[lbo-talk] Congestion pricing may not hurt the poor, study finds

Jordan Hayes jmhayes at j-o-r-d-a-n.com
Fri Aug 29 12:02:53 PDT 2008


Wojtek writes:


> from a household budget point of view, operating expenditures
> i.e. immediat eout of pocket costs of everyday life activities
> count differently than "capital expenditures" i.e. purchasing
> a car or a major appliance. For one thing, households cannot
> depreciate capital expenses as businesses can - so once such
> items are purchased by households, the money is already gone
> and everything else is in addition to that cost.

I don't think that's true. While you can't "depreciate" in terms of taxes[*], there is a useful lifetime for such assets, and many people do plan for replacement in kind of a reverse-amortization (i.e., "This year I buy the new car and then not again for a long time"). And of course many people just lease cars these days, which does in fact bring the cost of capital onto the current accounts side of things. Traditional car loan financing also factors this into a daily budget. I'm going to step out on a limb (after googling around a little with no success) and say that I bet the majority of cars purchased aren't purchased with cash ...


> current operating expenses is all that matters from a household's
> perspective (especially low income household), and operating costs
> of a car (about 10 cents per mile for my 35mph on highway 1995
> Saturn) is far below the cost of commute (which is about 26 cents
> per mile plus twice as long as driving because of waiting time in my
> case).

I think you're also trying to compare this to the 'rich white fatheads' who, I'm guessing, have much higher per-mile costs than you (what with their $700/mo BMW leases) do with your paid-up older Saturn, though I'd love to see some actual data on your 35mpg ... Saturn doesn't presently make a *new* car that gets 35/highway, so the odds of you having one from 13 years ago seems slim, especially how you say you don't maintain it -- at least you don't pay for it to get maintained :-)

Even the 2009 Saturn AURA Hybrid is listed as 34mpg ... and we know that the EPA is notoriously high on these numbers.


> Gasoline tax collection is as efficient as general tax collection,
> but has an advantage of not shifting the cost of driving on those
> who do not drive (mainly the low income folk.)

Since the vast majority of gasoline taxes are paid by trucks carrying goods around, bringing a benefit to drivers and non-drivers alike, you're still stuck on this idea of a user tax being better than a general tax. You're still wrong, of course :-)


> the main poin here is to avoid congestion and thus making driving
> more efficient.

I agree that this is a laudable goal. I have suggested in the past that one way to do this would be to remove tolls from congested roadways because tolls directly cause congestion that far exceeds that money collected by said toll. If you think buying carbon credits has a real impact, you should be for the dismantling of the toll-booths across the world.


> Congestion-sensitive tolls are can accomplish that goal ...

... at the cost of making driving only available to 'rich white fatheads' who are price-insensitive. This is exactly opposite what you have been saying! This thread started with a couple of idiots in Southern California making up a specific case that is at odds with the rest of the cases and coming to the conclusion that "Congestion pricing may not hurt the poor" ... Since they had to work so hard to find a case where this might be true, I think it's fair to say that the currently-held belief -- that congestion pricing DOES hurt the poor -- is intact.


> ... and if the tolls collected pay for the the toll booths themselves
> ...

... which they have already been shown not to! Check the archives ...


> are you trying to tell me that tranporation in the US is not
> seggregated

Of course I've said no such thing, Mr. Straw Man. You said no white people ride the bus; I love debunking hyperbole, 20% is nowhere near none.

/jordan

[*] I think you're missing an important point about depreciation; you make it sound like it's a benefit, when in fact, depreciation is the consolation prize. Depreciation is how the government tries to make up for the fact that you can't expense capital purchases: the money is gone today, but you can't take the expense until later. The worst thing would be to realize the expense at the end of the useful life; the best would be to realize it today. Depreciation is somewhere in the middle: by far not the best, but also not the worst. In the cash-basis personal household, as you said, the money is gone today ... in terms of household accounting (as opposed to tax accounting; most households are ') you're recognizing the "expense" immediately. You don't get a tax benefit for it, but you do actually have a tangible hole in your wallet.



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