Transit is not expensive

Photo courtesy of Lindsey B

 

Common in any ongoing discussion of transit is the price. It seems like a fare hike has either just happened or is about to happen soon. This brings out the usual amount of griping, mostly about how expensive transit has become. In the newspapers, there is usually an interview with a person on the street, who mentions how in order to cope he’ll probably skimp out on food, or just stop using the subway system and start driving everywhere.

Oh please. Transit is cheap.

A single payee system

People do think that public transit is expensive, and I’ve always wondered why that is. Part of it, of course, is that everyone feels poor, and so any time there is a rate increase it’s a psychological reminder of this. Also, since transit agencies are subject to public scrutiny, fare hikes are necessarily in the news. Prices rise on all sorts of goods all of the time, but with the exceptions of food staples like milk, rarely are things whinged about like fare hikes.

Perhaps this is because transit is seen as a necessity, so people are stuck without a choice in the matter. And to a certain extent, this is correct. There is usually no competition in the public transit space. This upsets people of a certain free-market nature; without multiple operators, there is no competition, and without competition, there is less incentive to improve service or cut fares. The conclusion is then to privatize public transit, and introduce competition, right?

That would be correct, except that it’s not. To see this all we have to do is look to history. At the beginning of last century, many public transit agencies were private. (New York City, for example, had two private operators and one city-owned “independent” subway). And all or most private transit agencies all eventually went bankrupt, and were taken over by the city/state.

But I say a single public operator of transit is actually a good thing. After all, as I see it, the primary benefit of transit is as an extrinsic economic generator, in that it generates economic benefit other places by nature of it being there. It allows people to get to work, to go to shops, to move around efficiently. Introducing a private sector profit motive would retard this economic activity, and therefore cause more harm than good.

A fare deal

So we understand why people gripe about transit fares. But is that griping fair?

Below is a list of cities and the cost of a monthly pass for an adult. Fares are obviously subject to change, but are deemed to be correct as of the time of writing.

  • New York: $112 ($3.73 /day)
  • Portland: $100 ($3.33/day
  • Philadelphia: $91 ($3.03/day)
  • Chicago: $86 ($2.87/day)
  • Salt Lake City: $83.75 ($2.79/day)
  • San Francisco: $76 ($2.53/day)
  • San Diego: $72 ($2.40/day)

So basically, for less than the cost of a daily latte from Starbucks, you can go anywhere in your city that public transit goes.

Transit vs. car

But what if you’re of the type who thinks that’s still too much. Perhaps you own a car, and therefore want to use it instead, as you’re “already paying for it.” It’s worth noting that the cost of owning a car is almost $10,000 a year. According to that linked article, maintenance costs turn into about 5 cents per mile, with fuel costs being 14.5 cents per mile. So if you drive 15 miles to work and back, that’s 30 miles per day, or 630 miles per month of working days. Using these figures, that’s about $123 of extra personal economic outlay to drive to work.

That looks just about like the cost of a transit pass to me.

But remember that these costs to drive are just the cost of driving to and from work. The transit pass gets you unlimited trips throughout the system for an entire month. In New York, if you were sufficiently moved to do so, you could go from Wakefield in the Bronx to Tottenville in Staten Island, a distance of almost 50 miles. Even in little Portland, you can go from Forest Grove to Troutdale, on the edge of the Columbia Gorge, a distance not much less than that.

So the car-versus-transit question doesn’t have to be an either/or equation. You don’t need to ditch your car, and transit still comes in at about the same price or cheaper. And it can be less stressful than driving too, especially if you’re moving around during rush hour. How much is that worth?

Transit vs. nothing

$100 might be a lot for someone who’s at the severely disadvantaged side of the scale. This isn’t then a choice between car or bus, it’s a choice between bus and not getting anywhere. It would be the height of insensitivity to say that this was cheap. What I will say is that many transit providers offer discounted options. And frankly, this just shows me that there are larger societal income/equity issues that need to be discussed.

But I sense that there are many of the people complaining about how expensive transit is aren’t in this situation.

Perhaps, if transit is such a public good, that it should be free. That’s a complex topic, and my mind is not made up on that. What I will say is that for me, $100 is a small price to pay to be able to walk out my door and go pretty much anywhere in the city. It’s not a perfect system, and many would say that our systems aren’t as good as they used to be, but I can’t say that I’m not getting a good value from it. If you think what else $100 will get you, I suspect you will agree.

But enough about me. Do you think transit in your area is too expensive? Why?

Mike Pumphrey

Mike Pumphrey

I'm the founder and author of Unlikely Radical, a site to help people succeed with money, achieve their goals, and live intentionally.

I offer a free phone consultation to anyone who is interested in changing their financial narrative. Are you ready? Click here for details.
Mike Pumphrey
Posted on January 30, 2014
  • Michelle L

    As a public transit rider/supporter/semi-poor person, this topic is of great interest to me! Glad you’re talking about it. The only other thing I would have liked from this entry of yours would be for you to delve into more detail about the benefits/cons of riding public transit and driving your own motorized vehicle.

    • Hi Michelle. Thanks for weighing in. Can you be more specific? There are lots of pros and cons to both! As always, it’s a balance between personal benefit and collective societal benefit, whether you’re talking about economics, environment, or time.

      And as the saying goes, “you are not stuck in traffic; you are traffic.” I just love that.

      • Michelle L

        I don’t think actually listing out a list is really relevant at this point – What I meant, I suppose, broadly, is just that I crave more information in your posts sometimes, to back up your views. I feel it would only strengthen your arguments to have more actual examples/information.

        • Thanks for the feedback. I try to limit the length of each post, both because I know people are busy, and also if I made them much longer, I might never be able to hit Publish!

          That said, I will be returning to this topic, so I hope you’ll keep reading in the meantime.