Author: Dhruv Muralidhar, Graphic: Lydia Qu
THE BRB BOTTOMLINE:
With people slowly heading back to work, it is worth examining America’s struggling public transportation systems. Community Columnist Dhruv Muralidhar reviews how we got here and what we can do going forward by examining different sides of the issue to answer the pertinent question: how do we get back on track?
I moved to America a week after my third birthday. Though I was young, there is so much I remember about that day at the Detroit airport: the cold April rain falling against the tarmac and the smell of french fries from the McDonald’s next to our gate. But the one thing that stood out to me was during the drive from the airport to our new apartment. I was simply amazed by the ubiquity of smooth highways and soaring bridges. That was 15 years ago. Today, the America I live in has crumbling infrastructure, with potholes riddling the highways and fractures covering the bridges. We came a long way, but not the right way, and it didn’t stop with roads or bridges. In 2017, the country received a D+ from the American Society of Civil Engineers in the category of transit. With population centers growing, solutions to rush hour congestion seem more urgent every passing day. But could frictionless mass transit and transnational railways be in our nation’s future, or are these projects black holes of taxpayer dollars?
The Derailed State of American Public Transit
Though it seems to be common knowledge that American public transportation leaves a lot to be desired, it was not always this way; we used to be at the forefront of innovation in this sector. A glance at the Federal Transit Administration’s website shows that the earliest form of public transit in America came before there was even a United States, with Boston establishing a publicly operated ferryboat in the year 1630. After ferries came trains, then streetcars, then trolleys, followed by buses. For much of history, public transit was funded in its entirety by local and state money through taxes and fares. In the 1930s, as part of President Franklin Roosevelt’s New Deal, the Works Progress Administration began the era of federal funding for mass transit systems on a larger scale. Since the adaptation of busses, not much has changed in the way most public transportation systems work other than a few safety regulations at the state and federal levels.
Studies have shown that Americans are catching on to the stalling state and lack of meaningful progress in their transit systems—every single major city in the country (except for New York City) has seen a stark decline in ridership from 2012 to 2017. It’s no wonder given how there have been numerous safety issues or the seemingly ubiquitous delays associated with taking the train or bus to work. Then there is also the issue of routes and availability. Vox recently did a segment on why the current public transit systems do not work for many Americans. To summarize, most lines are designed to connect suburbs to the city center, yet many people who live in the vicinity of major cities travel from suburb to suburb for work, and, as such, the system is of no use to them. The emergence of the now commonplace interstate highway system made some parts of cities nearly impossible to access if you did not own a car. To make matters worse, due to the inefficient manner in which lines are arranged, only about 5% of people use public transportation to commute, making the revitalization of broken systems not a legislative or political priority at the local, state, or federal level.
The inefficiencies and overall broken state of our public transportation systems also have huge implications for racial divisions and inequities in the country. A Rice University study found that many systems are built on racist policies of the past whose effects are still being felt to this day. These are the policies that labeled urban, mostly minority users as “dependent riders” for whom providing transit lines was important, but quality and level of service could be disregarded. These are the same policies that labeled suburban, mostly white users as “choice riders” for whom the transit authorities would stop at no length to provide quality rides to ensure continued use. Years of thinly veiled racism and discriminatory policies like these are part of why we are stuck with transit systems crumbling in the cities but improving in quality in the suburbia.
A Map to Our Financial Station
It’s not like working public transportation models are not plausible. You only need to look to Europe, Japan, and even cities in Canada to see numerous success stories. So where’s the funding? According to a 2011 study, 27% of the funding comes from fares, nearly 20% from the federal government, and the remaining from local and state governments by way of various taxes and appropriations.
No matter how you cut the issue, it always seems to trail back to one problem: ridership. For transit lines to receive additional funding to keep routes in operation and expand new routes, they need riders to pay fares and demonstrate the project’s demand. It’s important to note that it is entirely possible to break even or even make profits with just fare revenue, as demonstrated by Hong Kong’s Mass Transit Railway (MTR) Corporation. By investing in businesses neighboring their lines and using other forward-thinking financial strategies, the MTR can maintain the impressive farebox ratio (percent of operating costs covered by fares alone) of 185%. This, sadly, is far from the reality in America. Because of crumbling quality, ridership has been falling in cities across the country. To make up for lost revenue, the entity owning the transit line will either cut back on services or raise fares. Either of these actions will inevitably lead to fewer users, creating and perpetuating a vicious cycle, referred to as the ridership death spiral.
Much of federal funding for mass transit comes from the Capital Investment Grant Program (CIGP), a part of the Federal Transit Administration’s discretionary funding. The CIGP provides funding for light rail, commuter rail, streetcars, and bus transit. In theory, this is a great program, but it has encountered struggles in recent years. In the Trump Administration’s 2020 budget, the CIGP was cut by $1 billion, and President Trump even floated the idea of completely phasing out the program back in 2019. A House Committee investigation also found that project approval times have more than doubled over the past few years.
Funding for public transportation at the state and local levels are often jeopardized by partisanship and misinformation. At the state level, much of the budget is determined by taxes. In turn, taxes vary in magnitude and diversity based on the political party in charge at a given time. This results in unpredictable funds that make planning for long-term projects challenging, especially when the projected end date is multiple election cycles away. At the local level, funding is at the mercy of the voters’ will, as many cities have ballot measures to determine whether to increase or decrease spending on these projects. As was in the case of Nashville in 2018, extensive lobbying and campaigning employed by various forces can swing the vote and eventuate in a funding cut.
A Glance at the Other Lane
Before we go any further, let’s pause for a moment to examine why opponents support cutting funding for public transportation. Americans For Prosperity (AFP) is a libertarian-conservative political advocacy group funded largely by Charles and David Koch (David Koch founded the organization), some of the biggest donors to right-wing causes. By taking a look at AFP’s response to the city of Nashville’s 2018 plan for public transit, we can glimpse into their reasoning.
First, they argue that public transportation lines contribute to traffic congestion and that these lines cannot adapt to changing traffic patterns. This reasoning is based on the so-called “law of traffic”, which states that expanding a hypothetical highway will only reduce congestion in the very short-run, with more drivers hearing of the reduced congestion and deciding to use the highway, returning it to its pre-expansion levels of congestion. Closer examination, however, points to AFP’s claim being only partly true. Research done by UC Berkeley’s Professor Michael Anderson suggests that congestion in the vicinity around transit lines is reduced permanently. Seeing as many transit lines are placed in areas of high population, having congestion reduced, even if only in the immediate vicinity, would be a blessing to anyone stuck during rush hour.
The other primary claim of AFP and similar groups is that government-funded transit projects are unnecessary with the emergence of ride-sharing applications. A fact sheet, published by TransitCenter, refutes the claim quite well. In essence, the most obvious counterargument is that public transit takes up less space per person—25 strangers can fit in a bus, but 25 strangers would need 25 individual cars. If everyone using mass transit made the switch, there would be traffic jams galore. The factsheet points out that ride-share companies like Uber and Lyft are most popular when public transit is not usually available (midnight to dawn) but are scarce during rush hour when most people are commuting. Finally, the worst-performing buses carry more passengers per hour than the best ride-share drivers. As such, AFP’s claim is just plain wrong.
Moving Away From the Wrong Side of the Tracks
Having done our due diligence in looking into the other side and seeing that their arguments hold little factual relevance, we can move on to exploring the primary reasons why funding public transportation benefits society.
While the environmental benefits are obvious, it often takes more than that to convince voters and legislators. Looking at the economy from a macro level, we can see that investing in mass transit systems can pay huge dividends. Statistics derived from a 2013 Department of Transportation report show that for every $1 billion of funding received, public transportation projects yield over 35,000 new jobs, $472 million in tax revenue, and an increase of $1.8 billion in GDP. The same report also shows that businesses around the transit lines see an increase of $3.5 billion in sales for every $1 billion invested. Other reports show that every dollar invested in public transportation yields $5 of economic growth, and that funding mass transit results in the creation of 31% more jobs than similar funding towards bridges and roads. With these figures, it is clear how increasing public transportation can help the economy as a whole.
The economic impact of public transportation doesn’t just stop with the government or businesses—it helps individuals, especially those struggling in poverty. According to a study done by Harvard University, commute time is the single most prominent factor when it comes to scaling the socioeconomic ladder. The study showed that families with a shorter average commute time had better odds of escaping poverty. In fact, access to reliable transportation beats crime, elementary school test scores, and percent of two-parent homes in a community when it comes to determining the odds of socioeconomic mobility.
Now, of course, this study just talks about reducing commute time and having reliable transportation, not necessarily public transportation. So having a decent car that runs most days solves this problem too, but surveys show that, in some states, 94% of welfare recipients do not own cars, and have to rely on public transportation to get to their places of employment. It is true that poor transit systems can increase the wealth gap. However, a reliable system can allow people to reach the city center with more ease, stimulating the local economy. A reliable system can allow small business owners to reach banks and government license offices, enabling them to get their business off the ground. It can also provide children with a chance to attend quality schools and those in poverty to search for economic opportunities that are too far to reach on foot, giving them a chance to brighten their future.
Given the sheer magnitude of potential benefits, be it macroeconomic, environmental, socioeconomic, or opportunity-driven, it would frankly be ignorant to only consider the financial bottom line. While the taxpayers may have to pick up the tab in the short-run, when the local economy booms due to the investment, people will undoubtedly be better off.
Engineering a Brighter Future
With all the problems presented here, it is indubitably a daunting task to even know where to start fixing what seems to be a heaping pile of inefficiency and disrepair. But, while there is no reason to believe that this will be an easy fix over one, five, or even ten years, we can start to take steps to better the situation.
While it is easy to blame politicians, lobbyists, and partisan gridlock for the dire state of public transit in our country, and while there is certainly plenty of blame there, it is important to recognize that we, the people, have to do our part. Most politicians are inherently reactionary and will not take the bold action we need without a push from their constituents. We need to put pressure on our representatives at the local, state, and national levels to make revitalizing public transportation a priority. This is not an isolated issue either. By advocating for better public transportation, we can push the needle on a variety of other pressing topics. Do you care about the environment? Support public transportation innovation. Do you care about stimulating the economy? Support public transportation investment. Do you care about increasing social mobility and reducing racial inequities? Support public transportation reform. It is easy to bemoan a broken system, but it would be disingenuous and frankly hypocritical if we sat on our hands instead of taking the necessary steps to ensure that a better tomorrow comes today.
With a new administration now taking the reins, many wonder if President Biden and Secretary of Transportation nominee Buttigieg will prioritize public transportation issues. Biden’s past would seem to be a reassuring sign, earning him the nickname “Amtrak Joe.” Biden even wrote an article titled “Why America Needs Trains” in 2011. According to the Mass Transit Magazine and the Biden-Harris campaign website, Biden’s administration will reduce congestion, provide more transit options, make transit with no emissions commonplace, and reduce inequities based on race and socioeconomic status. While these are indeed encouraging pledges with the power to improve the daily lives of millions of Americans, only time will tell if these plans will translate into legislation or empty promises.
Demand for public transportation has understandably decreased this year with the pandemic making an enclosed space with 30 strangers, not the best idea. As things begin to return to normal over the next year, we should see a reversal in that trend, but even then, ridership figures would have to increase for more people to take notice. Of course, given enough time, fossil fuel production will reach its zenith. Past that point, gasoline prices will increase and lead more people to public transportation. If we, as a country, want to be prepared for that influx, we must start working now. We need to design new routes that do away with outdated thinking about user trends and demographics. By looking at cities like Paris and Toronto, we can form a framework to enhance our systems, allowing us to compete globally.
This shouldn’t be a partisan issue. Provided the facts, it is easy to see that almost any well-thought-out public transportation project is worth the cost, only improving its community. It’s time to stop putting up with our crumbling transit systems. It’s time to move past the misinformation and hold our leaders accountable. It’s time to prioritize a better America that serves all her people and brings home a report card that makes us all proud. That’s how we get back on track.
The American public transportation system is severely lacking, with progress stalling over the past few decades. The situation has not been helped by the abundance of funding cuts at the federal, state, and local levels, even as opponents of public transportation struggle to develop meaningful arguments. The truth is that investing in mass transit can stimulate the economy and contribute to socioeconomic mobility. We need to work fast to improve the situation before external trends like rising gas prices put more pressure on the crumbling systems.
Dhruv Muralidhar is a freshman at the Haas School of Business majoring in Business Administration through the Global Management Program. He is a passionate public speaker who is interested in geopolitics and its intersection with business. His belief in the power of small businesses and community-minded approaches to improve social mobility inspired him to write for BRB’s Community column. Hoping to put his business skills to good use, he is also a member of BRB’s Financial Operations. In his spare time, Dhruv enjoys trying new cuisines and building LEGOs.