Britschgi on Mass Transit
By David Henderson
Britschgi makes multiple good points. Here’s one:
For starters, for all that he writes about Uber’s low fares, Hill spills not a drop of ink on the fact that those public transportation services are themselves subsidized up to their eyeballs. Unlike Uber, whose losses are covered by shareholders voluntarily sinking cash into the company, transit subsidies come straight from taxpayers, whether they ride it or not.
I am aware of no transit agency in the United States that turns a profit. Few are even able to cover half of their operating expenses with traditional farebox revenue.
Take New York’s Metropolitan Transit Authority (MTA), which runs the city’s buses and subway system. It’s the most heavily used transit system in the country, and it services America’s most densely populated major city, yet it covers only 40 percent of its operating expenses through with farebox revenue.
Hill mentions a colleague who expresses a preference for a $5 Uber ride over a $2.25 bus ride. Hill asks his friend whether he’d make the same choice if that Uber ride was an unsubsidized $10. Given that MTA’s bus service covers less than a quarter of its operating expenses with ticket sales, perhaps Hill should have asked his colleague whether he would prefer a $10 Uber ride or a $10 ride on the bus.
I recommend reading the whole thing.
I’ve been following Britschgi’s work for a number of weeks now and he hits it out of the park a lot with both factual backing and clear writing.
Christian Britschgi responded to my query about ad revenue based on commenter JFA’s query. Christian writes:
[T]he stats I relied for my article came from MTA’s 2018 financial plan. It lists yearly ad revenue from 2017 for the whole system at about $148 million. That’s compared to about $6 billion in farebox revenue, so a pretty small portion of the budget overall. Ad revenue is included in “other revenue” which is about 4 percent of overall revenue.
He also gives a link for those who want to look further.