The future funding of our roads has emerged as an important issue
in 1997. The issues are: who owns our roads? who pays for them?
who profits from them? These issues are further complicated by
the fact that congested motorways are a quite different kind of
economic good than are country byways or residential streets.
The latter roads are first of all public spaces, and are vehicle
carriageways only as a secondary feature. Unlike motorways, they
are innately "green", an essential part of our public
environment.
I have noted that the automobile lobby in America believes that
its particular income streams are more important than the wellbeing
of the planet (Hara-Kiri in Kyoto?). Road transport is
indeed one of the greatest environmental menaces of modern society.
We do urgently need to charge the road users who impose social
costs on communities, nations and the planet itself. The problem
of this environmentally abusive pattern of road usage is largely
most prevalent on the roads that are specially constructed so
as to give privileged status to the automobile and the lorry.
Such roads, while in public space, are not public spaces. Pedestrians
and cyclists are forbidden from them. I can see no general problem
in charging for the use of motorways, or even having properly
regulated private motorways. I believe that the lack of charging
to date is mainly due to a lack of technical means of charging.
Charging must be higher during peak periods.
Charging motorway traffic and peak hour traffic addresses a number
of social ills. It creates the conditions for (i) less commuting
(ie fewer unnecessary journeys), (ii) less of a commuter peak
(the mere existence of the commuter peak is a social problem that
leads to much economic inefficiency, with respect to all forms
of urban transport, central business district (CBD) infrastructure,
and interurban domestic air transport), (iii) more demand
for public transport, (iv) more vehicle, cyclist and pedestrian
safety, and (v) less pollution.
We cannot wait for improved public transport before charging road
users for the social costs they impose; and for the infrastructure
that they consume. Public transport only thrives where there is
a real demand for it; and when there is a demand for it then it
can be improved. The same arguments apply to the use of trucks
and lorries - even campervans - on trunk highways. They represent
a very wasteful use of resources compared to rail transport and
coastal shipping, while carting the kitchen sink about wherever
one goes is wasteful compared to both proper camping and fixed
site accommodation. And heavy road transport is a much greater
safety hazard than is rail transport and shipping.
The generalisation here is that the users should pay all of the
external costs associated with road transport, and that includes
the construction and maintenance of carriageways that would not
be required if the users did pay those costs. Such charges should
be used to fund socially beneficial nonroad transport infrastructure.
The issue that might be more controversial to economists relates
to roads as public rights of way. Roads, as rightsofway,
are inherently a part of the public domain. It is in the interests
of both nations, counties and urban communities to fund these
public spaces so as to optimise ease of access to the places that
we have to access in order to participate in local and national
life; and to ensure our safety in going about our daily lives.
Roads are at their most important as communication arteries, and
it is as communication arteries that the roads make their greatest
contribution to our wellbeing.
Thus, given that the matter of private external costs has been
addressed through user charges, the critical issue becomes one
of valuing the public domain. How should we fund the public domain,
and how do we and should we profit from it?
We own the public domain equally. We can think of it best in national
terms, bearing in mind that each locality has its own unique public
spaces. The basic social wage accounting model (see "The
Standard Tax Credit and the Social Wage: Existing Means to a Universal
Basic Income" and "A New Fiscal Contract?") suggests that the public domain is funded mainly through national production taxes; essentially income tax. It is also
funded through consumption taxes (eg GST), and through local body
rates. Roads are more inherently local than are other public domain
assets such as knowledge or ever culture, so the emphasis on local
taxation will be greater than for the public domain in general.
Local roads should to some extent be locally funded, but with
regional development subsidies applying.
We build roads with public funds. Who profits from roads? Everyone
can profit from public domain resources. We profit from wellmaintained
spaces simply by using them. Market producers profit from all
forms of infrastructure by paying user charges that fall well
short of the benefits passed on. Firms also make profits through
their workers' use of roads, as commuters. We tax producers in
the market economy as a general charge for the use of the entire
public domain.
Roads, as communication arteries, remain at least as important
as telephone lines. There is no economic reason why the owners
of roads should not profit as much from their asset as the owners
of telecommunication facilities profit from their assets. It's
just that roads - or at least most roads - are inherently public.
So the public should be allowed to profit from them, not only
by being allowed to "enjoy" the freedom of our highways
and byways, but also through the receipt of social dividends.
Today Aucklanders receive small inadequate dividends as owners
of Mercury Energy, a community electricity retailer. We should
be receiving a much bigger social wage as a result of our ownership
of the roads. But, in this regard, we should not separate the
road network from the rest of the public domain. We should profit
from the whole public domain through being allocated a social
wage, and being paid a universal basic income as a social dividend.
What about motorways? Should private companies not profit from
them, given that they are not a part of the public domain to anything
like the same extent as other roads? The answer, for me, is yes
and no. Privatised motorways can work, if properly regulated so
that all social costs are funded by the users, and so that only
normal profits are made from the venture. Any excess profits should
reflect the fact that motorways exist in public space, at an opportunity
cost to other uses of that space. Any economic surpluses that
arise from the existence of vehicle carriageways belong to the
public; as a part of the social wage.
Roads should be allowed to generate an equitable public income
stream. Private user charges should apply so as to counter the
social costs associated with road transport, and with commuting.
{ This document is: http://www.oocities.org/Athens/Delphi/3142/rankinfile.html
{ the above references are to: http://www.oocities.org/Athens/Delphi/3142/krf38-kyotoCO2.html
http://www.oocities.org/Athens/Delphi/3142/krnkndisc_pap.html
and:
http://www.oocities.org/Athens/Delphi/3142/krnknubi1new.html
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