Cars, User Fees and the Intransigence of Human Nature

Image credit: Thinking Highways
Image credit: Thinking Highways

by James A. Bacon

Bern Grush has been promoting Mileage Based User Fees (MBUFs) as a mechanism for financing roads and highways since 2002 or so. The Toronto native was one of the earliest evangelists of the concept of charging trucks and cars by the mile to raise money to build and maintain roads. The movement built a head of steam in the mid-2000s but it has fizzled since. “I’m finished with the dream,” a frustrated Grush told me in an interview yesterday while we were discussing an essay, “Social Evolution and Road Pricing,” he had written for Thinking Highways.

Well, he’s not really finished with the dream, but Grush does realize that MBUF proponents must adopt a radically different approach. Reformers wishing to alter the auto-centric transportation and land use policies have been flapping their jaws literally and figuratively for years in conferences, debates, presentations, academic journals, textbooks and mass media. Other than a mileage-based tax on heavy trucks in a couple of European countries, it has amounted to naught, Grush lamented in the essay.

Arguments appealing to fairness and economic rationality just won’t work, he says. “People are just stubborn. It’s not that they’re dumb, they don’t get it or they’re Tea Party. They’re responding to their DNA.”

We are biased for automobility by the reproductive advantages that superior autonomous mobility granted ancestral social groups of human nomads, gatherers, hunters, scavengers, warriors and conquerors. Any individual group or group of humans that could travel faster, carry more, range farther, and kill more would tend to eat more, live longer, keep more wives and produce more offspring. This generalized automobility, entrenched long before Karl Benz or Henry Ford, was triggered by the domestication of donkey, horse, camel and elephant. The advantage of superior, power-assisted automobility has been wired into humans for at least 7,000 years.

The desire for autonomous travel operates at the same biological level as our evolutionary proclivity to wage group war and our deep social inclination to engage with religion. … When we ask drivers to use an alternative to the personal car, we are asking something more fundamental than most of us realize.

Cars allow people to drive where they want, when they want. People in cars can travel alone, with passengers or loaded up with grocery bags or loot from Wal-Mart. People can choose whom they travel with. They can cocoon themselves in privacy and listen to music, talk radio or books on tape. At a more fundamental level, cars expand an individual’s range, allowing them to reach more potential work, more potential mates and more goods and services.

As critics of the auto-centric society have pointed out, there are drawbacks to automobility as well. Cars create pollution, kill thousands in accidents, spew CO2 emissions (a concern to those who worry about catastrophic global warming), and create a hostile environment for those who would travel by other means. Ironically, when too many people own cars, the congestion they cause limits the very range and reach they covet when they purchase their cars.

Cultural determinists, who believe that human behavior is infinitely malleable, will object to this way of thinking. But they have to reckon with the fact that in every society on the planet, humans invest personal resources to increase their personal mobility — bicycles in poor countries, motorcycles in somewhat wealthier countries, and automobiles in wealthier countries. They even drive cars in cities where traffic conditions are far more congested and hellish than in the United States. Whenever a human proclivity is universal across all societies, that’s a pretty good indication that it stems from what we colloquially refer to as human nature.

But genes are not destiny. Warlike impulses are embedded in the genome but humans, endowed with the faculty of reason, have created institutions that have drastically reduced the incidence and severity of violence and war compared to that of our primitive forebears. Grush believes the same thing is possible with automobility. Autonomous or Self-Driving Cars, he says, may be the technology that allows us to reconcile our personal need for mobility with our social need to dampen congestion, pollution and the other externalities associated with too many cars.

Many technology trends increasingly push services into the cloud, and away from physicality and ownership. Bus, taxi and carshare are forms of transportation as a service, but each are flawed. The bus is a far cry from automobility, the taxi is expensive and often uncertain, a car-share vehicle still needs the user to operate it. Large, variegated fleets of autonomous vehicles can provide true transportation as a service (TaaS). TaaS from the AV can be far more personalized than bus or tax and somewhat more than the current carshare fleet. And the AV can reach a far larger portion of people requiring automobility than can bus or carshare and much more cheaply and safely than a taxi. …

If we want to address demand and funding, the autonomous vehicle will make a far better platform for road-use charging than would any of the mechanisms we have proposed so far. … What we need to do now is ensure that the MBUF demand-based concepts are converted to the self-driving fleets that will be the backbone of TaaS.

That, then, is Grush’s new path toward mileage-based user fees: fleets of cars big and small, adapted to a wide range of needs, maintained by third-party enterprises, which people can access as desired. Assuming the TaaS enterprise charges users at least in part on a per-mile basis, as car rentals do today, it would be a simple and unobjectionable matter to tack on a mileage-based user fee for road maintenance and/or construction.

“Let me give you something that allows you to accomplish the same thing [as owning your own car] without the necessity for owning your own car,” says Grush. Self-Driving Cars and transportation-as-a-service are the future of car ownership and transportation, he insists. Give him a couple of months, and he’ll be back with details on how that might work.


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15 responses to “Cars, User Fees and the Intransigence of Human Nature”

  1. Once again, I offer Kudos to Jim Bacon and the folks who write on transportation and I find this effort by Bern Grush to be excellent.

    … Because he and others are starting to realize the issues with cars by recognizing that what makes folks “stubborn” is their allegiance to something that provides them with huge benefits – and yes, at costs to the environment, other modes, and people in general.

    Folks are not stubborn just to be stubborn.. they refuse to have things taken away from them…. they view it as tantamount to taking their freedom.

    and many of this have seen this personally as a parent gotten to the point where driving is no longer viable. We all, in fact, will ultimately deal with it ourselves.

    but we still have problems with self-driving MBUF cars.

    1. – if they are perceived to be more expensive than a self-owned car – people will still buy their own cars…

    2. – cars are personal. consider your own case ( for those who own cars).

    did you just go out and buy the cheapest 4-wheels you could find – or did you look for the right vehicle for you and you family?

    of course in a taxi/mbuf world – you can order – on a per-use basis – the car that is right for you – at that time… perhaps a key advantage at those times when you need a small gas efficient car then the next day – a family vehicle for an outing somewhere.

    I still think there is a problem with “adverse selection” where someone who should not be driving or is irresponsible – will find the rent-by-use option a way to get a car that ordinarily he/she could not – the equivalent of someone trying to rent a Hertz car and Hertz, through it’s verification procedures knows you are not a good risk.

    there are several key events in the lives of people who own and drive cars.

    1. – getting your drivers license

    2. – getting your vehicle licensed

    3. – getting insurance for your vehicle

    4. – getting your vehicle inspected

  2. I had a friend who had worked in NYC for a couple of years before transferring back to WDC. He and his wife lived in Manhattan car free, but bought two new ones as soon as they moved back to NoVA. I’ve been to Manhattan many times, but never by car. But NoVA is not NYC and vice versa.

    Cars gave people incredible amounts of freedom Remember your first car. I once had a medical condition that prevented me from driving for a couple of months. While I got to many places on foot or through the good graces of friends, I felted trapped until I could drive again. I’m sure I’m not alone.

    1. re: ” But NoVA is not NYC and vice versa.”

      but do you think that sometime in the distant past – NYC was where NoVa is now?

      is Nova on a timeline similar to NYC but just back 100 years?

  3. Roadster Avatar

    Mileage based user fees seems like (someone’s ideal) solution in search of a problem. If you consider our old gas tax, nearly every disincentive is “baked into the cake”. Larger commercial vehicles get poorer mileage, therefore pay higher tax. Those that insist (or cannot avoid) driving rush hour congestion get worse mileage, and pay more tax. Older carbon-belching SUV’s get worse mileage, and therefore pay more tax. I do not think one could come up with a more objective system.

    Of course electric vehicles throw a wrench in the works, but that could be solved by technology-driven solutions, such as smart meters recognizing vehicular recharge cycles that could be taxed appropriately. (Surely we wouldn’t trash an entire community support system, evolved over decades, just to accommodate a small percentage of non-participants, would we?)

    I remain unconvinced that MBUF is but just a mechanism to allow another wizard at the dials behind the curtain, permitting folks like Mr. Grush to seek his revenge on “drivers of over-sized vehicles”, “bullies”, and those that “arrange to drive in congestion without thought to time or place” (the nerve!).

    1. Roadster – you need to look at how much money the gas tax is bringing in.

      it’s failing.

      take a look: http://www.dmv.state.va.us/webdoc/pdf/tracking_jan14.pdf

      the fuel tax is bringing in just 15% of transportation funding these days.

      it’s proportional – as you say – but for it to be the primary funding of transportation – it would have to be 50 cents a gallon instead of 17 cents.

      the reality is that the majority of transportation funding these days does not come from the fuel tax.

      1. Roadster Avatar

        It’s only failing because it has not been adjusted to keep pace with spending (or vise-verse – spending has increased unchecked while revenues ignored). Changing the method of taxing, but still increasing the tax, does not mean taxes haven’t been raised – its just been done in a hidden, insidious manner. Whether Richmond takes it from me at 50 cents a gallon or by additional sales and other taxes, it’s still removed from my pocket. Worse still, by artificially lowering the direct gas tax, we begin subsidizing all of the poor behaviors that the MBUF and legit direct gas tax discourages.

        So are we just chicken-stuff stupid not to keep spending and revenue in check with a simple, user-pays direct gas tax, or are we *creating* the problem to enact new “solutions”?

        1. I think you can get the truth on the first part of your supposition.. and the reality is that as cars have gotten more efficient – people buy less fuel and pay less tax – and at the same time the cost of roads has gone up.

          this part I do not yet understand:

          ” Whether Richmond takes it from me at 50 cents a gallon or by additional sales and other taxes, it’s still removed from my pocket. Worse still, by artificially lowering the direct gas tax, we begin subsidizing all of the poor behaviors that the MBUF and legit direct gas tax discourages.”

          are you opposed to a fair gas tax or do you not trust government is assessing and using it?

          how did we “artificially” lower it?

          what exactly is your solution?

          do you think it is politically feasible to add 50 cents to a gallon of fuel?

          In a perfect world, we’d index the fuel tax (and in fact now do it sort of) but if we had indexed it to counter fuel efficient cars and inflation -we would have ended up with the highest fuel taxes in the country.

          is that what you are advocating?

          my only real position here is that I think it’s politically untenable to do that but perhaps I’m not thinking “big” enough!

          1. Roadster Avatar

            Apologies, let me clarify:

            We’ve artificially lowered, or more accurately artificially suppressed, the gas tax by not increasing it for twenty years while costs rose. IMO we should have recognized this error and proposed a phased increase to get revenues back in line with costs. Would this have been politically “hard”? Yes, and that’s why those guys get paid the big bucks – to make the decisions and enact the policies that need to be done.

            Instead, a convoluted system was enacted to raise revenues (taxes), while giving the “appearance” that taxes were not increased to those not following closely. The new revenue is coming from us, just a little more deceptively. That is dishonest, and I don’t support dishonest government.

            Worse yet, by decoupling a portion of the revenue stream from a direct (user) gas tax, it subsidizes those that burn more gas through what has been identified as bad behavior (congestion driving, less fuel-efficient conduct, heavy vehicles).

            Now we seem to be looking for solutions to re-couple the traffic, maintenance, and damages costs (the relative magnitude of which is reasonably synonymous with/corresponding to fuel usage) all for the reason that we were too scared to face the problem head-on. If vehicles are getting better mileage and the tax needs to be raised (or expenses cut) then so be it – but the relative costs for undesirable behaviors remain.

            If the final result is a net road tax that is higher than anywhere else in the Country, then we must be doing something else *really* wrong and it needs to be addressed, not just buried in tax code.

            Like too many other issues, the “solution” is to just make things more complicated and deceptive. That, in my opinion, is not where conservatives should be going.

          2. re: ” We’ve artificially lowered, or more accurately artificially suppressed, the gas tax by not increasing it for twenty years while costs rose. IMO we should have recognized this error and proposed a phased increase to get revenues back in line with costs. Would this have been politically “hard”? Yes, and that’s why those guys get paid the big bucks – to make the decisions and enact the policies that need to be done.”

            yeah.. after I re-read it I realized your intent.

            some states DID increase their gas tax and some are already indexed but even those states are having the same problem in that the higher the cost of fuel – the more folks are cutting their costs by getting more fuel efficient cars. It’s a problem nationally no matter what individual states have done with their fuel tax.

            It’s also a problem with the Federal Gas tax – and as far as the “big bucks” guys go – you may recall the mantra of the right and conservatives these days. If the conservatives in Congress get their way – they are going to:

            1. – cut the 30 billion in general revenues that “help” the 17 cents fuel tax
            2.- get rid of the fuel tax all together … or if they can’t do that – get rid of TE and Transit.

            “Instead, a convoluted system was enacted to raise revenues (taxes), while giving the “appearance” that taxes were not increased, to those not following closely. The new revenue is coming from us, just a little more deceptively. That is dishonest, and I don’t support dishonest government.”

            okay – be more specific … here..

            “Worse yet, by decoupling a portion of the revenue stream from a direct (user) gas tax, it subsidizes those that burn more gas through what has been identified as bad behavior (congestion driving, less fuel-efficient conduct, heavy vehicles).”

            philosophically maybe – but the reality is people have technology available to them to cap their fuel needs and in turn their gas tax. The higher the price of fuel goes – including increasing the tax – the more people will evade it. That’s precisely what is motivating MBUF.

            “If the final result is a net road tax that is higher than anywhere else in the Country, then we must be doing something else *really* wrong and it needs to be addressed, not just buried in tax code.”

            it’s the recognition that if we try to increase the gas tax to compensate for more fuel efficient cars – that in doing that – you do not end up with more fuel tax revenues – because people respond by buying more fuel efficient cars – and the prospect for the future – is even more fuel efficient cars including hybrids.

            “Like too many other issues, the “solution” is to just make things more complicated and deceptive. That, in my opinion, is not where conservatives should be going.”

            wait. you are advocating that conservatives increase taxes openly and overtly?

            let me guess.. you are not a Conservative, right?

            😉

    2. Roadster, we’re in 100% agreement on this point.

  4. Actually many electric car owners and others support the idea of Mileage Based User Fees, so we may be getting close to implementing that in some US states, at least for some vehicles.

    Specifically what we have going on in VA — lower gaso taxes — is sort of strange. Normally one would think the repubs would want user-based fees (higher gaso taxes). But VA is counter-intuitive apparently because our repubs are in rural areas that drive more miles/yr and feel vulnerable to high gasoline costs.

    Gasoline price at the pump is a funny thing that has to do with gasoline distributors with proprietary formulas charging what they feel the consumers will pay in a certain region. To that extent, price at the pump can be somewhat unrelated to state gasoline taxes. I am thinking instead of increasing NoVA sales taxes, we should have increased gasoline taxes in NoVA, and potentially not seen this tax increase in the pump price. The reason for this is MD/PA are increasing gasoline taxes, so NoVA is following their pump prices, to some extent whether or not we keep our gasoline taxes low in NoVA.

    In any case, the whole idea of higher fuel taxes is to try to encourage more fuel efficient cars. In VA our whole car tax system (which asks green car drivers to pay much more car tax due to progressive nature of our car tax) and low gasoline tax system highly discourages green cars. I believe our VA car tax/fuel tax structure is the least green car friendly of any state…and I’ve studied a lot of states. I support reform of our car tax system in VA.

    1. well the embedded fuel tax in Va is not even discernible at the pump any more as it has become a percent tax on distributors much like the 2.1% VRE Tax.

      but anything that contributes to the higher price of fuel – ultimately results in steps that consumer will make – to reduce their use of fuel – especially if it goes over $4 a gallon.

      they will not only buy more fuel efficient cars, but they will reduce trips, chain errands into one trip, carpool/vanpool/slug, etc

      behaviors do change and the end result is shortfalls in transportation revenues that have led to other taxes and MBUF efforts.. tolls, etc
      I don’t think this is evil or incompetent govt at work.. I think it’s simply market economics.

      the fuel tax/user fee paradigm only “works” when fuel is cheap and people drive a lot. If you alter either one or both of those things – they lead to economic decisions that people will take to minimize the cost of travel.

      I just have a hard time attributing “bad faith govt” more to the fuel tax than any other tax… do we worry that govt “manipulates” the sales or income or liquor or new car tax – any more or less than the fuel tax?

      1. I know about the extra NoVA 2% tax because I am a knowledegable consumer. But I favor transparent taxes where the user knows the taxes paid and it is shown on the bill. Years ago the Fed commerce laws made it illegal to show taxes on US gasoline station receipts. Now in VA we have state taxes at 3.5% wholesale, whereas the consumer is not allowed to know the wholesale price since it’s a trade secret. Whatever we do, please give me the tax numbers on my bill: state + local + fed. Impossible I know, just thought I’d complain.

        1. well actually I AGREE I think each fuel tax receipt should fully show the tax part of i t.

          Further – I think you should be able to look at your locality and see how much was spent on transportation as well as how much your locality generated in transportation revenues.

          and I’ll go you one further. I think the sales tax we pay should show you who gets the constituent parts. For instance, .5% goes to the transportation fund. 1% goes to the local schools and another 1% goes to the locality – and the rest goes to the state.

          Now I do not expect the tax and spend “lefties” to care about telling you and I this information but I’m forever amazed the Conservatives don’t see fit to make this lack of tax and spend transparency an issue.

          I issue a challenge to anyone reading this – to go find out how much your locality generated in gas taxes…

          and you get a bonus if you also find out how much was spent on transportation in your locality.

          this is similar to the way that local school boards choose to not tell you what they spent the excess funding beyond SOQ match – was spent on – because it’s not SOL subjects.

          I’m getting to the point where I do not think Conservatives actually care what money is spent on – except for the areas they are concerned about – like entitlements.

  5. billsblots Avatar
    billsblots

    “I don’t support dishonest government.”

    You are left with no choices.

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