Should Tolling Aim to Reduce Driving
or Increase Economic Opportunities?

Seattle’s mayor has announced a vague proposal to toll downtown streets in order to relieve congestion. While the Antiplanner supports congestion pricing, I oppose cordon pricing, which is more of a revenue-raising scheme than a congestion-reduction program, and it isn’t yet clear which of these two the mayor is proposing.

Tolling has a bad reputation in Seattle because stiff penalties on people who failed to pay bridge tolls were so oppressive that they put some people into bankruptcy. At the same time, a well-designed tolling system can be good for low-income people, in the same way that they are better off paying market prices for groceries rather than having food allocated by the government, which generally results in little or no food available at all.

The downtown congestion that the mayor wants to fix is a problem of the city’s own making. Thanks to a variety of subsidies and incentives, the number of jobs in greater downtown Seattle — which covers a little more than 10 percent of the city — grew by 30 percent to 262,000 between 2010 and 2017. Although only a quarter of downtown employers drive to work, that’s more than the number who drive to work in downtown Portland, where more than half the employees commute by auto but has only around 100,000 jobs.

In 2016, when downtown Seattle had 247,000 jobs, the city of Seattle had about 420,000 while the Seattle urban area had 1.74 million. This means that nearly 60 percent of the jobs in the city of Seattle, but only 15 percent in the urban area, are located downtown. Seattle’s decision to not just allow but encourage this concentration of jobs is one reason why the region’s transit ridership is growing. But it also has negative consequences including severely increasing congestion.

Although not many people understand it, the reason why true congestion pricing works is that uncongested roads can move more vehicles per hour than congested ones. Tolling thus increases everyone’s access to jobs, housing, consumer goods, and other economic benefits by increasing the number of vehicles on the road. In other words, congestion price works by tolling people onto the road rather than off of it.

But Seattle’s goal is explicitly to reduce, not increase, the number of cars on the road. The city wants to “get from 25 [percent commuting by car] down to 20 percent and take a few more of those cars off the road, so people that are still driving would be able to get there easier,” says one city council member. This means the city is more likely to propose cordon pricing rather than true tolling.

Seattle’s real problem is that city officials have an early twentieth-century vision for their city, one with few cars and most jobs downtown. While that may boost the city’s transit ridership, the negative consequences in terms of increased housing costs, traffic congestion, and other problems will prove to be overwhelming in the long run. So far, Seattle, like Portland, has benefitted from being “not California,” but today more people are moving towards cities in the center of the country, which are more spread out and more affordable.

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6 thoughts on “Should Tolling Aim to Reduce Driving
or Increase Economic Opportunities?

  1. Frank

    “Seattle’s real problem is that city officials have an early twentieth-century vision for their city, one with few cars and most jobs downtown.”

    That’s one of Seattle’s many real problems. The city officials truly have an antiquated view of what a city is and will be. Concentrating jobs in city centers is ridiculous given technological advances that allow employees to work from home. I can do most of my job from home and really only need to be physically present for 4 to 8 hours per week. Telecommuting will not only revolutionize business, but it has the potential to significantly reduce the amount of cars commuting to city centers.

  2. CapitalistRoader

    “If we can get from 25 down to 20 percent and take a few more of those cars off the road, so people that are still driving would be able to get there easier. The buses, which is our top priority that are on those streets would be able to move more efficiently through town,” O’Brien said.

    Translation:

    There are too many proletariat driving their crappy cars, fouling up traffic for bourgeoisie like me. We need to herd those deplorables onto buses so I can drive my $60K car through the city unimpeded by their old and unsightly, unfashionable cars. We elites can afford to eliminate those deplorable drivers, one way or another; whether we use congestion pricing or continue the long-term plan to make housing as unaffordable as possible. Hey, it’s been working great for years. Let’s take it to the next level!

  3. Frank

    Translation:

    There are too many proletariat driving their crappy cars, fouling up traffic for bourgeoisie like me. We need to herd those deplorables onto buses so I can drive my $60K car through the city unimpeded by their old and unsightly, unfashionable cars.

    Have you even been to Seattle? First, there are few people in the proletariat. Middle class has been effectively priced out. Secondly, the Amazon, Microsoft, Google, and other well paid techies are driving luxury car like Audis, BMWs, Teslas, etc.

  4. LazyReader

    Seattle wants to increase density, they’ve adopted Canadian principals, to Vancouverize
    Not to be confused with Manhattanization where they build highrises (200 meters or taller). Like Vancouver they wanna dominate with midrises (150 meters or less), never the less dominate the city with more tall buildings.

    People don’t realize the skyscraper is gonna be obsolete, they’re not built to accommodate the boom and bust cycles of real estate. This is best summed up in places like Dubai where highrise construction has broke record pace, I’ve seen them many of them are virtually empty. What do you expect when the heat where it costs as much as 1,000 a month just to air condition your condo and they’ve saturated the market with too many highrises. Burj Khalifa is half empty. rents in the Burj Khalifa plummeted 40% some ten months after its opening. Out of 900 apartments in the tower, 825 were still empty at that time. China is building whole cities for a populace that cant afford them, cause a third of their economy is state sponsored construction which is ridiculous even thou China has a billion people their population density is not high, prior to 2000 they were still very rural people. All this construction is resource use for resource use sake. For thousands of years the pyramids at Giza, Egypt were the tallest man made structure in the world; So I guess the Middle east is building glittering highrises to recapture that glory and to hopefully attract people to reassure them not to fear the hazards of radical Islam or it’s inevitable petroleum collapse when tiny nations like Dubai with small reserves eventually hit their peak. And China is doing it cause to not to means sending millions of Chinese either back to the collectivist farms or the Nike factories.

    Furthermore, economists have found large new skyscrapers to be a negative economic indicator, as these buildings often open on the verge of bad economy. Much of the study on this phenomenon was done in 1999 by Andrew Lawrence, a research director at Deutsche Bank who created the “skyscraper index,” originally as a joke. But later discovered a true phenomena that these towers open often during economic problems. Examples like
    The Singer Building which opened during the Panic of 1907
    40 Wall Street, the Chrysler Building and the Empire State Building built during the Great Depression
    the World Trade Center and Sears Tower built during the 1970s economic flop
    the Petronas Towers built during the Asian Crisis of the late 1990s
    the Burj Khalifa built during the late-2000s recession.

    Another phenomena I’ve observed is the abandonment effect where companies that often chose new highrises to headquarter or consolidate often leave in a few years for cheaper offices else where. Silicon Valley doesn’t occupy a highrise….they have sprawling suburban office campuses. When Apple decided that Cupertino wasn’t accommodating enough tax wise, they spent 5 billion dollars on a donut shaped campus further away. A building so stupid the employees keep running into the glass.

  5. NoDakNative

    “People don’t realize the skyscraper is gonna be obsolete, they’re not built to accommodate the boom and bust cycles of real estate.”

    Skyscrapers have been obsolete virtually everywhere for many decades. Especially for housing. The construction and maintenance costs are just too high. 1-2 story houses are simple and requires none of the expencive plumbing, HVAC, and elevators that high rises need.

    There is plenty of land. All that is needed is to spend the gas taxes on roads and highways, then make it easy to build.

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