Within the US, leftists often cite the interstate system as a government program everyone likes. Which is reasonable enough.
But US highways share the downsides of socialism, not just the upsides. Consider a Soviet breadline. The bread is free, so everyone wants lots of it, and demand exceeds supply. The way to reduce demand is making everyone wait so long that the annoyance of waiting deters them. Hence, long lines. (And this is a deadweight loss; when bread is expensive, at least the bread company gets rich, but a long line benefits no one.)
US interstates have the same problem. They’re free and well maintained, so demand is high. When demand exceeds supply, everyone wastes time in traffic jams, the American equivalent of the Soviet breadline.
If roads were privatized, they’d be pretty expensive, since infrastructure is a natural oligopoly. But from a road company’s perspective, traffic jams are terrible; they hurt the “customer experience” and reduce revenue (traffic jam = no one can enter the road = no tolls). The natural solution is raising prices until demand goes down. And then you’d never have to wait in traffic again.
This would make road trip vacations much lot less frequent. I wonder how high the price to use a privately owned highway would need to be before a family which would have otherwise drive across the country would choose to fly. On its face, the value at which a family would choose to fly between states rather than drive on a private highway seems to be the price at which the cost of driving exceeds the cost of a flight. Since driving is also much costlier in terms of time, in this case a family would save both time and money for their vacation.
With free highways, private individuals and families will sometimes drive on an interstate, rather than hopping on a plane to their destination, despite the great cost in terms of time of driving relative to flying (in most cases). I wonder if this is because flights are still prohibitively expensive, or because private individuals don’t think in the terms of the value of their own time as much as they do with their own money.
Anyway, I believe questions about how the privatization of highways would effect interstate transport of goods via tractor-trailer, and the prices of those goods, are a lot more complicated and interesting.
Because they would save both time and money, it seems private individuals and families on vacation would opt to fly to their destination rather than drive along a private highway at the price at which the cost of driving exceeds the cost of flying. However, driving along an interstate highway instead of flying comes at the cost of a much greater travel time (in most cases). With free highways, I wonder if private individuals and families choose to travel by interstate highway due to prohibitively high flight costs, or because they don’t think in terms of valuing their own time relative to their own money, or a combination of both.
In a similar vein is the “de-congestion fee” proposed by urban planners: during peak usage hours or in frequently congested areas, vehicles are charged a fee (this can be based on type of vehicle, number of commuters, and so on). Such practices are already in effect in Mexico City (where certain license plates are randomly assigned one day each year in which they cannot be used), London (where vehicles passing through parts of the city are charged a fee), and Stockholm (the same as London). Such a fee was proposed for NYC but unfortunately rejected.
Yes, but what are the effects of constant tolls on all the goods and services that move by highways? I’m thinking mostly of the freight haulers I see every day outside the local seaport, moving everything from food to high-end electronics, in containers destined for all over the country. What would the economic effects be on independent truckers, on people movers like Greyhound, on a couple guys who drive to the next city to buy some cabinets?
In addition to the congestion charge discussed by Anonymous, urban planners are starting to focus on other remedies for congestion that involve reducing the number of cars on the road – buses, trains, bike shares, walking, etc etc, since the single-passenger vehicle is spatially a very ineffiecient way to move people around. For a single person, it’s very efficient, but en masse, it’s horrible. You need so much square footage of asphalt to move X people because each one is wrapped in a steel cocoon that takes up a full lane.