC and I recently took a trip to a rural part of America. I must say I was a bit shocked. I have been in my little metro bubble for so long that I was completely out of touch with how rough rural areas are looking.
There are towns that have given up maintaining parts of their road networks and are intentionally turning some hard-to-maintain paved roads into gravel roads - "depaving".
Even my home state (Texas), which isn't in an obvious economic crisis (though its budget situation is arguably a self-made crisis by our crazy legislature), has been doing it for a few years now:
I live in New Orleans but am not a native. Visiting DC this past fall (although not for the first time, I have been there when I was little), coming out of the Metro station on King St (in Alexandria) was absolutely cause for my jaw to drop.
" Most people in Congress have enough money and get a nice insurance plan" -- hehe they get government insurance that pretty much covers 100% of everything you can't really buy an equivalent commercial policy but they sure will argue all day that you def. don't want that horrible gov. insurance.
If you make one friend with someone in your neighborhood or your workplace and carpool the express lane is free. It's that easy. That's what one of my coworkers' wife does. Another person I work with comes to work at 0500, others come after 1000.
This $40 was a charge that allowed willing, solo drivers to use the car pool lanes. No one had to pay the $40; they could continue to drive solo in the non car pool lanes as they had previously. This option was just added.
Yes, and now there's a privileged option for privileged people, whereas before it was just banned / equal for everybody (everybody driving solo, that is). That's what the GP was getting at, I think.
Should first class seating on airplanes be eliminated?
Should seats to sporting events all cost the same?
Should all of us drive the same model car or should all models just be priced the same?
Should steak be priced the same as hamburger?
I observe that economic discussions here on HN are dominated by two interesting perspectives:
(1) We should have a Star Trek like economy: no one wants for anything.
(2) If smart people like us had our hands on the steering wheel we could regulate the economy into good shape—-Friedrich Hayek described this as “The Fatal Conceit” in his book with that title.
Say the public grid is notoriously unstable. Electricity is on maybe 50% of the day. (This is in fact true in some countries.) Now the government (who pretty much has sole domain over running utility wires) offers a "deluxe" service, with 100% availability, for the low-low price of a week's worth of food for one day of service.
Congratulations. Now you've stabilized a scenario in which everyone with money and power is sated, and the government has little reason to allocate any resources to improving the service to the remainder of the public.
The important thing is that the rules for using publicly financed goods/services are the same for everybody. If you pay for your electricity of course you are free to choose what you do with it.
This is not the same as with roads though, since they are a finite resource (whereas, arguably, electricity can be seen as infinite in this case). You can't ask people to pay for roads which they then can't use because they can't afford the tolls for it. It's already bad enough that so much tax money flows into building roads, which can only be utilized by people wealthy enough to own and maintain a car in the first place. (I'm reading the book "Happy City" at the moment, so this topic struck a chord with me)
If you make $550 per day, $40 is 7% of your daily income; if you make $82 per day, it's 49%. That's not the same for everyone. Of course, there are people who make well more than $550 per day and people who make significantly less than $82 per day.
By that logic, almost every single rule in this world is 'unfair' towards the poor, because of course things cost disproportionately more for the poor.
Not quite...there aren't, and haven't been for over 20 years, any non-HOV lanes on the road at rush hour. They expanded the rush hour HOV time period, so it catches people that left early or late to avoid it. They also removed an exception for hybrid vehicles with special plates and traffic to the airport.
The real issue is that the NIMBYs in Arlington won't let them expand the road at all.
Right, if the rush hour times hadn't changed (and the other exceptions) the toll wouldn't seem like as much of a money grab.
One interesting thing, is how this might incentivise people to ignore the toll altogether since the price over even a short period of time are likely to be higher than the fines.
Your own link says it's less absolute than you're making it out to be:
> A comparison of congestion data from 1982 to 2011 by the Texas A&M Transportation Institute clearly demonstrated that additional roadways reduced the rate of congestion increase. When increases in road capacity were matched to the increase demand, growth in congestion was found to be much lower.
> ... one study ... found that "over a six- to eight-year period following freeway expansion, around twenty percent of added capacity is 'preserved,' and around eighty percent gets absorbed or depleted. Half of this absorption is due to external factors, like growing population and income ...
Though it is likely true that expanding metro lines into VA would be more cost-effective here.
Whenever I see "problematic" it's always someone who is pointing out something that is not actually a real problem, ie. supported by data or facts, but they desperately want it to be because it doesnt make them "feel" right or it seems like the "right thing to do". More often than not it runs counter to their initial goals (increasing exclusion in the name of inclusion, hurting everyone in the name of punishing the top few, etc).
...No one is being excluded when a service is being underutilized and a small group of people pay extra to reach optimal capacity. There is no way for them to fill this small extra space without flooding it (ie, hybrid only, or Dulles airport cars as they already tried was obviously too much traffic), so why not use it to capacity and earn the city more money from these wealthy people?
Would you rather the government make less money from the wealthy?
Do you really think the small group of people willing to pay $40 is going to slow down the existing traffic?
Would you rather no one uses it, even though the highway can support a small amount of other cars, just for some abstract satisfaction at 'hurting' wealthy people?
My main concern is that the people in power (the ones with money) will direct resources to deluxe infrastructure because they can afford it and neglect basic infrastructure. When I hear people in Congress talk about the US system being the best in the world it's already clear that they haven't experienced it from the view of somebody with little money.
When I drive around LA this trend is visible. Rich neighborhoods have nice roads and don't allow street parking so they don't get much traffic. Poor neighborhoods have bad streets and get a lot of traffic.
You seem to be suggesting the only two options are
1. No one uses the nice thing.
2. Only thing richer people use the nice thing.
There are plenty of other ways of allocating resources besides giving it to the richest people. E.g., there could be a lottery so that everyone gets to use the nice thing sometimes.
I'm curious how they use the money from the $40 toll. If, for example, they used the money to improve roads and other public transportation options so that everyone on average gets where they need to go faster, then that ought to make everyone happy.
Or else just divide up the revenue and mail everyone in the state a check at the end of the year. That would make me less angry about the fact that other people are able to afford the $40 toll.
> "I'm curious how they use the money from the $40 toll."
The article says that it is being used to fund new construction:
"This is what transportation costs!"
"The real reason there's sticker shock is that the real cost of road transportation is hidden from most voters. Gas tax money goes to states and the US Department of Transportation which flows back as what seems like free federal money to build a lot of roads. Meanwhile, every transit project has to scrimp for funds and deal with constant sniping from critics calling it a boondoggle."
It's not true. The road had a planned expansion to go to 4 lanes in each direction in 1977. It was blocked by Arlington County, and the only new construction they've done for 40 years is extending the exit lanes. It's so ridiculously under the needed capacity that all of the canards about not being able to build your way out of traffic don't apply.
> "It's not true. The road had a planned expansion to go to 4 lanes in each direction in 1977..."
Doesn't matter that it was planned a long time ago and blocked. Regardless of how or when it was initially built, the cost to build it has to be compensated somehow.
Money is fungible. Even if the toll goes to transportation they will just cut that amount from the regular budget. Sending out a check to everybody would be fine but that ain't gonna happen...
Or, people who don't have a lot of money but really, really need to get there in a hurry can use them too. See: late for job interview, in labour, late for flight, etc.
Also if you're driving a vehicle you own you're already not among the poorest folks out there.
> Also if you're driving a vehicle you own you're already not among the poorest folks out there.
Is an incorrect notion. Poor people don't not drive (how could they not, to drive across the city from their not-served-by-public-transit residence to their minimum-wage job?), they drive shitty cars. Certainly, I owned a vehicle out of necessity when a $40 expense would have been unthinkable for me. That's half a days' wages for many people. 2.5% of your month's income is a LOT, especially after spending half of it on housing.
Sure, you're correct that the destitute don't own cars, but there's a large swath of the population more well-off than "destitute" but not so well-off as to be able to ever spend $40 on something that is not an absolute necessity.
It won't really be people who are personally rich as much at it will be people who can expense it to their rich employer or bill it to their rich client.
They have a strategy in the UK to get everyone to pay £40 tolls, regardless of your income - by stealth.
There’s been a trend towards digital tolls - that is, no physical means to pay, you just have to know that you need to go online to their site to pay within an hour of leaving the toll road/bridge.
Thing is, many operators have little signage, poor or unavailable websites, and you can end up in a situation where you don’t realise you need to pay, or can’t pay because their tech has failed, or simply forget. So - instead of paying the £2 toll, you get a £40 penalty, payable immediately, appeals at your expense, etc.
Now, it’s easy to go “conspiracy” but there’s one factor that strongly leads me to believe that this is by design. It’s cost. At £2 per transaction, acquirer and network fees will eat a big chunk - much more than the salary for a human, or the cost of an automatic change bucket. Therefore, they rely on the fines as core revenue.
Rubbish. I guess this happened to you once somewhere and now you think it is a 'strategy', but the only automatic toll I can think of is the London congestion charge and everyone knows about that.
Liverpool, merseyflow, and I’m a long way from alone - there’s one sign, a website (merseyflow.co.uk) with major availability and usability issues, and they charge a toll on both the old (used to be toll free) and new bridges.
The same article asserts a revenue of £50m+/yr from fines for dartford - same administering firm. With toll barriers this revenue would have been zero.
As mentioned below, Dartford Crossing (bridge + tunnel) is an automatic toll (using ANPR).
There are also a few other places which use ANPR for charging (Betteshanger Country Park car parking springs to mind) but I don't think you can consider those "tolls" in the traditional sense of the word.
I live in Northern Virginia, and the statement "People who were totally banned from a road now could now use it at its busiest time" is false. People were already driving on I-66 solo during HOV-only hours, they were just counting on super lax enforcement and the law of probability falling in their favor for not getting caught. When riding in the metro in the mornings (which runs parallel to I-66 into DC for a time) you saw lots and lots and LOTS of solo commuters during HOV times.
I imagine now people are just switching their EZPass (toll transponder) to "HOV" and still driving solo, which I imagine is even harder to enforce.
Traffic into and out of DC to and from Northern Virginia SUCKS, it's always sucked, and it will continue to suck probably indefinitely. There need to be more roads and more bridges across the Potomac river but there's no logistically possible way to do so.
Have you ever heard of induced demand? More roads and bridges are not the answer, especially since the associated capital costs could go a long ways towards fixing Metro and thereby provide greater utility.
Northern Virginia has some of the absolute dumbest land use policies and traffic planning of anywhere in the nation. It's reaping what it's sown with traffic congestion. This is a big step in the right direction. (I live in DC, because I can't stand Virginia.)
That is not what happens. The effect they're measuring is that a road gets congested, the congestion suppresses the natural demand, and if you expand the road to reduce the congestion then more of the natural demand comes back and there is still more congestion than you expected.
But the same applies to any of the alternatives. If you build more housing in the metro area then there are less cars, which reduces congestion some, but not very much because as soon as there is less congestion for any reason, more people drive.
The only way to eliminate the congestion is to satisfy the entire demand. You can do that by expanding the roads, you can do that by making it less expensive to actually live in the city, but it's often more effective to do both.
A much worse choice is to suppress the natural demand with tolls, which will certainly reduce congestion, but will also screw up your city even worse because people are severely punished for living in the suburbs even though there still isn't enough urban housing. So urban housing prices go up, commuting costs go up, and everyone in the city becomes poorer (except the landlords and toll companies).
DC's been on a building spree and rents have stabilized, maybe even decreased a bit. In the greater Metro area, there are four fundamental problems: 1) new housing and jobs are placed too far away from Metro; 2) Metro is severely under-capitalized due to a lack of a dedicated funding source, so they can't undertake the projects they need to restore the level of service that was unsustainably enjoyed in the late 90s/early 00s; 3) we haven't prioritized bus service with BRT, transit ways, dedicated bus lanes, etc., to serve as a middle tier between cars and Metro; 4) DC lacks autonomy from Congress and Congress has explicitly forbade DC from enacting anything that resembles a commuter tax. If we tolled every car coming into DC (NYC and SF have tolls on their bridges and tunnels), that could be a nice funding stream for mass transit projects; but we can't simply because of Congress.
There's also an exacerbating problem, especially within DC's boundaries, that the rise of Uber and Lyft at the same time Metro has taken a nose-dive means an individual can be better off using ride-hailing instead of using mass transit, but it puts more cars on the street and makes street-level congestion horrible. Hopefully DC's DDOT will start carving out dedicated bus lanes so that many DC residents are assured better commutes through bus than through ride-hailing.
> DC's been on a building spree and rents have stabilized, maybe even decreased a bit.
You can obviously offset something that raises rents by doing something that lowers rents, but then you're only depriving yourself of the benefits you would have had from actually lowering rents (or lowering them more) instead of having the benefit canceled out. And it still screws over anyone who still can't afford to live in the city.
> new housing and jobs are placed too far away from Metro
It's probably also that new housing and jobs are placed too far away from each other.
> dedicated bus lanes
Bus lanes are crazy. It's impossible for them to cause congestion relief because the instant they actually did the bus lane would no longer confer any advantage to the bus and any incentive it provided not to drive would evaporate. So it's logically impossible for them to actually solve the problem, but they can easily make it worse by wasting road capacity when the reason people don't take the bus isn't just congestion, e.g. if the bus doesn't go where they need it to.
> If we tolled every car coming into DC (NYC and SF have tolls on their bridges and tunnels), that could be a nice funding stream for mass transit projects; but we can't simply because of Congress.
Tolls are popular with some cities because it's effectively taxation without representation. The city gets to collect money from people who live in neighboring cities and states, who don't get a vote on whether there should be a toll there. This is not commendable behavior.
And there is no magic. One way or another the citizens have to pay for the infrastructure. It's not like tolls can cost them less money than to pay for it with normal taxes. For most people it will cost them more, because tolls are incredibly regressive. Even more regressive than flat taxes. And on top of that you have to pay the overhead cost to collect the tolls.
Build housing and eliminate rules that prevent it from being built, and build infrastructure and pay for it with normal taxes. Don't make driving worse, make the alternatives better.
I never understood this argument against more roads/bridges. Even if there is no improvement in latency (travel times), isn't the increase in throughput (number of people traveling) and the associated economic benefit worth it?
In addition to the counterintuitive traffic congestion stuff, you also have to consider cost. Bridges ain't cheap. Metro isn't either... but you could make a lot of improvements to Metro for the price of a bridge.
The 7000 series has fortunately been a godsend for Metro. Now it just needs a miracle for each of: power supply, rail insulators, water leaks, automated control, and the union contract/pension.
The other under-reported issue is that they expanded the window that these tolls are in place vs. the old HOV model. Lots of people used to drive in at 6AM before it was HOV, or at 9AM after it was over, and now there are heavy tolls during both those periods. So there are lots of people that were legally driving in for free and now cannot do so without leaving even earlier or later.
More roads and more bridges doesn't work. If a new lane suddenly was created, people who normally avoid rush hour would suddenly start going at that time. People would start moving farther out, rather than stay closer. Vehicle miles would increase, the road would eventually be saturated. See Atlanta.
I think you're right, though some of those solo drivers might be in electric or hybrid vehicles, which have been allowed to use the toll lane free for a while.
> Which would you prefer in general: Being forbidden from doing something at all, or allowed to do it at high cost? Under standard economic theory, the latter should always be better. In the first scenario, you have one option: don't do it. In the second, you have two options, including the same option as before.
This is not how the human mind works.
One part is obvious: would you rather starve, with no options, or starve in front of a beautiful cheesecake, just out of reach? Or worse, in front of a cake out of reach to you, but with other people feasting on it? This is not just "envy", it's loss, in the second case we're losing out and we're extremely loss adverse.
The other part is less obvious but no less real: we average the cost of options. A set of 11 plates with one of them broken is worth less to buyers than a set of 10 good plates, because the average value of 1 plate in the first case is less than in the second one. This has been demonstrated many times.
When you go from one option at no cost (slow lane) to one free option + one paying option, then the perceived value/cost of the "free" option isn't free anymore, it goes up because people average the cost.
(That said, tolls are probably the best possible solution; but the transition is always going to be painful).
> One part is obvious: would you rather starve, with no options, or starve in front of a beautiful cheesecake, just out of reach?
Choices made when consequences are so extreme, especially in life or death scenarios, are often different than everyday decisions. A life or death decision would have zero risk tolerance.
For example, in a work environment, one strategy people like to choose is to never say that something is 'impossible', but rather that something has a particularly high price. People are much more comfortable hearing that the effort/costs of doing something aren't for them, rather than feeling like they have no choice at all.
Another interesting example of pre-committing to less options: sending an agent to negotiate for you.
Eg the company service rep you are talking over the phone can play the 'good cop' all day long and be nice and polite; but to make any decisions they have to call their manager, who can play the 'bad cop' or defer to 'company policy'.
(Not very relevant to the road charging example here, though.)
I don't think people are being unreasonable by being unhappy with a $40 toll. The way the article words it, solo drivers all of a sudden saw a $40 toll where they previously had no permission to drive at all.
What actually happened was that people were expecting to see a $6 toll be put in place and instead saw a $40. Imagine going to McDonald's where your friend told you that you could get a Filet o' Fish for $1 but when you get there you find out that McDonald's was charging $5. You'd be mad. You still have the option to not buy the sandwich, but it went contrary to your expectations.
So the article is correct, but I don't think they fully accounted for the fact that people had already been told to expect something else. The article mentioned it, but then goes and talks like people are being unreasonably frustrated for tolls that were completely unexpected.
The other aspect is that politicians simply didn't communicate the nuance - the toll exists to LIMIT access, it will be as high as necessary to keep traffic flowing.
People understood the clear division that existed prior to tolling - the separate lanes were for commuters that had a lower environmental and traffic impact, and people that had to catch a flight. A price tag reframes the problem in terms of access to a paid service... and everyone expects to be able to afford access to public infrastructure.
where they previously had no permission to drive at all.
I think this is where it's getting hung up. The signage and all other road markings on I-66 did not give a solo driver the overwhelming impression that they did not have "permission" to drive on those roads. Compounding this is that it was/is only during certain portions of the day.
As an example, if I go onto the Dulles or Loudoun county toll roads, it's explicitly clear with toll booths etc... that YOU ARE NOT SUPPOSED TO BE ON THIS ROAD WITHOUT PAYING. Similar around the country on other toll roads.
If all access is just as easy as any other road and there is no enforcement mechanism (save the odd example of someone you know getting a ticket) or overbearing signage (like on the 495 EZPass lanes) then naturally people would assume it's just like any other "free" highway.
I think DC has a unique driving culture around this and slugging that unless you are just a total stickler for the rules is largely a grab bag game.
Definitely unique. I've never lived in DC but visited a few times for work and was flabbergasted when I heard about slug lines (I still am). It's a bad driving situation when you'll voluntarily get into a stranger's car, and drivers will just let random strangers in their car. That doesn't happen in any of the cities I've lived in.
They do this in the SF Bay area, it's called casual carpool. Very popular in the East Bay. I used to do it for many years, both as a driver and passenger. It's all about getting past the Bay Bridge toll plaza, and the carpool lane goes way faster than the (sometimes horribly) backed up traffic. The FastTrac lanes aren't any good when it gets so backed up.
Yes there are myriad unspoken rules, and hilarious stories about when they are flagrantly violated. But over the years I've had some great rides, met some wonderful people, discovered some new music, and generally enjoyed the experience of intermixing with fellow humanity in a random but mutually beneficial way.
An acquaintance I know has been going to work via a slug line for more than 10 years. It's impressive that it is reliable enough for getting to a day job. There are even unwritten rules you're supposed to follow and so on when in someone else's car.
Now I guess with Lyft and Uber it might seem less strange being in someone else's car these days. But before I can see how it would look totally weird for someone from out of town.
> Imagine going to McDonald's where your friend told you that you could get a Filet o' Fish for $1 but when you get there you find out that McDonald's was charging $5. You'd be mad.
Yes. At my friend, for being wrong, and for suggesting I eat a Filet o' Fish. I wouldn't be mad at McDonald's.
The issue is this: being banned is a certainty, the decision is simple; being asked to pay a variable price, once you go there as a captive (you're already chosen to take that road, say) is forcing you into an uninformed decision. Of course people would be pissed, what's hard to understand?
Ignoring the morals for a second, with tolls that high and difficulty identifying which vehicles qualify for a HOV exemption, I wonder how many days of tolls a single ticket is and likelihood of being caught?
Let's say a ticket is $150. If the toll is $6 then you're likely better off paying the toll as you're likely to be caught at least once every 25 days. At $40 they'd need to catch you at least once a week for you to lose money. The $150 amount is fictional, I don't know what the ticket would cost, more just a thought experiment.
In any regard, when tolls are this high, you have to consider issues like this. What works for a $4-6 toll doesn't scale to $40 unless the tickets also scale.
When I was younger, and new to the city, I used to park in a car park where the fines were $22, but to park for a full day was $20.
I got a few tickets. Let me tell you, escalation of parking violations in my state are no joke. I forgot about one or two of them just before I moved, so by the time they found me again they had made their way through the court system and had been there a couple of months. A hefty $300 levy is applied immediately, and failure to pay the fine is now failure to pay a state fine not a council fine, with the next steps being another $750, then suspension of vehicle services (can't register your car) then finally suspension of your drivers license, and you can't travel abroad. Times this all by two for two tickets.
The suspension of my drivers license was how I found out about this silent tsunami of infractions building up toward me, and when it broke across the shore, I was left stranded with my car and yet another $1000 fine for driving unlicensed (news to me).
I repealed and the whole situation went away, as I never recieved any of the letters and was unaware.
I do think it's ridiculous a $20 parking fine is allowed to escalate that far, but I suppose it worked, as I pay my tickets now.
This is a pretty standard way of how governments enforce their authority. Each demand is backed with the threat of a bigger punishment, ultimately ending with incarceration. I wonder if there is any alternative strategy that is "better"? Dings on credit score? Automatic garnishment of wage / tax return?
In practice, however, most of the issues arise from people not getting the notices in time due to moving, clerical errors, etc. Unfortunately, there is very little recourse (and a lot of hassle) if the state makes a mistake.
They combat this fairly smartly: the fine starts at $125 and doubles with every incident, up into the thousands. This was the case before this toll road, circa 2013 ish.
When the I-66 HOV lanes originally opened, there was a problem of some percentage of drivers being willing to risk an $X citation (and the delay while being written up) every few months in exchange for using the road every day.
The solution that VA put in place to combat that is that the HOV violation citation not only has a money cost, but second or subsequent infractions within a five year window result in assessment of points [1] against your drivers license. Only a small number of points [2] is necessary to risk losing your license.
Do they not have e-tags, cameras and registrations in this part of the world?
I genuinely ask, since my assumption when using toll roads here is that the fine would find you pretty much as soon as you use the road...marginal errors and bugs aside.
On this road, they're using e-tags that have a "HOV" switch on them. If you set it to "HOV mode", you're not charged a toll. The tag can't actually know how many people are in the car, so someone could cheat by setting their tag to HOV and driving without anyone else in the car. Hence the actual officers-pulling-people-over enforcement required. (They have readers in the police cars that tell them whether a vehicle's transponder is in HOV mode or not.)
Do you need a tag to carpool where you are? Here in MN you do not, so it makes the HOV difficult to enforce, particularly because our Supreme Court decided you cannot be ticketed by camera. You basically have to have a cop car come up beside you.
You're supposed to have it now to get on this highway. Before there was no toll on it but it was all HOV-only during certain times of day. Now it is HOV or single drivers can pay apparently up to $40 use it too. Other roads in the area have manned toll plazas which accept cash.
I think the likelihood of getting caught is close to 100% each day. HOV policing is an extremely high priority in the DC area and because of dedicated highways like this, also extremely easy and profitable for police. Also, I believe fines start around $250 and quickly move to $1000. There is a whole informal system of carpooling called "slugs" that works with the system. That'd be your best bet. Or, at $70 round trip, you can literally hire someone to wait around for 8 hours on minimum wage and still get off cheaper. $7.50 x 8 = $60.
> hire someone to wait around for 8 hours on minimum wage and still get off cheaper. $7.50 x 8 = $60.
Hah. If slug lines wren't a thing, it would be a startup idea -
"hire a perma-slug". They go to work with you, file papers and bring you coffee or maybe they get to hang out in museums during the day. Then you go home in the evening with them.
If slug lines weren't a thing, you could probably make it an uber-like thing were you can hire a slug (who might be just going in the same direction anyway, or just needs a few bucks) just for the occasion. No need to hold someone up the whole day.
They've got multiple camera stations and EZ Pass scanners so they'll just mail you the bill now. Before a cop had to pull you over to catch you cheating in the HOV lane.
> "The real reason there's sticker shock is that the real cost of road transportation is hidden from most voters. Gas tax money goes to states and the US Department of Transportation which flows back as what seems like free federal money to build a lot of roads. Meanwhile, every transit project has to scrimp for funds..." "...estimated that tolls would have to be at least $41 to pay off the costs of construction."
A lot of people take for granted the Eisenhower interstate infrastructure.
An interesting contrast is Japan, where the highway system was totally privatized, and to get almost anywhere you have to pay tolls. A 300 km (280 mi) drive can cost you 6000 yen ($50) in tolls.
Of course in Japan there are usually alternatives. Not always any cheaper though. The bullet train for the same route as above costs 9000 yen, but is 3x faster than driving.
It's a simple answer and no clue how to actually fix it.
It's because the US is being bifurcated into a 1st world and 3rd world in the same country. Both use significant corruption in very different ways to get things done. The price increases you're seeing is the response to the various types of corruption used.
How do you fix it? Go back to many of the Socialist policies from the '40s that were enacted then, and maintained until the Capitalists chipped at them one at a time. In other words, reign in the Capitalists, and protect the working class. That's a solid way to reduce corruption. It wont happen immediately. It'd likely take a Great Depression style event, ousting of many Capitalists, and laws passed like they were in the 40's.
If it doesn't happen, the Capitalists will just loot more and use their bought out govt regulation to claim legality. And the working class will cheat the capitalists because they wouldn't be able to get back to where they used to be if they didn't. And, the Capitalists need the workers. Not enough people on the rich end to actually do the hard work needed.
* Not enough family sized units in the city (drive down cost with supply).
* Insufficient quality of life in building codes. (Noise, smell, clean air, green spaces)
* Lack of vertical density;
This is begging for Cave of Steel like results complete with indoor parks and atriums.
It’s the set of values that controls nearly all land use policy in the United States. YIMBYism exists, and I am one, but I recognize that pro-skyscraper or even pro-mid-rise is a fringe position.
I mean, one of the problems with tolls is that it is another form of taxing that has a bigger impact the lower income you have.
Without getting into an ideological discussion, having surge pricing on tolls would contribute to a minor divide in class.
In Australia this is a current topic, as (in Sydney specifically) there was a recent controversial highway widening which has been funded by tolls and constructed by a private company, which will own the road and tolls for the next 100 years or so. This highway leads to/from the CBD as a work commute for everyone coming from the west part of the city (the poorer part usually..) and so has direct influence on people's pockets in an already high expenses city on people choosing to live further away in a cheaper part of the city.
This perhaps does not directly apply to this specific instance, but I do think it illustrates that this is slightly more of a complex issue and has more implications than the simplification of the issue the article author wrote - if you introduce a toll but allow people to use it, that does have an impact on overall equality in society, even if you can debate the merits & size of the impact.
Ive seen multiple sources say that widening roads only makes the problem worse yet in this article and in your comment it seems like the "solution" people are going for. That leaves me wondering; Are these sources not sound or are the people in charge of transport morons?
More lanes, in networking terms, improves throughput but doesn't improve latency.
More lanes moves more cars. That's fairly straightforward.
More lanes doesn't improve the time of an individual commute on the road or cut down on congestion of the road.
People have a fixed annoyance level, and congestion will increase until that annoyance level equilibrium is reached again.
The only time more lanes genuinely improves things is when the extra lanes suddenly means that the road now has more capacity than required to carry the traffic level it sees.
Normally, the cost required to add that many lanes is sufficiently prohibitive that such a situation almost never occurs.
There are a few cases where widening roads actually does make traffic jams worse (Braess' paradox), but in the majority of cases, wider roads make traffic flow better, but more traffic flows, which makes the benefit smaller than what you'd expect if the same number of cars were on the road. It's debatable whether the increased traffic flow is an undesirable side effect or represents an increase in public utility.
When people say widening roads makes the problem worse, they usually cite as an example 'before construction, traffic was congested for X minutes; and after it is congested for X + Y minutes' the problem is that often demand has increased in the meantime (because of population growth, or increased economic activity).
There is certainly some amount of induced demand, and in the right scenarios, that could make things significantly worse. In the Bay Area, if 880 was significantly widened but 101 and 280 were not, it might make it attractive to drive from San Francisco to San Jose by crossing the bay and taking 880 south. This could make 880 less effective for east bay users.
This doesn't become a significant issue if there's reasonable regional planning, and routes are kept in rough balance.
There's a limited budget for transportation projects though, and they can be complex and time consuming, so often roads aren't widened until there is a significant amount of peak congestion. During construction, things get worse, and afterwards, there's still a period of peak congestion. People who expect a road widening to create free flow conditions at all hours will be sorely disappointed. I'll add that on and off ramp design makes a big difference in traffic flow as well; a full clover leaf is good for interchanges with low traffic, but all the weaving makes for poor results in congestion; redesigning to avoid weaving helps flow tremendously without widening, although more/different space can be needed depending on the specific road alignment.
There is potential to argue about what is the best use of transportation money; I'm not familiar with transportation in the DC area though, so I won't weigh in on that.
If all you have is a hammer... Australia cities are dominated by cars, people can't imagine a world with them, even the cities are cars first. It is a joke.
China has this big time. Almost all of the infrastructure built out in the current book was privately financed and is heavily tolled (definitely by western standards, it is much worse by Chinese standards). This is part of the reasons chinese logistic prices are so high, but also why there are 8 day traffic jams (because the non-toll option went under construction) and why much of the infrastructure isn’t usable by local farmers.
Yeah, I just spent a week driving to a few different cities throughout China, and the tolls are unbelievable! Just one leg of my trip cost a $50 toll for a half day of driving (not sure about the exact distance). And that’s US$50, which is a lot of money by Chinese standards. You can stay at a decent hotel for two nights for US$50, or buy several nice meals at least.
Actually this is a form of progressive taxation that has less impact the poorer you are. Because the poor are less likely to pay for the roads, they on the average pay less taxes. And given that the road was previously completely banned, they also have access to plenty of alternatives, be it taking other roads or carpooling. On the other hand, the ‘dumb rich’ will pay out of their nose to not have to share their car with someone else.
>Because the poor are less likely to pay for the roads, they on the average pay less taxes
That is assuming that this isn't a critical road that poor people would want to use.
Anyway, I'm not talking about this specific case, I mean more generally that this isn't as simple as was made out, e.g. what if this road is good overall for balancing out wealth (if you view that as a good thing...), but then another case happens where it is a critical road that causes poorer people to have to extend their travel by 20 minutes to avoid the toll? (Ala sydney).
> To many drivers' surprise, though, the tolls during rush hour were high, hitting $34.50 Monday morning and reaching $40 Tuesday.
Is this like "surge pricing" on tolls?
I thought most of the tolls are fixed to allow people know in advance what they must pay. If it increases based on demand, I think people will get mad.
I think the psychology, if any, need not go towards the two choices. But rather what people thought the "dynamic pricing" will be and that was $5-$6 on average.
People get mad at ride sharing companies for their "surge pricing" so this seems in the same mold.
Yes, the whole point of this pricing is not to maximize revenue but to ensure that the total traffic is kept below a certain level - in peak hours it's not enough to charge the maximum what people are willing to pay with clenched teeth, you must go beyond that, you must set it so high that a significant portion of riders in peak hours will refuse to pay it and drive elsewhere or it's not doing its job.
Here in Washington state our 405 lanes have new "Express toll" lanes; if you have 3+ people during rush hour you get to use them free, otherwise for 1-2 people you pay up to $10 based on congestion...
The prices are mostly set dynamically to in theory keep the average speed above a specific number to qualify for federal funding of the work.
Yes, this is not the first private toll road whose price fluctuates by demand in northern VA. They are also on the behest themselves and probably higher areas by now...sometimes 2 miles being 6-8 dollars...however it can easily save 45 min and therefore to many completely worth it. Many use the savings to also justify the dulles toll road as well as a normal commuting road.
The hov restriction makes committing difficult during normal hours.
When I lived there I wished they would improve the metro system, pricier than NY and not as frequent however much cleaner...
Express Lanes were rolled out a few years ago on I-495, aka "the Beltway" that rings DC. Now they've been extended to I-66, the main artery that links the Virginia suburbs to DC's west.
Ride sharing surge pricing gets nasty when it's a national disaster or other major unpredicted event and the rates are sexdecoupling, because it begins to look like profiteering off human misery. But moderate surge pricing is already a fact of life on ride sharing services.
Not sure how it works in VA. I know in SoCal, you are metered by distance, and you can calculate your own tolls. It has nothing to do with traffic congestion.
> Last week, only people in carpools with two people or more, drivers with an exempt hybrid vehicle, [...] during peak times.
> This week, [...]. Hybrid folks and Dulles users also lost their privileges, [...]
If I bought a home on the far end of this road thinking I could buy a hybrid or electric car and use it on the toll road, and then suddenly they take that away and start charging $30 each way, I'd be really upset.
Whether the expectation that this road would remain open to hybrid cars is a _reasonable_ one is an interesting question. I'm not aware of similar changes (hybrids losing their exemption) in other road systems, but I don't exactly read transit-hawk blogs.
The hybrid car exemption for HOV was supposed to be temporary but it kept getting extended for years. New hybrids couldn't get the special license plates but if you got in before the cutoff you could keep the license plate and keep transferring to whatever new hybrid or electric car you bought.
I can imagine a lot of the people with the alt fuels tags are angry, but at the same time their exemption was never supposed to last this long.
California was the same way, hybrids were only supposed to get HOV access for a little while. It was written into the original law. (Don't know if that ever changed)
"The government could theoretically go back to the 20th century model of taxing more and building more free transportation, but voters haven't shown much appetite for raising their taxes."
This is the author weaseling out of addressing the reality that most Americans want higher taxes on the rich. Not taxes raised on everyone, not funds raised through purchasable perks.
"A significant majority of Americans believe that upper-income people and corporations pay too little in taxes, supporting other research showing that well less than half of Americans -- 38% -- agree with a proposal to cut corporate income taxes, and that the majority favor heavier taxes on the rich."
Which would make voting in a president that openly campaigned in a platform to massively cut taxes on corporations and the rich unthinkable, right?
You can often predict reasonably well what individual segments of the voting public will vote for, but they overlap with each other so divining the will of the voters as a whole is really hard. Unless you just promise everyone the earth without any regard to the cost. That can work.
Let's assume that overall, this does not make the road any more or less efficient ( i.e. the same # of product, i.e. people and goods, still pass through the highway stretch per hour ).
For those whose $time_saved_in_traffic > $40, they now have a more economical option.
Imagine a business that bills out labor at $100/hr and offers to pay the $40 toll + $10 extra per day if the employee can and is willing to bill another 30 minutes. Employee is better off ( they effectively spend the same amount of time "at work" plus and extra $10 and likely slightly less gas money ). Employer bills out an extra $50, assuming 20% of that is markup over labor cost, this is an extra $10 in their pocket. The government gets an extra $40 (minus whatever the base toll is) to reinvest elsewhere.
The downside is that the remaining lanes ( those who cannot justify the cost of the fastlane ), will end up paying more in slightly longer commute times if the remaining lanes are now more congested.
What society should be paying attention to is how the efficiency of the road overall improves.
If there is open ( i.e. wasted ) capacity in the HOV lane, opening HOV lane to more traffic will improve efficiency in the road overall.
If the additional revenue can be reinvested to improve efficiency, this should improve things for everyone overall.
If there are no ( or negative ) efficiency gains, then those forced to ride in the mainstream lanes will bear the net cost.
tl;dr; Focus on improving the overall efficiency of the road.
I wonder if this will increase demand for "ride sharing." Anyone who takes an Uber/Lyft will automatically have at least two people in the car, allowing them to use this highway for free. I suppose this probably depends on how long the commute is and whether the ride would be <$40 (or <$40 + gas + car depreciation).
https://en.wikipedia.org/wiki/Catastrophe_theory
I believe in the context of these road discussions its important to understand the math behind the usage of roads. Roads become less efficient, in terms of people per hour, the more people use them. While restricting access may be unfair it also creates value by getting cars off the road faster than what would have happened otherwise.
We have the best road system in the world with high quality roads over the whole country. Most roads are "rain-resistant", meaning heavy rainfall does not affect road conditions negatively. We don't have any toll roads.
We do pay a relatively high tax for it though. The article is spot on that tolls are the consequence of public not willing to increase their taxes.
It's OK to be proud of "the best road system in the world". As you point out, you pay taxes to support it.
However, it's easier to solve certain types of transportation problems when your population density is as high as it is in The Netherlands.
Consider that 41 out of 50 US states have a larger land area than The Netherlands. Consider that only 4 out of 50 US states have a larger population than The Netherlands.
We in the USA need to build and maintain a lot of roads. And our lower population density means that mass transit isn't nearly as viable, except in the largest metropolitan areas, as it is in most of Europe.
Even for the honest ones, I would wager you'll find that most people fit into one of three categories:
1. The ones that won't pay at any cost for whatever reason.
2. The ones who will pay only if it's an emergency or they're in a rush and it's the difference between being on-time or late.
3. The ones who will pay just so they don't have to sit in traffic. Either the money is meaningless to them or they'd rather be happy than rich.
I'm reasonably frugal, generally speaking, but I'm still category 3. My sanity is worth more to me than the $40. Even if it costs me some percentage of my daily pay. I'd rather spend all my money on things that remove friction from my life so I have more time for fun than spend my time dealing with one frustration after another. My happiness is worth way more to me than money. I would say that a fair portion of my time and pay cheque every month is spent on removing friction from my life.
What would be interesting is if (as I predict) the majority of people fall into categories 1 and 2. If too many fall into category 3, I'm going to need to rethink my strategy.
Seems like toll roads are always simply rent-seeking or exclusivity-seeking behavior by entities having greater-than-average resources compared to ordinary individuals.
On private property, toll regulation according to a market seems fair enough under a free-enterprise system.
On public property, toll roads are always unfair unless the toll rate is virtually insignificant to all potential users. Any other explanation does appear deceptive, whether intentional or not.
Therefore it is usually just destructively extractive for the average users to fund roads on public property exclusively by tolls alone.
When the public tolling entity is under the jurisdiction of electable officials in a working democracy, the proper response is for a disruptive candidate to campaign on a platform of eliminating toll roads altogether. With public support this could include public purchase of private toll roads according to eminent domain if a price affordable to the citizens can not be negotiated.
Other things being equal, this type candidate should be able to prevail in cases where toll rates are particularly significant to the citizens in general.
Assuming of course free enough enterprise and democracy working well enough . . .
I guess I'm at a loss here because I've lived in DC almost 6 years now and it never occurred to me that I-66 was HOV only during certain portions of the day. I know I am not alone in this because I see similar conversations happening elsewhere.
Additionally, many comments say that single traveler HOV use is forbidden however I frequently see single drivers in the HOV lanes on 66 and elsewhere un-restricted. As a computer vision engineer, I know that DC doesn't have the capability to build camera systems that can infer a single/multi passenger drivers and the number of police that are 1. available and 2. can discern as much are simply not there. Are they now mailing toll charges to everyone who does not have the EZPass system?
What they effectively did was permit free use of I-66 virtually unimpeded, through lack of enforcement of the intended laws, for years and then rapidly and expensively enforce the system.
So the question I have is, how is it that they can go from a minimally (at best) enforced HOV policy to a high toll rate system effectively overnight, and expect that driver behavior will change without outrage?
It seems like it will certainly decrease the road users, IF one of two things happen: they can identify and charge (or overcharge) drivers based on occupancy (I argue they technologically can't) OR rely on self-policing of behavior from drivers.
The other day I was driving along 50 to Annapolis, where the left lane is always HOV for 8 miles after 495, and was passed by a dozen cars in the HOV lane, all single riders. This sort of behavior is a cancer that will destroy America, mark my words.
As to enforcement, in my experience the I-66 HOV is pretty aggressively enforced. They’ll park cop cars in major exits during the toll period pulling people over. I’ve gotten tagged that way when I’ve accidentally taken the road during toll hours when I left work earlier than usual.
I’ve accidentally taken the road during toll hours when I left work earlier than usual.
This is exactly the point. If you can accidentally take a road without impedance that is supposed to be "off limits" then it's not really "off limits."
There are words on the interstate sign that say “HOV-2 6AM-9AM M-F”. It was the first thing I noticed about that road as a new driver. Maybe fewer people read signs? Few people definitely read speed limit signs...
> guess I'm at a loss here because I've lived in DC almost 6 years now and it never occurred to me that I-66 was HOV only during certain portions of the day.
Here is a photo of one of the HOV restriction signs:
This sign seems perfectly clear, provided of course one has learned the acronym "HOV".
These signs (and they are large signs, the small no-truck sign in the photo above it itself about 2 feet by 2 feet) exist at every on-ramp for I-66, sometimes more than one of them.
If you're not familiar with HOV lanes then they're not clear. I recently moved to the Northern Virginia area, coming from Michigan a state without HOV/Toll Roads, I was not familiar with all this nonsense.
Those look like any other sign that is routinely ignored by most drivers because they assume they aren't applicable - like: "Over 13 feet must exit" "No trucks" etc...
State and local police did enforce the HOV lane laws, usually by catching people on either the on or off ramp. Now if you don't have the EZPass transponder they'll just mail you the bill.
A decent amount of people used to cheat in the HOV lanes but the penalties get very high very fast (fine doubles for each additional violation), so I think it worked as a decent deterrent.
The people who would be most upset by this change are the ones who scheduled their commutes either before or after the HOV restriction and hybrid drivers. I think it is a bit unfair to expand the HOV/toll period by this much since some people were getting in to work before 6:30 and leaving before 4 to make their commutes work.
The alt-fuel vehicle exemption will sting for people who were grandfathered in, but at the same time that was not supposed to last as many years as it did.
> the penalties get very high very fast (fine doubles for each additional violation)
It is worse than that. Second or subsequent violations that stick (meaning you don't get them dismissed at court somehow) within a five year window of a first violation also attach points [1] to one's drivers license.
> Which would you prefer in general: Being forbidden from doing something at all, or allowed to do it at high cost?
There are plenty of government policies or state run services that prevent or completely avoid this dynamic in the name of pseudo 'fairness'. When usually it more often restricts options for more people rather than makes it more fair.
It's easy to see why from a populist perspective, look at the outrage on Twitter:
... he admits he never even uses it but he still finds it unfair 'highway robbery' regardless.
And it's not just a policy helping the wealthy as it would be using the service to maximal efficacy rather than below capacity. It's a net gain for average users. As there will never be a high number of people willing to pay that fee, not slowing down existing traffic. Plus the additional revenue gained could otherwise be used to improve the operation, go back into the economy via employee income or spending, etc. It's a net gain.
An individual car might not be a mass transit system but a highway is (albeit inefficient). I think it's just as absurd to use demand pricing for highways as it would be to use them for subways. (I support HOV lanes though)
The main issue I see with a non-HOV toll option on an HOV road, toll lanes, etc. is that it gives the wealthy an option that others do not have. If there isn't enough commuting capacity (regardless of medium) we need to provide more. The state should not give the rich an option to make their commutes tolerable because that's easier than solving the problems (because we all know that when the rich and powerful have problems with how the state is running things that's when they change).
The wealthy have to wait on the same subway platforms as the poor. The national parks don't have a "skip the line if you're rich enough to justify the insane price" option. The wealthy should have to sit in the same traffic jams as the rest of us. Congress should have the same healthcare options as the rest of us.
The worst part about toll lanes and the other demand based pricing for necessities is that they reduce the incentive to increase supply.
If it were independently verifiable that any given implementation of surge pricing was optimized for bandwidth (people-miles over the time period surge pricing applies) rather than latency (average speed) or revenue I might feel differently but considering how pretty much every other traffic control rule turns into a revenue source of some sort (tolls on I90 in MA were only supposed to last long enough to recover the construction cost) I quite frankly don't trust any government to do it that way unless it's 100% in the open.
Is everyone else missing the fact that this may be a bug in the algorithm? Read the update to the article, tolls are “surging” despite the road being almost empty.
> Which would you prefer in general: Being forbidden from doing something at all, or allowed to do it at high cost?
This is market economics at its best. If you don't like the $40 toll go back to alternative routes you were using before they introduced the toll. I also find it ironic that "free market" Republicans are suddenly stamping their feet and demanding either price controls at $6 or reverting to the old system.
It’s nuts. Reasonable people can differ about the accuracy of economic predictions on the large scale, but market mechanisms are great for things like this (and surge pricing, etc).
I'm a guy with a long commute and a dislike of traffic jams. I've shifted my work hours to get me to work by 6:30 am at the latest. I'll take the toll route (Boston's Tobin Bridge, $1.50) or the free route (I-93) without considerating cost because I've taught myself that time is worth more than money.
But if the Tobin toll abruptly went up to $20, my loss-aversion anxiety would spike (cf. this year's Nobel Memorial winner Richard Sunstein, for behavioral economics) and my behavior would change in ways that weren't exactly rational.
This already happened on the Tobin Bridge when the tolls were first introduced. People from the neighborhoods near the Tobin used alternate routes and clogged them. The government response was wise: issue special toll tags to neighbors giving them a discount on the Tobin. The wisdom was that it countered loss-aversion with a special privilege. It worked. (Of course, this being Massachusetts, there's a small but thriving black market in those special toll tags for wiseguys wanting to save a couple of bucks a day. But so what?)
In a place like the DC area, people react to loss anxiety by attacking public projects as well as by changing their behavior, so this experiment may not last too long. I hope they can get some skilfull behavioral economics people to work with them before the whole thing gets shut down hard by fake-angry politicians.
If the goal is really to increase vehicle occupancy, the highway needs stations named for Tom and Ray Magliozzi's Russian chauffeur (Pickup Andropoff) near the exits. Getting more people into cars has proven very difficult.
Understanding this kind of peak-load pricing, and how to apply it effectively, will help all sorts of future projects in our overcrowded metroplexes.
Tolls change routing decisions. If you can't gauge a toll until you are at the road because it keeps changing, that's a risk. Dynamic tolling asks people to take a risk; that will never work unless they do like Uber and fix the price at the time you leave. It's only fair that the planning risk should fall on the central traffic manager, as they have the most information and capabilities.
The true cost of a trip is masked behind sales taxes, property taxes, income taxes, various state fees unrelated to roads, insurance, rent/mortgage for the cost of space for the car, the loan for the car, etc. The technology exists to toll everyone for the actual cost per mile, with higher fees for higher weight (trucks wear roads way faster than cars), and congestion. It incentivizes more investments in cycling and pedestrian lanes, would affect how and where housing is built, and how much investment is made in public transit and where it's located.
Congestion fees are used by at least Long Island Rail Road, it's roughly 50% higher during peak times. So it can be applied to public transit as well. In fact a chunk of automobile transport is public transit because the biggest cost in the whole system is the infrastructure which is publicly owned and maintained, typically without direct user fees that relate to usage. Gasoline taxes only approximate a person's usage.
I find these types of articles massively deceiving, if there is a simple explanation for something, a complicated explanation isn't required, ie. the human psychology. Here is one reason why the drivers reaction makes sense, when previously people were disallowed to use the toll road it wasn't about money when you charge them $40 it is all of a sudden a question of money. Previously people were perhaps understanding of congestion problems and it's natural when you have so many cars on the roads that the government should disallow some and they understood that otherwise the traffic wouldn't move. Now when you make it about money, it's no longer arbitrarily decided who gets to ride in the toll road, it's about who can afford to ride on the toll road. (or to the extend that it was arbitrary before)
Consider that taxpayers fund and build airports. Available seats on an airplane are priced using demand based pricing.
Taxpayers provide land and (sometimes) fund rail infranstructure. Most long distance rail uses demand based pricing (the last seat costs more than the first).
Taxpayers also (sometimes) provide/pay for land and the costs to build roads. Until now, we haven't seen demand based pricing (the last slot costs more than the first), but it actually fits well with other modes of taxpayer funded transportation.
This approach also considers the cost and value of a road network in a congested area. This could possibly fund other new transport in the area if it really is such a valuable commodity.
I understand the psychology of it as far as the high price goes, I think also people are appalled that there are others who can afford such obscene prices too, not just that the prices are so high. And well the two counties funneling traffic into this road Fairfax and Loudon are the richest counties in US, I have no doubt they'll be enough people who will pay the $40.
But what most people are upset about is that the hours when the whole highway becomes HOV-2 only have been expanded. So solo drivers who were getting up early, could have made it into the city before the restrictions kicked in, now won't be able to, and will have to funnel to secondary roads.
When the price algorithm goes above some unacceptable amount, they should just change it to "Carpool only", as it was before, and there would then be no reason for people to complain.
If they made the "Carpool only" have some sort of fine for violations, say $100, paid the same way as the toll would have been, people could still use it in real emergencies.
It sounds like the calibration of the toll amount is a bit off, and can probably be adjusted over time as the systems get experience managing the demand of the road. If they'd launched with an $8 toll, and ended up with gridlock on the road, would that have been better?
There is an important point lost here. People are saying 'people who couldn't use the road before now have the option to', but they are ignoring that the restricted hours were increased by 90 minutes in the morning and evening. I used to have an option to get to work super-early, or work till 7pm then head home on a road that was no busier than the rest of the regions traffic. Those options are now off the table. What was legal, fair, free, and without congestion is now blocked by a toll that is pushing early morning traffic onto roads not built for commuter traffic.
If the road was already pretty full during rush hour when no solo driver was allowed, how is this new rule going to help by adding even more drivers? Sounds like a major fail to even have that kind of rule in first place.
> which is why I called charging the highest toll in the country what it is: price gouging.
No, no, no it's not price gouging: it's charging what the privilege of driving in the fast lane is worth.
The problem in northern Virginia is that there are too many people commuting. Fortunately, there's the entire rest of the country that they can move to.
'Not located in northern Virginia, New York or California' is a very real marketing edge for a potential employer.
Stuck in traffic, you might as well be stuck in prison. Say your loved ones are counting on you to be somewhere. When you are stuck , you're letting them down! Suddenly you have an option when there were no options previously. Now $40 looks pretty cheap in the face of fighting a spouse, disappointed children, etc.
If I drove there twice a day I wouldn't need to go to work anymore, because it would (almost) cancel out my salary. Granted I don't work with an American salary, but they're not THAT much higher. I don't know if that's what you call cheap.
This is kind of a joke, but imagine this scenario:
If I illegally immigrate to USA, how much I would make just to take a ride with people?
I believe I could charge US$20 per trip. One trip early morning, go back by public transportation (it is just 10 miles!), and get another ride. The same at rush hour in the other direction. It would me about 80 * 22 = $1760 each month. Nothing bad. Better than a minimum wage of $1,150 per month.
There are plenty of slug line commuter parking lots around the area that you can find people that will ride for free in your car so everyone can take advantage of HOV lanes. It's definitely a thing in some places where the passengers have no real need to be going anywhere in DC, people are just trying to get to work.
Why would you pay someone when we already have a mechanism in place here to pick up additional people for free? See http://www.slug-lines.com/ for more information.
Edit: Didn't notice the comment below, that's what I get for not refreshing the page...
The shock comes from people thinking, you've just opened a road for the rich, not for the every man. Roads have not, historically in the US, been excluded to a certain group of people. Of course people will react harshly.
Some economists need to get their heads out of their asses and live in the real world for a bit.
Keep in mind that the safety distance you have to the preceding driver increases with speed. Additionally the large speed differential between cars leads to more frequent lane changes, acceleration and breaking, etc. Which hinders the flow of traffic, reducing throughput.
In Germany it's common to use electronic signs to limit speed when the highway is (moderately) congested to help traffic flow more smoothly, increasing throughput (typically to 100 or 120 km/h).
It's very problematic when in a society the people at the top never experience life the same way regular citizens do.