Insidious Subsidies Granted to the Automobile

By Francis de Winter 1401 Laurent Street Santa Cruz, California 95060 Phone: (831) 425-1211

In the century since the automobile became a reality, it has literally changed the face of the earth. Pavement crisscrosses the whole nation, and covers the equivalent of whole states. The automobile industry is the largest industry in the USA. Our lives seem to revolve around the car.

Most people realize that the car produces air, water, and soil pollution which harms people other than the driver. Most also realize that the car is responsible for urban sprawl, and that if "public transportation" is "not economically feasible," this is generally because we are trying to fit a bus or a tram or a train service, into an urban structure which was urbanized not around "public transportation," but around the "private automobile."

Few people realize, however, the extent to which the automobile has worked its way into our code books, our systems of law, our ordinances, and our taxes. In the most insidious and unsuspected ways, the automobile industry has managed to line up subsidies for itself. These are hidden well enough so that many seem to be unaware that the automobile is a very costly luxury for society.

These legal battles started very early on, and at the beginning they often went against the car. In the early part of the century there was an ordinance in many towns: Any automobile must be preceded by a pedestrian ringing a bell, so as to avoid ..scaring the horses. This particular ordinance however did not ..last too long, and now the pendulum has not only swung the other ..way, but it is stuck way out of control and almost out of reach.


Taxes are quite biased. Railroad bridges and rights-of-way pay real estate taxes. Real estate is however "condemned" to build a road, after which the real estate pays no more taxes.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx For example, with the use of codes, laws, and taxes, many car costs are folded into residential costs in hidden ways. When one builds a new house or owns a house, one must make certain provisions and payments for the automobile. A reasonably large house must have a two-car garage, it must have a driveway large enough to accommodate a few parked cars more, it must have enough in parking area in the street for a few cars more, and it must pay enough in off-site "traffic" (i.e. car traffic) impact mitigation to compensate for "x" car-trips-per-day-per-bedroom, whether one owns a car or not. Finally, in the local real estate taxes (not in the gas taxes, mind you), one must pay for the local police, for much of the street paving and the street repairs, for the traffic courts, for the ambulances, for the fire trucks, for the hospital emergency room costs, for the morgue, and for many other car-associated costs. One might well then buy a second hand VW, but one may already have paid for a new BMW without realizing it, all hidden in the "residential costs."

These car-costs can be very significant. A cantilevered two car garage on a hillside lot might cost many tens of thousands of dollars. If one tries to do things on the cheap one can end up with an unlivable arrangement, after having simply surrendered to the automobile. Examine the "townhome" condos on River Street across from the San Lorenzo Lumber store, or the development on the South-West corner of Bay Street and High Street. In both cases, most of the ground level has been turned into pavement or into garages, where the car rules supreme. The homes may be cheap to buy; but is this the only real cost, when the occupants may well feel exiled in upper floor rabbit hutches?

pa Many are oblivious enough to all of this to claim that the car is by far "the most cost-effective" transportation system, that it is the "free enterprise transportation system par excellence," that "public transportation is highly subsidized," etc. Detroit could not have said it better.

The 1994 "State of the World" publication of the Worldwatch Institute (W.W. Norton & Co., NY) has an interesting chapter entitled "Reinventing Transport" which should be read by all who are interested in this area. One thing mentioned is that if gasoline taxes were to cover the real cost of the automobile, they would have to be twice as high as they are in Europe (where they are as high as US$4.00 per US gallon). Raising the cost of gasoline is clearly politically difficult. The recent President-elect of Venezuela confessed that he had promised the voters that gasoline costs in Venezuela would not go above US$0.22 per gallon, and that if he had not made that ridiculous campaign promise he would not have had a chance at the polls! The current worldwide fad of building toll roads gives another indication: governments build toll roads when they do not have the courage to increase the gasoline taxes to pay for new roads.

The mayor of the city of Pasadena recently gave a talk in Santa Cruz. He mentioned that in Pasadena they concluded that cars cost the city seven times as much as the cars paid in taxes. In Santa Cruz things are probably not much different.

There are many things on which action in Santa Cruz is impossible. If, for example, we levied a large gasoline tax in Santa Cruz, people would simply go elsewhere for gasoline. We can however decide to change the car subsidies associated with buildings, by using deed restrictions and car usage fees, and there is no reason why in this area Santa Cruz should not take the lead in the nation. Why should the home buyer in Santa Cruz not be able to make the following choice: Considering the limited amount of money I have to spend on a house, should I get a two-bedroom-three-car house, a three-bedroom-two-car house, or a four-bedroom-one-car house? People never get to make this choice. Should Santa Cruz not try to make this choice available, and give people the freedom from servitude to the automobile?

In a new house, the developer could choose to build such different types of houses, with the limited car ownership rights (or quota) built in as a deed restriction, and a DMV privacy waiver required for ownership or occupancy so the city would be able to confirm that the occupants did not exceed their car quota. If someone wanted to exceed their car quota legally they could do so by paying a tax or user's fee to the city (say $1,000 per car per year), and there could be an anonymous reward for reporting cheaters, with a fine on the cheaters for paying the reward. The benefits would come from giving people the freedom to choose an extra bedroom instead of a car, in reducing pollution, in increasing the livability of Santa Cruz, and in keeping Santa Cruz from becoming another Los Angeles.

Santa Cruz should feel free to experiment with these types of things. Others are not going to do it for us.