The Ontario government has proposed to study the effects of converting some HOV lanes into HOT lanes, to reduce the costs of traffic congestion. Traffic congestion is an important issue for people interested in real estate because those costs affect both the market value of a property and its advantage relative to a competitor. It is a pity that the comments which followed were so predictable.
The immediate and loud response confirmed a basic rule of tax policy. It is never surprising to hear people complain about any “tax grab”: the basic rule states that a successful tax policy is not the one which “makes everybody happy” but is able to “pluck a live chicken while suffering as few bites as possible”.
With that perspective, most of the commentary was boring. Yes, there are many examples showing how government is not as efficient as you would like it to be. There are also many examples of private enterprise being badly run for many years and, somehow, surviving the pressures of a competitive market. Thus, it is not immediately obvious that it is better for money to be spent by the private sector vs. the public sector.
To commentators on the political left who complain about the government creating “Lexus Lanes”, I would have thought that the debate is not about whether to charge the rich but about how much. (Conveniently, sales by Lexus make up about one percent of the Canadian market.)
Thus, it looks like this government is taking a “middle of the road” policy.
A common and related theme was “My currently-high taxes pay to build roads. Why do I have to pay extra to use them?” When stated this way, the answer should be obvious. If you own a car, you pay a lot to have it sit in your driveway. To use the car, you have to pay extra for the gasoline.
This is a long-winded way of me saying that the debate is currently at the silly stage. The real starting point for the debate is something which I emphasize to my students: it is misleading to ask “should you pay extra?” because you already pay without opening your wallet. There is some debate about whether, compared to the rest of the world, traffic in the Toronto area should be even considered as bad.
The proposal aims to study the effects. So, as a researcher, I would have thought commentators to offer predictions about the effect (in a way which could later be confirmed or proven wrong). This would add to the research which has already been done ( e.g. , ).
The issue of traffic congestion is interesting for lots of big and small reasons that most people do not understand well. It is all about behaviour. So, a number of paradoxes wait for careless thinkers. It is even possible for a traffic jam to be self-generated, without any trigger such as an accident or construction, as shown in this video. (Congestion can be studied with some fancy mathematics of dynamic systems, which is another reason why you should learn more math in school.)
Before we all use self-driving cars, there is one solution which the government should pursue: improve driving skills and get bad drivers off the road. To see how this might affect traffic flow, consider the ordinary drivers driving at 50 mph on the 401 vs. the professional drivers in NASCAR driving at 150+ mph (and think of what they could do if they co-operated).
If that solution is not to your taste, here is a final suggestion.