Recently a prominent anti-automobile organization based in New York published a paper bemoaning the fact that transportation costs are now the second-leading category of expenditures for the average family (behind housing). The authors wrote, “Nearly 95 percent of funds spent on transportation by the poorest American families are devoted to private vehicle expenses,” and that these costs pose a tremendous burden which “inhibits” wealth creation.

This factoid was quickly repeated by local environmental groups in Portland as part of their justification for increased spending on expensive rail transit projects. However, in their zeal to bash automobiles the transit lobbyists managed to get the facts backwards: for most poor families—especially single mothers on welfare—car ownership is an essential tool for wealth creation. The costs of vehicle ownership are far outweighed by the economic and social benefits of personal transport.

One of the most startling sources of evidence for this proposition has been generated right here in Portland. Kerri Sullivan, a graduate student at Portland State University, completed her master’s thesis last year on how car ownership affects employment and wages for adults without a high school diploma. She found that car ownership improved a person’s likelihood of being employed by 80 percent. Car owners worked approximately 8.5 more weeks per year than non-owners, and they made $275 per week more in wages.

Sullivan’s work showed that auto ownership was a much better predictor of employment than education. In fact, her study found that a high school diploma/GED played no significant role in explaining differences in employment rates.

In most respects this is good news. It’s much easier to help a single working mother obtain a used car than it is to enroll her in a GED program, so this presents a promising strategy for helping low-income families generate wealth. The bad news is that Portland transportation officials have no intention of helping anyone acquire a car. Local planners have spent most of the past two decades making car usage as difficult and expensive as possible, and they are not about to let empirical evidence to the contrary get in the way of that crusade.

More Than Just a Toaster Oven

The automobile is one of the most empowering technologies in history. Car ownership allows us to work in one location, live in another, and recreate in many others. Compared with other modes of travel such as bicycling, walking or public transit, use of a private car is the best option for most trips that we take. Due to technological innovation and intense competitive pressures, contemporary automobiles are safer, cleaner and more reliable than ever before, and these trends are expected to continue indefinitely.

That’s why life is so difficult for those too poor to own a car. It’s not like trying to live without cable TV or a microwave. Those are merely appliances. Without a car, the poor are excluded from an entire communication network, the ubiquitous road system.

The challenges for aspiring car owners are difficult to remedy because of the circular nature of their financial problem: they could get a car if they had a better-paying job; but without a car they can’t even apply to most workplaces because they can’t get there.

The Spatial Mismatch Dilemma

Most job locations are no longer in central cities where public mass transit is focused. Locally, between 1970 and 1997, Multnomah County’s share of regional jobs fell from 67 percent to 47 percent. Jobs that used to be centrally located have dispersed to suburban office parks and highway interchanges, in part because so many workers have moved to the suburbs.

But not all workers have moved there. Nationally, three-fourths of welfare recipients live in central cities or rural areas. This creates a spatial mismatch, or at least a transportation mismatch, because two-thirds of new jobs are located in the suburbs. Those jobs may not be far away in terms of geography (frequently only 5-15 miles), but they are so inaccessible by public transit that they may as well be on the moon.

The majority of welfare recipients are unmarried women with children, and many have no access to cars. For those employed outside the home, this means that every day is a struggle just to get to work, drop kids at day care, and shop for groceries. Research shows that working women overall have different travel patterns and needs than either working men or nonworking women. For example, employed women in urban areas take roughly 12 percent more trips than urban employed men and 31 percent more trips than urban women who are not employed. Even the best transit system is highly limiting in these circumstances.

As Dr. Sandra Rosenbloom of the University of Arizona has noted, “Working women with children are particularly dependent on the car because it is the best—and perhaps only—way
to balance the child care and domestic responsibilities they retain when they enter the paid
labor force.”

Irrelevant Transit

The general public policy response to the lack of car ownership has been to spend more money on mass transit. It’s not that the poor necessarily want to use those services, or because transit is a good investment of public funds; the primary reason is that a new class of car-hating elites has taken over the transportation planning process in many American cities.

Rutgers University political science professor James Dunn sees this as part of a national movement that he calls the “anti-auto vanguard.” In his book, Driving Forces: The Automobile, Its Enemies and the Politics of Mobility, Dunn describes the crusaders as urban intellectuals who view the automobile “not as a proud achievement of American industry but as a relentless oppressor and a menace to civilization.”

In the Portland region, professional transit zealots have seized complete control of the transportation planning process, from Congressman Earl Blumenauer all the way down to mid-level bureaucrats in the city’s Office of Transportation. Anyone observing the monthly meetings of JPACT—the Metro committee that controls the flow of transportation dollars in the Portland region—will quickly see that the top spending priorities are always rail transit, bikeways, monster sidewalks, and transit-oriented development. The more wasteful a project, the better the planners like it, as it leverages increased federal dollars from Washington D.C.

In the Metro planning process, road capacity is routinely cannibalized for other uses (such as the loss of lanes on the Steel Bridge, North Interstate Avenue and East Burnside Avenue for light rail construction), while new roads are rarely proposed unless done so for other reasons, such as providing more access to rail stations (including Rose Biggi Drive in Beaverton and Civic Drive in Gresham). The fact that no new interstate highways have been opened in the Portland region or anywhere else in Oregon for 25 years is symbolic of the planning bias against auto mobility.

Local planners seem oblivious to the demographic shifts of the past 30 years. The majority of work trips are now suburb-to-suburb, instead of suburb-to-downtown. These trip patterns are almost impossible to serve effectively with public transit, whether by rail or bus. Instead of wasting money in the effort, we could devise programs to help get low-income households into private wheels, and simply focus transit on inexpensive bus routes where there is a clear demand for service. However, that would offend environmental advocates who believe that auto “dependency” should be discouraged.

Keeping the Poor in Their Place

A relatively new and growing body of academic research shows that policies designed to discourage car ownership clearly harm the poorest members of society. For example, Steve Raphael of the University of California-Berkeley, one of the most prominent scholars in this field, has looked at how car ownership might lower the unemployment rate gap between whites and minorities. He concludes, “Raising minority car-ownership rates to the white car-ownership rate would eliminate 45 percent of the black-white employment rate differential and 17 percent of the comparable Latino-white differential.”

More importantly, Professor Raphael has also demonstrated that there is a causal relationship between car ownership and employment. In other words, it’s not just that motorists own cars because they have higher incomes; they have higher incomes in part because they own cars.

A study in Milwaukee found that single mothers with cars were much more likely to be employed. Among single women with young children and a car, 42 percent were employed full-time and 16 percent held part-time jobs. Single mothers with young children without cars worked much less —12 percent were employed full-time and 11 percent part-time.

The evidence strongly suggests that the shortest distance between a welfare client and a job is along a route traveled by a private automobile. The question is why so many policymakers are ignoring this relationship.

The Federal Response

Congress has taken action, but in a misguided way that simply results in more transit pork-barreling. In the 1998 re-authorization of federal transportation policy, Congress created the Job Access and Reverse Commute program. The title acknowledges two realities: first, full access to jobs by all workers will require more than traditional transit service; second, many low-income workers frequently have to commute from homes in the central city to jobs in the suburbs, often at off-hours. This is known as a “reverse commute.”

Congress authorized up to $750 million for fiscal years 1999 through 2003 to implement the Job Access/Reverse Commute program. The money was to be dispersed through a competitive grants process. Unfortunately, none of the money was spent to increase car ownership among the poor. Most grant recipients in Oregon and elsewhere have been traditional transit agencies.

The most recent round of Job Access grants for FY 2004 is illustrative:

Ø      $213,000 to South Metro Area Rapid Transit (SMART) in Wilsonville to increase bus service to Portland.

Ø      $155,000 to Community Cycling Center for its “Create a Commuter” program. Social service clients are referred to the CCC and are eligible for a free restored bicycle and all necessary safety gear after completing classes focusing on safety and general maintenance.

Ø      $80,000 to Portland for marketing of the Interstate MAX.

Ø      $350,000 to Portland for capital investments in North and Northeast designed to “improve access to transit.” This project includes the construction of two high capacity bus stops, sidewalks and nine new shelters at major bus stops.

Ø      $533,500 to Ride Connection, an organization that will provide a demand-responsive shuttle service to low-income clients in western Washington County.

Ø      $2,500 for non-commute taxi vouchers (on contract to TriMet), made available to social service agencies to help clients meet non-work transportation needs.

It’s interesting that the smallest grant—the $2,500 for taxi vouchers—is for the one program that comes closest to providing the benefits of private auto ownership, though even that was restricted to non-work trips. All the other funds are for traditional forms of collective transit or for bicycle education. That’s because direct funding to individuals for private automobile ownership and repair is not eligible under the program. Funds may be used for local programs that assist individuals in acquiring and maintaining vehicles, but agencies receiving funding for such projects must ensure that title to the vehicles remains with the funded agency and that the vehicles are used for shared rides. These constraints essentially make it impossible to promote auto ownership under the federal program.

A Car in Every Garage

In the last several years a backlash against the transit bias has emerged from a surprising source: anti-poverty organizations. A number of groups have come to the conclusion that even though improved transit is a desirable goal, consigning poverty-stricken families to the lowest common denominator of public transit service will lead to a very undesirable outcome, namely the perpetuation of poverty.

One of the most prominent researchers is Margy Waller, a senior fellow for Social Policy at the Progressive Policy Institute, a think tank that funnels ideas to the Democratic Party. She is also a fellow at the Brookings Institution, a politically moderate research center in Washington, D.C. In a 1999 paper entitled “Working Far From Home,” she and co-author Mark Alan Hughes (also of Brookings) argued, “The most important response to the policy challenge of job access for those leaving welfare is the continued and expanded use of cars by low-income workers.”

They noted, however, that “private automobiles have been an overlooked solution and remain largely taboo in Washington, D. C. and in some states. Some of the strongest protests against car-based programs in welfare reform come under the banner of environmentalism.”

They concede that concerns about air pollution and congestion are valid, but ask rhetorically, “should we pursue them on the backs of poor people being compelled by time limits and work requirements?”

Across the country in Oakland, California, The National Economic Development and Law Center (NEDLC) works to “build the human, social and economic capacities of low-income communities and their residents.” The NEDLC has teamed up with the Annie E. Casey Foundation, a private foundation dedicated to helping disadvantaged children, to publish a comprehensive guide to creating car ownership programs, entitled “Shifting into Gear.” The report notes that in the effort to promote work among welfare clients, “it has become clear that public transit is not enough. Too many people quite literally cannot get to work.”

Their goal is to promote innovative local programs that help transit-dependent families gain access to private automobiles. In general, these programs operate like non-profit used-car dealerships with a social conscience; they seek to get inexpensive used cars into the hands of low-income families through various grant, loan or lease arrangements.

NEDLC has published a paper entitled, On the Road: Car Ownership as an Asset Building Strategy for Reducing Transportation Related Barriers to Work. There are approximately 40 car ownership or car loan programs around the country serving welfare recipients and the working poor, and this paper looks at seven to glean the best practices from each. The analysis finds that most programs make available to clients used cars with a retail value ranging from $2,000 to $5,000. Clients pay between $0 and $5,000, which is usually structured through a monthly
loan or lease payment. Single mothers on public assistance make up the largest group of programs clients.

According to the authors, “Early results show that car ownership leads to higher wages and decreased dependence on government for clients of these programs.”

NEDLC is so focused on this mission that they have created a special website to promote car ownership programs (http://www.nedlc.org/center/car.htm), where they publish an electronic news bulletin.

Until recently no organization promoting car ownership existed in Oregon. However, the Metropolitan Family Services (MFS), a Portland non-profit, is quietly preparing to launch a new program called Ways to Work. This program will provide loans for low-income parents at risk of losing their jobs due to unexpected expenses related to transportation. Most of the applicants are expected to be single, working mothers. Applicants will need to have been employed for six months and have dependent children. Loans will average $2,500, and MFS hopes to do about 60 per year.

MFS is partnering with Albina Community Bank, which will provide in-kind services for loan processing. Initial grant funds have come from the US Department of Transportation, Meyer Memorial Trust ($120,000 three year grant), and The Oregon Community Foundation ($30,000).

These are impressive numbers for a small non-profit, but they are dwarfed by public expenditures for light rail. TriMet spent $350 million to build the North Interstate light rail line, which will serve no purpose other than replacing existing heavily-used bus service. For less than the cost of one mile of train track ($60 million), we could have purchased serviceable used cars for 10,000 transit-dependent residents, and still had $10 million left over to help with insurance and operating costs. For poor families, this would probably have been the single most empowering thing anyone could do for them.

Of course none of the local environmental or transit groups have suggested such a policy shift. TriMet spent $1.4 million of tax money just on artwork for the North Interstate Line, yet no one complained about the frivolity of such spending.

What, Me Worry?

Local transit advocates admit to being either unaware of the latest research on car ownership or unimpressed by it. For example, Teresa Huntsinger of the Coalition for a Livable Future, a left-wing collection of environmental, land-use and housing activists, was supportive of car ownership programs but not if it reduced transit funding. She said, “I don’t think our members would support using funds that otherwise would be dedicated to programs that reduce car dependency.”

Similarly, a spokeswoman for the Portland Transportation Bureau stated that promoting car ownership is “not anything we’re working on.”

In the battle to control policy, transit activists tend to be much more savvy than anti-poverty advocates. As Waller and Hughes note in their paper, “It was our experience that in a world where transit is a much bigger deal than welfare to local decision-makers, it was often hard for the welfare staff sitting around the table to be heard over the roar of the public transit providers.”

The Low-Cost Solution

The official transit vision for Portland is to build expensive rail lines and then use zoning restrictions, subsidized high-density housing projects, and free parking to lure affluent motorists out of their cars. Portland State University economics professor Gerard Mildner calculates that on the North Interstate MAX line, this strategy will cost approximately $62 per round-trip. The rail passenger will only pay about $3.20 of that; taxpayers will foot the bill for everything else.

A more sensible approach would be to stop wasting money on trains that few people will ever use, and shift a small fraction of the savings to grant and loan programs designed to help transit-dependent people become car owners. With increased rates of car ownership, transit could be scaled back. Inexpensive buses could be used in those corridors where ridership demand exists, minimizing or eliminating the need for operating subsidies. The physically handicapped could be served through on-demand shuttles, as they are now.

Such a strategy would lower the cost of transit service while dramatically improving the quality of life for our poorest citizens. It’s true that expanded car ownership would add a few thousand cars to the Portland road system during commute periods, but the effects on traffic would be insignificant given the size of the road system.

Unfortunately, transit planners are not interested in this vision. TriMet is preparing to raise the regional payroll tax in order to leverage federal dollars for the next two light rail lines into Clackamas County, at a construction cost of nearly $500 million. These lines, which are being built into a very low-density part of the region, will require numerous park-n-ride lots in order
to generate any ridership, so by definition they will be virtually useless to poor families
without cars.

Yet those same families will be harmed by the tax increase. The payroll tax drains more than $150 million annually from local employers. If that money stayed at the worksites, it would probably be used to create new jobs, increase wages, or provide goods at lower prices. Raising the tax will worsen Portland’s already-bad business climate and spur more employers to move elsewhere; this in turn will make the transportation problems for inner-city poor families more challenging.

Light rail, streetcars, and even commuter rail lines are all part of Metro’s Utopian plan to reduce auto dependency and foster transit-oriented development. For those at the bottom of the economic ladder, however, this vision is a long ride to continued impoverishment.

John A. Charles, Jr. is a Contributing Editor to Brainstorm NW and Environmental Policy Director at Cascade Policy Institute, a Portland think tank.

Sidebar: A Chicken in Every Pot; A Prius in Every Garage

For years, light rail critics have been arguing that the construction costs of rail are so large that cities could save money by simply buying new cars for transit-dependent riders. Now Molly D. Castelazo and Thomas A. Garrett of the Federal Reserve Bank of St. Louis have done the math to prove it.

In early July they published a paper concluding that based solely on dollar cost, the annual subsidies to the St. Louis light rail system could be used to buy an environmentally friendly hybrid Toyota Prius every five years for each poor rider and even to pay annual maintenance costs of $6,000. The increase in air pollution would be minimal, and 7,700 new vehicles on the roadway would result in only a 0.5 percent increase in traffic congestion. More significantly, after all this, there would still be about $49 million per year left over for other socially
beneficial uses.

As informative as this analysis is, it substantially understates the savings that would accrue from such a strategy because in the real policy world no one would actually suggest giving away new cars. Functional used cars could be purchased at a cost of just $3,000-$5,000 per vehicle, minimizing the need for subsidies while still providing the benefits of private transport.

The authors note that other alternatives to light rail include expanded bus service, more express bus routes, and on-demand shuttle services. They conclude, “Although these other forms of public transportation are also cost-inefficient compared to the automobile, fewer inefficient public transportation systems would be less costly to society.”

The Federal Reserve paper is available online at
www.stlouisfed.org/publications/re/2004/c/pages/light_rail.html

BrainstormNW - September 2004