Miles for dollars
Today highway users think of our roadways as “free,” according to Joseph M. Giglio, author of a Hudson Institute study called “Mobility: America's Transportation Mess and How to Fix It.” Sure, we pay fuel taxes that provide highway funds, but there's only an abstract connection between per-gallon taxes and the number of miles we cover as we consume that fuel. For most of us, there's no correlation between how much we use highways and the real cost of supporting all that use.
Our road capacity is limited, and in many areas we're right at that limit, which means congestion is an everyday condition in most urban and suburban areas. And whenever a resource is limited, rationing is inevitable.
Pat Quinn, co-founder of U.S. Xpress, is only half joking when he says that our congested highways are America's version of “the breadlines in the old U.S.S.R.” The Soviet economic system kept the price of basic consumer goods low enough so that everyone could afford them, but they had to “pay” for those low prices in time spent waiting on line. Giglio calls that “time rationing.”
With our capitalist economy, we practice “price rationing” for the most part by allowing prices to rise until they reach levels that bring demand in line with available supply. The one exception is our highways, where anyone is free to travel any road at any time, as long as they have the time to spare.
Why couldn't we switch to price rationing for our increasingly scarce highway capacity? We certainly have the technology to make such a system feasible. In fact, we could put a pay-as-you-go system in place that's based not just on distance traveled, but time of day as well, offering those who choose non-peak periods a cost savings to encourage more efficient use of limited highway capacity.
Similarly, those paying for peak access could have rates set on actual performance. That is, they would pay less when roadway speeds fall below some average measured by real-time monitors.
It seems a much fairer way than fuel taxes to fund highway construction and maintenance. Fleets could make conscious business decisions about the trade-off between time and money spent to deliver the freight. Overall, we might even save money by spreading traffic capacity throughout the day and reducing the number of new roadway miles we need to build.
Giglio has a number of other good arguments for directly linking user fees to miles traveled, chief among them that “service to customers” would become the measure for any proposals to spend our highway money. When individuals know just how much their portion of the bill is going to be for any project, the days of building horizontal monuments to government officials will quickly become a thing of the past.
In the past I've criticized some highway privatization schemes as shortsighted, doomed attempts to find a quick and painless solution to highway congestion and decay. Given our current “free” highway systems, getting anyone to accept pay-as-you-go fees will be neither quick nor painless. But as an industry, trucking would do well to look beyond the dollar signs such fees attach to every mile and see a fair, practical approach to solving an enormous problem that could eventually shut down the industry and our economy with it.
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