Tag Archives: externalities

book: Power Hungry

I just got finished with Power Hungry: The Myths of “Green” Energy and the Real Fuels of the Future by Robert Bryce.

The basic gist is that everything you “know” about power, particularly if you are an American, is wrong. His data is no doubt correct, but I think he goes out of his way to sometimes mislead. For example he claims that the United States economy is somehow very energy efficient. To prove his point he gives figures for the change in energy intensity over some period shows that the US is “winning”, beating such countries as France and others. The trouble is, a simple trip to wikipedia shows that actual, and not the percentage change in Continue reading book: Power Hungry

Phoenix city parks to charge $5 fee for parking

More on driver’s attitudes towards parking:

“I’m kind of flabbergasted,” … “It seems like we’re getting taxed right and left. They shouldn’t be charging for this. It’s going to be a financial burden for some people.”

And what is “this”? Why, (formerly) free parking of course. Parking must be “free” and plentiful. And I’m sure it could be a burden for some, but let’s keep things in perspective; Phoenix recently instituted a 2% grocery tax.

The plan would charge $5 a day, yearly passes would be available for $75. [arizona republic]

Little drips make a big mess

More externalities of mass motorization.

The Arizona Republic ran this USA Today story under the better-named  headline “Gulf spill can’t rival oil seepage from cities: Over time, tiny drips add major pollution to oceans”.

“Human-caused spills send more than 300 million gallons of oil into North American waters every decade, an amount roughly double the highest estimate of the BP spill”… “the largest human-caused source of oil into the environment is the byproduct of millions of autos and other oil-powered devices.”

Land-based oil spills add up, too

USA Today, 6/30/2010 Continue reading Little drips make a big mess

Burning 10,000 barrels a day

In order to mitigate marine damage, some of the oil that is leaking from the blown-out BP / Deepwater Horizon well, around 10,000 barrels a day is being burned into the open air in a completely uncontrolled combustion. [story from AP: BP starts burning oil from leaking ruptured well, June 16, 2010]

BP or whoever can theoretically run around an pick up every tar ball and clean off every pelican, but who is going to clean the air? As is usually the case, nobody does.  So everyone gets dirtier air. It’s just blowin’ in the wind. Just another externality of oil and gas consumption.

Ezra Klein had a good piece on externalities in last week’s Washington Post:

Think gas is to pricey? Think again Continue reading Burning 10,000 barrels a day

Agressivity and SUVs

No, not aggressive driving. This is why (truck-based, not so-called “crossover”/car-based) SUVs and pickups are bad for everybody.

The term agressivity refers to…

The effects of vehicle model and driver behavior on risk,  Accident Analysis & Prevention, Volume 37, Issue 3, May 2005, Pages 479-494

We find that most car models are as safe to their drivers as most sport utility vehicles (SUVs); the increased risk of a rollover in a SUV roughly balances the higher risk for cars that collide with SUVs and pickup trucks. We find that SUVs and to a greater extent pickup trucks, impose much greater risks than cars on drivers of other vehicles; and these risks increase with increasing pickup size. The higher aggressivity of SUVs and pickups makes their combined risk higher than that of almost all cars. Effects of light truck design on their risk are revealed by the analysis of specific models: new unibody (or “crossover”) SUVs appear, in preliminary analysis, to have much lower risks than the most popular truck-based SUVs.

Welfare Wagons

In a typical bit of masterful Jenkinsian prose, he lays out the case for raising fuel taxes, which I happen to agree with. However, he scolds “politicians” for not being courageous while at the same time not endorsing any such increase himself. This theme appears over and over in WSJ editorial opinions.

Even if you believe saving gasoline is a holy cause, subsidizing electric cars simply is not a substitute for politicians finding the courage to jack up gas prices. Think about it this way: You can double the fuel efficiency of any car by putting a second person in it. You can increase its fuel efficiency to infinity by refraining from frivolous trips.

These are the incentives that flow from a higher gas price. Exactly the opposite incentives flow from mandatory investment in higher-mileage vehicles. You paid a lot for a car that costs very little to operate—so why not operate it? Why bother to car pool? Why not drive across town for a jar of mayonnaise?

Welfare Wagons, WSJ, May 12, 2010

Use taxes are the best way to reflect the externalized costs of an activity.  E.g. in this example taxes on motor fuel. Fuel taxes have been falling for years, this makes the cost of driving less and less — which, as Jenkins points out, tends to make people drive more and more. There are a couple of reasons the tax is falling, one is the simply that taxes are levied on a per gallon basis and the amounts rarely change (Arizona has levied the same tax for around 20 years), this means the real price of the tax is continuously falling. for 20 years. Another is the tendency for vehicles to become more efficient over time, resulting in a lower tax per mile traveled.

City Liability

The Arizona Republic did a roundup of the city of Phoenix’s motor-vehicle  liability claims paid over the about the past 5 years, 2005 – most of 2009. It was about $15M

Phoenix pays millions… March 6, 2010.

On one hand it seems like a rather moderate amount. And not all of these claims has to do with what would normally be viewed as a traffic crash (like e.g. the bus-door-closing ones). Yet still it illuminates just another unpaid (“external“) cost of our car-culture.

Cities, townships, counties, states, and the federal government all run enormous fleets of motor vehicles, running in the many millions of vehicles. Liability expenses being just one of the smaller costs; fuel, capital cost, maintenance and so forth all add up to more.

The vast majority of these expenses are not paid via any sort of use fees (e.g. gasoline tax) on automobiles — but rather from general fund sources; property taxes, general sales taxes, income taxes, and so forth. And my favorite, the new grocery tax; yes we have to pay city sales taxes on groceries, in part to bankroll Phoenix’s vehicle fleet. I’m thinking government entities don’t even pay the so-called “road taxes” on fuel, nor do they pay other use taxes, like Arizona’s VLT (Vehicle License Tax). More on Road Taxes in Arizona. Continue reading City Liability

More on the socialized cost of parking

An integral part of unrestrained car use is having somewhere to put the darn things when we’re not driving them. Enter the “free” parking space.

They aren’t, of course, actually free — thus someone else is paying, not the driver using it, it is external to the cost of driving; call it socialism for drivers. Thus leading to ever more demand for more driving and more parking spaces.

from the Arizona Republic 12/28/2009; Ahwatukee Park-and-Ride Lot Expanding.

In the example mentioned in the story, 353 spaces are being added to the existing 562 for a cost of $3M. That’s $8,500 per space. But that is only the cost of construction (or land but that is cheap); the ongoing costs aren’t listed but they are significant. A not exhaustive list would look something like; lighting, maintenance like sweeping and cleaning, and re-sealing asphalt, full-time(one employee ~ 50hrs/week) security during operating hours, cost of operating the small building (heat and cooled approximately 24×7, even though no one is usually there; didn’t these people ever hear of a programmable thermostat?).

see Doug Shoup’s book mentioned here; The High Cost of Free parking.

In the particular example of a transit park-and-ride lot it gets even more interesting because of the cross-subsidies involved in mass transit. One wonders if the best use of presumably limited transit funds is to build parking spaces for the relatively well-off remote suburban commuters. This lot serves only one bus line; a rapid/express (no intermediate stops) route between Ahwatukee and downtown Phoenix. The line only runs one way, and only in the morning and evening. Thus the parking spots have low turnover — one spot equals one round trip rider.

Photo Enforcement in the mainstream media

The WSJ (news side) did a story on photo enforcement. Since there’s so much activity on this issue in Arizona, we figured prominently in the story.

Overall, it strikes me that it was fairly typical of such stories. The point of view of photo enforcement opponents, “it’s all about the money” is well represented, and I think that’s fair. But what troubles me, though, is the lightweight treatment of the safety aspects and the science involved. Consider:

Studies are mixed on whether traffic cameras improve safety. Some research indicates they may increase rear-end collisions as drivers slam on their brakes when they see posted camera notices…

A study of crash causes released by the National Highway Traffic Safety Administration last July found about 5% of crashes were due to traveling too fast and 2% were from running red lights. Driving off the side of the road, falling asleep at the wheel and crossing the center lines were the biggest causes identified.

Get the Feeling You’re Being Watched? If You’re Driving, You Just Might Be. William M. Bulkeley, the Wall Street Journal, March 27, 2009, p. A1

The truth, or rather, the problem with that analysis is it ignores the relative severity of rear-end vs. an intersection collision. The 5% figure is interesting and misleading at the same time. It refers to the National Motor Vehicle Crash Causation Survey.

The article also talks about use of automated license plate reading technology being used for other (not traffic enforcement) uses, such as catching those with outstanding fines or whatnot.

Meanwhile, just wandering around the internet, I noticed the author of Traffic: Why We Drive the Way We Do (and What It Says About Us), a wonderful book by the way, Tom Vanderbuilt, blogged on the same article as well, with similar criticisms “to compare them so casually is typical of myopic mainstream-media reporting when it comes to traffic safety”. He also puts traffic dangerousness into terms of it being an externality of driving, just one of many, of course.

WSJ: just say no to taxes; and personal responsibility

In yesterdays ed, Tax My Products, Please the WSJ argues that Ford CEO Mually’s call for higher fuel taxes is like “a Google executive demanding a tax on software”.

That analogy being as it may; what they are really renewing is their intentional obliviousness to externalities. And the tacit cost-shifting that inevitably results. Combusting fuel is damaging on its face (even if you don’t “believe in” global warming — as the WSJ editorial board clearly does not). Both in environmental damage and the toll it takes on human health.

So, who pays for all the negative externalities arising from automobility? Drivers don’t; the costs are all shifted to “society”.

They firmly support the status-quo; dead-set against cap-and-trade, and dead set against any increase in fuel taxes. Fuel taxes, which are supposed to fund road construction and maintenance have been dwindling in real dollars for years. The gas tax, which is levied per gallon, hasn’t budged in years; and does not adjust for little things like inflation. It has been at the current federal rate of 18.4 cents per gallon as long ago as 1993 (going on 16years! The arizona state gas tax hasn’t changed in even longer). This leaving a gap which is filled from other funds, like income, sales, and property taxes. (sources that have nothing to with driving).

This underpricing inexorably (remember WSJ eds, the laws of economics?) causes a greater demand for driving, and more roads, and more driving…

To cap off this topic, I’ve pasted below the one letter-to-the-editor that ran in print edition today, March 20, 2009. At first I thought the writer was being ironic, but apparently not. On closer inspection, it seems that he is of the something-for-nothing school. He believes, for example, that a 5,000lb. truck can or should get “more than 30mpg” (though he doesn’t say gallons of what; perhaps it is rocket fuel or something). To support his belief, he cites an acquaintance that has done so; but for unstated reasons, no one sells what would certainly be a highly desirable vehicle — perhaps a conspiracy? In the real world, expect to get about 15mpg in a 5,000 pound vehicle. If automakers (and that includes not just the big-three, but all of them worldwide) could make their engines twice as efficient; THEY WOULD DO SO.

In response to Ford CEO Alan Mulally’s call for higher gas taxes (which you report in “Tax My Products, Please,” Review & Outlook, March 17), I would like to say that Americans don’t want smaller vehicles. We have great distances to travel, mountains and plains to cross in all seasons of the year. We tow our boats and other contrivances. We haul our children around and travel with them over the continent. Our businessmen drive long distances since they can no longer own corporate jets. What we want is a more efficient internal combustion engine, not a smaller car.

And do not tell us it cannot be done. It can be done, because efficient engines can be created today with off-the-shelf parts bought from General Motors, Ford or Chrysler.

A friend of mine has converted a GMC Vortec V8 gasoline engine for his 2.5 ton pickup truck and the engine delivers more than 30 mpg. Why can’t we buy this type of vehicle at the dealer? Why does individual ingenuity have to point the way to corporations that have the money, skill and engineering brainpower to deliver a more efficient engine? Why do we have to pay more at the pump?

The suggestion that consumers should pay more in gasoline taxes is a cop-out on the part of the auto makers, politicians and everyone else who supports it. This is not Europe. This is the United States of America, a vast country with amazing distances and varieties of geography and climate.

We do not want higher gas prices. We want more efficient engines to power our vehicles. We want the Big Three to use their brains to create something new, not deliver a rehash of junk from a bunch of whiners.

Bernard P. Giroux
Fall River, Mass.

Ozone and CAFE

Coincidentally, two related-but-unrelated items came out today.

A new National Academy of Sciences report confirms (reconfirms?) the link between elevated ozone air pollution and increased risk of premature death was released. See, e.g. Panel Confirms That Ozone Kills, US News & World Report April 23, 2008. Ozone is an unavoidable byproduct any combustion, e.g. automobile use.

On the fuel-economy front, presumably to coincide with earth day, Bush Administration released accelerated CAFE standards. See e.g. Government to release proposed fuel economy rules, Associated Press April 22, 2008.

Holman Jenkins’ WSJ Business World column, A Volt out of the Red, gave his usual analysis of CAFE, which I believe is right, and I tend to agree with. My complain is his sin of omission — does he not know about toxic pollution? He continues to berate the Prius, as in this dig “…GM intends to beat Toyota at its own game of selling bogus green symbolism to Washington and Hollywood”.

Does toxic pollution not count? Since apparently Jenkins doesn’t “believe in” global warming, does that also mean he doesn’t believe in air pollution either?.

The Toyota Prius (note 1) puts out only about one-half the ozone-forming pollutants per mile of the average new car (average is defined as being bin 5). An absurd vehicle like the Hummer H2, bin 8, emits between two and ten TIMES as much ozone-forming pollutants (note 2). How much more are H2 drivers paying to pollute the air, say, compared to Prius driver? Nothing. Drivers pay nothing. And if you can believe it, the H2 situation now is much better than it was a few years ago, in 2004 model year the H2 emitted between five and 30 times the pollution of a Prius.

And it’s not like Toyota is “green” and Hummer (owned by GM) is dirty — Toyota produces their own dirty cars, e.g. in 2008 the Scion XD bin 8, just like the H2. Though it looks like Toyota never produces a bin 11 car.

What’s the point? I don’t own a Prius. The point isn’t for everyone to run out and buy a low-emissions vehicle — that actually wouldn’t work because the regulations work on a fleet average. A constructive start would be to price pollution appropriately. This simple market-based solution would reduce the total amounts of smog and result in better health for all. The polluter, that is to say the driver, should pay.


1) See EPA GreenVehicle Guide, About Ratings. Pdfs for vehicle emissions standards, and summary/history (the glossary is particularly useful). This explains the Tier 1, and Tier 2 “bins”. This is all terribly confusing because the bin number (1 through 11) goes up as pollution goes up — whereas the EPA’s “Air Pollution Score” (10 downto 0) goes down.

2) Retrieved from the 2008 model year EPA Green Vehicle Guide.

-) Another explanation of Tiers and Bins at hybridcars.com

-) Excellent article at Edmunds: Untangling U.S. Vehicle Emissions Regulations