When it comes to public rail transportation, I'm a bit like an agnostic who attends church every Sunday. In DC, having rail to get me around - particularly as I both live and work near rail lines - is exceptionally convenient and costs about the same for me as a tank of gas a month, all with the added benefit of not having to worry about parking. In New York, of course, rail is ubiquitous. In Boston, the T is cheap and relatively convenient.
But then there's Atlanta. And Miami. And now Charlotte's trying. And there are plenty of other metro rail systems that I have never been on but I understand are just as miserable, inconvenient, expensive, or poorly run. So my sense has been that for high-density places, particularly on the East Coast that developed before cars made distance negligible, rail is super. For everywhere else it probably isn't the way to go and generally wastes taxpayer money.
A new paper by a lead economist from the left-leaning Brookings Institute challenges the notion that any of the systems are truly adding much to the public good. As transportation expert Robert Poole explains, the paper looks at a number of factors and finds that the burden to the taxpayers for funding rail simply out weights the intrinsic benefits of having it:
Winston and Maheshri construct an elaborate econometric model to estimate the “consumer surplus” of 25 rail transit systems. This is economists’ term for the benefits to users, over and above the fares they pay. The large systems (New York, Washington, D.C., San Francisco’s BART, etc.) all produce significant consumer surpluses. But most of the smaller ones do not.
Next, the authors compare the consumer surplus of each system with its net taxpayer cost. On this measure, every single one of the 25 systems has negative net benefits, i.e., the annual value of the benefits to users is much less than the annual cost to taxpayers. Surprisingly, this is true even for the massive New York City rail transit system, which by itself accounts for two-thirds of the nation's rail transit passenger miles.
But what about larger benefits to the metro area? Rail systems are advocated not just to benefit their riders, but because they are expected to reduce traffic congestion, reduce air pollution, save energy, etc. So the final step in Winston and Maheshri’s analysis was to estimate the value of these “externality” benefits. They first conclude that the only one of these purported benefits large enough to make any difference is congestion relief. Adding the congestion savings to road users to the consumer surplus gives the total benefits of rail transit.
When this total is compared with the net taxpayer costs, only San Francisco’s BART produces net social benefits. Each year the system improves social welfare by an estimated $36 million. All 23 [sic] other U.S. rail transit systems are net losers. This means that each of those urban areas is made poorer by many millions of dollars each year.
Here's one of the most interesting things from Poole's commentary:
And there is also the claim that rail systems increase the mobility of low-income residents. But the authors point out that the median annual income of rail users in 2001 exceeded $50,000, which was greater than the median income of the general population in that year. So rail’s primary market is not the poor (unlike bus transit).
Politicians love rail transit because it's so tangible and looks so clean and polished. Plus they get to break ground on it - a photo op holding a shovel is much more exciting than sticking a Bus Stop in the ground. Yet bussing seems to be a far more economical and flexible choice. Perhaps the politicians could just spend some of that rail money into make bussing sexier - or better yet, put a piece of that money to infrastructure, privatize public transit, and give the rest back to the taxpayers to grow the economy - which would increase demand for public transit.