It's time to get the government out of mass transit

by Jean Love - USA Today

November 1993

PUBLIC TRANSIT'S biggest market--Americans who used it to get to work--declined 17% during the 1980s despite an inflation-adjusted 60% increase in taxpayer subsidies. Transit's share of the commuter market dropped in all but three of the U.S.'s 39 largest metropolitan areas; in half, by more than 30%. Moreover, it declined in 12 of the 13 metropolitan areas that "invested" in major rail construction.

Yet, Congress has responded to transit's dismal record by passing the Intermodal Surface Transportation Efficiency Act (ISTEA), which could hike Federal aid to transit more than 50%--$31,500,000,000 over six years, not including possible diversions of 50-100% of highway funds in some localities. Most of the new money will be used to "invest" in transit vehicles and modern rail lines.

The alleged benefits of increased Federal assistance are seductive: less traffic congestion, air pollution, and use of fossil fuels; urban revitalization; and inexpensive access to efficient transportation for the poor. Taxpayers have pumped almost $150,000,000,000 into urban mass transit systems during the last 30 years. Regrettably for the nation, experience shows that the supposed benefits of publicly supported transit are more myth than reality.

Myth: Federal subsidies have improved transit service. Less than 25 cents of each new inflation-adjusted dollar of funding has been used to produce new transit service. Federal subsidies mostly have financed declining productivity and high transit wages. Government and industry figures indicate transit unit operating expenditures soared 418% from 1970 to 1990--twice the rate of inflation and two and one-half times operating cost increases for similar service in the private bus industry. The rate of increase in transit expenses was 20% greater than that in health care costs.

Transit does not suffer from a lack of funding; it suffers from a lack of cost control. The increased aid authorized by ISTEA will stimulate transit outlays and fuel demands for further subsidies. Many university researchers have found a high correlation between increased transit costs and Federal aid. Annual subsidies rose from less than $300,000,000 in 1970 to more than $12,000,000,000 in 1989--a 10-fold, inflation-adjusted increase. Taxpayers now contribute $2 for each dollar transit receives in fares.

Declining productivity and rising pay have consumed most of the subsidies. The Federal Transit Administration reported that hours of bus service fell 55% from 1964 to 1985 for large transit agencies. Meanwhile, transit employees are working less. Charles Lave of the University of California found that annual service hours per worker fell from 1,205 hours in 1964 to 929 in 1985 for big-city transit agencies. Research has documented annual driver absenteeism of 34 days in Miami, 32 in Los Angeles, and 27 in Pittsburgh, not counting vacations and holidays. The San Jose Mercury-News found absenteeism so high that local full-time transit drivers worked only 200 days per year on average.

Public transit drivers' wages are double that of their unionized private sector counterparts, and the average transit employee receives 70% more in wages and benefits than the average U.S. employee. Transit agencies require a high school diploma or less, and drivers can be trained in a month. Yet, their compensation is 45% higher than the average full-time worker, and drivers receive 11% more in total compensation than private sector employees with four or more years of college education.

Federal transit labor requirements have fueled outrageous cost increases. A transit agency's refusal to make concessions to labor can result in loss of Federal funding. In addition, labor provisions of the Federal transportation law require up to six years' pay for a transit worker whose job is eliminated as a result of economies or efficiencies.

Myth: Raising transit subsidies will generate increased ridership. Transit ridership is lower today than it was 30 years ago--when transit systems were self-supporting--despite a 40% growth in population and an 80% expansion in jobs. Nationwide, less than two percent of local trips are made via public transit. According to the 1990 Census, 40% more people worked at home or walked to work than used transit to reach their jobs, and vans and carpools carry two and one-half times as many workers. These more popular ways to get to work do not require large subsidies.

Myth: Public transit can meet the needs of commuters in the 1990s. Transit use has declined for more than five decades as a result of changing lifestyles and economic conditions. Three-quarters of Americans live, work, and shop in low-density areas outside the central city. The predominate commute is from low-density suburb to low-density suburb, not to downtown. The relative importance of large downtown areas has diminished. According to Peter Gordon of the University of Southern California, the central business districts of the 10 largest U.S. urban areas contain just seven percent of their respective metropolitan area jobs. Yet, public transit's conventional forms--buses and trains--can be efficient only in high-density corridors, where riders begin and end their trips in a concentrated area such as a densely developed central business district.

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