Per passenger mile, federal subsidies to Amtrak are 30 times greater than federal subsidies to airlines and 500 times greater than federal subsidies to intercity buses, according to a new study from the American Bus Association. The study also reports that federal subsidies per passenger mile to public transit are 3,200 times greater than federal subsidies to autos.
The report, written by economist Robert Damuth of Nathan Associates, compared federal outlays for each mode with excise taxes collected from highway users and air travelers. It also apportioned costs to users such as auto drivers, intercity buses, and commercial airlines.
For example, the study found that federal expenditures on air travel between 2002 and 2009 averaged about $19 billion a year (p. 7), and it cited a Federal Aviation Administration report attributing about 70 percent of that cost to commercial air passengers (p. 12). The study also found that various taxes collected from air travelers averaged about $9 billion a year (p. 14), for a net subsidy of about $4.5 billion a year (p. 24).
A summary of the report compares subsidies per trip. But no one has estimated trip numbers for autos, and it doesn’t seem fair to compare transit trips, which average about 5 miles, with Amtrak and airline trips, which average hundreds of miles.
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Despite these highway subsidies, subsidies to autos are tiny, the report says, because auto drivers pay about two-thirds of the revenues into the Highway Trust Fund (p. 16) but only impose about 60 percent of the costs (p. 12). Even then, the report erred in counting only passenger car passenger miles, ignoring light trucks (pickups, SUVs, and full-sized vans). Adding these passenger miles would reduce the subsidy per passenger mile by 40 percent.
Bus companies pay a lower fuel tax per gallon than auto drivers, but the report cites DOT cost allocation studies that show that bus contributions to the Highway Trust Fund offset costs. The latest study, however, is for 2000, which means that it doesn’t account for the surge in Internet-driven bus companies such as Megabus, Bolt Bus, and the various “Chinatown” buses. In addition to general highway funds, the study counts about $60 million in annual earmarks to intercity buses, including Federal Transit Administration funds and grants to add wheelchair lifts to help companies comply with the Americans with Disabilities Act.
The report estimates that “commercial buses” carry about 125 million passenger miles per year (p. 19). The author apparently calculated this by subtracting “transit bus” and “demand response” from “bus” in National Transportation Statistics. However, this still leaves school buses, which are usually not “commercial.” The American Bus Association’s annual motorcoach census (which was also written by Nathan, but by a different researcher), charter buses, tour buses, airport shuttles, and intercity buses carry about 60 million passenger miles a year, about a quarter of which is intercity buses. Subsidies to these buses are therefore about double the subsidies calculated in the report. That still means per-passenger-mile federal subsidies to intercity buses are about one-eighth of airline subsidies and 1/250th of subsidies to Amtrak.
What about state and local subsidies? A first approximation of such subsidies can be found by subtracting expenses from revenues in National Transportation Statistics. The results suggest that total subsidies to air travel are tiny, subsidies to highways are large (but tiny per passenger mile), and subsidies to transit are in between (but much larger per passenger mile). National Transportation Statistics doesn’t have state and local subsidies to Amtrak or intercity buses, but I suspect the former are much larger than the latter.
I’m looking forward to ending the Federal Housing Subsidy, just as Randal is as well.
DS
The highway and bus numbers are not realisitic when compared to known bus ridership and the US population as a whole.
The highway numbers in the BTS report are 4.566 trillion passenger miles per year in 2007. That translates to 15,220 passenger miles per American per year in cars and trucks. Considering the portion of the population that is carless, and the obviously reduced miles of the non-commuting population of children, university students, retirees, prisoners, the unemployed, welfare recipients, and housewives, plus the number of people with cars who walk or take public transit to work this number is sheer fantasy. It would imply that the typical daily car user is driving/riding around 30,000 miles per year, or 80 miles per day. That is not believeable. Even the 42 miles per day number per American of the BTS figure is not believeable if we assume that everyone does travel 15,000+ miles per year. Remember this is a figure for every man, woman, and child.
With buses, the problem becomes even bigger. The BTS gives 127 billion passenger miles on non-Mass Transit buses, which is 423 miles per American per year. That is simply fantasy. Most Americans never board a bus during a year.
Ridership on Greyhound is only 20 million per year as noted in their annual report.
http://www.firstgroup.com/assets/pdfs/investors/annual_reports/2010_annual_report.pdf
Megabus is only 4 million per year.
http://www.businessweek.com/print/magazine/content/11_16/b4224062391848.htm
Its tough to understand where the other 510 MILLION “intercity” (they do have a strange definition of it including airport shuttles) passengers are hiding that the BTS believes exist.
http://www.bts.gov/publications/national_transportation_statistics/html/table_bus_profile.html
I can’t believe its charters when the charter industry only employs 50% more people than the intercity industry according to BTS. Greyhound employs 8000 people according to the FirstGroup annual report, which is 40% of all intercity bus employment according to the BTS. That implies total intercity ridership of 50 million, and Charter ridership of 75 million if their employee productivity is similar. We are still missing 411 million riders the BTS and Nathan thinks are there, or everyone not working at Greyhound is 10 times as productive.
Nathan thinks there are 35,000 intercity buses. Greyhound only has 2200. If every other bus equals Greyhound’s productivity in hauling riders (not really believable), that implies 320 million riders. Still way short by hundreds of millions.
The typical intercity trip is short, probably under 150 miles. Few people want to be on a bus over 3 hours. The numbers simply will not add up to 60 billion passenger miles per year unless there are hundreds of millions of invented trips.
Now to school buses. There are 534,000 school buses in the US according to the FirstGroup annual report. There are about 52 million school age children. But obviously those 534,000 buses carry many less, because their average number of seats is probably about 40 per bus, and buses don’t always leave the school fully loaded, and most school buses only make one round trip per day. If all 52 million kids did ride the bus 180 days per year, they would have to average 7 miles of riding per day. Since we know that not all ride, this effectively increases the average trip length. And of course the average length is not the full length of the route, which is necessarily longer. Where are kids (other than sparsely populated large rural districts) riding routes up to 15 miles long? That is longer than the bredth of most midsize metropolitan areas.
The American School Bus Council has some alternate figures which imply a lower passenger mile count for school buses.
http://www.americanschoolbuscouncil.org/index.php?page=fuel-calculator
26 million students @ 10 miles per day is 47 billion passenger miles.
Were subsidies to local streets, roads and arterials included in this study? I travel 15 miles by car to work everyday and never get on a highway. Am I a freeloading driver?
Does the subsidy to auto users (and other transportation forms than produce pollutants as well) take into account the costs of air pollution?
Does the subsidy to auto users include the costs of x-thousand deaths to the U.S.?
Just wondering …
bennett:
Am I a freeloading driver?
No, you are a driver subsidizing the users of the limited access highway system by burning gasoline.
Its no different than people who use gas powered lawn mowers, weed whackers, and trimmers, who subsidize auto users to the tune of 1 cent per gallon in gas tax (they use 2% of gasoline consumed in the country). So be patriotic! Mow your lawn more, drive more on local streets, and help out the poor starving exurbanite commuters.
Nodrog:
Obviously the auto subsidy numbers do not include the governmental cost of road deaths and miscellaneous maiming carnage (for example, premature payout of social security survivor benefits, families thrown on to welfare by the loss or disability of a breadwinner, medicaid payments to the maimed, etc.), the highway patrol, or our bloated overseas war efforts to ensure the free flow of oil from the Persian Gulf.
On the other hand, figures for Amtrak and Mass Transit do include their legal liability payouts for accident victims.
Does the subsidy to auto users include the costs of x-thousand deaths to the U.S.?
No. Nor does it cover lower cardiopulmonary health, lowered school performance in some SES groups, etc.
DS
Hey Danny Boy!
Does the subsidy to rail include paying for 5-50 miles of water hose for every fire engine railroad car, so that they can put out fires 5 miles away from the track?
Does the rail subsidy include paying for 5-50 mile rail spurs so that every school train can bring school kids to the school every day?
Does the rail subsidy include paying for 5-50 mile walk overtime for police while they make their rounds on foot from the police rail cars?
Does the rail subsidy include paying for 5-50 miles of sewer, water, electric, cable and gas right of ways while they make their way from rail lines to houses?
Didn’t think so. That is why we look up to you so much, Danny Boy!
But Andy, you don’t get the message Dan is here to share with us. Cars are evil. Trains and planning are good. Period.
Speaking of eliminating all the oil subsidies that subsidize cars, did you hear the hee-row Christie, who is a fiscal hawk dontchaknow, bravely took the fiscal responsibility reins and bravely saved NJ from the evil trains, right? Mr Fiscal Responsibility right?
Nope. Now he’s using public money to subsidize private profit. Real fiscal hee-row that one. He didn’t eliminate the Federal money out of fiscal hero-ness. He did it for political posturing.
DS
This is kind of a tired conversation around here. Everything is subsidized one way or another, and transit more than the auto (especially when omitting externalizes). What this game of score keeping and finger pointing is distracting us from is the ideological debate that lies underneath this conversation. The central question is why/why not subsidize anything (sans military, yaddy, yaddy, yadda)?
Many use government inefficiency as the paramount factor to oppose certain programs/subsidies, stating that the private sector could do better, and that private entities are priced out by government spending. I wonder however, if we were to eliminate publicly funded transit, particularly ADA paratransit, medicaid transportation and local fixed route bus service, would the private sector be there to provide similar levels of service to the transit dependent populations that the public agencies currently serve? Do my Randian/Libertarian opponents even care one way or another?
This gets down to the next level. With the exception of intercity/high speed rail and a few others, most of these programs/services a geared toward serving those with less means. Now lord knows there are many out there that take advantage of government programs for the poor and many are lazy. But is this the characteristic of the majority of people that from time to time participate in such programs? Are the bad apples reason enough to take food of the table or take away a persons ride to work in these imperfect systems? I’m inclined to think that subsidies are okay, but the systems of planning and financing may need to be reformed.
Next level down… Is using tax dollars to fund programs for the poor really akin to slavery; is selflessness something to be looked at as a weakness and with disdain; is selfishness a virtue, as the Randian philosophy would have us believe? I personally reject these assumptions.