What is public transit? [Economics]

What is public transit? What do those words mean to you? What do those words mean to those who use it & why doesn’t everyone use public transit, if it truly is public? Public transit was supposed to answer the age old question of how do I (as a city or region) reliably and efficiently move around the people who live, work or commute through my city, so its users can meet their own personal goals and aspirations for their day. It’s supposed to lift people out of poverty and enable those who cannot afford to make the move across town, still accept that job because public transit will solve ‘the moving problem’. Noble concepts and from what we have discussed it is obvious that public transit is supposed to solve what we will refer to as the “moving” question all the while saving people money and time. I will preface my article by stating I present no new ideas, only old ideas recycled.

So here’s where we will take a look at the public transit problem from a different lens. As mentioned above we’ll take a look at a theoretical system that transports 100% of its citizenry across town and compare it to one that transports none. It’s pretty easy to imagine the latter; look at many major American metropolis’s as they currently stand. Living in Detroit for a year, I can tell you, the public transit there is non-existent. To get from one end of the city to the other? It would be a 2-2.5 hr venture and forget considering that option if I had to commute. I’d rather just stomach whatever it took to afford a car out there because 4-5 hours a day of commuting is just not something I’d be able to stomach. This also leads to more income inequality because there’s less labour mobility – fancy way of saying you won’t take a job that’s 1hr+. That and it’s been said, that providing a convenient way for people who live in the ghetto to get downtown, is the fastest way to empower those citizens because you bring them directly to high paying jobs. Forget the immediate benefits, even if someone from disenfranchised community lands a good job, it motivates everyone around her. Detroit is not alone in this poor public transit question. I was shocked to find out after visiting San Francisco how absolutely non-existent its public transit happens to be. Growing up and watching Full House I thought the cable cars were everywhere, not just a few streets. I find it quite amazing that Toronto, SF & other cities who claim to be at the forefront of stopping climate change, drag their heels when it comes to implementing efficient solutions for the public transit question. Better and more efficient public transit directly translates to more cars off the road and better labour mobility. As someone who lives in the Hamilton area, I’d shoot myself in the foot rather than take a job past Mississauga; directly hampering labour mobility and with real estate growing 10+% YoY, this has a tangible detrimental effect on our economy. I covered how traffic limits skills to constrained geographic areas in this article, but this article and that article get to the same point; that point is combining the effects of traffic and poor public transit, hinders the economic progress of a region. Not only economic but social as well, how many times have you used ‘the traffic excuse’ when avoiding to go crosstown for a social event.

Now let’s compare this to a system where everyone takes public transit. For this to happen, you must consider competition. For the masses to all ditch their cars public transit requires these critical features:

1) It must have the confidence from its population that it will operate when they require it

2) It must offer travel times that are comparable to driving in your own car

3) It must be affordable

Your politicians would put these three features on the corners of a triangle and ask you to pick two because picking all three is impossible. Here’s where you have to think about public transit as a system. Think about your body. It has thicker arteries that carry a high bandwidth of blood to and from the bodies major organs then it has smaller arteries that carry blood into every little nook and cranny of your body.

By utilizing outside the box thinking, a private & public partnerships combined with an Uber like data-driven payment and logistics engine, would allow all three corners of the triangle can be satisfied. Take a deep breath. Remember without thinking about the basic problem you’re trying to solve, you’ll end up thinking like a politician who all just think the same way. In Toronto, they’ve been arguing about a subway extension for the last 20 years. What if I told you, you could get that quick, affordable public transit tomorrow. Minimal investment, only retraining and a reallocation of government owned resources. Now here’s where you’ll say you presented too simple of a solution for such a complex problem and here is where I will expand on it.

Firstly payment and logistics. All handled through an app. No need to have payment handling done in person. If people want to pay in person, make those people pay a surcharge to maintain the existing infrastructure, a city like Toronto could even keep the token system. This will organically incentivize people to pay in-app. App also lets the required party know where to pick up and drop off. I bet once the system is worn in, it would even be able to guestimate pickup and dropoff times accurate to within minutes (you know like Uber currently does). I would recommend people still pay a flat rate, which would be shared between the private and public parties that facilitates the person movement. The large arteries are the high traffic areas that require busloads of people. Since municipalities already possess busses and the resources required to maintain them, they’d be the ideal candidate to handle all high traffic movement (think Main St) or to and from a University and Central Station. Next we get to the tricky part, the little arteries that have to navigate from the central drop-off stations to the individual homes people need to be dropped off at. Again another old idea. Dollar cabs. They work in New York (maybe because the density permits it) but without trying its unknown whether or not this would work in elsewhere. Burlington (my hometown) has ~170k people living in it. If the system attains a penetration rate of 60% where users use the system 3 times in a day paying upwards of $2.5 a trip, that’s potentially a $90M industry. My point is that private investment could be attracted by this industry and you could make it so licenses are dependent on customer service delivered by the private operators, since they’d be ideally picking you up and dropping you off. This policy would have a side effect of eroding current auto sales but also it would also deliver considerable environmental savings from a carbon footprint point of view.

Right now people don’t commute because it does not make sense to. If I want to go to my friends house in downtown Toronto from my current place of residence, I would have to take 2 buses totaling 45 minutes, the go bus (an hour) & then the subway (40 minutes) all the while costing ~$12-14 bucks 1-way. Compare that to 45 minutes & maybe 5 bucks for gas, insurance & wear and tear on my car. Noone wants to pay that extra amount, especially when it comes to their commute because those costs add up. What if I also intended to go to a Raptor game a month (again 12-14 bucks 1-way) or maybe even a trip to Niagara Falls (similar time and money perspective). I wouldn’t, if I didn’t have a car and that’s not fair. The government does not even price public transit fairly. The government performs many services inefficiently, they use public transit as a way of funneling money from what’s supposed to be a lean service (people movement) into government programs that no longer serve their purpose effectively. As a citizen of Toronto, I’d be asking myself why I have to stomach another decade of arguing over a subway, when I could have my dollar cab + bus trip deliver me the public transit I deserve NOW. Btw this is Uber’s current strategy, to utilize high traffic routes where demand is pent up but unfulfilled because of government inaction, and service it through ride sharing, all the while reducing our carbon footprint. I mean most public transit could be automated if we dropped the requirement for transit to fill the general municipal coffers. If people want transit they should get it. It shouldn’t be every year the TTC delivers a surplus to the government then when the TTC needs investment they have to BEG government for the money. It’s not smart policy but because everyone on your city council does not think about the big picture, you’re stuck with the government you vote in.

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Author: gtareguy

Real Estate Investor Raptors fan (don't cry for me this year) Mech Eng Graduate

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