Policy Frog has a good post on Hydro’s subsidy for sprawl and CO2. Every blogger in town seems to like commenting on his posts, probably because they are often well-thought out and lead to good discussions. (And probably because they like generating hits through his site)
In the discussions, I considered the costs and benefits of Hydro subsidizing monthly bus passes and/or parking. I wrote:
“One problem here (among many) is the other subsidies in the system, such as no user fees for additional road use but user fees transit use. If I choose to ride the bus instead of my car, for example, I reduce the costs to the city/economy in terms of roads wearing down, congestion, smog, etc. But, I need to pay the city in order to save them money. Although eventually – through taxes – they will charge me for my “choice” of more expensive transportation, I don’t see that cost at the time of choosing. Choosing the most economically and environmentally efficient means of transport depends on the marginal costs and benefits at that moment and whether I can know those costs/benefits at that moment.
“Furthermore, the subsidising of parking represents an increase of demand for parking, which only inflates its cost for other users. But, subsidising transit has no such inflationary pressure. In fact, that subsidy would reduce the costs to the city to pay for transit which would either reduce taxes, free funds for other programs, or give more money to improve transit.
“Subsidizing the Hydro worker’s bus passes can be a good way to reduce costs to the people of Winnipeg – in terms of air quality, congestion, road repairs, accident claims, and costs of operating transit. Subsidizing the Hydro worker’s parking increases costs to the city, reduces transit income, harms air quality, creates more accidents and accident claims against MPI, and drives up the price of parking in the downtown.”
This raises a question: Should Transit be free for all citizens of Winnipeg? We would still pay for it, one way or the other. But, increased usage would reduce costs to the city in other areas such as road maintenance and expansion to meet self-generated demand; decrease pressure for sprawl (a further hidden cost to the taxpayers); reduce noise, air, and CO2 pollution; reduce accidents; and dramatically increase convenience.
I have not yet formed a definite opinion on this one. Anyone have anything to say on it?