NYTimes.com Article: Driving Takes Its Toll
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The economics of driving
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Driving Takes Its Toll
September 4, 2004
By OWEN D. GUTFREUND
This summer, Americans continued to rack up highway miles.
Even while higher gas prices raised vacationing and
commuting costs, most drivers acted as though this was a
temporary glitch, complacently looking forward to the
return of reasonable prices. For decades, Americans have
grown too accustomed to cheap gas, buying S.U.V.'s and
V-8's, driving more and more miles per capita every year.
We are now more dependent on imported oil than ever before.
But is there any viable alternative? Our own history offers
us a possible solution.
Starting in 1916, the federal government dispensed millions
of dollars in highway grants to states, without collecting
a penny from consumers of the new highways. There was no
federal gas tax, and tolls were banned on the new roads.
But desperate for cash and pressed to pay their share of
road-building expenses, states tried to pass on some of the
costs to drivers.
At first this was only through state gas taxes. But these
levies were effectively limited by lobbyists from auto
manufacturers, oil companies, tire makers, highway
engineers and road builders - all of whom wanted to
increase car use as much as possible. With this source of
revenue capped, some states turned to toll roads.
When Pennsylvania announced plans to build a toll-financed
turnpike in 1937, Washington gasped. If other states
followed Pennsylvania's lead, then federal bureaucrats
would lose the control they had enjoyed for more than 20
years. They tried to squash the project, issuing
pessimistic traffic forecasts to scare away lenders. But
the Pennsylvania Turnpike was built anyway, and was hugely
Within a year, New York, Connecticut, Florida, Illinois,
Maine, Maryland and Massachusetts entered the toll-road
business. A decade later, when the Eisenhower
administration was preparing the Interstate highway
legislation, even more states - New Jersey, Colorado,
Indiana, Ohio, Oklahoma, North Carolina and Texas - had
joined the movement. It was clear: drivers understood that
tolls were a fair way to pass on the high costs of
road-building to highway-users, in direct proportion to how
much they drive.
But despite its proven viability, this alternative became
the proverbial road not taken. The Interstate legislation,
as enacted in 1956, put a stop to new toll-road
construction, and we instead proceeded with a socialized
transportation system, available to the consumer at no
charge, mostly paid for from general revenue. Toll-road
construction ceased, and with the exception of a handful of
projects, all new highways built since have been freeways.
There is a mistaken notion that American drivers pay for
their roads through gas taxes. Actually, even though states
collect gas taxes and a modest federal levy was imposed to
pay part of the Interstate expenses, the total of these
charges never amounted to more than one-third of highway
costs. Such taxes, adjusted for inflation, have actually
decreased, and efforts to increase them are politically
risky, even though each 1-cent rise in the gas tax costs
the average driver less than $8 a year. In practice, our
roads and highways have been underwritten by general
taxation. With gas taxes and tolls capped by effective
lobbying, this annual subsidy has grown, amounting to
billions of dollars annually.
With driving so generously subsidized and the true costs
hidden, Americans have driven more and more miles each
Now we need to reconsider the road not taken. We must stop
encouraging over-dependence on oil by under-pricing our
roads and hiding the true costs of highway driving. Of
course, to impose new gas taxes on top of the recent spike
in prices may be politically impossible. But if oil prices
drop, we should be ready to raise gas taxes. In the
meantime, we should expand the use of tolls to finance
The toll roads built in the 1940's and 1950's still exist,
although some have been converted to free highways. But
instead of removing tolls from these roads, as is
occasionally suggested, we should go in the other
direction. All of our major Interstates, across the
country, should have tolls that are high enough to defray
the full costs of building and maintaining the highway
network and also high enough to make us change our driving
We don't have to bring back the frustrating traffic
bottlenecks at old-fashioned tollbooths now that the
logistics of collecting tolls have been greatly simplified
by systems like E-ZPass, FastLane and SmartTag. But by
permanently raising the artificially low cost of driving,
we could encourage people to drive fewer miles and to place
a higher value on fuel efficiency, ultimately reducing our
dependence on imported oil.
Instead of letting drivers onto our expensive, world-class
highway system free, we should charge a fair price by
imposing more and higher tolls, and raising gas taxes much
higher, permanently. Otherwise, our insatiable need for
petroleum will continue to distort our foreign policy, to
undermine the stability of our economy and to damage the
Owen D. Gutfreund, the author of "20th-Century Sprawl:
Highways and the Reshaping of the American Landscape," is a
professor of history and urban studies at Barnard College.
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