The true mark of a city is the presence of public transportation: subways, buses, trains. It keeps the streets clearer, lowers pollution and gives people who do not have cars access to the city. But in Chicago and St. Louis these systems are self-destructing, raising fares, cutting service and subsequently being dumbfounded with the lower passenger rates that requires further cuts and increases.
As of 2009, the Chicago Transit Authority has increased prices to $2.25 for a bus ride, up 25 cents from the previous year. For the increase, they cited in November the rising gas prices and the possibility of them increasing over 2009. Understandable at the time, perhaps, but with the gas prices down to $2, taking public transportation is less and less appealing. With the increase in prices, the system is creating a large disincentive to stand and wait for a bus, and thus the prices continue to increase in an attempt to cut losses.
The public transportation system failure is similar to the government's dedication to raising taxes to stem economic problems. It seems that the laffer curve was never taught to the officials in charge. (The public school systems of both cities is another blog post altogether though.) With gas prices low and public transportation costs high, buses and trains are becoming considerably less appealing.
St. Louis has a Metrolink and bus system, which are facing huge service cuts this year. The Metrolink, the subway railsystem, does not have a system to insure that all riders have passes; in fact, most ride for free for the majority of the time. A few conductors are occasionally on hand to check tickets, but this usually only for games and large events. They have focused too much on unnecessary and unprofitable westward expansion instead of consolidating the useful routes and services. Instead of contriving a way to enforce payment, with turnstiles or more conductors (or having those who ARE paid actually checking tickets) the Metrolink begged for a sales tax increase in November in the form of the band-aid Proposition M. It was defeated in the polls; instead of facing the real issues of the abysmally low purchase rate, Metrolink decided to lower service which even they contend will only cause a downward spiral.
Chicago needs to launch a public advertising campaign for the public transportation system. It needs to streamline routes so that they are more reliable and give incentives for people to ride; raising the price is the opposite of what should be done. St. Louis needs to enforce tickets for those who do ride, in addition to encouraging more riders to use the system. Perhaps this is a simplified explanation of a large problem, but both Chicago and St. Louis need to stop contributing to the destructions of their own public transportation systems, or there will be no public transportation left.
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3 comments:
What's a laffer curve?
A laffer curve is a bell shaped curve... it basically says that higher taxes/prices don't mean higher revenue. There is a point where the right price will maximize revenue. (I think CTA has gone past that point so they are making less than they could)
From Arthur Laffer, an economist. If you click on the link in the original article, it will take you to an article on the Laffer curve.
It is very logical. If the rides were free, usage would increase but no revenue would be generated. If you increase the price to $1000 per ride, no one would ride - and still no revenue would be generated. The ideal point is when the revenue is maximized. This might be at a relatively low ticket price (say, $0.75 per ride), with the trains packed all the time. Most public officials make the mistake of thinking that doubling the price will double the revenue - but behaviors will change at the higher price, and maybe people will decide that walking is good, or maybe they can carpool. Thus, an increase in price may cut the number of riders by such a large amount that the revenue actually decreases.
It is the same for taxes. On multiple occasions, the capital gains tax has been cut, but the revenues generated have increased!
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