EPISODE 30: America’s Crumbling Highways with Bob Poole

Famed economist Milton Friedman called America’s highway system a “socialist enterprise” and he was right. America’s roads are in desperate need of repair and the federal government is clearly incapable of maintaining them efficiently. Drivers pay tens of billions of dollars in gasoline taxes every year and our infrastructure problems only seem to get worse.

Instead of taxpayers forking over trillions of dollars in new legislation to address the problem, why don’t we trust in private sector solutions, both to ease congestion on our roads and to finance their ongoing maintenance through robust competition? Why not allow private companies to run and care for our roads in the model of utilities like power, water, and gas companies? There are some perils with this approach, as we’ll see, but the concept is worthy of serious consideration.

No one understands the fruitlessness of the status quo or thinks about practical solutions to these problems more than Bob Poole, founder and director of transportation policy at the Reason Foundation. He has advised nearly every president on transportation issues over the past 35 years and is also the author of “Rethinking America’s Highways: A 21st Century Vision for Better Infrastructure.”

He says the problem begins with how government looks at us.

“People who use highways are not even talked about as customers in the transportation business. They’re called users, and treated as users. And in fact, in some states like California, they’re treated as nuisances. That the policy focus is, we’ve got to get them out of their cars and off the highways and into buses,” said Poole.

For more than 70 years, Americans have been paying federal taxes at the pump. Now north of eighteen cents per gallon, the taxes are supposed to fund badly needed repairs and upgrades to our roads. Instead, opportunistic politicians have redirected roughly a quarter of those revenues into more than a hundred different programs to build sidewalks, bike paths, and recreational trails. Rolling back any of those is considered politically impossible. But it doesn’t have to be this way.

“Highways are the only vital utility that we have that is not done in a corporate structure with user payments directly to the provider. Instead, the money goes to the government and is allocated politically, which is why you get all sorts of perverse outcomes like bridges to nowhere,” said Poole.

So if Congress won’t use our tax dollars for their intended purpose, Poole wants to allow private companies to take responsibility for our highways and collect the money needed to keep them in good shape.

“We’ve got to shift from the state-owned enterprise funded by taxes to basically a kind of a modern day toll road model where the highways are basically vital utilities like electricity, water supply, telecommunications, natural gas service that comes to your house, cell phones, cable. All of these things are provided by companies. You pay the company based on how much of the service you use,” he added.

Under his plan, all interstates and other major highways would adopt electronic toll systems like E-Z Pass, which is already common in the Midwest and the Northeast. Eventually, a single transponder in each vehicle would work nationwide and drivers would pay a monthly bill. The tolls would also pave the way for the repeal of gasoline taxes.

But this idea comes with significant concerns. We can’t put E-Z Pass on every two-lane road and city street, and Poole’s solution will make some people uncomfortable. He wants to institute annual odometer readings or place devices in vehicles that not only track how many miles we drive but where we drive, using cell phone towers to pinpoint our location in order to distribute our payments to those maintaining the various roads we use.

In addition, Poole says we would be charged about three and a half cents per mile under the tolling plan as opposed to the two and a half cents we pay through gas taxes. That’s a significant cost increase when the miles start piling up, especially for rural Americans and suburban families who moved far outside major cities to find affordable housing but still commute to work.

Any plan with the potential to infringe on personal freedom or burden the family budget must be evaluated very carefully, and hopefully improved upon, but one thing is certain: the answers to our persistent gridlock and shabby roads are not found in government. The genius and incentives found in the free market are the best bet to get us all moving again.