Privatize Roads?

You asked how privatizing roads would prevent road deaths. I answered the question.

 

No I did not. Are you on crack?

 

No need to be snarky, I even conceited that because roads are publicly funded innovation is stifled. The reason I feel comfortable saying that roads will lead to market failure is because of it's characteristics, something else I've already said.

Correct, I stand by my statement that a housing authority is not a public good. Maybe I should provide a definition since I'm using terminology:

HA do no meet those criteria. It's because of those features impact on competition and the profit motive that the market doesn't do as well with them as it does with other goods and services. There is no good that meets those criteria completely, but having them ensures the market will struggle to achieve equilibrium.

Maybe, but those resources are then wasted to fix a problem you could have avoided to begin with. Like I said, it's irrational.

 

But but Finland is a socialist paradise! How can those rural folk possibly pay for the privilege of living in remote locations? It's the People who should be producing for their benefit. Only road systems that are centrally planned can possibly be efficient and serve the needs of the public.

 

More likely the downtown association would pay for the roads and would provide a very pleasant driving experience to boot. Businesses with brick and mortar location are very concerned about getting people into their stores. They must deal with a socialist road system, but go to any city council meeting and watch as they lobby for road improvements and more parking for their customers.

 

Do you assert that the only people who die or are hurt on roads are due to alcohol and/or rednecks? Or even a substantial majority of them?

Not all toll roads are private, and most weren't designed by the operators but were designed by bureaucrats and then licensed to toll operators.

 

Refer to your own words below.

 

How exactly do you cut someone off from a road that fronts their driveway?

Are you going to put tollbooths at the end of everyone's driveway manned by security guards?

As for "they shouldn't be living in rural areas", you do get that farming and ranching aren't really major cash cows for moat people involved in those trades and the ones that support them right? Many farms and ranches barely hold on as it is and you think you can just increase their costs?

I hope you don't like eating because you are either going to put farmers out of business or drive up the already high prices of food.

 

Then you are debating a strawman. I did not say that a housing authority is a public good. I said that what a homeowner's association has control over are generally considered public goods in other areas where government is responsible for maintenance. I'm not even sure how we got from Homeowners' associations, which are typically a private corporations formed for the purpose of maintaining common grounds surrounding privately owned homes or condominiums, and housing authorities which are typically government run entities given authority to oversee development, redevelopment and conservation of land resources, as well as fix rents and etc.

You just push the costs onto others. Calling the resources "wasted" is entirely subjective.

 

It's not terribly difficult to block a driveway. In the story I posted to Anikdote, the homeowners agreed to a 25' setback on their properties which allowed the road provider to setup a barrier that could be activated should the homeowner not pay the dues required for home maintenance.

Have you ever lived in a condominium? My homeowner's association sends me an invoice once a month and I send them a check. This means that the common areas of the complex are maintained and they don't have to post a security guard outside my door to collect a small fee everything I walk out the door. If I don't pay them within the contractually required timeframe, they have the right to seize my home and sell it and deduct from the sale the amount of unpaid association dues.

Why is everyone stuck on tollbooths? One imagines that if government were operating all of the internet, no one could imagine how a private provider would offer such a thing without demanding a credit card every time you turn on your computer.

Farming and ranching are businesses like any other. They have to get their products to market. Why wouldn't they have an incentive to build and maintain the roads that they use? Their distributors also have an incentive to get products to market. They manage buy trucks, and warehouses, and hire employees and run software for supply chain management, all without the government to provide those things. Are they that incapable of also contracting to lay down road beds and manage them?

It's a surprise that we get food at all, given that the government isn't running all of the farms, distribution networks, and supermarkets. It worked so well in the former Soviet Union.

 

There are plenty examples of home-owners associations providing private roads without such problems. Your fear is irrational. The easements are determined in the lease or purchase of the home, ensuring right of way. Residential roads would not likely operate identically to through-ways. Residents would likely be charged a very low price to use the roads in the area, similar to utilities. The only need for tolls would be for through traffic, non-residents. Such tolls might even be prohibitive. What residents would want a ton of traffic driving down their streets? It can also be assumed that the roads would not provide such a fee (as it is with plenty Home-Owners Associations today). Profit could be made through providing other neighborhood services, the roads simply attracting people to that neighborhood to use the services.

Tolls are not the only means of providing private roads, nor is it necessary that private roads always charge a fee to remain useful. They may be owned by companies that provide something else that requires a road, such as garbage collection or real-estate.

The better argument is that the roads, if necessary, would be maintained by the ranchers communally. With less traffic (they are rural after all) they would be less costly to maintain. The possibility of this working is not up for debate, as there are thousands of miles of rural roads in Finland privately operating in this way. They even get to set their own speed limits. It all works just fine, and nobody is harmed at all.

 

Housing authority was a typo, I meant homeowner's association. In either case, we can see in both scenarios that some type of collective action was preferred over private ownership and control again, because of the nature of the good involved.

We know of an alternative where they can be put to better use, ok, "wasted" is subjective. Inefficient though isn't, and it's most certainly inefficient.

 

While I agree in principle, the reality is that dedicating a fuel tax to the roads will just end up being drawn away for other projects, like social security.

Yep. There's really no contradiction there. Competition increases efficiency, pretty common knowledge. I don't care to prove it, it's more widely accepted than climate change. I don't have any proof that anyone who has taken macro 101 agrees with it - I don't know how many art majors believe that the sun will rise in the morning, but why would that even matter?

There's a huge difference between saying your opinion is FACT (note the capitalization), and citing common knowledge as one piece to back up your argument.

 

Action can be both collective and private. We are talking about state action vs private action.

How do you know if one use is better than the other? "Better" is subjective.

 

It's when government, and it's monopoly on the legal use of force, gets involved that the collective becomes collectivist. An HOA cannot arbitrarily change the contract between itself and the members of the collective, so in order to get changes made, it must obtain the sanction of the homeowners to the extent required in the contract. In the HOA in which my home is involved, that would require 100% consensus of all homeowners since there is nothing in the contract that allows the HOA to do anything but maintain the swimming pool for public enjoyment. The government, on the other hand, has no incentive to satisfy the members of the collective, as it relies on coercion backed by the threat of violence to get what it wants, and may arbitrarily alter or simply ignore whatever might be referred to as the contract. If there is one.

So, while I will agree with you that some collective action will be preferred over individual ownership in some cases, I will not agree to the assumption that collectivist is equivalent, preferred or otherwise desirable.

Is it? It gets the job done given the resources at hand. We know that technology in 1867 was nothing like what we have today, so a large iron gate, being the height of technology then, was probably the height of efficiency for the job at hand. I question whether the provision of roads by government can be considered more efficient given that the only way for people to get changes to their local roads is to lobby the government, sometimes for years, to pony up the money or put a bond issue on the ballot in order to get voters out to pay for it. It's an extremely costly system and I don't think that you've adequately calculated all of the transaction costs of the roads. That's not to mention that government road users are frequently made to pay for things which have nothing to do with their use. For instance, the bridge tolls collected in California go to the MTC, which may spend them on things other than the bridge. 68% of Golden Gate Bridge tolls are spent on the provision of services that having nothing to do with the bridge but which bridge bureaucrats deems beneficial to the public. It is often the same with gas taxes, sold as necessary to provide roads, but which then go to general revenues to pay for legislators' pet projects.

 

It's when government, and it's monopoly on the legal use of force, gets involved that the collective becomes collectivist. An HOA cannot arbitrarily change the contract between itself and the members of the collective, so in order to get changes made, it must obtain the sanction of the homeowners to the extent required in the contract. In the HOA in which my home is involved, that would require 100% consensus of all homeowners since there is nothing in the contract that allows the HOA to do anything but maintain the swimming pool for public enjoyment. The government, on the other hand, has no incentive to satisfy the members of the collective, as it relies on coercion backed by the threat of violence to get what it wants, and may arbitrarily alter or simply ignore whatever might be referred to as the contract. If there is one.

So, while I will agree with you that some collective action will be preferred over individual ownership in some cases, I will not agree to the assumption that collectivist is equivalent, preferred or otherwise desirable.

Is it? It gets the job done given the resources at hand. We know that technology in 1867 was nothing like what we have today, so a large iron gate, being the height of technology then, was probably the height of efficiency for the job at hand. I question whether the provision of roads by government can be considered more efficient given that the only way for people to get changes to their local roads is to lobby the government, sometimes for years, to pony up the money or put a bond issue on the ballot in order to get voters out to pay for it. It's an extremely costly system and I don't think that you've adequately calculated all of the transaction costs of the roads. That's not to mention that government road users are frequently made to pay for things which have nothing to do with their use. For instance, the bridge tolls collected in California go to the MTC, which may spend them on things other than the bridge. 68% of Golden Gate Bridge tolls are spent on the provision of services that having nothing to do with the bridge but which bridge bureaucrats deems beneficial to the public. It is often the same with gas taxes, sold as necessary to provide roads, but which then go to general revenues to pay for legislators' pet projects.

 

That's fine, I get how their different. Government doesn't have to be the solution, I'm merely pointing out that completely private roads has some obvious issues so in order to over come those challenges an alternative provider may be optimal. I think we'd both agree that for a market to function properly there needs to be competition and prices that reflect scarcity. The problem with public goods such as roads is that first genuine competition doesn't exist naturally and because it non-rivaled prices ought to plummet to zero (there is no scarcity). You can create it artificially through various policies (such as your fencing/gating), but that it has problems I think we both agree. Although maybe I"m wrong.

That's fine with me. There are alternatives to government providing roads and I'd be open minded to it. I just haven't heard any really good ones.

Yup, by definition in fact. For the record I'm referring to pareto efficiency.

Those types of things aren't relevant to the definition. Government is slow, unweildy, doesn't like to change and is influenced by specials interests that ensure whatever outcome they give us will be mediocre. What they are able to do is create economies of scale and take collective action to accomplish a task, and most importantly to this particular problem, the significantly reduce transaction costs, which considering how difficult coordinating roads is would be very high.

Transaction costs only apply to market transactions, it's the cost of using the market (bargaining and search frictions etc)

Bureaucrats are beholden to special interest groups, despite that though they can sometimes be cheaper to use to solve certain problems.

 

Make it a crime to do that, punishable by one year in prison.

 

Fuel taxes are appropriate for road maintenance but road construction would be better financed through a land value tax. Roads make adjacent land more productive and therefore increase the value of that nearby land. A land value tax would capture that increased value and the road can be financed out of the proceeds, and in that way only those who benefit financially from the new roads pay for their construction.

 

The Federal government cannot create specially allocated taxes. The Constitution doesn't allow for it. All taxes, including your social security taxes, go to general revenues. Most states have similar provisions. Besides, why would politicians want to punish themselves for the way they spend your money?

 

When you say "value', you mean, specifically, the value of the land to the market, not necessarily to the owner. The owner may be happier without the sort of road you think will be better for his property, and by building that road, you reduce the value of the property to him.

 

Now you're trying to cherry pick the public roads to the advantage of stockholders and expect the tax payer to only provide for expensive, non cost effective solutions. The you try to expand the cherry picking to the general case. A rather typical tactic recently use in the parisan wars.

You can always point to the superficial appearances of a public/private project, but even in the few cases that actually benefit tax payers, some citizens take collateral damage. The Devil is always in the details. If you don't trust Government to even contract out road construction, why would you expect them to negotiate a beneficial contract with a multi-million dollar corporation and their army of lawyers employed solely to make certain they always get the better of the deal?

 

What you describe is not what I am advocating. I am talking about private roads provided by the market. That means no government involved in road creation, plain and simple. You argument is a strawman.

 

If the owner doesn’t like the road he can move to a location where the road doesn’t exist, and he won’t have to pay a dime for its construction. If the government taxes others in order to build the road, then the owner becomes an economic parasite, because he captures the value which others paid to create.

But I see where you are going with this, you know that landownership is a government issued privilege, and you believe that government issued privileges are a higher form of property then are earned wages. So in a world where government does exist and does build roads, you would rather the government strip producers of wealth so that the privileged landowners can gain wealth without effort.

 

No Government involved??!

Right now anybody is free to buy all the land they want, get the approval of the various utilities for right of way, pave the whole thing over and charge admission. The trick is to do so where anyone cares.

I'll admit I have seen it done. It's called Disney World. But no one is really interested that it connects Kissimmee and Hwy 429.