The slogan ‘sell the streets’ has long been used as an example of libertarian principles carried to a ridiculous extreme. That it might also be a practical proposal was first suggested to me by the late Robert Schuchman some twenty-eight years ago. At the time, I was not convinced.
Certainly there are practical difficulties in transferring the present system of governmentally owned streets and highways to private hands, although the difficulties are much less for newly created communities, some of which are already being set up with private road systems. The cost of negotiating private contracts to guarantee each homeowner access to his home and to define his legal rights and responsibilities with regard to access roads would be considerable. So are the costs of the present governmentally owned system.
The rush hour problem is a good example. The size of city expressways is determined almost entirely by the peak traffic that they have to bear. The extra cost to the city of an additional driver at 3 a.m. is essentially zero—the roads are there anyway and nobody is using them. The extra cost of an extra driver at rush hour averages out, I am told, to about five dollars per trip. Presently, both drivers are charged the same price, in the form of higher gas costs due to gas taxes. If the roads were privately run, it would pay their owners to encourage off-hour traffic by charging a low price and to discourage people from driving at rush hour by charging them the full cost of their trip.
That cost—five dollars per trip—comes to over two thousand dollars a year, a sizable sum for the average commuter. One way to decrease it would be by changing his working hours. The present custom of having almost everybody work the same nine-to-five day has some advantages (a businessman knows that if he is in his office, his customer probably is too), but it also has severe costs, especially in a crowded city. Fixed resources, such as parks, beaches, restaurants, and roads, are used very irregularly, jammed at certain times and empty at others.
A two thousand dollar a year saving on transportation cost, when added to cheaper parking and such nonmonetary benefits as a quicker trip and less crowded restaurants, would surely be a sufficient incentive to induce some firms to shift their hours of operations, or the hours of some of their employees, from nine-to-five to (say) eleven-to-seven, or even three-to-eleven (p.m.).
The cost of rush hour driving could also be avoided in other ways. Commuters could use cheaper forms of transport—bus, train or carpool. They could move back to the city or their businesses could move out to the suburbs. In any case, they would be responding to the real cost of their actions, something they are not now forced to do.
How could a private firm charge variable fees? It might use toll booths and vary the rate according to time of day and condition of traffic. It might charge a fixed monthly fee for the right to use its roads at peak load hours and a lower fee for the right to use them only at other times; those who paid one fee or the other could be given identifying license plates and other arrangements could be made for those customers who used the road less regularly. Different highway companies might have exchange agreements, allowing customers of one to use others at no extra cost.
Using modern technology it would be possible, and relatively inexpensive, to create a much more detailed system of fees, varying by both where and when you drive. Each car would be equipped with a transponder, a small radio designed to receive the query ‘who are you?’ and respond with the computer equivalent of ‘I am car number 97341’. The technology to do this already exists; it has been used for years to automate toll collection for buses. The information about what car drove where when would be collected in a central computer and drivers billed monthly. If customers were worried that detailed information about their movements might fall into the hands of a jealous spouse or overzealous employer, the system could be set up to keep track of how many road units each car used each day but not when and where; the number of road units charged per mile could still vary with time and place. [8]
The imposition of variable charges is not the only improvement that a profit-making corporation could make. Traffic jams are minor inconveniences to a government bureau; to a private corporation, they mean the loss of a small fortune in potential customers. Traffic jams are not the inevitable result of many people wanting to drive at once. The rate of traffic flow in a jammed expressway, with cars taking up twenty feet apiece and moving at five miles an hour, is far lower than in the same expressway with traffic at 50 miles an hour and each car taking up 60 or 80 feet. A well-operated expressway with computer control of entrance to keep people out when traffic density got too high or with holding lots into which surplus traffic could be temporarily diverted in order to speed up traffic flow, would get everyone to his destination sooner.
Electronic recording devices, computer-controlled entrances, and three-to-eleven working days sound like science fiction. Private highways would also bring more obvious improvements, some of them long awaited. It would hardly pay a private corporation to clog its highway with repair crews through the rush hour and then send them home, leaving it empty of both cars and workmen at night.
Any of these improvements could, in principle, be made by the socialist institutions now running our highways. None, so far as I know, has been. Meanwhile, our cities continue to clog their highways with heavily subsidized traffic, beg Washington for money, and blame the whole mess on private enterprise.
[This chapter was first written in 1969; since then some of the approaches described have been adopted by public highways here and abroad. A two thousand dollar savings in 1969 dollars comes to about thirteen thousand 2014 dollars.]
[8] Using anonymous digital currency, as discussed in Chapter 66, it would be possible to set up a system in which cars paid without having to identify themselves, hence in which no privacy was lost.