Can the 99 Percent Movement Reinvigorate Congestion Pricing?

Not yet three months old, Occupy Wall Street stands this week on the threshold of its first big concrete win. Governor Andrew Cuomo has called a special session of the New York State Legislature, reportedly to recalibrate the state income tax to draw more from the one or two percent at the top and less from everyone else. After refusing for months to consider extending the state’s “millionaires’ tax,” the governor may have sensed a need to stand with the 99 percent, even if it requires bending a campaign promise.

Photo: AFP/Getty

At this point, it’s fair to ask how the changes in the zeitgeist wrought by the Occupy movement might affect transit and transportation in New York City. Will revenue infusions from Albany mean better service and stable fares for that most egalitarian mode of travel, mass transit? Will the most inefficient and socially destructive mode — driving private cars into Manhattan — finally pay for usurping so much street and road space? In particular, might congestion pricing, the sole policy measure that could finance transit and disincentivize driving in gridlock, get a boost from OWS’s paradigm of equity and equality?

All that’s clear at the moment is that little if any new state income tax revenue will go to transit. Any net increase will be too small, while other claimants such as education and medical care are too compelling. New revenues may lessen the chances that dedicated transit funds will be siphoned away, but the connection is tenuous and the potential take — under $100 million — is little more than a rounding error in the MTA’s nearly $13 billion annual budget.

In contrast, a cordon toll to drive into the Manhattan central business district could offer transit a billion dollars a year or more in new net revenues. If all of the tolls were paid by the super-rich, congestion pricing would align nicely with the Occupy movement. Alas, that’s not the case. Though the propensity to drive into Manhattan rises with income, and though only one in 25 residents of the MTA’s 12-county tax district is a habitual driver into or through the CBD, these aren’t necessarily the wealthiest four percent. The chronic CBD car commuter is as likely to be your neighbor Sal as a hedge fund billionaire. Which means that shouting “We are the 96 percent!” isn’t the way to rouse a political and legislative majority for congestion pricing.

Some other rubric is needed.

How about the unfairness of letting each CBD-bound driver impose a hundred dollars worth of “time costs” on other drivers, truckers and bus riders, without paying a dime for the privilege? Yes, you read that right. When you or I take a car into the Manhattan core on a weekday morning, each mile we drive causes other road users to ring up $3 worth of aggregate delay costs on the approaches to the CBD and close to $7 on the streets within it. Apply that rate to each mile of a Manhattan-bound round-trip from New Hyde Park or New Rochelle, and pretty soon your trip has racked up a social toll north of $100. In this light, a peak cordon toll of, say, $10 per trip seems eminently fair.

And yet, given that every driver who contributes to gridlock is stuck in it along with everyone else, the absence of a congestion toll is more a signifier of inefficiency than inequity. A more effective rubric for congestion pricing may be the egalitarian nature of the benefits provided by the transit improvements it will pay for. Not only subway and bus and rail riders benefit from better mass transit; so do drivers, who will be moving on freer-flowing highways and less-gridlocked streets because transit has attracted some trips that would otherwise be done in cars.

I estimated last summer that cutbacks in transit service causing just five percent of daily users to bail from the subways would cost drivers more than half-a-billion dollars a year in lost time by throwing an additional 30,000 cars onto CBD-bound roads. The converse is equally true. A cordon toll that reduces the number of car trips to the Manhattan CBD will cut down on traffic and save drivers time in two ways: not just via the stick of the toll but also by the carrot of better transit service that the tolls can pay for. Of course, transit users benefit as well.

Yet that too is an efficiency argument. It seems that, at the end of the day, the case for congestion pricing must rest on efficiency grounds: the efficiencies of driving, of transit, and of urban density in general are vastly improved when at least some of the “externality costs” of traffic congestion are internalized into the price charged for the most congestion-causing trips.

But even if “We are the 99 percent” isn’t a suitable rubric, the impact of the Occupy movement may still ease the path to a political and legislative majority for congestion pricing. A huge obstacle cited by veterans of the 2007-08 congestion pricing fight was that many of the clearest beneficiaries — straphangers and bus riders — identified with car owners and thus failed to give the toll plan full-throated support. This “aspirational” thinking isn’t the sole province of congestion pricing; it is seen in the tepid support of low- and middle-income voters for the highly progressive estate tax, for example. Four years ago, it helped keep transit commuters on the sidelines and enabled opponents of congestion pricing to claim the high ground.

Now, however, OWS has raised awareness of the true extent of economic inequality in America. It may also be renewing pride in belonging to the working and middle class, and helping to redefine the American dream as something more enduring than a fancy house and a shiny car. If this more-communitarian consciousness can be harnessed to the fight for congestion pricing, we advocates might have a decent shot next time.

  • Talia

    Charlie,
    Head down to Liberty Plaza (or NYCGA.net) and see if OWS has a Transit working group. If not, start one. Then you can take this conversation to the streets and ask the occupiers (who are having a bit of a transit crisis, btw) to help you rally around CP. You could have a teach-in and plan direct action to let NYC know the time has come. Your fairness argument is right on – the top whatever-percent that can afford to drive shouldn’t be freely imposing these costs on the rest of us.

  • Glenn

    I think OWS has been good at articulating the wrongs we see in the world, calling attention to them and the unfairness/injustice. What they seem to have consciously avoided in getting behind specific solutions. There’s something important about that. Being a moral voice doesn’t require pragmatism and compromise (at least not in the beginning). Setting the moral agenda and changing hearts and minds is rarely done with specific detailed policy ideas. Advocating for specific solutions seems to just play into politician’s hands and you end up negotiating with yourself. Pointing out the injustice of a $4.50 round trip fare by clean and efficient mass transit while people polluting the air and crowding our streets pay nothing seems to be the right way to start. Attack the fare and low levels of service as unreasonable. Then let the politicians figure out how to best satisfy the angry masses on an issue.

  • Larry Littlefield

    First of all, it isn’t the 1 percent and the 99 percent.  It is the 1 percent, the 4 percent or so, and the 95 percent.  The executive class, the members of the political/union class with the best deals, and the serfs.  The bonus rich and pension rich who have their deals set by their pals on the board and in the legislature, and the serfs who have to negotiate what they get in a free market because they can’t force others to pay if they don’t offer value in return.

    From 1990 to 2010, the inflation adjusted pay per worker in Downstate New York’s financial sector rose to a peak of 250 of the 1990 figure, and is now at about 220 percent of the 1990 figure.  The pay of everyone else in Downstate New York put together increased modestly more than inflation over 20 years, with the majority probably falling behind.

    But NYC’s public employee pension fund payouts increased to 250 percent more than their 1990 level, adjusted for inflation, in 2009.  And they are going to keep going up and up.  Pension contributions are going to have to go up far faster and father, because all of those retroactive pension enhancements were described as “free” and none has yet been paid for, opening a huge hole.  Meanwhile, the total wages of NYC public employees is at 125% of their 1990 level according to the Census Bureau, after adjustment for inflation, or a 25% gain.

    The sooner OWS understands this, the better off we will be.  For one thing, it isn’t the 1 percent that is against congestion pricing.  It is the 4 percent.
    Everyone sees the money the 1 percent get, and they would use some of it to pay the toll.  No problem.

    The 4 percent gets the hidden money, in the form of things like parking placards.  It sees congestion pricing as a reducing in its fair share of the serf’s hide in favor of people like Mayor Bloomberg.  Congestion pricing is elite vs. elite.  The placard privileged elite that is against congestion pricing is trying to co-opt Occupy Wall Street the way the 1 percenters co-opted the Tea Party

  • carma

    Talia,

    You make it seem like only the top echelon earners drive.  that is far from the truth.  the so-called 99% also includes drivers, so would you want to stick it to the 99% as well?

  • Joe R.

    We have to realize that congestion increases the costs of goods and services in NYC.  The fairest way to reduce it is to give disincentives to those who drive (or otherwise use autos on a for hire basis), but have a choice.  That basically includes the vast major of suburban and outer borough auto commuters, and also a large percentage of taxi riders.  Using automotive transport (except late nights when public transit is sparse) in a place like Manhattan, or other similarly dense neighborhoods, is at best a frill for the majority currently driving.  Even more illogical is when people chose to drive even though driving takes longer and costs more than public transit.

    The biggest problem I have with congestion pricing as currently envisioned is that it’ll likely turn large swaths of the outer boroughs into parking lots for suburban auto commuters who will take mass transit the last few miles into the CBD to avoid the congestion tax.  A better solution might a a two-tiered charge.  First, you charge private autos entering city limits during certain times of the day.  This would tend to move suburban auto commuters to commuter rail.  Second, you add an additional charge for going into the more congested parts of the city like Manhattan.  This would tend to discourage outer borough commuters who drive into Manhattan.  Finally, we need to exempt or charge very little for essential traffic, such as delivery trucks.  Such costs would only end up being passed on to customers.  The goal should be simply to give incentive to those who have viable alternatives to use them.  I think once the majority of auto commuters realize their commute would be cheaper (and probably faster) on public transit they’ll never go back to driving.  And these additional riders will pump more money into mass transit via fares.

  • carma

    joe r
    i meant to include delivery vans, small businesses and other service folks that do need to drive into cbd
    these for sure are your 99%
    thats why i cant favor a so called millionaire congestion tax

    even with the added revenue from a cbd congestion tax
    it does little to add much needed service in areas like queens and brooklyn

    the last i checked ols wanted to boycott black friday as well without even understanding that businesses get A HUGE portion of their profits from that weekend and it drives 70% of the economy

    the ows folks need to focus on ONE issue rather than traverse into a thousand things wrong with the country

    i dont give much credibility to a group that demands the mta give free rides to union members etc

    charles thats why i cant agree with this article

  • Anonymous

    @d68c3d2e72aa510ca73cc1ee6afb1f49:disqus Thanks for that suggestion, I might just take you up on it.
    @d8d46f16f380afef59ca318522397233:disqus Exactly what did I write that you “can’t agree with”? I couldn’t follow you.

  • Dave B

    If there was any identification between transit riders and car drivers, it must have been especially because at the time of the debate, the talk was that transit fares were going to go up also. As you pointed out, not all drivers going into the CBD are 1%ers. While transit riders may have benefited from congestion pricing, how that would be was surely not evident to most people. So they really had no stake in the game, as car drivers did.

    If the advocacy was for your own much more progressive “Kheel Plan, whereby the steeper congestion fees were to be earmarked to LOWER transit fares, that would have been something that for most New Yorkers, who don’t own cars, to get behind. I think they would have crawled out of the woodwork to support it.

  • Larry Littlefield

    “If the advocacy was for your own much more progressive “Kheel Plan, whereby the steeper congestion fees were to be earmarked to LOWER transit fares, that would have been something that for most New Yorkers, who don’t own cars, to get behind.” 
    Older generations have bankrupted the United States.  People need to wrap their heads around the fact the for those coming after, politics is about the allocation of the losses.  If you want something better, or even no worse, it will have nothing to do with the government, or even many of existing corporations.

  • carma

    Dave, You are right.  The original idea of congestion pricing was to divert the funds for better transit.  i would say more earmarked for the completion of 2nd ave subway phase 2 and 3.  NOT to eliminate fare hikes.  nowadays the idea is so you can prevent fare hikes. well guess what.  even with congestion pricing, its STILL not going to eliminate fare hikes.  and furthermore, it hurts the small businesses that DO actually need to drive into manhattan, and makes manhattan appear to be only an island for the elite.  another group it hurts is those looking to get off the island from long island to jersey.  with plenty of jobs in jersey city these days, it does hurt a lot of folks who live in queens/brooklyn who would have to pay that congestion fee as driving is still a better option than mass transit for some.  btw: i work in jersey and i live in queens.  i do take mass transit even though its longer.

    charles, the idea of tying anything to the OWS really loses point when the OWS group have NO CLEAR agenda but the entire world is f-ed up.  how about concentrating on ONE problem instead of all the problems.  adding congestion pricing to their equation further complicates their movement.  or whatever it is.

    the OWS have complained about everything from coorporate greed to black friday being bad for the US to world peace issues to womens rights to demanding student loans be wiped out to class warfare to even free mta rides

    you may not like it, but the truth is that the rich really DO pay for all the services the govt provides for.  in terms of federal taxes, the truth is 47% DONT pay any income taxes after all the deductions.  while it is also true, that the rich really can afford to pay a little more.  what is that MORE going to do .   more spending?  i hardly see that as a solution to the problems of our society.

    does that make it more clear of why i dont agree with this article and why tying an association with a convoluted group makes you not so credible.

  • vnm

    Komanoff, it isn’t just about efficiency. It’s about basic social fairness. Yes, not all drivers are part of the 1%, and in NYC people from all walks of life ride transit. But still, transit riders tend to be lower income on average than drivers. How can the government (because let’s not forget that the MTA is just an arm of government) charge a fee to lower-income, non-polluting subway riders crossing the East River but at the same time let higher-income, carbon-emitting car drivers cross totally free of charge?? It is patently counter to social justice! It’s also counter to environmental justice.

    The socioeconomic floor for driving across the East River is significantly higher than it is for taking the subway. There are plenty of subway riders who can’t scrape together the $104 for a monthly MetroCard, and thus pay-per-ride or buy a weekly. YET, virtually anyone crossing the East River in a car, even the very worst clunker, has been able to pull together multiple hundreds of dollars, if not four figures. Or they can afford a monthly payment plus gas, insurance and maintenance that is well higher than a monthly MetroCard. 

    I say virtually anyone because, sure, maybe there are some people in special cases who inherited a car, say, and are driving it into the ground.

  • “Congestion” taxes are regressive and will affect the poor more severely than the wealthy. Believe it or not, plenty of the 99% drive cars. Heck I bet they account for nearly 99% of the cars on the road. 😉 

  • Anonymous

    @5b8562ae241592c3da5509d06172c5ee:disqus I think that tolls may be required to reduce congestion, to raise revenue, and to internalize negative externalities, but not for social fairness. Like you said, motorists are already paying many times more to use their cars than transit riders pay. That doesn’t mean car owners are rich. In fact, many of the drivers among the “99%” are “car poor” because they spend so much of their limited income on their vehicles. Either they do it because they think it’s worth it (like cable!), or because they think they have no better options.

    I live in New York and don’t have a car. But that’s not just for environmental or urban virtue, but also from a self-interested economic analysis. I figured that owning an operating a car could easily add up to $1000 per month. Using transit and cycling, and even an occasional taxi, ZipCar, or rental car, is way, way cheaper and works for me.

  • carma

    qrt145,

    Thank you for further clarifying my point that car owners are part of this so-called 99%.  i agree that a car is not a cheap thing to own.  yet, i also disagree that it has to be a blood-sucker in your finances.  a well maintained used car costs far less than $1000 / month depending on usage.  very nice hondas can be found cheap for around $3000, plus including regular maintenance will cost no more than a few hundred per year.  even including insurance/registration, that is around lets say $1500 / year.  driving sparingly, gas will cost around $2000 / year.

    and lets remember, that upfront $3000 for a used car is not a recurring fee.  unless you like paying every year for a new “used” car.

    now again, your mileage may vary.  and the appeal of a new car is that its supposedly the latest and greatest, reliable, and the coolest thing on the road.  That will add significantly to car ownership.  but even new, its hard to say it costs $1000 / month for most folks.  even if you drive a bmw/lexus, etc…

    however, it is true that the uber poor should really not be driving any car.  even at lets say $350 / month, is a hard amount to come up with.  much wiser spending on a $104 unlimited metrocard.  and believe me, you see plenty of poor folks that ARE attached to their car.  and THIS IS your so-called 99%. or your “car-poor”

  • vnm

    @qrt145:disqus : “motorists are already paying many times more to use their cars than transit riders pay.”  

    Sure, but that money doesn’t go toward the public good. It goes toward private corporations. One’s subway fare goes toward the public good. Buying gas goes toward the Saudis. Motorists driving over the free East River bridges contribute nothing to the public good, but actually cause public costs: carbon emissions they don’t pay to clean up, and congestion.

  • Anonymous

    @d8d46f16f380afef59ca318522397233:disqus I may have rounded up slightly when I said $1000, to account for the unexpected. 🙂 I don’t disagree that it is possible to own and operate a car for much less than $1000, but only if you bought a really cheap used car, have the minimal insurance required, and don’t have to pay for parking or tolls.

    But believe it or not, when I was guesstimating how much it would cost me to own and operate a car I wasn’t thinking of a BMW or Lexus, but something like a Hyundai Accent, which is about as cheap as it gets (admittedly, I was thinking of buying it new). But I added a few expenses that you didn’t count.
    One is depreciation of the car, which you wrote off as a one-off purchase expense, but I amortized over the lifetime of the car. Even if you use your $3000 car until it falls apart, you’ll have to replace it eventually, and if you manage to sell it, it will be worth much less. I was thinking of a “depreciation cost” of roughly $1000 per year, which would be too much for a $3000 car, but it wouldn’t be unreasonable for a cheap new car that you sell after, say, ten years.

    Another is parking. While I could park for free on the street, I’d have to move it twice a week for street cleaning, spend untold hours looking for parking, etc. Since I wasn’t willing to do that, I added $200 per month for a garage. It depends on where you live, of course, in some places free parking may be easy, while in others a garage can cost $700 per month. Then there’s also the unavoidable parking expenses at your destinations, even if it’s just relatively cheap meters.

    Another expense is tickets. Of course, if you are a model citizen this cost is zero, but I’ve been known to make mistakes and have gotten parking tickets (and even one moving violation) in the past. And tickets in NY are expensive, so maybe budgeting at least $100 per year didn’t seem unreasonable to me.

    Then there are tolls, but that of course depends on your specific usage.

    I was thinking $250 per month between insurance and taxes. Maybe I overestimated here, because I didn’t even research those costs, but simply assumed that they would be somewhat more expensive than in my previous place of residence. And I didn’t have in mind just the minimum required coverage. I hope that doesn’t make me one of the 1%! (Well, I didn’t go for the car anyway, so there you go. 🙂

  • carma

    vnm,

    A few minor corrections.

    The gas we purchase will likely benefit the Canadians more than the Saudis.
    We import most of our gas from Canada, not Saudi Arabia.

    Also, paying a subway fare doesnt help the public good, when the MTA is still running on a deficit model.  The fare just alleviates a small percentage of its negative operating costs.

  • Stick a plunger up Cuomolectual Cox Yucker Bloombugger’s nose to
    relieve his congestion pricing and his metric system. Spray DDT to kill
    the bedbugs and roaches that infest Manhattan minds. When we were
    allowed to smoke, TB and bedbugs got fumigated. Parasite Manhattan
    residents, like Washington DC and exconvicts should not be allowed to
    vote, unless they want to vote in Europe. Move all the parasite
    universities to Manhattan and tax all college degrees and net present
    value of rent control to reduce our property taxes. Require a valid
    driver license for any employment. Double tax any parasite not working
    for profit. Build a rail hub at Randall’s Island to bypass Manhattan.
    Liberate Long Island City and Brooklyn from over a century of 1898
    Tamanend oppression. Move UN, missions, residences to Governor’s Island
    surrounded by gators. Anyone who shops at Whole Foods must consume at
    least one of their own organs weekly. Apartment dwellers must consume
    any vermin found on their premises. Turn Central Park into a smelly
    green waste processing facility. Firebrand the forehead of anyone having
    an abortion. Access in and out of subway stations should only be by
    firepole. David Broder in the Washington Post of July 25, 1984, called
    Mario Cuomo “one of the most artful manipulators since Machiavelli”. In
    the May 15, 1984 New York Times B1 Mario Cuomo called civil defense
    planning (such as might have prevented 9/11) futile “Cuomo said that
    prayer was the best preparation for a nuclear attack. He also
    urged everyone to read ‘The Butter Battle Book’ by Dr. Seuss
    for a clearer understanding of the issues.” Your islamosympathic
    gutterswabbing clothing and pierced privates spread disease. If you
    weren’t such baby killing, vermin snuggling perverts you wouldn’t be
    driving up our health costs, then collecting disability for your commie
    nutty organizing dementia. Your passive aggressive labor unions grab our
    guns, cars (congestion pricing), balls (SONDA), wallets, and homes but
    we will grab your throats and dang you from trailer bone tolls. Second
    Amendment is the ONLY Homeland Security. Wait until we waste all your
    stumbent subprimes, so you need to sell your affectation glutton art and
    work instead of diverting tuition and Y2K scams to soviet freezeniks!
    Deport immigrants who return to their home country more than once every
    five years. Lynch soviet wealth fund abetting aghadhimmic peakies when
    oil plummets! Parasites complain about salaries but pig out on benefits.
    Aqua volte! This land wasn’t built by bully craps.