Transitting Away from the Free Market; R. Condry

So what? Well, it's just another example of a government spending splurge in search of an issue. In a recent report the General Accounting Office (GAO) estimated that in 1993 the federal government would spend between $8 millionand $10 millionon transit benefits. Now, it's true that none of this money was actually appropriated for that purpose, which might irritate some taxpayers the more, but was to be taken from existing funds. There are those who will say that this is a net benefit for the taxpayer because that much money is not being spent regulating or otherwise interrupting the lives of the inno cent. This is true to a point, but the taxed should not rest easy just yet. What the law authorized the feds to do was use the same funds-available to busi nesses as tax deductions but to the govern ment as equal subsidies-to help subsidize their employees riding the mass transit lines.

Mr. Condry, a graduate of the U.S. Naval Academy, is employed with a defense consulting firm. He has previously been published in The Wanderer, Shipmate, and Sea Classics. Beginning in July 1991 the tax-free benefit was $21 per month, but on January 1, 1993, the figure was raised to $60 per month. The GAO surveyed certain federal agencies in the 25 largest metropolitan areas (those with the worst traffic and air pollution) to see what effect the ability to make use of these subsidies had on federal employee partici pation in mass transit. Surprisingly, some agencies did not par ticipate, citing a lack of funds. (Surprising because it is usually the federal habit to force all of its minions to get with the program of the month. Maybe they didn't understand the law.) Others participated to varying degrees-some offering the $60-per month bribe while others stuck with the $21 figure. But, notwithstanding govern ment size and propensity for keeping records, GAO was a tad put out that none of the agencies had any serious numbers to prove exactly what their level of participa tion was or what effect the subsidies had.

Those that did participate took the funds to pay the benefits from the operating funds voted them by the Congress. The usual reasons for pushing mass tran sit, preferably using the pocketbook of the taxpayer, are trotted out: It will reduce congestion and air pollution, and save en ergy. Noone thinks to ask whether mass transit subsidies are the only, or even the best, way to do any of these things. It also never occurs to anyone to ask whether, if 516 the subsidies have not had the desired effect on the private marketplace (and the GAO offers statistics which suggest that they have not), they ought to be extended to the federal civil service. Never mind the (hardly raised anymore) question of whether or not the people of Utah ought to have to subsi dize the cleansing of New York City. The fact is that the GAO has no idea whether the subsidies are having any effect or not. In a previous report last summer on the subject of automotive emissions, the GAO allowed as how there is no way to tell if the various programs in place to reduce emissions are making a dent in the problem.

The results of surveys are too local, the conditions too variable, and the response to the programs too varied. Ditto with mass transit subsidies, though the GAO fails to recommend that the subsidies not be imple mented until the facts are known. The agency willgo so far as to say that the impact of the employer-based initiatives will not be known until such measures are "measured in conjunction with other measures." (Translation: We won't know whether gov ernment coercion works until all of the various methods have been tried.) Confusion Reigns But it may be that the answers are not available because they are not knowable. It may be that the GAO is simply saddled with a recalcitrant subject here: The results ob tained from polls which measured the pulse of the affected federal workers found that confusion reigns. Those who do not use public transportation claim that it is too far from their home or that it would take too much time. But the surveys also show that ridership would increase if the subsidy were made available. It just goes to show you how much effect the unearned dollar can have.

The GAO claims that the subsidies and other TCMs (Transportation Control Mea sures-great government term) exist to "level the playing field" for public trans portation. For evidence of this the GAO points to those in the survey who claim that they no longer ride in van or car pools singe 517 the subsidies became available. People who formerly relied on private mass transit have gone over to the government. Hmmmm: Paying people to leave the private trans portation market, which puts the govern ment (and its command of the taxpayer's pocketbook) in competition with private enterprise, is leveling the playing fields. Interesting concept. It makes sense, and the surveys seem to bear out, that the poorer members of the work force would tend to value the subsidy more. Ridership falls off as income in creases, with $25,000annually the apparent cut off. But this raises a point that the GAO was careful to skip around in its report: Those Americans who can (and it is largely a financial decision) prefer to drive their own cars, everything else being equal. Notice also that mass transit cannot compete for the attention of the commuting public (where there is a choice) without the assistance of the public purse (taxpayer subsidies) to "level the playing field."

There are also those for whom the mass transit systems simply don't work. The polls stated that a huge percentage of federal users of mass transit said that it was very close to their workplace. This would stand to reason since government offices tend to be located in city centers-particularly in Washington, D.C.-the areas mass transit was designed to serve in the first place. But for the commuter going to a workplace in the private sector, the use of mass transit will become increasingly difficult as companies locate away from the troubled cities. It is frequently impossible, and this is true in the Washington area, to get to one suburb from the other on the trains without going to the city first. But 60 percent of all federal workers surveyed said that they would not ride the mass transit even if the subsidy were offered them. Here is the best evidence there is, after the fact that the playing field has to be leveled by the government on behalf of mass transit, that most Americans prefer the in dependence of their automobiles. More: Total transit miles have increased while the mass transit ridership fell from 3 percent to 518' THE FREEMAN • SEPTEMBER 1994 2 percent of the population, according to the Department of Transportation. We are not seeing a groundswell of support for mass transit, even with people being paid to ride it. The Department of Transportation does predict that highway traffic will increase by 65 percent in the next 20 years (more cause for alarm), but it is unclear where they got this number, or what it should mean. The population is not growing very fast any more, and it is aging, suggesting that the number of highway miles might level off or decrease, and that fewer of the miles being traveled will be commuter-type miles that would lend themselves to mass transit. But more importantly, the GAO and DOT seem to be suggesting that the cure for this woe is to step up the subsidy program in hopes of keeping some of those swarms off the road.