Urban Density and a Pocketbook Plea for Congestion Pricing

350px_US_Metro_popultion_graph.pngOf the ten largest cities in the United States, New York has far and away the greatest population density: 26,402.9 people per square mile, more than double the second densest big city, Chicago. The chart at right shows how the largest metropolitan areas stack up in terms of core population, overall population and core population density.  This fact alone should force New York City authorities to think differently than the rest of the country on all sorts of matters of public policy. New York is a quantitatively different animal than the other big American metropolitan regions in terms of percentage of people that live in the core, density and size of the core and size of the metropolitan area.

The movement for congestion pricing needs to start here, would inevitably start here and has started here. Here is a simple submission: People should pay for the privilege of bringing their air-polluting, noise polluting, lethal, two-ton pieces of private property onto the streets of such a dense place. But the reason for the payment shouldn’t be for any of those unsavory attributes of the automobile.

Drivers everywhere should be required to pay for the cleanup that will be needed for their pollution, not just here. Many industries with more concentrated negative externalities, to use the economic term, are required to pay into funds that ameliorate the consequences of their pollution. G.E. had to pay to clean up the Hudson River after it contaminated the river with PCBs; motorists should have to pay to clean up their pollution too.

Noise pollution (namely, honking) isn’t a problem unless there are people around to have to hear it. Here in New York, heavy fines are threatened on anyone who honks unnecessarily. We are also working toward a ban of audible car alarms.

As for the car’s deadliness, its worst attribute, well, the engineers are working on it.

No, the best reason for congestion pricing is that cars get in the way of business.

As Kathryn Wylde, president of the Partnership for New York City says, "The gridlock on New York City’s streets has become a brake on the city’s economy." She warns, "It is going to be increasingly difficult for New York to market itself as a place where you can get the most done in the least period of time with the best workforce if we’re not able to solve the congestion problem."

Traffic congestion slows you down when you’re trying to get somewhere. It slows down the delivery of essentially goods throughout the city and slows the movement of people — the city’s most valuable economic input — by clogging the roads that could be moving them along much more quickly with free flowing buses, cabs and bicycles. Traffic congestion gets in the way of emergency vehicles, no doubt contributing to the finding that heart attacks are more likely to be fatal in New York City than anywhere else in the nation. The fact that congestion pricing would lead to less air and noise pollution while improving the public realm is just a happy coincidence. But it is one that should make every New Yorker support congestion pricing, whether you’re in favor of making New York into an efficient platform for commerce or you are concerned about a rise in sea levels or you simply want to live in a more pleasant, breathable city.

Congestion pricing is working in the world city most similar to New York and it would work here. In fact congestion pricing should be applied not just to New York, but to every city in the United States with more than 8 million people living at a density of greater than 25,000 people per square mile.

17 thoughts on Urban Density and a Pocketbook Plea for Congestion Pricing

  1. A fantastic argument! It’s refreshing to see the congestion pricing idea put in terms that aren’t an anti-car screed. Pocketbook economics at its best.

    CG would be good for taxi drivers as well. They tend to make more money from lots of short trips over the course of their shift, as opposed to fewer, longer trips. Sitting in traffic (even with the proposed idling rate increase) means a driver can’t quickly move on to the next fare.

    The TLC should get behind CG. Fewer cars on the road, more people riding taxis, faster trips, more money for drivers, less time wasted by commuters when they could be earning money…everybody wins.

  2. The only way everybody wins is when the environemnt is restored. This would be a step in the right direction – add a carbon tax and then you actually would have progress…of course this is all academic at this point.

  3. There’s a fair amount of logic to congestion pricing from the point of view of traffic and air quality.

    However, it hits lower income people harder. For the wealthiest New Yorkers, congestion pricing wont deter. As a result, it makes the streets less congestion just for the rich. Is there a way around that?

    Further — congestion pricing seems to be politically difficult to sell. Outer borough car owners are thought to be less attracted to it than carless Manhattanites. Thoughts?

  4. We have congestion pricing in NYC already and it works. This weekend we had to use a car to go from Brooklyn into Lower Manhattan. I heard on 1010 WINS that all East River Bridges were backed up going in to Manhattan for at least 20 minutes.

    We went to the Brooklyn Battery Tunnel instead, painlessly paid $3.50 with our EZ-Pass, and traveled from Park Slope to our destination on Murray Street in a total of 12 minutes. It was the best $3.50 I spent all week

  5. The way to mitigate the effect on lower incomes is to invest a substantial amount of the revenue from congestion tolls into improved public transit. I believe that London has done this.

  6. Daniel,

    My first thought is that you don’t have a whole lot of lower income people driving to work in Manhattan every day.

    The biggest beneficiaries of congestion pricing might just be working class people like plumbers and contractors. For those hourly wage guys, time is money and being stuck in traffic is horrible for business.

    Charles Komanoff did a lot of research on the economics of congestion pricing and found that the argument that the numbers don’t support the argument that it would hurt lower income New Yorkers.

    Lots of CK’s stuff is here:


  7. From time to time I have had to lug equipment into Manhattan for a shoot. I ALWAYS tell the cab driver to take the Brooklyn Battery tunnel. It is so much faster, and I am not a very rich nor someone who spends lots of money.

    It is much quicker and efficient. Saves me a lot of time. Every time. Very much worth the $3.50.

  8. Daniel wrote, “For the wealthiest New Yorkers, congestion pricing wont deter.”

    I find arguments like this counter-productive to real debate. The wealthiest New Yorkers will always have a way around cost of living increases. (No one who lives on Park Avenue took fewer trips to the Hamptons because gas went over $3/gallon this summer.) The rich will never feel a proportionate share of the impact of these sort of policies, but that’s not reason enough to say it will hurt the poor.

    In London, which has more than its share of wealthy people and a cost of living that surpasses that of New York, congestion pricing has worked, even though wealthy people could certain afford limos or taxis to avoid the Tube.

    I agree with Aaron. Not too many low or middle income people are driving into midtown anyway, so the economic effect on them would be minimal. If anything, cleaner air, less noise pollution, and greater ease of transit around NYC would be a positive impact that would outweigh inconveniencing the few people who truly couldn’t afford congestion pricing.

  9. Dan:

    I wrote up my ideas for a grand compromise on congestion pricing on The Oil Drum NYC

    But basically:
    1. The revenue goes to the outer boroughs for more mass transit service and new BRT lines
    2. Allow free access to the FDR and Westside highway (better name for this?) to channel traffic off the streets
    3. Reduce tolls leaving the brooklyn and Manhattan on the Verrazano and GW bridges respectively to channel traffic toward underutilized road space.
    4. Encourage new investment over existing transit hubs in the outboroughs

    But really we need to have the outerboroughs articulate their transportation vision. We cannot continue to accept the outer borough leaders reflexively saying “no” to congestion pricing but then in the same breath calling for more mass transit service. These issues need to be linked. The MTA cannot increase service (save raising fares) without either a rise in ridership or a new funding source. Congestion pricing does both. So we need to start exposing this double talk. We need to start challenging outerborough leaders to be more open minded and basically name their price – what would it take?

  10. I agree with what everybody else has said. In a nutshell:

    1. That congestion pricing (assuming no discounts or other programs based on income) would impact lower-income people disproportionately is no different than any other commodity whose price is not linked to one’s income — a gallon of gas, a dozen eggs, a kilowatt-hour of electricity, a night at Holiday Inn, a car, a bike, a gaggle of geese. If the cost of any of those goes up, it disproportionately affects the poor.

    2. The major way to mitigate the effects of road pricing on the poor is to simultaneously invest in new and improved transit options, including capitalizing on the reduced congestion to improve transit speeds. For disproportionately affected car-dependent residents of the outerlying parts of the city, the way to mitigate is the same as stated above, as well as other investments (park + rides, etc) in their areas of the city.

  11. “…it hits lower income people harder.”

    Is there any evidence for this? Data or experience from London or some other city? Or is it just an assumption?

    Because my ASS-U-M-ption would be that lower income people are “stuck” using mass transit a lot, not driving. I’ll further assume that if congestion pricing is implemented, lower income people who currently drive for some reason will find another option, like cycling or improved mass transit (we’re going to do that, too, right?) – and they’ll probably find it’s better for their health and/or pocketbook anyway.

  12. Adam-
    Actually, there might be evidence to the contrary. I suggest you do some quick research (i.e. Google searches) on the two early value pricing / HOT lane projects in California. One is in San Diego and one is in Orange County. SR-91 and I-11 I believe. I think research in those cases found that users of the tolled facilities (which were opt-in, not even compulsory!) were actually pretty well-balanced in terms of income.

  13. Someguy,

    In California pretty much everyone has to drive to get anywhere. In NYC most commuters into Manhattan don’t drive. Congestion pricing wouldn’t disproportionately effect lower-income people because lower-income people aren’t the ones driving their cars into Manhattan to work every day. The group that it’d impact disproportionately would be government employees as they are twice as likely to drive as any other Manhattan business district worker.

  14. Of course, the other way to limit cars into the city is to simply ban single occupancy vehicles on the East River Bridges during the morning commute, forcing them to take one of the toll bridges. Easy to implement and low cost. A poor alternative to real congestion pricing, but perhaps a short term bridge to it.

  15. Daniel Millstone, the idea that congestion pricing would hurt the poor more is probably the most powerful argument against it – but I don’t think it’s true for the reasons Aaron noted in comment 13. You noted that it wouldn’t deter the wealthy but I suspect it would deter those who are most cost-conscious, which paradoxically often increases along with ones wealth.

    On a more general note, I think the most potent feature of congestion pricing is that is brings the costs-per-trip of driving up closer to those for transit riding. Nobody ever factors in vehicle depreciation or insurance or maintenance when they plan a trip, but they do factor in trip-specific costs like gasoline and train fare. So congestion pricing helps even the score with transit, which is mostly if not all paid for by per-trip costs. People preparing for a trip would be apt to weigh the charges of that trip: “Hmm, Metro-North is $20 and parking is $15 but the congestion charge is $6, so it’s cheaper to take the train today.”

  16. Aaron,
    Point taken, but I think there is still an important lesson from California’s experiment, one that discredits the notion that the low-income will be excessively “priced off” the road. The California examples are *opt-in* HOT lanes, not mandatory, and yet they have seem a representative spectrum of income groups using them. That leads me to believe that people’s trip values are not simply related to their wealth.

    And I agree that NYC has very few low-income people driving in. The few that do (such as very low-income immigrant workers who have to live outside the city) probably carpool and so wouldn’t be very affected by the cost. Nevertheless the point is that for those who do drive, they ARE disproportionately affected by the charge inasmuch as it represents more of their money. This may only be a handful of people, but just as they are disproportionately affected by a rise in gas prices, they are disproportionately affected by a congestion charge. Everything I’ve said is in support of congestion pricing, however.

  17. Even if it has a disproportionate impact on lower income people, it’s low income people who will primarily benefit from the improved air quality. Do it for the kids with asthma, people. Some low income people choose to move further out from the city center since they figure they can save a bit by driving instead of using public transit. (especially if you have a big family, the per-person cost of the subway becomes prohibitive.) When I was in the Bronx my students often had no means of transport in the summer since they didn’t get metro cards from school in those months. If congestion pricing made subway service more frequent, and extensive in outer boroughs I bet, a weekly metro card would seem more “worth it” –at least we could keep the price from going up any more.

    In any case, the roads are being abused at present, they don’t work for drivers or for non-drivers. My math class was interrupted today by 20+ minuets of LOUD and LONG honking from about 8 or 9 cars trapped behind a garbage truck and a stalled catering van. It was horrible, nobody could think with all that noise, (and these are kids used to normal city levels of noise during algebra lessons) But then, people just gotta drive drive drive… right? Who cares if they aren’t going anywhere and making themselves and everyone else miserable while trying.

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