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Our Gas Prices Are Low

July 16, 2006 Environment, Public Transit 7 Comments

bp3059Today I spotted regular gas for $3.06 a gallon at a BP station at Virginia & Bates. In December 2005, when gas was around $2.20 a gallon, I predicted we’d see sustained prices over $3/gallon for regular. We are certainly not at that point but I don’t see it dropping much below $2.80/gal.

The wild card here is the national elections in November. The public is upset about the high price of gas and we may see politicians on both sides of the aisle try to manipulate the price down, if only temporary.

But our gas prices are now, artificially low. Those of us that drive do not pay our fare share of the cost of roads and getting oil to the gas pump. We should be paying in the neighborhood of $5.00/gallon. America has for generations been subsidizing those that drive while penalizing those that cannot or chose not to drive. Few places exist in America where one can live without a car.

In the new global economy our dependence upon cheap oil and our cars to get us to work is going to cripple us when it comes to competing with other nations. Our decades long love affair with the car and driving is going to bite us in the ass.

In the 1950s we had a streetcar system throughout the City of St. Louis, supporting a population in excess of 800,000 people. We dismantled our streetcar system and, indirectly, dismantled our tax base (yes, many factors contributed to the loss of population).

A smart transportation system is the key to our future success. To be continued…

– Steve


Currently there are "7 comments" on this Article:

  1. Jon Galloway says:

    Well said. Too bad MoDot keeps dumping millions into interstates and local “boulevards” such as Olive that only support cars, strip malls and sprawl. Blame should also fall on counties and cities throughout Missouri that build roads almost as poorly as MoDot, and countinue to beg MoDot to expand.

  2. Jim Zavist says:

    Huh? “Those of us that drive do not pay our [fair] share of the cost of roads and getting oil to the gas pump.” And those of you that don’t pay gas taxes yet still use the roads do pay your fair share? I don’t think so!

    Two things drive the need for more roads, growth in population and congestion. Until the population stops growing, new roads will need to be built to accomodate suburban sprawl (we can argue that issue, as well, but the current paradigm supports sprawl over increased density). And the capacity of our major roads will need to continue to be increased because they’re the bottlenecks in our transportation funnels, whether it’s Highway 40, Highway N or a new bridge over the Mississippi. Until we get past working a more-or-less 8-to-5 workday, we’re going to continue to have rush-hour commuters who will continue to vote in large numbers for more capacity.

    Don’t get all high and mighty about not paying gas taxes and using alternative forms of transportation. Transit buses and motor scooters share the roads with the predominant form of transportation, the single-occupant vehicle. Congestion impacts them just as much as it does the SOV. Every trip on public transit is subsidized by sales taxes we all pay. Rail transit has much less impact on the street system, but is still funded through taxes and occupies a publicly-owned right-of-way, but one that is little used and can’t be shared with other users. Bike riders share the street with other users, and benefit from those infrastructure improvements, yet don’t pay directly, through gas taxes, that other users pay, so they’re getting an even better deal than the SOV user. And given current use of most bike paths, they rightly should be considered more as recreational amenities (like parks) and less as investments in our transportation infrastructure.

    Should there be more of a direct connection between designated taxes and what they pay for? Yes! Bus and light rail fares should be increased to fully cover the costs of providing service. Bicycles and scooters should be licensed and fees assessed commensurate with their infrastructure needs, much like how autos are taxed through license, personal property and fuel taxes. And any new road should be a toll road.

    But seriously and more importantly, ALL taxes and fees should more-directly reflect the infrastructure needs created by sprawl and congestion. Growth does not pay its way. Impact fees should be increased to reflect the true cost of providing more schools, more sewers and and more police as well as building more roads. Any new bridge over the Mississippi should be a toll bridge, with higher fees charged during rush hours, not one with a reduced rate for daily commuters (they’re the ones driving the need for a new bridge!).

    Bottom line, we have a very imperfect system of funding our transportation needs, and yes, it can be improved. But to assume that alternative modes are somehow better is short sighted at best and counter-productive at worst. Ultimately, we all pay the full cost of everthing directly or indirectly, so the best we can hope for is that it’s somewhat fairly distributed . . .

  3. Joe Frank says:

    “Bus and light rail fares should be increased to fully cover the costs of providing service.”

    Oh, Jim, the simple solution is not always the best solution.

    While I’d be the first to acknowledge Bi-State and other transit agencies have room for efficiency improvements, the reality is farebox revenues only cover about 20% of their operating costs.

    I can’t imagine anybody in St. Louis would pay $8.25 each way (current fare $1.65 X 5) to ride the bus!

    All transportation systems are subsidized to some degree. That’s called public investment.

    The only major American urban transit systems I know of that cover more than 50% of their costs via fares are in New York City: MTA Metro-North Railroad, at 58%, which mainly serves upscale ‘burbs in Connecticut and Westchester County; and MTA’s NYC Transit, at 57%.

    Meanwhile, in Austin TX, Capital Metro only captures about 3% of its budget at the farebox.

  4. Chris Rowley says:

    If automobile owners were to pay the full cost that an automobile costs society (accident/health, environmental remediation/ infrastructure, military operations of the mid east [not counting Iraq war] etc.) then the average cost of an auto would be around $50,000 rather than the $18,000 average that autos cost currently. The gasoline tax does not even cover all the infrastructure costs.

    Most people do not realize the full inpact of the auto on our society and planet. An auto dependant society is niether environmentaly sustainable, economically sustainable, nor socially sustainable.

  5. Jim Zavist says:

    Joe – I guess you missed my toungue planted firmly in my cheek – charging full fares for public transit would kill it, just like trying to get bicyclists to pay for bike paths.

    My point is that it’s easy to demonize the gas tax as somehow encouraging driving, when the opposite is true. Gas prices have nearly doubled over the past few years, yet I’ve seen little change in driving habits. The reality is the gas tax imperfectly reflects supply and demand – the more people drive, the more revenue is generated for road maintenance (and yes, new construction). I see the issue as not so much motorists “not paying their way” as suburban growth (and its geometric increase in vehicle miles traveled) as a much bigger issue, and much harder to address both politcally and as a society. Until density drives parking rates up and public transit gets embraced as something other than a system for “those” people to use, it will remain little used in this area.

    Bigger picture, a better way to reduce gas consumption and reduce vehicle miles traveled is to just have a depression and major layoffs. A not insignificant number of trips made every day, and the ones that typically create the most predictable points of congestion, are folks going to and from work (or school). Eliminate those trips, as well as discretionary income for shopping and entertatinment trips, and you’ll magically free up a lot of highway capacity. Personally, I rather see the challenges that soild, sustained and planned economic growth brings . . .

  6. Joe Frank says:

    Oh, sorry – I really did think you were being serious in that regard. You’re right, though, a big part of the problem is the sheer number of miles that people drive on a daily basis. Some folks do reduce their discretionary driving because of higher gas prices, but so many trips cannot be accomplished by public transit at all, that the demand for gasoline is relatively inelastic.

    And that’s how ExxonMobil gets to be the most profitable firm in the world, without ever paying out one dime of the judgment against it in the Exxon Valdez case.

  7. Jeff says:

    For Jim and others who think that, “cyclists don’t pay their fair share”. Here is a link to educate:


    Keep Cycling!


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