The Privatization of Roads and Highways

20 Aiding and Abetting Road Socialism: The Case of Robert Poole and the Reason Foundation1

In this chapter we take it for granted that governmental ownership and control of roads is unjustified, on the grounds that it is based on coercion (the tax revenues upon which it is based are compulsory), and needlessly kills thousands of people (over and above the much lower number who would likely die under privatization2). Given these premises, what is the proper attitude of the libertarian toward those directly responsible for this irresponsible, mischievous and even murderous scheme?

To ask this question is pretty much to answer it. Not to put too fine a point on it, but those responsible for the perpetration of highway socialism are guilty of the deaths of tens of thousands of people in the U.S. alone.3 This being the case, and combining that insight with libertarian theories of punishment, it is clear that the guilty parties would be made to pay for their crimes4 in a fully libertarian society. The Nuremberg trials would be the model followed in such proceedings. As in the case of the Nazis,5 there would be no statute of limitations on murder.6 Nor would we shrink from ex post facto jurisprudence. Libertarian law is timeless. Unjustified killing is just as much a violation of proper jurisprudence for modern man as it was for the ancient caveman, and as it will be for the future spaceman. The sooner this message gets out, moreover, the better off we shall be in reducing “man’s inhumanity to man.”

So much is pretty straightforward, at least in the libertarian neck of the woods. Perhaps a more interesting question is, what can be said, not about the actual managers of streets and thoroughfares, but rather of private citizens who aid and abet them? There are many such, unfortunately. At present, we will focus on only one of them, the Reason Foundation, and its Reason Public Policy Institute. This organization in one place advertises itself, not as an avowedly libertarian one, but rather as one that “explores and promotes the twin values of rationality and freedom as the basic underpinnings of a good society.”7 But if “freedom” is used in any reasonable way, it certainly implies private property, the rule of law, and laissez faire capitalism, phenomena incompatible with government ownership, operation and control of roads and highways.8

However, in another place, Reason explicitly claims the libertarian mantle:

Mission Statement: The mission of Reason Foundation is to advance a free society by developing, applying, and promoting libertarian principles, including free markets, individual liberty, and the rule of law. We use journalism and public policy to change the frameworks and actions of policymakers, journalists, and opinion leaders.9

It is my contention that Reason is not living up to its self-styled claim to be guided by libertarian strictures, nor to “promote libertarian principles,” at least not in the arena of surface transportation. Let us consider some specific difficulties with the Reason analysis of roadways, along the lines mentioned above.

CRITIQUE

BIG RIGS

In June 2002, two Reason colleagues and I10 accomplished the seemingly impossible. We persuaded both the American Trucking Associations and the National Safety Council—traditionally on opposite sides of the fence over big-rigs known as Longer Combination Vehicles—to endorse a concept we called Toll Truckways. Our June 2002 report11 proposed that these highly productive trucks (long doubles and triples) be allowed to operate into states where they are currently banned by federal law, provided that they operate on new, barrier-separated truck-only lanes designed for heavy-duty service.12

One problem here is that Poole is functioning, not as a libertarian critic of road socialism, but rather as and aid and abettor to the planning authorities, a non-paid consultant as it were. It is easy to imagine an analogous group functioning in the Soviet Union, circa 1965, giving advice to the U.S.S.R. collectivized farm bureaucrats, or to those in charge of that country’s steel mills.

Another difficulty is with Poole’s characterization of these vehicles as “highly productive trucks.” They may well be just that, as a means for transporting cargo, at least when compared to carrying sacks on one’s back, or using bicycles, motorcycles, cars or even smaller trucks. But, how about when contrasted to railroad trains? Then it would appear, even to the meanest eye, all bets are off. For, while one of these super trucks can carry two or even three container loads of product, a train can transport as many as 156 boxcars.13 Then, there is the matter of speed. Maximum legal velocity on most highways is seventy miles per hour. Trains, in very sharp contrast, are capable of multiples of that speed.14

It is not my place to give economic advice to the central planning authorities.15 We can safely leave such “analysis” to Poole and his colleagues. But it is more than passing curious that he did not instead advise government to rescind a welter of union and other anti-railroad legislation16 that has handcuffed that industry. With a healthy railroad sector, these super trucks of which Poole is so enamored would be reduced from cross country to local trips, radically reducing the need for them.

SEAT BELTS

Even though fans of individual liberty often (and rightly) decry the paternalism embedded in seatbelt laws, most Americans take little offense at such state-sponsored nannying. However, nannying does not just make us less free; when it distracts law enforcement from its proper role, it can also make us less safe. When government assumes many duties, it is tougher to do the important ones right.

Government officials are more on the mark when they call for enforcement of drunk driving laws. But here again, law should focus on recklessness, whether it’s encouraged by alcohol, fatigue, general stupidity or high-speed lipstick application.

Forty-nine states have seatbelt laws, and in many cases, the laws allow officers to pull over motorists whose only crime is not wearing a seatbelt. While the officer takes time to give the seatbelt scofflaw a scolding and a ticket, plenty of other drivers embark on the kind of harebrained maneuvering that often ends with a reckless driver colliding into a good driver. It’s these red-light-running, left-turn-at-any-cost daredevils who enrage and endanger good drivers.17

According to the analytic framework developed above, it would be one thing for a free-market oriented analyst to note that were roads privatized, those that focused on seat belts, i.e., assigned their police forces to concentrate on such violations, would likely lose out in the profit-and-loss war with other highway firms who addressed more important issues, such as driver recklessness. That would be an eminently sensible point to make, and if the road socialists adopted this insight, well, at least lives would be saved.

However, it is entirely a different and more problematic matter to be gratuitously dispensing advice to those who are responsible for road carnage in the first place. This sort of stance plays fast and loose with the job of the free-market advocate which is, wait for it, to be advocating free markets, and not advice intended to render more efficient institutions which are very much the opposite of free enterprises.

“WE” ARE LOSING TAX BASE

Two of the biggest challenges facing public officials in America today are deteriorating roads and highways and a lack of funding to pay for needed improvements. Since the Interstate Highway System was completed in the early 1990s, we have witnessed a continual decline in the overall condition of our nation’s road infrastructure. There are several reasons for this.

First, the purchasing power of the fuel taxes we now collect—the principal means of highway finance in the U.S.—has declined dramatically since the 1950s. Second, vehicle fuel economy has risen dramatically during the same time, so we do not collect the same amount of taxes on a per mile basis as we once did. And third, many officials are unwilling to increase fuel taxes because of intense voter opposition to new or higher taxes of any kind.18

The obvious question is, Who is this “we?” The above quote comes from a press release for the Transportation Finance Summit that took place March 3–4, 2004 in the Grand Hyatt, Washington, D.C. As one of the sponsors of the event was the Reason Foundation, it would appear that this organization includes itself, and is included by all the others, in the general “we.”

However, there are those of us libertarians who would not consent to any such inclusion. Wringing hands over the declining real value of taxes is something somewhat incompatible with advocacy of the free society.19 Nor is this merely a debate between limited-government libertarians and anarcho-capitalists. Surely, it is a contradiction for a libertarian of any stripe to countenance fuel taxes per se, let alone any increase in them.

Why is this any different than if a group ostensibly devoted to “freedom as the basic underpinnings of a good society”20 were to take part in a general dissatisfaction with the fact that income or sales or property or any other taxes for that matter were too low, and that the real value of the government’s take had slipped? Surely, were any group or individual to take part in such hand-wringing in any other context, their (lack of) libertarian credentials would be clear. Why should it be any different in this case?

ROAD DEATHS

States Poole:

[O]ur highway systems are in trouble. They face four main problems:

1. Traffic Congestion. In the 68 largest U.S. metro areas, motorists lose a total of $72 billion per year in wasted fuel and time, due to traffic congestion;

2. Lack of Expansion. From 1987 to 1997, U.S. vehicle miles traveled increased 34 percent, yet only 3 percent more lane-miles were added;

3. Funding Shortfalls. In 1997, the U.S. invested $43 billion in rebuilding and capacity additions, but to [sic] simply to maintain the system’s asset value, we should have spent $51 billion—to keep pace with growth would have required $83 billion; and

4. Anti-highway Politics. A large coalition of environmental, urban planning, and transit organizations opposes highway expansion and advocates shifting highway funds to public transit, bikeways, etc. Their mantra is: “We can’t build our way out of congestion.”

The U.S. highway system is failing to satisfy its customers, and its ability to do so is more constrained with each passing year. We need a new highway paradigm for the 21st century.21

Minor difficulty: the people who use U.S. highways are not “customers.” Very much to the contrary, those accurately depicted by such verbiage make a decision as to whether or not to patronize a given supplier, and are as free to pay and receive the service as they are to eschew it and not be billed for it. For example, movies, bookstores and groceries: each of them deals with customers. In very sharp contrast indeed, all residents of the country pay for streets and roads, whether or not they wish to “purchase” this service, not merely those who venture out on to them. Failure to distinguish between a customer and a victim does not bespeak a very sophisticated analysis.

Major problem: there is a gigantic elephant in the room. Somewhere in the neighborhood of 40,000 people in the U.S. perish on the nation’s system of Sovietized roads.

CAR POOLS

The recently released journey-to-work figures from the 2000 census reveal what many of us have long suspected: carpooling is a flop. Despite the expenditure of billions of dollars adding carpool lanes to congested freeways, carpooling declined from 13.4 percent of work trips in 1990 to 11.2 percent in 2000. Carpooling’s mode share declined in thirty-six of the largest forty metro areas—including highly congested Los Angeles and San Francisco. So what do we do now?

Here is another statement on this subject by Poole:

Some transit advocates have resented the use of these lanes by carpools from the outset, reminding us that high-occupancy vehicle (HOV) lanes were originally conceived as busways and should be converted, accordingly. Some highway advocates argue vociferously for converting most carpool lanes to general purpose (GP) lanes. And the Federal Highway Administration’s Value Pricing office tries valiantly to persuade metro areas to convert underperforming HOV lanes to HOT lanes. What’s been missing from this discussion has been serious quantitative analysis of the tradeoffs involved.22

With all due respect, it is my contention, in sharp contrast, that what is missing from this discussion is not at all a “serious quantitative analysis of the tradeoffs involved” but rather one that asks whether a public entity is the sort of institution from which we can ever expect good results, given that there is no market test of profit and loss to weed out under performing entrepreneurs, and to encourage successful ones.

TRAFFIC DIRECTION

Poole has very strong opinions on the one way vs. two way street controversy, heavily favoring the former.23 His reasons are only peripheral to our present concerns, so I will not rehearse them here.

Suppose governments ran restaurants and there was a vociferous debate over whether the tablecloths should be red or green, made out of cloth or plastic, or should exist at all. Posit, further that a group, call it Treason, ardently favored one or the other of these alternatives, it matters not which. What could we deduce from this one fact? My claim is that we could infer that this group, whatever else it was, was not a libertarian one. For, any organization worthy of that name would surely recognize a far more important question that all sides to the controversy had ignored: should government be running restaurants in the first place, putting completely to the side the issue of, given that they are, what type of tablecloth should they choose?

The same reasoning applies in the present case. Yes, there are indeed important considerations that rest on whether streets are one or two way. But there is such a thing as specialization and division of labor in all things, political economy specifically included. It is the task of those other than libertarians to involve themselves in these issues. Regarding this one political philosophy, the overwhelming question is not the direction of traffic flows, but rather the propriety of a necessarily coercive institution being placed in charge of making such a decision.

PARTNERING WITH THE DEVIL

Here, Poole advocates Public-Private Partnerships24 in order to address traffic problems in Wisconsin. Again, the details of this specific case do not concern us. What does is that so-called Public-Private Partnerships are anathema to the free-enterprise system, and this analyst swallows them whole, without question.

Let us thrust ourselves into the scenario depicted above: state-run restaurants. Now, the “libertarian” commentator urges a PPP25 for this industry. This means, if it means anything at all, that private enterprise combines with government in some sort of unholy alliance, and becomes a creature combining the characteristics of both. But that can only be a first approximation, since the two are necessarily incompatible. For government rests on coercion,26 and the market is the quintessentially voluntary institution. So, what trait must this mischievous combination of the two take on? Clearly those of the former. If an organization is in part based on coercive levies, and part on voluntary contributions, then, as a whole, it takes on that of the former. This is because if a group is coercive part of the time, then it is a coercive group.27

But more. An unholy alliance of public and private tends to obliterate the crucial line between them. As there is no more important distinction in all of political economy than that which divides coercion and non-coercion, such combinations tend to blur this crucial difference. To see such perversions advocated by a self-claimed libertarian organization is surely problematic.

OUTSOURCING

Poole is on record as supporting contracting out: the cooperation of public and private authorities wherein the former subcontracts with the latter for support and services.28 In his article, “Outsourcing Repairs Can Speed Up Road Improvements, Cut Costs: Guide Highlights Most Successful Road Privatization Methods and Contracts,” this author advocates just that.

One difficulty is that such endeavors only further entrench government involvement in this industry. If, thanks to such outsourcing, governments are able to more efficiently run projects which should have been private in the first place, then it will become just that more difficult to promote overall privatization. Another is that outsourcing is but a subset of PPPs, and thus heir to all the shortfalls of that mode of business. Blurring the line between public and private will hardly promote the latter at the expense of the former, the presumed goal of the libertarian.

Here is a direct quote from this initiative:

State, county, and city governments are grappling with severe budget deficits and looking for ways to cut costs. To assist in this cause, a new Reason Foundation report demonstrates the savings that highway and road maintenance outsourcing can bring and outlines the most effective ways for public officials to go about the privatization process.

“We’re facing double trouble—our roads are in bad shape and most governments are running deficits. Public officials can significantly trim costs, and potentially save other programs, by outsourcing road repairs and maintenance,” said Geoffrey Segal, director of government reform and privatization at the Reason Foundation. “This . . . guide . . . [is designed] to help governments stretch tax dollars by taking advantage of private sector efficiencies and management approaches that can reduce costs and improve the quality of service.”29

The obvious rejoinder to all this is that if the “State, county, and city governments” are in such dire straits with regard to street and road management, why come to their aid with offers of private-enterprise expertise, which would still leave these inept bureaucrats in control of the operation? Why does this organization, ostensibly devoted to libertarianism, not suggest to them that they divorce themselves entirely from these amenities they have so mismanaged?

Then, there is, of course, the additional problem that if the statist managers are so incompetent, how can we expect them to successfully contract to private firms parts of their enterprise? For, surely, the task of subcontracting is a skill that can be done well or not. Poole implicitly assumes they can acquit themselves well in this particular regard, when they have failed so dismally in all else. But he offers no reason why this should be the case.

As anyone who has ever had to serve as a general contractor for house building or repair knows full well, to pick the best carpenters, electricians, plumbers, etc., to contractually obligate them to finish their jobs on time without compromising on quality, to orchestrate matters so that they do not hinder each other, are no mean tasks. But the same entrepreneurial abilities, if not more difficult ones, are required of roads authorities to subcontract tasks in that arena. Is it written in stone somewhere that state bureaucrats have some sort of comparative advantage in such responsibilities? Poole vouchsafes us no answer to this question.

MEGAPROJECT FAILURES—AND WHAT TO DO ABOUT THEM

States Poole:

We all know at least some of the projects: the Channel Tunnel, Boston’s Big Dig, Japan’s Kansai Airport. These and many other megaprojects (costing over one billion dollars) all too often cost fifty to one hundred percent more than initially estimated. And their usage is often less than half as much as forecast. These are not necessarily boondoggles—I happen to think there was a good case for all three of the above—but there’s a very real question of whether they, and other megaprojects, would have gotten built at all had the true cost and usage been known beforehand.30

In other words, what is needed regarding these megaprojects is not to leave the decision over whether to embark upon them or not solely to individual investors, but, rather, for the government to continue to make these determinations, only on the basis of more accurate information. However, there is good and sufficient explanation for the fact that government was operating in the dark in these cases, and shall necessarily continue to do so for the expected future: it does not benefit from the automatic feedback mechanism of the market, which weeds out those economic actors who operate on the basis of incomplete or erroneous information, and encourages those who do not. Then, too, Hayek31 has done yeoman work in underscoring the fact that the state, but not the marketplace, tends always to operate in the dark. The central planners simply have no way of amalgamating, gathering, mobilizing and utilizing the scattered and subjective knowledge of specific time and place possessed by numerous market participants; in contrast, the price system is a marvelous mechanism for accomplishing precisely these tasks.

More radically, Mises stresses appraisement: if there are no entrepreneurs out there estimating the values of goods, then socialist enterprises of the sort now under discussion simply cannot rationally plan. But with governments in charge of roadways, and with private enterprise relegated to the secondary position of subcontracting, then the process of accurate price generation is to that extent compromised.32

TEMPORARY OR PERMANENT?

“Should New Toll Lanes Have Temporary or Permanent Tolls?” asks Poole, and he answers as follows:

It’s the question that’s taking Washington, D.C. by storm (well, at least a little corner of D.C.): should tolls authorized to support new congestion-relief lanes (such as HOT lanes or Rep. Mark Kennedy’s FAST Lanes) be temporary or permanent? The Joint Economic Committee held a briefing session for congressional staffers on this question last month (June 27) and I was one of three panelists. I made the case that such tolls should be seen as a long-term, permanent measure, both for replacement and expansion of the lanes and to preserve the powerful benefits of market pricing for congestion management.33

One problem with this answer is that it further indicates there is no level of minutia of government highway operation from which Poole will restrain his involvement. Let no one attack the analogy of restaurant tablecloths mentioned above as excessive.

Another is that he does not seem to realize that these fees are akin to taxes,34 in that they swell the coffers of government, and thereby reduce command over goods and services enjoyed by the people. Even a libertarian advocate of limited government would have to acquiesce in the notion that at present, the state spends far more than the optimal amount of the wealth of the citizenry. If so, then any program that further enhances their spending power is to be rejected, not supported.

States Rothbard on this issue:

Taxes, and the tax bite into their earnings, keep going up, on the federal, state, county and local levels of government. Semantic disguises don’t work any more: call them “fees,” or “contributions,” or “insurance premiums,” they are taxes nevertheless, and they are increasingly draining the people’s substance.35

It, of course, cannot be denied that under any reasonable privatization scenario for highways, their owners would charge peak load pricing fees—higher during rush hours and lower at other times—that would tend to quell congestion.36 But the stark fact is that we are not now enjoying an era of private road enterprise. It makes all the difference to a libertarian, or at least it should, that these amenities are now in the compulsory public sector. Yes, there is a choice as to which roads to use, and at what times of day or days of the week, but we are coercively obliged to pay taxes to this selfsame enterprise, therefore its activities and cannot properly be viewed in the benign way that Poole seems them.

I have criticized a plethora of advice given by Reason to the roads authorities as highly improper. What kind of advice to the state is legitimate? Tell them to cease and desist. The model has been established by John Galt.37

Rothbard also weighs in on this question:

The economist, of course, is a technician who explains the consequences of various actions. But he cannot advise a man on the best route to achieve certain ends without committing himself to those ends. An economist hired by a businessman implicitly commits himself to the ethical valuation that increasing that businessman’s profits is good. . .. An economist advising the government on the most efficient way of rapidly influencing the money market is thereby committing himself to the desirability of government manipulation of that market. The economist cannot function as an adviser without committing himself to the desirability of the ends of his clients.38

The point, here, is that, in giving advice to the state about roads, Poole is “thereby committing himself to the desirability of government” action in this regard. Does this mean that the libertarian can never advise the state? No. If he confines himself to pointing out the economic inefficiency, immorality and other related problems, he does no violence at all to libertarianism. For example, if he is called upon to testify about rent control or the minimum-wage law, and limits himself to pointing out the errors and flaws of this legislation, he is on firm ground. But if he attempts to fashion a “better” or “more effective” law, he diverges from this philosophy. If he gives counsel on taxation, he must call for a reduction, or elimination. And, returning to our present concern, if he advises government on highways, qua libertarian, he must content himself with showing its defect, and calling for privatization. Not contracting out, but privatization. Certainly any attempt to play the role of efficiency expert for the bureaucrats would be ruled out of court on the basis of this criterion.

OBJECTIONS

In this section, we consider some objections to the thesis maintained above, to wit, that Poole’s (and Reason’s) support for government, surface-transportation arteries cannot be reconciled with the freedom philosophy.

CASTING THE FIRST STONE

Poole might object to the criticisms made above on the ground that they come with particular ill grace from me, personally, in that I have been employed over the years by several public universities. What is the big difference, he might say, between working for the government and giving it free advice? If anything, the former might even be considered worse than the latter, insofar as the connection is deeper and more enduring.

This argument must be rejected, and on several grounds. First, it is an argumentum ad hominem. Even if it is otherwise correct, it in no way exonerates his behavior. All it does is indict my own. But he would still be guilty, as charged. Just because I misbehaved, does not mean he has not.

Second, there is all the world of difference, as far as libertarianism is concerned, between aiding and abetting the state in its ill advised, ill considered, dangerous, mischievous and even murderous road system, on the one hand, and infiltrating into the state’s educational system with the goal of examining and transmitting to students a political-economic philosophy that is consonant with economic freedom. That is, stipulate for argument’s sake, that during the years I was involved in public education,39 my teaching did not promote Marxism, socialism, or even a centrist, mixed economy; but, rather, to the extent that positive economics leaks out into the normative realm, the very opposite. There is simply no comparison between this sort of activity and Reason’s promotion of statism.

What about the propriety of a libertarian such as myself working for the state apparatus in the first place? Just as “the Constitution is not a suicide pact” neither is libertarianism. According to the “logic” of those who see a contradiction in such an act, so would walking on the public sidewalks, driving on the streets, using the post office to mail a letter, and perusing a book at the public library be incompatible with this philosophy. But that would mean that the advocate of the free market could not live in society, and this is by no means required by the nonaggression axiom. For one thing, the taxes of libertarians, along with many others, were taken so as to finance these goods and services. It seems harsh to condemn him for using them, after he has been forced, at the point of a gun, to pay for them. For another, according to this theory, the government has stolen from him the wherewithal to fund these items. Therefore, it is a virtue to seize them back from these criminals.40

GIVING AID AND COMFORT TO THE ENEMY

Let us now posit, if only arguendo, that many of my previous publications, and, indeed, the contents of the present book, give hints on better road management. For example, I suggest that automobiles damaged in traffic accidents be placed on poles adjacent to the highway, as a warning to motorists. How, then, am I different than Poole/Reason, which, as we have seen above, offers a plethora of advice to the National Highway Safety Traffic Administration (NHSTA) and the Department of Transportation (DOT). We both, seemingly, are guilty of the same offense.

One of the questions I am often asked is: as a libertarian who urges separation of state41 from highways and streets, am I not afraid that the minions of the government will read my material, adopt it to their institutions of road socialism, and thus improve this misbegotten system? Is this not something I would regret?

My answer, to myself and to others is that yes, I would regret it if the government bureaucrats read my publications and improved the operation of their roadways. I realize that there is some slight “danger” of this very thing occurring. However, that will not stop me from writing about it. For my intention is not to marginally improve the present transportation system, but rather to replace it, root and branch, with free-market, private property right institutions.42

The difference between Poole and myself is that my suggestions about highway safety are not at all an attempt to help the road socialists. They are not even addressed to the present highway authorities. Rather, they are part and parcel of an attempt to make the case in behalf of roadway privatization. True, during this process all sorts of nuggets appear that might be of use to them.43 Am I supposed not to write in behalf of private streets since the road planners might peruse this material?44 In contrast, Poole is very far from advocating the complete elimination of the highway bureaucracy. Instead, he is indeed giving aid and comfort to what I can only consider to be the enemy.

THE PERFECT IS THE ENEMY OF THE GOOD

Let us posit that Reason is actually reducing the number of traffic deaths.45 In contrast, since no bureaucrat, we may suppose, will ever read any radical free enterprise material such as the present book, it can have no such beneficent, practical effect whatever. Nor, it may readily be conceded, will libertarian privatization efforts succeed any time in the near term.46

Poole might then argue radical privatization schemes are all well and good in theory, but that he is undertaking efforts with actual payoffs in the present. Part of a loaf in the hand, to mix metaphors, is far better than a total loaf in the bush.

It cannot be denied that there is something to this argument. Getting into bed with the state can sometimes pay off in tangible benefits. Of course, these will only be short run. As far as the Reason strategy is concerned, state control of roads will endure indefinitely; that organization certainly does not oppose it. It is not that Poole and his colleagues have not “landed a glove” on the DOT. They have not even tried. Worse, they have supported the statists, contenting themselves with rearranging the deck chairs of a sinking Titanic.47

What would we say if a different group, call it Treason, was advising the USSR on its steel factory? This, too, could conceivably save a few lives. How about saving lives by urging softer whips on the slave plantation? Or fewer executions in the concentration camps? Are we being unduly harsh? I think not. In all these cases, some few lives are saved by supporting those responsible for the deaths in the first place.

The evidence does not bear out great antipathy toward the present regime. There is no “hold the nose” attempt on the part of Reason to deal with these monsters. Rather, Poole et al. actually brag about being efficiency experts for the state. These people are part of the problem, not the solution. How about others, such as the Eno Foundation? They are just as bad. But, unlike Poole and his colleagues, there is no claim on their part to be libertarians.

______________________

48www.rppi.org/ps305.pdf; www.rppi.org/ps294.pdf; and www.rppi.org.

49See Lawrence H. White, “Comment on Block,” (unpublished manuscript) on this claim.

50It is one of the errors of Rummel who calculates the number of people killed by their own governments, that he does not include roadway fatalities. R.J. Rummel, Death by Government (New Brunswick, N.J.: Transaction, 1996) calculates the total number of noncombatants killed by their own governments during twentieth century as 169,198,000. But, he neglects to include the deaths on the nation’s highways attributable to government operation.

51Murray N. Rothbard, The Ethics of Liberty (Atlantic Highlands, N.J.: Humanities Press, 1982), pp. 54, 85–96; Stephan Kinsella, “Estoppel: A New Justification for Individual Rights,” Reason Papers 17 (Fall): 61; idem, “Punishment and Proportionality: The Estoppel Approach,” Journal of Libertarian Studies 12, no. 1 (Spring, 1996); idem, “New Rationalist Directions in Libertarian Rights Theory,” Journal of Libertarian Studies 12, no. 2 (Fall, 1996): 313–26; idem, “A Libertarian Theory of Punishment and Rights,” 30 Loyola Los Angeles Law Review (1997): 607–45.

52It is more than passing curious that mass-murdering Communists are treated differently than mass-murdering Nazis. Although this can only be speculative, this is perhaps due to the fact that the former were allied with the victors in World War II and not the other way around.

53Is it too harsh to claim that those responsible for road deaths are guilty of murder? Surely, there was no intent to kill such victims. Perhaps manslaughter is the more accurate characterization, since it would appear that the authorities are guilty of no more than “reckless disregard” for the lives of others. For the criminal code of Louisiana, see www.legis.state.la.us/tsrs/search.htm. See the appendix for definitions of manslaughter and negligent homicide, and then you decide, gentle reader, into which category our road and highway managers fall.

54www.rppi.org.

55There are, to be sure, private groups other than Reason also operate as collaborators with the National Highway Safety Traffic Administration (NHSTA) and the Department of Transportation (DOT). However, none of them characterize themselves as pro freedom, let alone libertarian.

56www.reason.org/mission.html.

57This was written by Robert Poole, Director, Transportation Program, Reason Public Policy Institute and Founder, Reason Foundation (www.rppi.org/robert.html).

58www.rppi.org/ps294.pdf

59Robert Poole. See www.rppi.org/surfacetransportation14.html.

60“CN boxcars jump tracks . . . FORT LAWRENCE—No one was injured when 10 empty boxcars belonging to a 156-car freight train derailed here late Friday night, blocking the main rail line.” www.herald.ns.ca/stories/2004/05/23/fNovaScotia247.raw.html.

61Some commentators (re: the German Inter City Express) speak of average speeds of 125 miles per hour, and top speeds of 174 (www.o-keating.com/hsr/ice.htm); others, re: the Japanese Shinkansen Bullet Train www.okeating.com/hsr/bullet.htm) mention an average speed of 164 mph.

62The enormity of the deviation between calling for the government to cease and desist from killing people on the roads, and the sort of specific advice given to them from Reason may be seen in the detailed plans created by the latter for the former. Here is where Poole thinks his truckway policies can best be introduced: 1-80 across Iowa and Illinois, linking current LCV operations in the West with those on the Indiana and Ohio turnpikes; 1-90 from Cleveland to the New York state line, linking LCV operations on the Ohio Turnpike and New York Thruway; 1-15 in California, from the logistics center in Barstow to the Nevada line (where LCVs now operate); 1-75 from Detroit to Toledo, a spur off the Ohio Turnpike; 1-75 from Toledo south to Florida, connecting both to Tampa and to the Florida Turnpike (where long doubles are legal); 1-5 the length of California’s Central Valley; 1-94 from Chicago to the Twin Cities; 1-65 from Gary, Indiana (on the Indiana Turnpike) to Nashville; 1-81 from Knoxville, Tennessee to Harrisburg, Pennsylvania, both major logistics centers; 1-76, the Pennsylvania Turnpike, which links directly to the LCV-friendly Ohio Turnpike. Nor is Poole satisfied, even, with this level of detail. He continues:

Our study also contains specific recommendations for legislative provisions needed to enable pilot toll truckways to exist, most importantly the legalization of LCV operations on such truckways in states currently subject to the LCV freeze, the ability to charge tolls on the truckways, and a mechanism for interstate compacts to facilitate the majority of such truckways which need to involve more than one state. (See www.rppi.org/surfacetransportationl4.html)

63The Railway Labor Act www.nmb.gov/documents/rla.html and www.socialstudieshelp.com/Eco_Union_Legislation.htm).

64Ted Balaker, “Strapped: Unbuckling seat belt laws,” see, www.reason.com/hod/tb052704.shtml; May 27, 2004.

65Transportation Finance Summit conference background and purpose, March 3–4, 2004; brochure.

66In any case, the responsibility for this decline is yet another government entity, the central banking system which creates inflation. See on this, Milton Friedman, Studies in the Quantity Theory of Money (Chicago: University of Chicago Press, 1956); Milton Friedman and Anna J. Schwartz, Monetary Statistics of the United States: Estimates, Sources, Methods (New York: National Bureau of Economic Research, 1970); idem, Monetary Trends in the United States and the United Kingdom, Their Relation to Income, Prices, and Interest Rates, 1867–1975 (Chicago: University of Chicago Press, 1982); Murray N. Rothbard, The Mystery of Banking (New York: Richardson and Snyder, 1983).

67www.reason.org/.

68www.rppi.org/pbrief19.html.

69www.rppi.org/carpoollanes.html.

70www.rppi.org/onewaystreets.html.

71www.rppi.org/ps304.pdf. Somewhat disconcertingly, there is even an abbreviation for Public-Private Partnerships: PPP. This is troublesome, since it would appear that in this literature, the concept is ubiquitous enough to deserve an abbreviation. For shame.

72When in Rome . . .

73If you don’t believe that, try not paying your taxes and see what happens to you. For a more rigorous defense of this claim, see Hans-Hermann Hoppe, A Theory of Socialism and Capitalism: Economics, Politics and Ethics (Boston: Dordrecht, 1989; idem, The Economics and Ethics of Private Property: Studies in Political Economy and Philosophy (Boston: Kluwer, 1993); idem, Democracy—The God That Failed: The Economics and Politics of Monarchy, Democracy, and Natural Order (New Brunswick, N.J.: Transaction, 2001); Rothbard, The Ethics of Liberty; Lysander Spooner, No Treason (Larkspur, Colo.: Pine Tree Press, 1966).

74Hitler and Stalin themselves were not entirely evil men. Part of the time they slept, and perpetrated no evil. At other times, they engaged in acts characterized by mutual consent. In fact, strictly speaking, probably the majority of their time was not spent on mass murder. We only see them as the mass murderers they were, not because most of their waking days were given over to such acts, but because, compared to other people, these acts were disproportionately overrepresented.

75www.rppi.org/020403.html.

76Geoffrey F. Segal, et al., Contracting for Road and Highway Maintenance (Santa Monica, Calif.: Reason Foundation, 2003), p. 2.

77www.rppi.org/surfacetransportation10.html.

78F.A. Hayek, “Socialist Calculation I, II, & III,” Individualism and Economic Order (Chicago: University of Chicago Press, 1948), pp. 119–208.

79For more on the latter type of analysis, see Walter Block and Kenneth M. Garschina, “Hayek, Business Cycles and Fractional Reserve Banking: Continuing the De-Homogenization Process,” Review of Austrian Economics 9, no. 1 (1995): 77–94; Richard Ebeling, “Introduction,” in Ebeling, ed., The Global Failure of Socialism (Hillsdale, Mich.: Hillsdale College Press, 1992); Jeffrey M. Herbener, “Ludwig von Mises and the Austrian School of Economics,” Review of Austrian Economics 5, no. 2 (1991): 33–50; Murray N. Rothbard, “The End of Socialism and the Calculation Debate Revisited,” Review of Austrian Economics 5, no. 2 (1991): 51–76. Reprinted in The Logic of Action One: Method, Money, and the Austrian School (Cheltenham, U.K.: Edward Elgar Publishing, 1997), pp. 408–37; idem, “The Present State of Austrian Economics,” working paper from the Ludwig von Mises Institute (November 1992), reprinted in The Logic of Action One: Method, Money, and the Austrian School (Cheltenham, U.K.: Edward Elgar Publishing, 1997), pp. 111–72, reprinted in journal des Economistes et des Etudes Humaines 6, no. 1 (March 1995): 43–89; idem, “Mises and Hayek Dehomogenized,” Review of Austrian Economics 6, no. 2 (1992): 113–46; idem, “A Final Word: Calculation, Knowledge and Appraisement,” Review of Austrian Economics 9, no. 1 (1995): 141–42; Odd Stalebrink, “The Hayek and Mises Controversy: Bridging Differences,” Quarterly Journal of Austrian Economics 7, no. 1 (Spring, 2004): 27–38.

80June 2003: www.rppi.org/surfacetransportation10.html

81They do not resemble taxes, but rather payments for services in private markets, in that road use is a choice; no one is coerced into driving. However, with the state monopolizing the roads, the degree of free choice is less than it would otherwise be.

82Murray N. Rothbard, Making Economic Sense (Auburn, Ala.: Ludwig von Mises Institute, 1995), p. 16.

83So inept are present authorities (who, now, can ever mention this word without Eric Cartman’s pronunciation of it ringing in their ears?) that they actually engage in the very opposite policy. That is, they exacerbate the peaks and valleys of daily travel, not counter them. Typically, a road, bridge or tunnel authority will offer a monthly or yearly pass at a price per trip lower than that which would otherwise obtain. Regular travelers, then, get a bargain, compared to all others. But which type of motorist is more likely to utilize these amenities during rush hours, toward the city in the morning, and away from it in the evening? Precisely the regular users, who, at the lower per trip price, are now encouraged take to the highways even the more.

84See Ayn Rand, “America’s Persecuted Minority: Big Business,” reprinted in Capitalism: The Unknown Ideal (New York: Signet, 1957).

85Murray N. Rothbard, Man, Economy, and State with Power and Market, Scholar’s Edition (Auburn, Ala.: Ludwig von Mises Institute, 2004), p. 1362.

86Full disclosure regarding my employment at public universities: from August 1997–May 2001, I was professor and Chair of the Department of Economics and Finance, College of Business Administration, University of Central Arkansas, Conway, Arkansas 72035; from September 1975–June 1979, I was assistant professor, Economics Department, Rutgers University, Newark, New Jersey 07102; from September 1971–June 1974, I was assistant professor, Economics Department, Baruch College, C.U.N.Y., New York, New York 10010; from September 1968–June 1971, I was instructor, Economics Department, Rutgers University, Newark, New Jersey 07102, and from September 1967–June 1968, I was instructor, Stony Brook, S.U.N.Y. 11794.

87For more on this see Walter Block and Gene Callahan, “Is There a Right to Immigration? A Libertarian Perspective,” Human Rights Review 5, no. 1 (October–December 2003).

88I, of course, advocate separate of church and state, education and state, police and state. Indeed, I regard the government as a sort of virus. The more we can separate ourselves from its baleful influence, in whatever of its manifestations, the better off we shall be.

89This does not mean, either, that I counsel attempts to undermine the present road system, to hasten its alteration to one based on the principles of free enterprise. It is already quite bad enough; with friends of the ilk that it now has, it hardly needs any “help” from libertarian enemies in further undermining it.

90Would I willingly and happily see a copy of the present book sold to them? No, I would not. On the other hand, it would be exceedingly difficult to ensure that it did not fall into their hands.

91As a practical matter, the odds of our roads masters delving into truly libertarian literature on this issue are exceedingly small—think, Soviet collectivized planners reading about private property farming.

92Actually, a search of their material does not reveal any such concern. However, they are vitally interested in traffic congestion, their suggestions to our rulers on this matter are eminently reasonable, and overcrowded conditions on the highways may exacerbate their danger. Thus, it is not entirely unreasonable to suppose that Reason may be properly given credit for reducing the number of road deaths by a small amount.

93I am tempted to say, “will never succeed.” Even within the libertarian community, this issue is far from being the number one concern. To think that the NHSTA and the DOT will one day be forced to cede their authority to private road owners would appear to be the stuff of fantasy. And yet, and yet. There was a time, too, when the mighty Soviet Union seemed impregnable to change. And then one day Communism was swept away into the dust-bin of history, a place it so richly deserved. Who is to say that our present institutional arrangements, on the basis of which people are dying like flies, will endure forever?

94Well, okay, rearranging the row boats on this ship; after all, we are conceding to the Reason that due to its efforts, some few lives may be inadvertently saved.

• 1The number of people who were victims of motor vehicle accidents in 1976, in Accident Facts (Chicago: National Safety Council, 1977), p. 13.
• 2The number of road and highway deaths in the decade, 1967–1976, in ibid.
• 3Data for 1968, in ibid., p. 57.
• 4Data for 1969, in ibid., p. 60.
• 5Data for 1969, in ibid.
• 6Statement by Charles M. Noble, distinguished traffic engineer who served as director of the Ohio Department of Highways, chief engineer of the New Jersey Turnpike, and was recipient of the Matson Memorial Award for Outstanding Contributions to the Advancement of Traffic Engineering. Charles M. Noble, “Highway Design and Construction Related to Traffic Operations and Safety,” Traffic Quarterly (November 1971): 534; emphasis added.
• 7Accident Facts, p. 13.
• 8Sam Peltzman, Regulation and Automobile Safety (Washington, D.C.: American Enterprise Institute for Public Policy Research, 1975), pp. 8–9.
• 9David M. Winch, The Economics of Highway Planning (Toronto: University of Toronto Press, 1963), p. 87.
• 10Strictly speaking, this is far from the truth. Before the nineteenth century, most roads and bridges in England and the U.S. were built by quasi-private stock companies.
• 11William C. Wooldridge, Uncle Sam, The Monopoly Man (New Rochelle, N.Y.: Arlington House, 1970), pp. 7–9.
• 12Gabriel Roth, Paying for Roads: The Economics of Traffic Congestion (Middlesex, England: Penguin, 1967), p. 16; emphasis added. See also:
• 13The present author wishes to express a debt of gratitude to the two trailblazers into this subject: Jarret B. Wollstein, Public Services under Laissez Faire (New York: Arno Press, 1974), and Murray N. Rothbard, For a New Liberty (New York: Macmillan, 1973), pp. 202–18.
• 14William Vickrey, “Pricing and Resource Allocation in Transportation and Public Utilities,” American Economic Review (May 1963): 452; and “Breaking the Bottleneck by Sophisticated Pricing of Roadway Use,” General Motors Quarterly (Spring, 1974): 24.
• 15Says Rothbard:
• 16F.A. Hayek, The Constitution of Liberty (Chicago: University of Chicago Press, 1960), p. 160.
• 17I owe this point to David Ramsey Steele, of the Department of Sociology, University of Hull.
• 18We assume away here the presence of psychic income phenomena. See Walter Block “Coase and Demsetz on Private Property Rights,” Journal of Libertarian Studies 1, no. 2 (Spring, 1977): 111–15.
• 19George M. Smerk, Urban Transportation: The Federal Role (Bloomington: Indiana University Press, 1965), p. 228.
• 20Robert Haveman, The Economics of the Public Sector (New York: John Wiley and Sons, 1970), p. 23. For a telling criticism of the “control over price” confusion, see Murray N. Rothbard, Power and Market (Menlo Park, Calif.: Institute for Humane Studies, 1970), pp. 87–90.
• 21Cf. Israel Kirzner, Competition and Entrepreneurship (Chicago: University of Chicago Press, 1973).
• 22Alfred W. Stonier and Douglas C. Hague, A Textbook of Economic Theory, 3rd ed. (New York: John Wiley and Sons, 1964), p. 104.
• 23See Lionel Robbins, An Essay on the Nature and Significance of Economic Science (London: Macmillan, 1932).
• 24Kirzner, Competition and Entrepreneurship, pp. 122–23.
• 25Wilfred Owen, The Metropolitan Transportation Problem (Washington, D.C.: Brookings Institution, 1956), p. 119.
• 26John Burchard, “Design and Urban Beauty in the Central City,” in James Q. Wilson, ed., The Metropolitan Enigma (Garden City, N.Y.: Doubleday, 1970), p. 245; emphasis added.
• 27Noble, “Highway Design and Construction Related to Traffic Operations and Safety,” pp. 546–47.
• 28Z. Haritos, “Theory of Road Pricing,” 13 Transportation Journal (Spring, 1974): 57.
• 29Smerk, Urban Transportation, p. 228.
• 30Even if someone intends, for some reason, to purposefully invest in a “losing” proposition, we would still deny, ex ante, that he intends to worsen his position. That people act in order to benefit themselves is an axiom of economics. If a person intends to lose money through his investment, it could only be because, by so doing, he thinks he will increase his psychic income by enough to more than compensate himself for his loss of money. In short, he is engaging in charity.
• 31Roth, Paying for Roads, p. 61.
• 32Herbert D. Mohring, “Urban Highway Investments,” in Robert Dorfman, ed., Measuring Benefits of Government Investments (Washington, D.C.: Brookings Institution, 1965), p. 240.
• 33Haritos, “Theory of Road Pricing,” p. 56.
• 34Winch, The Economics of Highway Planning, p. 3.
• 35For an explanation of “monopoly as a government grant of exclusive privilege, see Rothbard (1971), pp. 586–619.
• 36James M. Buchanan, “The Pricing of Highway Services,” National Tax Journal 5, no. 2 (June 1952): 97. See also Smerk, Urban Transportation, p. 179; and Norman L. Cooper, Urban Transportation: An Answer (Bloomington: Bureau of Business Research, Indiana University, 1971), pp. 1, 15.
• 37Herbert Mohring, “Urban Highway Investments,” in Robert Dorfman, ed., Measuring Benefits of Government Investments (Washington, D.C.: Brookings Institution, 1965), p. 248.
• 38O.H. Brownlee and Walter W. Heller, “Highway Development and Financing,” American Economic Review (May 1956): 235.
• 39Wohl, “Must Something Be Done About Traffic Congestion?,” pp. 407–08.
• 40Morris, “Freeways and the Urban Traffic Problem,” p. 523.
• 41Dyckman, “Transportation in Cities,” p. 143. See also Owen, The Metropolitan Transportation Problem, p. 109.
• 42Bish and Kirk, Economic Principles and Urban Problems, p. 139. See also Anthony Downs, Urban Problems and Prospects (Chicago: Markham Publishing, 1970), p. 176; William Vickrey, “Maximum Output or Maximum Welfare? More on the Off-Peak Pricing Problem,” Kyklos 24 (May 1971): 305, Thompson, A Preface to Urban Economics, p. 334; Meiburg, “An Economic Analysis of Highway Services,” pp. 648, 653; Wohl, “Must Something Be Done About Traffic Congestion?,” p. 406; and Sam Yagar, “Potential Demand Response to Improved Roadway Service,” Traffic Quarterly (January 1973): 133. Gabriel Roth, Paying for Roads: The Economics of Traffic Congestion (Middlesex, England: Penguin) objects as follows: “It is doubtful whether cities as we know them today could ever be designed to accommodate all the vehicles that would appear if free uncongested roads were made available to them” (p. 15).
• 43Such prohibition would, of course, be inconsistent with a pure free-market system.
• 44Smerk, Urban Transportation, p. 198, favors the exclusion of automobiles from highly congested areas. See also Wohl, “Must Something Be Done About Traffic Congestion?,” p. 405. William J. Baumol, “Urban Services: Interactions of Public and Private Decisions,” in Howard G. Schaller, ed., Public Expenditure Decisions in the Urban Community (Baltimore, Md.: Johns Hopkins Press, 1963) justifies such extremely radical measures as “the complete banning of privately owned passenger cars from downtown streets to cope with the traffic problem,” on the ground that the traffic equilibrium effect has prevented the additional building of highways from solving the problem: “Freeways seem frequently to have turned out to be obsolete before they were completed” (p. 15).
• 45See Kain, “A Re-appraisal of Metropolitan Transportation Planning,” where he states:
• 46Vickrey, “Maximum Output or Maximum Welfare? More on the Off-Peak Pricing Problem,” p. 305. See also Meyer, “Urban Transportation,” p. 66, who objects to “physical controls” on the ground that “they will not differentiate . . . between different classes of user and the intensity of different groups’ desire to use urban highways.” See also, with regard to the heterogeneity criticism, Harold Torgerson, “Comment [on Brownlee and Heller],” American Economic Review 46 (May): 262, wherein it is argued that highway monies ought to be allocated on the basis of necessarily homogeneous “traffic counts”; Schreiber, Gatons and Clemmer, eds., Economics of Urban Problems, p. 93, also err in making use of “homogeneous service units . . . in comparing modes of transportation.” An author who takes account of the nonhomogeneity phenomena is Winch, The Economics of Highway Planning, p. 21.
• 47Thompson, A Preface to Urban Economics, p. 350.
• 48Were a government to demand the sacrifice of 46,700 citizens each year, there is no doubt that an outraged public would revolt. If an organized religion were to plan the immolation of 523,335 of the faithful in a decade, there is no question that it would be toppled. Were there a Manson-type cult that murdered 790 people to celebrate Memorial Day, 770 to usher in the Fourth of July, 915 to commemorate Labor Day, 960 at Thanksgiving, and solemnized Christmas with 355 more deaths, surely the New York Times would wax eloquent about the carnage, calling for the greatest manhunt this nation has ever seen. If Dr. Spock were to learn of a disease that killed 2,077 children under the age of five each year, or were New York City’s Andrew Stein to uncover a nursing home that allowed 7,346 elderly people to die annually, there would be no stone unturned in their efforts to combat the enemy. To compound the horror, were private enterprise responsible for this butchery, a cataclysmic reaction would ensue: investigation panels would be appointed, the justice department would seek out antitrust violations, company executives would be jailed, and an outraged hue and cry for nationalization would follow.
• 49Were a government to demand the sacrifice of 46,700 citizens each year, there is no doubt that an outraged public would revolt. If an organized religion were to plan the immolation of 523,335 of the faithful in a decade, there is no question that it would be toppled. Were there a Manson-type cult that murdered 790 people to celebrate Memorial Day, 770 to usher in the Fourth of July, 915 to commemorate Labor Day, 960 at Thanksgiving, and solemnized Christmas with 355 more deaths, surely the New York Times would wax eloquent about the carnage, calling for the greatest manhunt this nation has ever seen. If Dr. Spock were to learn of a disease that killed 2,077 children under the age of five each year, or were New York City’s Andrew Stein to uncover a nursing home that allowed 7,346 elderly people to die annually, there would be no stone unturned in their efforts to combat the enemy. To compound the horror, were private enterprise responsible for this butchery, a cataclysmic reaction would ensue: investigation panels would be appointed, the justice department would seek out antitrust violations, company executives would be jailed, and an outraged hue and cry for nationalization would follow.
• 50Were a government to demand the sacrifice of 46,700 citizens each year, there is no doubt that an outraged public would revolt. If an organized religion were to plan the immolation of 523,335 of the faithful in a decade, there is no question that it would be toppled. Were there a Manson-type cult that murdered 790 people to celebrate Memorial Day, 770 to usher in the Fourth of July, 915 to commemorate Labor Day, 960 at Thanksgiving, and solemnized Christmas with 355 more deaths, surely the New York Times would wax eloquent about the carnage, calling for the greatest manhunt this nation has ever seen. If Dr. Spock were to learn of a disease that killed 2,077 children under the age of five each year, or were New York City’s Andrew Stein to uncover a nursing home that allowed 7,346 elderly people to die annually, there would be no stone unturned in their efforts to combat the enemy. To compound the horror, were private enterprise responsible for this butchery, a cataclysmic reaction would ensue: investigation panels would be appointed, the justice department would seek out antitrust violations, company executives would be jailed, and an outraged hue and cry for nationalization would follow.
• 51Were a government to demand the sacrifice of 46,700 citizens each year, there is no doubt that an outraged public would revolt. If an organized religion were to plan the immolation of 523,335 of the faithful in a decade, there is no question that it would be toppled. Were there a Manson-type cult that murdered 790 people to celebrate Memorial Day, 770 to usher in the Fourth of July, 915 to commemorate Labor Day, 960 at Thanksgiving, and solemnized Christmas with 355 more deaths, surely the New York Times would wax eloquent about the carnage, calling for the greatest manhunt this nation has ever seen. If Dr. Spock were to learn of a disease that killed 2,077 children under the age of five each year, or were New York City’s Andrew Stein to uncover a nursing home that allowed 7,346 elderly people to die annually, there would be no stone unturned in their efforts to combat the enemy. To compound the horror, were private enterprise responsible for this butchery, a cataclysmic reaction would ensue: investigation panels would be appointed, the justice department would seek out antitrust violations, company executives would be jailed, and an outraged hue and cry for nationalization would follow.
• 52Were a government to demand the sacrifice of 46,700 citizens each year, there is no doubt that an outraged public would revolt. If an organized religion were to plan the immolation of 523,335 of the faithful in a decade, there is no question that it would be toppled. Were there a Manson-type cult that murdered 790 people to celebrate Memorial Day, 770 to usher in the Fourth of July, 915 to commemorate Labor Day, 960 at Thanksgiving, and solemnized Christmas with 355 more deaths, surely the New York Times would wax eloquent about the carnage, calling for the greatest manhunt this nation has ever seen. If Dr. Spock were to learn of a disease that killed 2,077 children under the age of five each year, or were New York City’s Andrew Stein to uncover a nursing home that allowed 7,346 elderly people to die annually, there would be no stone unturned in their efforts to combat the enemy. To compound the horror, were private enterprise responsible for this butchery, a cataclysmic reaction would ensue: investigation panels would be appointed, the justice department would seek out antitrust violations, company executives would be jailed, and an outraged hue and cry for nationalization would follow.
• 53The immediate need was to get the country out of the mud, to get a connected paved road system that would connect all county seats and population centers with mudless, dustless roads. These were the pioneering years. Safety, volume, and traffic operations were not considered a problem. But by the middle thirties there was an awakening and a recognition that these elements were vital to efficient and safe operation of the highway system.
• 54By the “middle thirties,” indeed, nearly one-half million people had fallen victim to traffic fatalities.
• 55Vehicle speed . . . alcohol consumption . . . the number of young drivers, changes in drivers’ incomes . . . the money costs of accidents. . the average age of cars . . . the ratio of new cars to all cars (because it has been suggested that while drivers familiarize themselves with their new cars, accident risk may increase) . . . traffic density . . . expenditures on traffic-law enforcement by state highway patrols . . . expenditures on roads . . . the ratio of imports to total cars (because there is evidence that small cars are more lethal than large cars if an accident occurs) . . . education of the population . . . and the availability of hospital care (which might reduce deaths if injury occurs).
• 56Further, David M. Winch cites another reason for public apathy: the belief that “[m]any persons killed on the roads are partly to blame for their death.” True, many victims of road accidents are partly responsible. But this in no way explains public apathy toward their deaths. For people killed in New York City’s Central Park during the late evening hours are also at least partially to blame for their own deaths; it takes a monumental indifference, feeling of omnipotence, absent-mindedness or ignorance to embark upon such a stroll. Yet the victims are pitied, more police are demanded, and protests are commonly made.
• 57We must realize that just because the government has always built and managed the roadway network, this is not necessarily inevitable, the most efficient procedure, nor even justifiable. On the contrary, the state of affairs that has characterized the past is, logically, almost entirely irrelevant. Just because “we have ‘always’ exorcised devils with broomsticks in order to cure disease” does not mean that this is the best way.
• 58Today, most Americans probably feel the telegraph naturally belongs within the private sphere, and few doubt the Post Office should naturally be a public monopoly. “Naturally,” however, in such a context means only that’s-the-way-it’s-been-for-as-long-as-we-can-remember, an Americanized version of Pope’s declaration that “Whatever is is right.” Yet few could think of a convincing a priori rationale for distinguishing the postal from the telegraphic mode of communication. At least one Postmaster General could not: in 1845 his Annual Report prophesied intolerable competition from the telegraph and suggested it might appropriately be committed to the government. At that early stage in its history, the telegraph might conceivably have become a government monopoly for the same reasons the Post Office already was, but the mere passage of time has obliterated any consideration of whether they were good reasons or bad reasons.
• 59[T]here is a[n] approach to the problem of traffic congestion—the economic approach—which offers a rational and practical solution. . . . The first step is to recognize that road space is a scarce resource. The second, to apply to it the economic principles that we find helpful in the manufacture and distribution of other scarce resources, such as electricity or motor cars or petrol. There is nothing new or unusual about these principles, nor are they particularly difficult. What is difficult is to apply them to roads, probably because we have all been brought up to regard roads as community assets freely available to all comers. The difficulty does not lie so much in the technicalities of the matter, but rather in the idea that roads can usefully be regarded as chunks of real estate.
• 60Let us now turn to a consideration of how a free market in roads might operate. Along the way, we will note and counter the intellectual objections to such a system. All transport thoroughfares would be privately owned: not only the vehicles, buses, trains, automobiles, trolleys, etc., that travel upon them, but the very roads, highways, byways, streets, sidewalks, bridges, tunnels, and crosswalks themselves upon which journeys take place. The transit corridors would be as privately owned as is our fast food industry.
• 61Consider now a road whose main function is to facilitate through traffic. If it is owned by one person or company, who either built it or bought the rights of passage from the previous owners, it would be foolish for him to install dozens of toll gates per mile. In fact, toll gates would probably not be the means of collection employed by a road owner at all. Now there exist highly inexpensive electrical devices which can register the passage of an automobile past any fixed point on a road. Were suitable identifying electronic tapes attached to the surface of each road vehicle, there would be no need for a time-wasting, labor-costly system of toll collection points. Rather, as the vehicle passes the check point, the electrical impulse set up can be transmitted to a computer which can produce one monthly bill for all roads used, and even mail it out automatically. Road payments could be facilitated in as unobtrusive a manner as utility bills are now.
• 62This does indeed appear frightening, but only because we are not accustomed to dealing with such a problem. It could not exist under the present system, so it is difficult to see how it could be solved by free-market institutions. Yet, the answer is simple: no one would buy any plot of land without first insuring that he had the right to enter and leave at will.
• 63For one thing, these are not the kinds of questions that can be answered in advance with any degree of precision, and not only in transportation. The same limitations would have faced early attempts to specify industrial setups in computers, televisions, or any other industry. It is impossible to foretell the future of industrial events because, given a free-market situation, they are the result of the actions of an entire, cooperating economy, even though these actions may not be intended by any individual actor. Each person bases his actions on the limited knowledge at his disposal.
• 64Just as private universities, athletic stadiums, etc., now enforce rules whose purpose is the smooth functioning of the facility, so might road owners levy fines to ensure obedience to rules. For example, automobiles stuck in an intersection could be registered by the road’s computer-monitoring system, and charged an extra amount for this driving infraction, on an itemized bill.
• 65A similar result would take place with two street owners, no matter what the property dispersal. It is easy to see this if the larger street company owns the intersections. The larger company would simply keep a high proportion (2/3, 3/4, or perhaps even 4/5) of green light time for itself, selling only the remaining small fraction to the intersecting side street. But much the same result would ensue if the smaller road owned the common intersections! Although the relatively lightly traveled road company might like to keep the lion’s share of the green lights for itself, it will find that it cannot afford to do so. The more heavily traveled street, representing a clientele willing and able in the aggregate to pay far more for green light privileges, will make it extremely tempting for the small street owner to accept a heavy payment, in order to relinquish most of its green light time. In other words, the customers of the main street, through indirect payments via the main street owner, will bid time away from the smaller number of customers using the minor street. This principle is well established in business, and is illustrated every time a firm sublets space, which it could have used to satisfy its own customers, because it receives more income subletting than retaining the premises for its own use.
• 66On the rare occasions when the feasibility of private road ownership has been considered by mainstream economists, it has been summarily rejected, based on the impossibility of competition among private road owners. Seeing this point as almost intuitively obvious, economists have not embarked on lengthy chains of reasoning in refutation. Thus, says Smerk, rather curtly, “Highways could not very well be supplied on a competitive basis, hence they are provided by the various levels of government.”
• 67A number of conditions must be met if the private sector of the economy—the market system—is to function efficiently. Indeed, these conditions are essential if the private sector is to perform in the public interest. . . . [I]t is the absence of these conditions which often gives rise to demands for public sector [government] action.
• 68Therefore, the objection to private roads on the ground that they are inconsistent with perfect competition cannot be sustained. It is true that this industry could not maintain the rigid standards required for perfect competition, but neither can most. In pointing out that perfect competition cannot apply to roads, we have by no means conceded that competition between the various road owners would not be a vigorous, rivalrous process. On the contrary, were we to allow that perfect competition could apply to roads, we would then have to retract our claim that vigorous competition could also ensue. For perfect competition and competition in the ordinary sense of that word (implying rivalry, attempts to entice customers away from one another) are opposites, and inconsistent with each other.
• 69The shape of the average revenue curve [demand curve] of the individual firm will depend on conditions in the market in which the firm sells its product. Broadly speaking, the keener the competition of its rivals and the greater the number of fairly close substitutes for its product, the more elastic will a firm’s average revenue curve be. As usual, it is possible to be precise about limiting cases. One limiting case will occur when there are so many competitors producing such close substitutes [the perfectly competitive model] that the demand for the product of each individual firm is infinitely elastic and its average revenue curve is a horizontal straight line. This will mean that the firm can sell as much of its product as it wishes at the ruling market price. If the firm raises its price, then, owing to the ease with which the same, or a very similar, product can be bought from competitors, it will lose all its customers. If the firm were to lower its price, it would be swamped by orders from customers wishing to take advantage of its price reduction. The demand—and the elasticity of demand—for its product would be infinite.
• 70Instead of concentrating on the maximization of ends, assuming given scarce means, as does the Robbinsian notion of perfect competition, the market-process view makes the realistic assumption that the means, although scarce, are in no way given; rather, knowledge of them must actively be sought out. The allocation of scarce means among competing ends is a passive procedure when the means and the ends are known. All that need be done can be accomplished by a suitably programmed computer. But the active seeking out of the ends and the means in the first place is a task that can be accomplished only by entrepreneurial talent: active, not passive. The entrepreneur, denied his crucial role in the perfectly competitive world view, takes center stage in the market-process conception.
• 71We have seen that the market proceeds through entrepreneurial competition. In this process market participants become aware of opportunities for profit: they perceive price discrepancies (either between the prices offered and asked by buyers and sellers of the same good or between the price offered by buyers for a product and that asked by sellers for the necessary resources) and move to capture the difference for themselves through their entrepreneurial buying and selling. Competition, in this process, consists of perceiving possibilities of offering opportunities to other market participants which are more attractive than those currently being made available. It is an essentially rivalrous process . . . (which) . . . consists not so much in the regards decision-makers have for the likely future reactions of their competitors as in their awareness that in making their present decisions they themselves are in a position to do better for the market than their rivals are prepared to do; it consists not of market participants’ reacting passively to given conditions, but of their actively grasping profit opportunities by positively changing the existing conditions.
• 72The Port of New York Authority Bus Terminal helps relieve mid-Manhattan traffic congestion. Approximately 90% of intercity bus departures and intercity bus passengers from mid-Manhattan originate at this terminal. The diversion of this traffic on overhead ramps from the terminal to the Lincoln Tunnel has been equivalent to adding three cross-town streets.
• 73On one short span of East River Drive [in New York City] there are grassed terraces carried over the traffic lanes right out to the edge of the East River, a special boon for nearby apartment dwellers. The solution was perhaps triggered by the fact that space between the established building lines and the river was so narrow as to force the superposition of the north and south lanes. But this did not do more than suggest the opportunity. Applause goes to those who grasped it, but none to those who with the good example in view so consistently ignored it thereafter.
• 74It seems clear that, ultimately, many urban freeways will become double or triple-deck facilities, with upper decks carrying the longer distance volumes, possibly with reversible lanes, and probably operating with new interchanges to avoid flooding of existing interchanges and connecting streets.
• 75There is joint road consumption by consumers with different demand functions. The road is not as good as steel which may be produced to different specifications of quality and dimensions. The economic characteristics necessitate the production of one kind of road for all users at any given place.
• 76Another objection charges that competition among roadway entrepreneurs would involve wasteful duplication. Says George M. Smerk: “[C]ompetition between public transport companies, particularly public transit firms with fixed facilities, would require an expensive and undesirable duplication of plant.”
• 77We must first of all distinguish between investment ex ante and ex post. In the ex ante sense, all investment is undertaken with the purpose of earning a profit. Wasteful overbuilding or needless duplication cannot exist in the ex ante sense; no one intends, at the outset of his investment, that it should be wasteful or unprofitable. Ex ante investment must of necessity, be non-wasteful.
• 78while it is possible to envisage competition in the provision of roads connecting points at great distances apart—as occurred on the railways in the early days—it is not possible to envisage competition in the provision of access roads in towns and villages, for most places are served by one road only. A highway authority is in practice in a monopoly position. If any of its roads were to make large profits, we could not expect other road suppliers to rush in to fill the gap. If losses are made on some roads, there are no road suppliers to close them down and transfer their resources to other sectors of the economy.
• 79Says Mohring, “But indivisibilities do exist in the provision of transportation facilities. Each railroad track must have two rails, and each highway or country road must be at least as wide as the vehicles that use it.” In similar vein, says Haritos, “To get from A to B, you need a whole lane, not just half, for the full distance, not half of it.” And, in the words of Peter Winch, “indivisibility of highways makes it impractical to have competing systems of roads, and the responsible authority must therefore be a monopoly.”
• 80Says Mohring, “But indivisibilities do exist in the provision of transportation facilities. Each railroad track must have two rails, and each highway or country road must be at least as wide as the vehicles that use it.” In similar vein, says Haritos, “To get from A to B, you need a whole lane, not just half, for the full distance, not half of it.” And, in the words of Peter Winch, “indivisibility of highways makes it impractical to have competing systems of roads, and the responsible authority must therefore be a monopoly.”
• 81Says Mohring, “But indivisibilities do exist in the provision of transportation facilities. Each railroad track must have two rails, and each highway or country road must be at least as wide as the vehicles that use it.” In similar vein, says Haritos, “To get from A to B, you need a whole lane, not just half, for the full distance, not half of it.” And, in the words of Peter Winch, “indivisibility of highways makes it impractical to have competing systems of roads, and the responsible authority must therefore be a monopoly.”
• 82We do not believe that the existence of indivisibilities is enough to guarantee monopoly, defined by many as a situation in which there is a single seller of a commodity. There are indivisibilities in every industry, and in all walks of life. Hammers and nails, bicycles and wheelbarrows, locomotives and elevators, tractors and steel mills, professors and podiatrists, ballet dancers and bricklayers, musicians and motorists, ships and slippers, buckets and broomsticks, none of them can be chopped in half (costlessly) and be expected to produce just half of what they had been producing before. A railroad needs two rails (with the exception, of course, of the monorail), not one, or any fraction thereof. Also, in order to connect points A and B, it must stretch completely from one point to the other. It may not end halfway between them, and offer the likelihood of transportation between the two points.
• 83(e) Expanding roads. One of the most popular antidotes to congestion is to build more roads. This solution, benefiting from the seeming presence of common sense, has attracted widespread attention and praise. As Buchanan reports, “the recommended solutions usually take the form of expansion and reconstruction of the highway system, all of which involve considerable additional investment of resources in highways and streets.” Mohring goes even further. In his view,
• 84Currently, the only technique being employed to an appreciable extent to alleviate urban traffic congestion is investment in additional highway capacity. Some of these additions to capacity have involved widening or otherwise altering existing arterial streets, but most of them have involved the construction of entirely new, high-speed, limited-access expressways.
• 85without raising the amounts spent by highway users, excess demand also can be cured by drawing on the general taxpayer to increase the supply—as some auto manufacturers and the American Automobile Association will testify.
• 86Oft-times, in addition to calling for increased roadway investments, specific designs are also advocated. Wohl, for example, favors building roads to bypass Central Business Districts of large cities since “through traffic as a proportion of downtown street traffic . . . usually ranges between 30 and 60 percent.” And Morris, in a thinly disguised call for an increased roadway supply, favors “using urban freeway design criteria which give preference to considerations of peak hour capacity rather than off-peak travel time.”
• 87Oft-times, in addition to calling for increased roadway investments, specific designs are also advocated. Wohl, for example, favors building roads to bypass Central Business Districts of large cities since “through traffic as a proportion of downtown street traffic . . . usually ranges between 30 and 60 percent.” And Morris, in a thinly disguised call for an increased roadway supply, favors “using urban freeway design criteria which give preference to considerations of peak hour capacity rather than off-peak travel time.”
• 88Additional accommodation creates additional traffic. The opening of a freeway designed to meet existing demand may eventually increase that demand until congestion on the freeway increases the travel time to what it was before the freeway existed.
• 89A second reason why new routes congest prior to forecast is simply that when transportation capacity increases and peak-hour time decreases, fewer drivers will take the trouble to beat the rush. Instead, they will travel closer to the time of their actual preference. Thus as traffic capacity increases, there is a shortening of the rush hour, but very little reduction in congestion during the new shorter peak-hours of travel.
• 90The answer lies in the concept of price: when charges are prohibited, i.e., when there is a zero price for highway use, then and only then, attempts to build our way out of congestion are doomed to failure. As long as highway services are “free”—as long as people pay for them whether they use them during peak periods or not, and pay no more for this use than for nonuse—then the “equilibrium” phenomenon will tend to consign to failure all attempts to cure congestion by adding to the highway stock. Private enterprise, too, would “fail” if it were prohibited from charging a price for services rendered.
• 91(f) Automobile banning. A solution to the congestion problem widely beloved of some less sophisticated economists and of many popular writers is to ban cars from crowded highways. On the most simplistic level, the “reasoning” seems to be that since road congestion consists of too many automobiles, the best and surest way to end the problem is to ban the offending vehicles. A slightly more cogent argument is that while automobiles usually carry between 1.2 and 1.5 passengers per vehicle, a bus, taking up no more than two and one-half times the highway space, is able to carry up to fifty passengers at a time.
• 92The problem with both views, of course, is that they treat human beings as homogeneous units. Underlying both is the democratic or “nose-counting” approach to economics which imparts a false equality into the analysis. For the trips of human beings are not all equal. That a bus can carry, for a given road space, a multiple of the people who can travel by car, does not mean that the bus is doing more “work” than the car. Even less justified is the assumption that the value of the bus’s services is equal to the same multiple by which it carries more people than a car.
• 93Perhaps a numerical example will clarify this point. Suppose that the average car carries 2.0 passengers per trip, that the bus carries forty people, and that the bus takes up twice the highway space of the auto. Dividing the forty people in half, we arrive at twenty as the number of people carried by a bus of equivalent size of a car. Can we say that the bus is doing ten times the amount of work being done by a car, since the former carries twenty people, while the latter only carries two? No we cannot, unless we make the further assumption that all people concerned are homogeneous in terms of the value they place, or which are placed on their trips. To take only the starkest example, all twenty people in the bus may be out on a pleasure tour, the value of which to them is barely above the costs of the fare they had to pay for the trip. And the two people in the automobile might be a man and his pregnant wife, rushing desperately to the hospital for a delivery. Not only is it not true that the bus is doing ten times the work of the auto; it is by no means clear that the bus is even doing more valuable work than the private vehicle. William Vickrey, one of the few economists to clearly apply this point to transport, criticizes “an aggregate made up of components which, through happening to have a common physical unit of measurement, are economically quite disparate.” It is, moreover, impossible to determine whether the bus or the automobile, in any given case, is doing more valuable work, in the absence of a road pricing system which allows them to bid against one another for scarce road space.
• 94Issue has been taken with this point by Thompson, who holds that under certain circumstances “an outright ban on automobile traffic becomes an approximation of and a rational substitute for a cost-based price.” And the special circumstances? “If it is generally agreed that the price that would be charged for automotive access to the Central Business District (C.B.D.) . . . is so great that no one would pay it.” Thompson reasons: “Whether the demand for automobile movement was priced out of the core area by [high prices], the effect is the same.”