fbpx The high cost of free roads: Q&A with Linda Bilmes and Stevie Olsen | Harvard Kennedy School

Q: The results of the research put the price tag for the Massachusetts car economy at more than $64 billion per year. Why is that number a surprise to so many people?

A: The $64 billion annual price tag is surprising because as drivers we use most roads and parking areas for free. We don’t experience the cost of all the resources society commits to build and maintain the vehicle economy.

Q: It would seem that studies like this one—which was designed to facilitate more honest and effective debate on this subject—should be included more often in public policy discussions. Why aren’t they?

A: Elected officials often oppose multi-million-dollar public transit investments because they are seen as “too expensive.” Our study helps to put these expenses in the context of the overall expenditure on transportation, including the vehicle economy. The $64 billion annual cost of the motor vehicle economy puts these public transit proposals – which are usually for one-time expenses - into perspective. For example, the Commonwealth is considering whether to invest in high-speed rail from Boston to Springfield, which is estimated to cost a one-time amount of $1.2 billion, plus a $23 million annual subsidy. That is a big figure, but relative to the $64 billion annual cost of the vehicle economy, it looks affordable. When we think about transportation investments we should consider the counterfactual, which is that the cost of moving people across the Massachusetts by car is not free—in fact it imposes a substantial cost on local and state government, individuals, and the economy.

Q: “What is the cost of the vehicle economy?” is a relatively simple question, but we are not trained to think of roads as a massive cost. How do we ask the right questions?

A: The costs of the vehicle economy are highly fragmented. We pulled together a range of costs at the state and local level, including the cost of road construction, financing and maintenance, emergency responders for vehicle accidents, as well as costs such as congestion, carbon emissions, land use and consumer expenses. There is no single database that adds these costs together. To estimate the costs in one model, our research team reviewed years of public expenditures from municipal, state, and federal reports. We studied academic literature on estimating social and economic costs related to motor vehicles and applied it to Massachusetts-specific data. Then we tested their model by conducting dozens of interviews with scholars, public officials, and industry experts. Our study brings together some of these costs so policymakers can consider the full costs of the vehicle economy. We also should bear in mind that this cost is not evenly distributed. All taxpayers have to subsidize the vehicle economy, whether they own a car or not. In urban areas, those who are lower-income, black or Hispanic, or immigrants are especially likely to use public transportation on a regular basis, but are still helping to shoulder the cost of vehicles and roads.

Q: What sorts of policy changes can be made to get people out of their cars? What are the challenges to achieving that?

A: This study is not intended to “get people out of cars.” Our goal is to change the equation when policymakers consider transportation. Cars may be convenient, but cars and other vehicles impose budgetary costs on all levels of government, as well as hidden costs such as pollution, congestion, accidents, and occupying a huge amount of prime land across the state. There are many decisions in which these costs should be considered, ranging from building bike lanes to the cost of widening highways to whether we should transport more heavy goods by freight rail instead of by truck. We calculated the costs of the vehicle economy to contribute to evidence-based discussions.

Get smart & reliable public policy insights right in your inbox.