by Bill B. May

As you may know from my writings, I’m a strong proponent of individual liberty.   It is defined as the freedom to do what you want as long as you don’t violate the liberty of others.  This represents a society that accomplishes things by individual effort together with others who voluntarily join in the enterprise.  It is the opposite of the idea that a community of people do things for the benefit of society.  And with a community approach, jobs need leadership to get things done and the usual answer is democracy,  that is, the election of leaders.  And this leads to government.  How does this relate to transportation?

Transportation is probably the most difficult enterprise to adopt the ideas of liberty.  Without property rights, people would travel over trails, willy-nilly, to get from one place to another.  And with wide-open spaces, this was not a serious problem; think the Wild West.  But property rights are essential to a progressing society.  And soon property, even in the Wild West, became owned.  So travel was restricted by those who might own the road or who allowed people to trespass.  In the early days, some roads were owned by private enterprise with tolls being used to fund the upkeep and reward the property owners for their investment.  But as we became urbanized, with many streets crisscrossing in a city, private ownership and collecting of tolls became a nightmare and it was an easy step to ask government to do the task.   Rivers and oceans were not allowed to be owned privately so ships didn’t encounter as much of a problem.  When airplanes came on the scene, the air above property was deemed to be public and so private ownership was not a factor and would have been difficult if the air were owned.   Management of these public spaces, air and water, were assigned to government as the easiest way to do the job.

As we have learned over the years, government ownership and control of assets has many disadvantages.  Government is a monopoly and we understand the negatives of sole ownership of any function.   It becomes sluggish because it doesn’t have the need to get better all of the time, to keep up with the competition.   So we have relied on government as a matter of convenience for all sorts of transportation related activities.  These include roads, highways, trains, air traffic control, buses, and so on.  Depending on the country, government owns more or less of these activities.

Just because government was the easiest and most convenient way to accomplish transportation jobs at one time doesn’t mean that we shouldn’t look to privatize these functions where possible.  Competition is always a good thing.  Fortunately, the various means of transportation did have to compete with each other even without competing private ownership.  Airplanes drove improvements in rail or, if not, passenger rail died a slow death, as an example.  Ocean-going ships today are not used as people transportation except for vacationers.  Airplanes have shut down that old function.  Cars had a major impact on government streetcar functions.

So how do we insert more competition into a transportation system that is dominated by government?   Technology is the answer.  We fund highways with gas taxes which is a good thing in that it forces payment by the users, not by some amorphous group of taxpayers.  But city streets are often kept up by property taxes along with a multitude of other uses for those taxes.  It would be better if road upkeep were directly paid for by the users.  Toll booths are not practical for city streets but today’s electronic technology would allow the tracking of usage by individual cars.  Street maintenance companies could bid on streets with their revenues coming from the usage tracking and electronic tolls.   The mayor’s street wouldn’t get high priority under such a system.

The related problem is that we don’t know how much various transportation alternatives cost or what the benefit is of more capital investment.   It is all mixed into a big government budget with no profit and loss responsibility.  How do we know that a new interchange on a freeway will have an economic benefit?   We might have a gut feeling that it is needed but if it were a profit and loss item, we would know.  Companies make these kinds of decisions all the time. Government, not so much, as they don’t care about profit and loss.

The conclusion is that transportation is perhaps the hardest segment of society to privatize but we should always be open to the possibility of moving in that direction.   The benefits of competition and the result of trying to improve customer satisfaction would be enormous in this field.  Other than education, no other field is so hidebound by the bureaucracy of government.