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This is interesting information, but from the perspective of a high-value urban area, even these fairly eye-watering numbers are a understatement. The capital r

This is interesting information, but from the perspective of a high-value urban area, even these fairly eye-watering numbers are a understatement. The capital represented both as infrastructure and forgone real estate usage (i.e. yes, we need roads, but building more roads than we need diverts incredibly valuable real estate from other purposes) is huge. I'm always amused here in Australia when governments like to make the spending on roads and the amount raised through petrol taxes and registration fees "balance out". Uhhh, ok, you're sitting on billions of dollars worth of capital and you're patting yourselves on the back that it's "breaking even".

nightski 7y ago
Sure it's breaking even if you consider the utility of the roads to be equal to the taxed value of petrol. But it's likely far greater than that.
- lmm 7y ago
  The point is that the value created and not captured by the government (at a cost of billions of dollars of what could otherwise be working capital, so effectively being paid for by taxpayers) is effectively a subsidy, and this particular subsidy may not be fairly distributed.
asdff 7y ago
When they built the harbor freeway alone (a half a block wide and 20 miles long), LA razed nearly 100,000 of some of the most affordable homes in the city in the process.
beerandt 7y ago
I'm not sure what you're gunning for here. Spending road money on other projects? Or that real estate used for roads is somehow removed from the overall real estate market (in the active commerce sense, not active listing sense)? If it's a new project, even if land is behind expropriated, the market value is being paid. (I assume, bring Australia) So it does balance out, even in land value. For appreciated value, it doesn't occur in a vacuum. The local transportation is factored in to the market rates for property. So I'm not sure in what sense you don't see it as balanced out. Or what you'd like to see as the alternative.
- glangdale 7y ago
  The way I see it is that the existing road network is an enormous public capital investment that is permitted to woefully underperform due to political pressure to make roads cheap or essentially free. The idea that roads are "breaking even" when you roughly balance road spending and money raised from roads is artificial. Given the huge historical capital investment states have made in their roads they should be making money; or if they are not, we should be acknowledging that we are choosing to not make money at market rates when we compare the costs involved with roads with other forms of transport (especially rail). I don't think we should necessarily do anything different with roads, but we should acknowledge that, well, pretty much everything at this scale needs to be subsidized out the wazoo - roads as well as public transport. I'm not arguing for some sort of dystopia where the government does some crazy user-pays thing on even public asset; just an end to the endless rhetoric about how roads "break even" while public transport "needs to be subsidized".

nightski 7y ago

Sure it's breaking even if you consider the utility of the roads to be equal to the taxed value of petrol. But it's likely far greater than that.

lmm 7y ago
The point is that the value created and not captured by the government (at a cost of billions of dollars of what could otherwise be working capital, so effectively being paid for by taxpayers) is effectively a subsidy, and this particular subsidy may not be fairly distributed.

asdff 7y ago

When they built the harbor freeway alone (a half a block wide and 20 miles long), LA razed nearly 100,000 of some of the most affordable homes in the city in the process.

beerandt 7y ago

I'm not sure what you're gunning for here. Spending road money on other projects? Or that real estate used for roads is somehow removed from the overall real estate market (in the active commerce sense, not active listing sense)? If it's a new project, even if land is behind expropriated, the market value is being paid. (I assume, bring Australia) So it does balance out, even in land value. For appreciated value, it doesn't occur in a vacuum. The local transportation is factored in to the market rates for property. So I'm not sure in what sense you don't see it as balanced out. Or what you'd like to see as the alternative.

glangdale 7y ago
The way I see it is that the existing road network is an enormous public capital investment that is permitted to woefully underperform due to political pressure to make roads cheap or essentially free. The idea that roads are "breaking even" when you roughly balance road spending and money raised from roads is artificial. Given the huge historical capital investment states have made in their roads they should be making money; or if they are not, we should be acknowledging that we are choosing to not make money at market rates when we compare the costs involved with roads with other forms of transport (especially rail). I don't think we should necessarily do anything different with roads, but we should acknowledge that, well, pretty much everything at this scale needs to be subsidized out the wazoo - roads as well as public transport. I'm not arguing for some sort of dystopia where the government does some crazy user-pays thing on even public asset; just an end to the endless rhetoric about how roads "break even" while public transport "needs to be subsidized".