On NYC's Subway Pricing Chaos
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Just two days before a massive fire caused subway chaos in Manhattan (yet again), mass transit officials declared that, lo and behold, they have too much money and want to give some of it back:
This is not what the MTA is chartered to do.
The MTA, a bureaucracy that is neither puny nor poor, exists to provide mass transit services at cost. Its raison d'etre is not to amass surpluses of nearly a billion dollars and then play Santa or Scrooge with arbitrary discounts.
It was wrong to accumulate such a surplus in the first place. Given that it now exists, it is wrong to use it for any purpose other than to shore up its own finances or to fund capital improvements.
If the MTA honestly can't think of anything better to do with its surplus than have a temporary, warm-fuzzy-feeling "sale" on fares, then let me make a modest proposal:
A subway endowment.
It would work like this: Whenever the MTA runs an unexpected surplus (which, remember, means the MTA was incompetent in its financial modeling and forecasting), the extra money would be put into a permanent fund, managed by independent trustees, the income from which would help offset the general operating expenses of the system, thereby helping to keep fares low in perpetuity.
This is hardly a Nobel Prize winning discovery. Permanent civic institutions often rely on endowments — colleges, museums, orchestras, scholarship funds, houses of worship, etc. — so why not mass transit? The benefits of an endowment are permanent and perpetual. They are also egalitarian, since all future riders benefit and not just those randomly fortunate enough to be paying their fare during some arbitrary interval.
The MTA should either figure out how to properly price train fares or at least put its surpluses to a use that would benefit all riders equally.
Either that, or at least spend the money on figuring out how to avoid burning the system down every few months.
More thoughts from Andrea Peyser.
UPDATE: Governor George Pataki, who controls the MTA board, has expressed his opposition to the "fare sale."
In an unprecedented move, the Metropolitan Transportation Authority will cut the base fare in half to $1 on weekends between Thanksgiving and New Year's Day, agency sources said yesterday.Of course, what is described as "giving a break" to riders between Thanksgiving and Christmas is really a redistributionist tax from all the people who rode the subway up until now (who have been paying what now appear to be artificially high fares) to subsidize later riders (who will pay artificially low fares).
The "bonus days" — which also include the last week of December — will be funded by a portion of the agency's $928 million surplus projected for the end of this year.
...
The discounts will cost the agency $50 million, but will encourage the use of mass transit during the holiday season and give riders a break in the face of escalating gas and home-heating costs, according to the memo.
This is not what the MTA is chartered to do.
The MTA, a bureaucracy that is neither puny nor poor, exists to provide mass transit services at cost. Its raison d'etre is not to amass surpluses of nearly a billion dollars and then play Santa or Scrooge with arbitrary discounts.
It was wrong to accumulate such a surplus in the first place. Given that it now exists, it is wrong to use it for any purpose other than to shore up its own finances or to fund capital improvements.
If the MTA honestly can't think of anything better to do with its surplus than have a temporary, warm-fuzzy-feeling "sale" on fares, then let me make a modest proposal:
A subway endowment.
It would work like this: Whenever the MTA runs an unexpected surplus (which, remember, means the MTA was incompetent in its financial modeling and forecasting), the extra money would be put into a permanent fund, managed by independent trustees, the income from which would help offset the general operating expenses of the system, thereby helping to keep fares low in perpetuity.
This is hardly a Nobel Prize winning discovery. Permanent civic institutions often rely on endowments — colleges, museums, orchestras, scholarship funds, houses of worship, etc. — so why not mass transit? The benefits of an endowment are permanent and perpetual. They are also egalitarian, since all future riders benefit and not just those randomly fortunate enough to be paying their fare during some arbitrary interval.
The MTA should either figure out how to properly price train fares or at least put its surpluses to a use that would benefit all riders equally.
Either that, or at least spend the money on figuring out how to avoid burning the system down every few months.
More thoughts from Andrea Peyser.
UPDATE: Governor George Pataki, who controls the MTA board, has expressed his opposition to the "fare sale."
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Posted by KipEsquire on
21 October 2005
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