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Summary
of Meeting with Craig Westover
Civic Caucus,
8301 Creekside Circle,
Bloomington, MN 55437
Friday, May, 16,
2008
Guest
speaker: Craig Westover,
senior policy fellow, Minnesota Free Market Institute
Present:
Verne
Johnson, chair; Charles Clay, Paul Gilje (by phone), Jim Hetland, and
Wayne Popham (by phone)
A.
Context of the meeting:
As part of
its inquiry into priority-setting for highway and transit projects, today
the Civic Caucus meets with an individual who believes that
transportation policy should be guided by the objective of assisting
individual mobility, which differs from system-oriented purposes like
guiding development or combating congestion.
B.
Welcome and introduction--Verne
and Paul welcomed and introduced Craig Westover, senior policy fellow,
Minnesota Free Market Institute. Westover is a freelance writer who early
worked for an advertising agency and later moved to corporate
communications and strategic marketing. In addition to his role with the
Free Market Institute, Westover is a weekly contributing columnist for the
St. Paul Pioneer Press and online news source MinnPost.com.
C.
Comments and discussion--During
Westover's comments and in discussion with the Civic Caucus the following
points were raised:
1. Minnesota Free Market Institute explained--According
to its website, the Minnesota Free Market Institute "conducts research and
advocates for policy that limits government involvement in individual
affairs and promotes competition and consumer choice." Westover said that
the Free Market Institute's president, David Strom, formerly was head of
the Taxpayers League of Minnesota. The Free Market Institute was formerly
the Taxpayers League Foundation, but is today a more independent
organization with a broader charter than just tax policy.
2. Guiding principles--Westover
outlined principles which he said guides the agenda of the Free Market
Institute: Limiting government to its constitutional functions, adhering
to the idea that “state resources are state resources,” which means state
government should prioritize all its spending against all its resources
rather than dedicated funding pools, which in turn would help hold down
taxes; keeping decisions as local as possible; preserving personal
responsibility; enhancing individual freedom; and ensuring choice for
consumers among competitive suppliers. The Free Market Institute
currently focuses on policies creating competition and choice in
education, health care, transportation, and supports policy promoting
limited government.
3. The problem is mobility, not congestion or guiding
development—Current
policymakers start with the idea of creating an effective and efficient
transportation system rather than with the basic question, “What problem
our we trying to solve?” The problem in transportation, he said, is not
congestion; it's providing mobility. He defined mobility as “the ability
of people to get from where they are to where they want to go, to do what
they want to do when they want to do it.” Typical individuals will choose
LRT, bus, or car based on what best helps them accomplish their immediate
practical needs: to get from where they are to where they want to go, to
do what they want to do when they want to do it. Persons don't make a
decision on the mode of transportation for a trip absent the purpose of a
trip.
Thus,
Westover said, transportation policy ought to be designed to respond to
hundreds of thousands of individual decisions concerning mobility, and
should not be used to guide development or to reduce congestion, which are
top-down, system-oriented decisions. Public bodies in transportation
ought to be responding to behavior of individuals, not try to change the
behavior of people to fit the planners’ ideas of a perfect system.
For additional discussion of mobility and congestion, see Westover's memo at the end of this summary.
4. Attack affordability directly; don't
subsidize one mode over another--Westover
believes it is bad policy to specifically design a transportation system
to serve low-income people at the expense of overall mobility. He argues
that such systems don’t actually enhance the mobility of low-income
people. “How,” he asks rhetorically, “does a single mother use LRT to get
one child to daycare in one direction from her home, another child to
school in another direction and still get to work on time at a job in a
third direction?” Instead, he said, when subsidies are needed, provide
subsidies directly to individuals in need, giving them the purchasing
power to choose among transportation options. Others should pay fares that
approach full operational costs of transit.
5. Questions about LRT--Westover has no personal preference
for LRT or any other system, other than it prove cost/effective. He does
not believe current light rail projects meet that standard, but is
intrigued by Scot Halstead’s idea presented to the Civic Caucus of
high-speed light rail along the I-94 corridor. When one examines the
Central Corridor LRT costing almost $1 billion you need to ask whether
that investment represents the best way to maintain and improve mobility
of people, he said. Everything he has seen to date would indicate much
more could be accomplished with those dollars by fixing four or five major
highway bottlenecks around the region.
6. Governmental decision-making on transit and
highways--Rather than turning
to the level of government with the broadest geographical area (like the
Met Council) Westover favors keeping decisions on highways and transit as
local as possible. A broader jurisdiction, such as MnDOT or the Met
Council in an advisory role, is needed to address coordination among
communities, he said. He agreed that he is not offering a specific
structural proposal for Minnesota. He says one of the largest
transportation problems facing the state is everyone has a different
scheme to structure transportation planning, but no one addresses the
mobility problem. You can’t create a problem-solving structure until you
can agree on the problem you are trying to solve. He understands the
complexities of dealing with the federal government, state government,
MnDOT, the Metro Council, the new transit ways board of the metro
counties, individual counties themselves, and individual cities, all of
which have a seat at the decision table now. The decision-making
structure has too many levels and should be flattened, he said. He
believes agreement on a central objective--keeping decisions as local as
possible--is needed before getting into details. Local roads should be a
local responsibility and be funded locally, he said. He has no
philosophical objection to using a property tax for local roads that
primarily benefit the local community. State roads should be a state
responsibility and be funded by the state. He believes the federal gas
tax should be discontinued and the federal government should get out of
the business of funding state and local projects, an action that often
distorts state and local planning. Money and decision-making should be
focused locally.
Westover
said the current decision-making structure in Minnesota is very much out
of control, with problems accentuated by the 2008 Legislature's creation
of the metro counties' transit ways board. Westover, however, is no fan
of the Metropolitan Council, which he prefers should serve primarily in an
advisory and coordination capacity. In the continuing discussion on this
point, it was noted that the Metropolitan Council is responsible for the
operations of the regional bus system. Westover would prefer a private
mass-transit system, but given the realities of the current situation, he
agrees that an organization like the Met Council is necessary to operate
public transit.
7. Opposition to distribution of transportation
funds by formula--Westover is
opposed to the current practice of distributing state gasoline taxes and
motor vehicle license fees by formula (constitutional or statutory) to
state, county and municipal highways. Such an "entitlement" approach will
never create a sensible system of setting priorities based on actual
needs, he said. The Free Market Institute opposed the package of
transportation taxes enacted by the 2008 Legislature because it
represented a continuation of the entitlement approach. The emphasis
should be on "how much should we spend," not "how much can we spend,” he
said.
8. General obligation bonds favored--The
Free Market Institute favors using general obligation bonds for capital
construction, he said, because the lifespan of the improvements exceeds
the time required to pay off the bonds. Using bonds makes it possible to
bring forward future benefits to the present, he said. Emphasizing the
idea that “state resources are state resources,” he said that all capital
investments – roads and bridges, transit construction, University
buildings, zoo exhibits, and even band music libraries -- should compete
for the same pool of state resources. The current “bucket approach” of
dedicated funding sources and formulas allows the legislature to justify a
tax increase for under-funded transportation, while bonding for local
projects of high political value but low economic return to the state
taxpayers footing the bill for local projects.
Westover
ultimately would place all funds now distributed by formula into the state
general fund from where they would be distributed as part of the budget
process. The Governor and Legislature are the decision-makers, he said. We
shouldn’t let them off the hook for tough spending decisions.
9. Distinguishing between the public good
provided by roads and by transit--Roads
are an economic public good that provide the essential connection for each
of us to everyone else, he said. We benefit from roads whether we drive
on them or not. They enable products and services to be brought to our
homes and businesses. They enable police fire and emergency services to
reach citizens in need. Transit is not an economic public good. We benefit
only if we choose to ride the service, making it a private benefit, he
said. Because roads are a public good, it makes sense to spread the cost
to everyone through general funding supported by taxes. Transit, being a
private benefit, ought not be supported by taxes but by user fees.
In response to a
question Westover repeated his earlier point it is better policy to
identify and subsidize poor and elderly persons dependent upon transit
instead of subsidizing and entire system.
10.
Essential steps to be taken--While
Westover refrained from making specific suggestions for change in
decision-making, he was pressed for what changes would be necessary.
First, he said, there must be agreement on the problem that is being
solved. Second, we need agreement that revenue collection and
decision-making should be pushed to the lowest level where it makes sense.
Third, develop solid definitions for how specific road and transit
facilities are assigned among specific jurisdictions.
11. Congestion can’t be solved
--Congestion is a problem, but it is good
problem to have, Westover said, because it is a measure of economic
vitality. Eliminating congestion is an impossible goal. Trying to
eliminate congestion means you always need more money than what is
available. Further, he said, only 40 percent of congestion can be
attributed to lack of lane capacity (according to the Federal Highway
administration). The balance of congestion can be attributed to unplanned
events, such as traffic accidents and weather, plus inevitable congestion
produced by special events that attract crowds. He distributed a policy
memo from the Free Market Institute's president, David Strom, on dealing
with congestion. (Available at http://www.mnfmi.org/images/pdfs/congestionmemo.pdf)
As
measures are taken to reduce congestion, it induces more demand among
people that didn’t use the roads or used them at a different, less
convenient time. Congestion is a market driven creature that will always
tend to some constant, acceptable level. As soon as new capacity is
created, people start changing their travel patterns in light of their
need to "get from where they are, to where they want to go, to do what
they want to do, when they want to do it", he said.
Westover
said, the Free Market Institute advocates an Acceptable Levels of Service
model, which balances the public tolerance for congestion during peak use
periods with a cost/benefit analysis including use during off-peak hours.
One can't always expect free-flowing service, he said. But expectations of
acceptable levels are achievable. In the larger scheme, individuals will
make trade-offs acceptable based on their needs. Individuals might move
closer to work or look for work closer to home. They might leave earlier
for work. They might consider public transit. Those are individual
mobility decisions and it makes better policy sense to facilitate
individual decisions than to try and create the “perfect system,” which in
reality will benefit only a few and create hassles for everyone else.
12. Congestion pricing can be used--Westover
said congestion pricing such as tolls should be used to encourage people
to make travel choices based on additional value received. For example,
allowing people to use a high-speed lane or alternative route, but for a
price. In other words, he said, people are paying to save time – they are
getting value for the dollar. People should not have to pay tolls for
roads already paid for by taxes, nor should they have to pay tolls to
drive to a specific place at a specific time, which hinders mobility.
Congestion pricing should be contingent on providing additional value, not
simply as a way to raise revenue.
13. Opposition to building transit or highway
improvements to direct future development--In response to a
question Westover said he's opposed to building transit or highway
facilities in areas where one hopes that future development will occur.
Area growth and development is an organic process that works best when
it’s the result of individual choices rather than bureaucratic planning.
(In a post-interview
comment, Westover cited
University Avenue
as an example. The street has and is undergoing transformation from a
run-down area to a vibrant business corridor primarily due to the industry
of immigrant populations. Now city planners are going to run light rail
down University Avenue in hopes of creating “transit-friendly” shops and
development. It’s a case of building what the planners want, not what
individuals have, through the market, decided they want. Another is the
Lake Elmo controversy – the Met Council deciding how a local community
should plan for the future, a way contrary to the reason people moved
their in the first place.)
14. Westover's views and those of the Free Market
Institute compared--Responding
to a question, Westover said his views and those of the Free Market
Institute are largely comparable, although some conservative supporters of
Institute and free-market philosophy might not be as strongly supportive
of giving direct transportation subsidies to the poor and letting them
make choices about when, where, and how to travel. Westover characterized
himself as talking more in terms of concepts than in terms of specific
proposals, but emphasized that without agreement on the problem that
transportation policy is suppose to solve, concrete proposals will
necessarily be disjointed and unproductive at best, harmful at worst.
15. Hunger for information continues--Turning
briefly to the question of changes in the mass media, Westover said that
while there's a clear reduction in the number of people who are reading
newspapers, there's a clear increased demand for more information on the
part of the people who continue to read newspapers. He speculated that
while general readership of newspapers is down, he’d be surprised if
readership of the editorial pages was down. Circulation drop is among
people that aren’t looking for analysis and comment. Policymakers and
politicians still care what’s in the paper. Westover noted that he's a
contributor to the conventional media (Pioneer Press) and new media
(MinnPost.com). If the online economic model works, he’s enthusiastic
about online journalism gaining more credibility with policymakers.
16. Thanks--On
behalf of the Civic Caucus, Verne thanked Westover for meeting with us
today.
* * * * *
Additional comments by Craig Westover on the distinction between promoting mobility and easing congestion
The following memo from Westover was sent to the Civic Caucus after the meeting, when clarification was requested on
the distinction between promoting mobility and easing congestion:
First, the increasing
mobility is the objective; easing congestion is one means to that
objective. Easing congestion can, but does not necessarily increase
mobility. To take an extreme example for illustration only, if we put a
$100 toll on I-94 during rush hour, we would certainly reduce congestion,
but fewer people would be able to get from the east side of St. Paul to
downtown and points west when they wanted to travel. In other words, we
eased congestion but decreased mobility – a poor trade-off.
Looking at situation
from a congestion perspective – say we have a stretch of road with two
lanes in each direction that can accommodate 1,000 cars during rush hour.
The number 1,000 is a market driven number – if more than 1,000 cars try
to use the road, some people start to make trade-offs; they leave earlier
or later in the day, for example, to avoid the traffic. As the number of
cars drops below 1,000 other people notice and return to rush hour driving
if its more convenient that altering their driving hours. Thus, the total
number of cars stays about 1,000.
Now assume we add
another lane in each direction with the potential to accommodate an
additional 500 cars. Initially, the 1,000 cars using the stretch of road
spread out and enjoy reduced congestion. However, remember congestion is a
market-drive force; as others making other transportation choices become
aware of the new lanes, they alter their driving habits to take advantage
of the lower congestion. Eventually, 500 new cars will fill the new lanes
and congestion will return to the same density it was prior to building
the new lanes.
There is an important
difference, however. You have increased mobility!
Whereas before the
lane addition you had 1,000 cars “getting from where they were to where
they wanted to go, to do what they wanted to do when they wanted to do it”
you now have 1,500 cars “getting from where they are to where they want to
go, to do what they want to do when they want to do it” – a beneficial
result and increased mobility.
An implication is the
poor return when we try to ease congestion with LRT. Because a high
proportion of LRT riders are not drivers, we take few cars off the road at
a great deal of cost. The road quickly returns to its market-driven level
of congestion, but you’ve accommodated no additional capacity for cars.
The net benefit, from a congestion perspective, is the relatively few
commuters LRT coaxes out of their cars. The cost per rider for a $1
billion line is huge – far more than eliminating bottle necks.
Another consideration
is LRT congestion, also a market driven force. More riders, means more
crowded trains. As trains become more crowded, some riders will opt back
for their cars, preferring the convenience and privacy of personal
transportation, even considering traffic congestion, over crowded
conditions on the train. Adding additional trains is a costly proposition
on a per passenger mile basis.
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