Tag Archives: externalities

No Such Thing as a Free Lunch

By Dom Nozzi

One of my cousins, on Facebook (FB) in the spring of 2020, responded to a post I had made to FB recently. My post noted that several developed countries in the world had zero people without health insurance, while the US had 30 million without health insurance.

She responded by asking for a “Show of hands – who wants to pay 50% or more of their income in taxes??? Bernie [Sanders] is proposing American taxpayers pay 72% of their income so we can have FREE healthcare- even for ILLEGAL IMMIGRANTS, free college, free, free, free- nothing is free – it all gets paid for somewhere…”

I responded to my cousin by saying that with all due respect, my partner and I believe my cousin needs to check her numbers.

I went on.

What you mention sounds like the distorted corrupt corporate media narrative (a media hugely funded by Big Pharma and Insurance companies). Our understanding: What Sanders proposes is that we go back to the Good Old Days of, say, the 1950s for our tax structure. Then, taxes on those making up to about $30K a year would pay, say, 15 percent in taxes. Those making $30-60K a year would pay, say, 30 percent in taxes on the money they make over $30K. Those making over $60K a year would pay, say, 55 percent in taxes on the money they make over $60K.

In other words, lower and middle-income folks would not see much of an increase in taxes.

Putting aside taxes, how about if we build one or two less F-16 fighter jets? How about if we fight one or two less endless wars of aggression (wars, by the way, that create two people who hate the US for every one US hater we kill, which helps induce the endless warfare cycle). How about if we build one or two less aircraft carriers? How about if we widen one or two less highways? Doing these no-brainer things would mean we could have universal health care (like all other developed nations on earth) and free college for all (and build a desperately needed national passenger rail system) without the need to raise taxes.

I agree with you, by the way, that it is unfair to provide free education and free health care to illegal immigrants. Shame on Democrats for not acknowledging that. Shame on Democrats for apparently supporting open borders and no real restrictions on immigration. That is not sustainable nor is it good for the US.

One last thing: I agree with you that nothing is free (someone, somewhere is paying for “free” things). That is why I’m sure you would agree with me that we should eliminate the biggest form of welfare subsidy by far in America: Free parking and toll-free roads. Those “free” parking spaces and “free” roads are being paid by someone. They are not actually free. As someone who has spent 40 years academically and professionally in transportation planning, I can say with certainty that gas taxes pay only a tiny percentage of those road and parking costs. The vast majority of those costs are paid indirectly: We all, for example, pay higher prices for groceries (including those of us who shop by bicycle or bus) to pay for those “free” parking spaces at the supermarket. We all pay higher property and sales taxes to pay for those “free” roads. And we all pay for those “free” parking spaces and “free” roads with enormous externalized costs such as air pollution, degraded public health, unaffordable sprawl development, noise pollution, tens of thousands of annual traffic deaths, strip commercial blight, etc.

In sum, thank you for pointing out that there is no such thing as a free lunch. I agree with you.

To answer your “show of hands” question, I very much DO want what Bernie Sanders proposes. As former Supreme Court Justice Oliver Wendell Holmes, Jr. once said, “I like to pay taxes. With them I buy civilization.” (and as I pointed out above, the Sanders ideas do not necessarily require that taxes be raised, and if they do, not much at all unless you are quite wealthy).

Oh, and I cannot let this be unsaid: There are HUGE hidden societal costs associated with having roughly 30 million Americans without health care. The numbers I’ve seen put those costs in the trillions of dollars. We cannot afford to have 30 million people without health care.

 

 

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Filed under Bicycling, Economics, Politics, Sprawl, Suburbia, Transportation, Urban Design, Walking

Fixing Transportation Problems With Pricing in Boulder Colorado

 

By Dom Nozzi

February 21, 2010

How can we improve transportation in Boulder, Colorado? Here are some of my ideas.

I prefer the efficiency of pricing as a lever to achieve GHG emission objectives, rather than land use policies.

I am convinced that we need to address the enormous problem of travel externalities.

Most all of the roads and parking in the Boulder area are either un-priced or underpriced. That means we have an enormous number of low-value car trips in the metro area. Since the costs of motorized travel is largely (exclusively?) externalized, we are experiencing an excessive number of motorized trips.

We need to institute and then calibrate road and parking pricing more comprehensively. We still have excessive GHG emissions, so those prices need to be ratcheted up until motorized SOV travel is reduced sufficiently. Revenue from the pricing needs to be why-tolls-are-neededexclusively dedicated to non-SOV travel (transit, bicycle, pedestrian), and perhaps toward assisting local governments to pay for the work needed to prepare new policies and regulations.

I recognize that pricing can have negative social impacts on other worthy community objectives, such as the need to allow lower-income groups to affordably live in the area, or commute to lower-pay jobs from remote locations (where false economies are assumed – but which often do not pan out when added travel costs are factored in). I therefore support travel pricing rebates or travel subsidies when lower-income people can provide sufficient evidence that they are low-income. Part of this affordable housing issue is the need to have the City provide adequate quantities of housing that is situated in mixed-use, relatively compact neighborhoods, so that the household can own less motor vehicles and devote more of the household income to housing instead of a second, third or fourth car.

By the way, while living in Richmond VA, I noticed that while the city has way too much free parking in the metro area, there are quite admirable road pricing strategies (via toll booths found on a number of metro roads and highways). I say this not because Richmond is an example of a city that has used pricing tactics to avoid sprawl (indeed, it has sprawled more than most any city in the US over the past few decades), but because the city shows that such road pricing is politically and financially feasible.

 

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Filed under Economics, Transportation

The Fairness of Making New Development Behave Itself

By Dom Nozzi

In 1998, there was a great deal of community discussion about a proposed 480-acre “sprawl” development in western Alachua County, Florida.

I find it peculiar that often, in response to a proposal to get residential development or travel by car to “behave” itself, we hear people make the red herring argument that we should not force people to live in a walkable town center of the city, or that we cannot “get rid of all cars.” In fact, the proposals to make residential development, or travel by car, behave themselves is simply a way to create more equity and provide more choices for both residential development and travel.

For about 50 years, we have built little other than low-density, single-use, large lot residential (“conventional”) subdivisions in outlying suburban areas. In addition, we have focused almost all of our efforts on making cars happy. The result, of course, is that throughout America, and including Alachua County, we have little choice in terms of residence or form of travel. We are pretty much “forced” to live in conventional residences in outlying areas, or travel by car for all our trips.

But what about the large and growing number of us who would enjoy the pleasures of a more urbane setting, where we would have easy access to a nearby grocery, various forms of culture, a pleasant public realm, civic events, retail, jobs, schools, parks, sidewalks that lead somewhere, sociable neighbors, and calmed traffic? What about those of us who want the choice to be able to walk, bicycle, or bus to those destinations? Do many of us have a choice to enjoy such things? Do we really “force” people to live in more traditional town center settings, or get rid of their car, if we simply make other residential and travel choices more of an option?

As for “behaving,” it is my opinion that residential areas are “misbehaving” when they, for example, generate a large number of car trips. Such areas tend to be “single-use” (only single-family residential land use), and nearly every trip is too far to travel except by car. The result is that instead of a reasonably self-contained subdivision with a reasonable amount of internalized “trip capture” (due largely to a mix of land uses in the area or development), those trips and costs are externalized on all the rest of us.

Let’s not forget that the reasonable travel distance by car extends out to about 10 miles (it is roughly 3 miles for bus and bicycle, and about one-quarter mile by foot). What are the “externalized” costs that we must bear when a new subdivision does not “capture” a large number of car trips?

Well, within a 10-mile radius (see above), our neighborhoods get more traffic, more air pollution, more water pollution, more noise pollution, more strip commercial development, more decline in neighborhood value, more loss of small business in the core area, more sign pollution, more danger on our streets, and higher taxes to pay for public services like parks, schools, police, fire protection, sewer, water, environmental protection, etc.

So it becomes a matter of equity.

Is it fair for a new, outlying residential area to impose those costs on us? Isn’t it reasonable to ask that new residential development “pay its own way,” by locating in appropriate areas, designing for livability, and paying for some of the costs for new or expanded public facilities and services they demand from us?

I recommend that we try to steer clear of red herrings. It tends to polarize us. I also believe we can all agree that providing residential and travel choices, and insisting on equity, are good things.

To me, the debate should center around what constitutes equity, and how much our local, state, and federal government should put into creating travel choices.

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Filed under Sprawl, Suburbia, Urban Design