Save Washington's Metro by privatizing the system

KEY DATA: Americans spend 15 cents per passenger mile flying, 24 cents driving, and 80 cents on urban transit.

TAKE HOME: San Juan, Puerto Rico residents ride private buses known as públicos that carry more people, without subsidies, than the city’s tax-supported public buses and trains. Why not here?

As Washington’s Metro lurches from crisis to crisis, including derailed trains and a $154 million deficit in next year’s budget, many see its troubles as a prime example of why transit systems across the nation need even more tax subsidies.

In fact, the Washington Metro is a prime example of the failure of our socialized transit model, and why transit systems should be privatized.

In 1964, most of America’s transit systems were private and the industry as a whole was profitable. Then Congress passed the Urban Mass Transit Act, not—as some believe—to help low-income people who couldn’t afford cars, but because railroads threatened to terminate money-losing commuter trains into Manhattan, Boston, Chicago, and Philadelphia.

Congress justified federal support for those trains on the grounds that some of them crossed state lines. Politically, however, supporting transit in those urban areas meant supporting transit throughout the country, whether or not that transit crossed state lines.

Washington, Atlanta and San Francisco then spent billions of dollars building new subway and elevated rail transit lines. These systems completely failed to live up to their promises, costing far more and carrying fewer riders than projected, and they did little to relieve congestion.

Yet transit agencies could not admit they had wasted billions of taxpayer dollars, so they proclaimed these lines to be great successes. Certainly, the people who ride them appreciate the heavy subsidies they receive, but the share of commuters and other travelers riding transit in these regions continued to decline.

For example, the 2000 census revealed that the Washington, D.C. urban area had gained more than 100,000 new jobs since 1990 and that virtually all those commuters drove to work.

Moreover, more than 21,000 commuters who took transit to work in 1990 switched to driving by 2000. You won’t hear that from Washington Metro officials.

Nevertheless, Congress opened the floodgates of federal funding for new rail transit lines, and the number of urban areas with expensive rail transit climbed from 10 in 1980 to nearly 40 today.

To cover the high costs of rail transit, many transit agencies ended up cutting bus service, contributing to declines in per-capita transit ridership.

Nor do transit officials ever mention that the cost of reconstructing rail lines every 30 years is almost as great as the original construction cost. Agencies invariably fail to plan for this cost and hope instead for federal bailouts.

The Chicago Transit Authority is “on the verge of collapse” as it needs $16 billion to rehabilitate its tracks and trains. New York’s Metropolitan Transportation Authority is in serious trouble because it is short $17 billion needed to rehabilitate its rail lines.

Washington’s Metrorail suffers increasing breakdowns because no one has found the $12 billion it needs to keep the system running.

Rail advocates argue that all transportation is subsidized so we should pay no attention to the transit subsidies behind the curtain. Yet transit subsidies are vastly out of proportion to other transportation support and have made transit the most expensive way to travel in the U.S.

Including subsidies, Americans spend 15 cents per passenger mile flying, 24 cents driving, and 80 cents on urban transit. While less than 4 percent of the cost of driving and less than 10 percent of the cost of flying is subsidized, three-fourths of the cost of transit comes from subsidies.

Contrary to conventional wisdom, all transit is not subsidized. Atlantic City, NJ, has a private bus system that runs 24 hours a day without subsidies. San Juan, Puerto Rico residents ride private buses known as públicos that carry more people, without subsidies, than the city’s tax-supported public buses and trains. Yet most American cities and states outlaw private competition to government’s monopoly transit systems.

We won’t fix transit’s woes by throwing money at it, especially not by building new rail transit lines, which will only impose huge obligations on future generations to maintain (or dismantle) those lines.

Instead, we need to return to a private transit model, allowing competing transit companies to provide innovative transit services that people will use at no cost to taxpayers.

Randal O’Toole (rot@cato.org) is a senior fellow with the Cato Institute and author of “The Best-Laid Plans: How Government Planning Harms Your Quality of Life, Your Pocketbook, and Your Future.”