The death of the automobile has been greatly exaggerated And you can blame that on government policies by Steve Lafleur

The death of the automobile has been greatly exaggerated

And you can blame that on government policies by Steve Lafleur

July 23, 2013 

WINNIPEG, MB, Jul 23, 2013/ Troy Media/ – The best public relations campaigns operate under the guise of illustrating public opinion. They can obscure the media’s perception of social trends. If you ask the right questions, you usually get the answers you want – and generate the right news.

For this reason, car-share company Zipcar and General Motors are boasting very different answers to very different questions about the future of automobile ownership among Millennials. Zipcar published a poll that it claims demonstrates that Millennials, unlike prior generations, care more about their computers and smartphones than car ownership. GM commissioned a poll wherein 69 per cent of Millennials claimed that purchasing a car is a key milestone in adulthood.

The Zipcar campaign in particular has shaped the narrative spun by urban-centric pundits and journalists. But is this narrative correct? Is the automobile losing its place as an important part of North American culture? The answer appears to be that the decline is real but exaggerated, and despite, rather than because of government policies.

American adults between the ages of 18 and 34 account for 11 per cent of the automobile market, down from 17 per cent in 2007. Some people argue that this is merely a lingering effect of the recession. However, only 81 per cent of Americans 20 to 24 had their driver’s licence in 2010 compared with roughly 92 per cent in 1983. This appears to signal a broader trend toward urban car-free living.

There are good reasons to believe that these declines are partly due to shifting preferences. While there is no sign of a collapse in automobile ownership, many Millennials apparently prefer to live and work downtown rather than commute from the suburbs. The sharp increase in telecommuting is creating a class of people who need not commute regularly ( me included). Technology can trump distance without the car. It is plausible, if not likely, that automobile ownership will continue to decline in North America. But the death of the automobile has been greatly exaggerated.

North Americans have had a long love affair with the automobile. Fast cars became the marquee status symbol for young suburban males during the 1950s. Pickup trucks continue to be closely tied to rural identity. However, cars appear to have lost their place as status symbols in major cities. It used to be that not owning a car was a sign of poverty and lack of social status. With many young professionals purchasing expensive downtown condos rather than cars, this perception appears to be changing. This shift is not entirely random. The cultural meaning of automobiles is changing in many cities, because metropolitan areas are changing.

America’s cities long had an image problem, partially due to a major post-war escalation of urban crime, which lingered into the early 1990s, and partially due to their portrayal by Hollywood. Movies such as TaxiDriverSerpico andDeath Wish painted an abysmal portrait of urban America. The default assumption of Hollywood pictures right through the 1990s was that U.S. cities are dangerous places (which, in fact, they were relative to today). Young people who grew up outside of urban centres often had little personal experience to contradict this perception. Thus, many grew up irrationally fearing urban centres.

White flight reshaped North American cities in the mid-20th century. Racial tension erupted into horrifying riots that convinced multiple generations of North Americans that cities were not safe places to live. Thus many, if not most, who could afford to move to the suburbs did. The process of suburbanization – while driven by many factors including cheap gas and uncongested freeways – was accelerated by government policies in both the United States and Canada that favoured the construction of suburban homes. Culture and government policies conspired to create the familiar ring of suburbs that engulf North American cities.

Part of America’s image problem had to do with the anecdotal experiences of non-urbanites. For example, I am a partisan of urban living, despite growing up with a negative impression of cities. My first experience with urban America as a child came on the way back from visiting Arlington National Cemetery with my parents. We took a wrong turn and ended up in Anacostia, D.C. That year, there were 133 homicides in the 10-mile x 10-mile neighbourhood. If I had not known which country I was in, I might have assumed it was a failed state. Some people roamed along the streets, accosting passing motorists; others loitered by boarded-up buildings; some burned tires. Nearly out of gas, we pulled into the nearest service station. My father fiddled with the pump and wondered why it was not working. From behind bulletproof glass, the attendant informed him by intercom that payment was required in advance. This experience skewed my perception of large cities until adulthood.

I have since returned to Anacostia, and few could come away with a memorably bad impression today. Given improving urban safety, fewer non-urban children are likely to have negative first impressions of cities.

Urban America’s image began to recover somewhere around the mid-1990s. Massive decreases in urban crime made the decision to locate in major U.S. cities seem less and less unwise. For instance, violent crime decreased by 56 per cent in New York City during the 1990s compared with 28 per cent nationwide. Eventually, big cities such as New York and Chicago became desirable destinations. This might have something to do with the fact that teenagers in the 1990s grew up watching television shows such as Seinfeldand Friends, shows that portrayed New York in a much better light than did movies and television shows from the 1980s. New York became cool for the first time in a long time for middle-class suburbanites. This trend spread to other cities, as people recognized that the proclivity toward greater public safety was not exclusive to New York. As New York became cool, Canadian cities that could offer Manhattan-style urban living – primarily Toronto, Montreal and Vancouver – became socially desirable places for young singles to live.

A growing number of young professionals aspire to move downtown in major cities. Many Millennials value proximity to the amenities that dense cores offer and compare that with long commutes in and out of the city. The average round-trip commute in Canada is 65 minutes. The commute in Toronto is considerably worse at 81 minutes, while Montreal and Vancouver are only marginally better at 76 and 74 minutes, respectively. This is a significant drain on people’s time and money. Being stuck in traffic is stressful, unhealthy and detrimental to one’s social life.

While many people are willing to put up with long commutes in exchange for a bigger yard, a large portion of Millennials are not (particularly those who defer or forego marriage and/or child rearing).

The decline in automobile ownership is likely related to the declining rate of home ownership. Buying a house is not practical for many highly-mobile Millennials. American adults under the age of 35 were 12 per cent less likely to own a home in 2011 than that cohort was in 2006. Urban home ownership has become unattainable to most Millennials, and suburban home ownership is generally only practical when accompanied by auto ownership. Transit to and between suburbs is less reliable than is transit within cities, and homeowners have many reasons to own vehicles that renters do not (e.g., homeowners tend to do their own maintenance and have to travel farther to buy groceries and household goods). Since many Millennials cannot afford both, they are renting downtown instead. According to the American Automobile Association, the average annual car ownership cost is $9,122. Assuming that downtown dwellers pay $120 per month for public transit, to afford a car, they would still have to save an extra $640 per month. This can underestimate the difficulty, given that car ownership requires access to credit and cash for a down payment. This can be challenging for Millennials fresh out of school. (EDITOR’S NOTE: For more on the plight of Millenials, read our series on Generation Squeeze.)

Technology is making alternatives to auto ownership increasingly convenient in urban cores. One example is car services such as Uber that allow people to order a car and driver via smartphone. The phone’s GPS connects customers with the closest driver and bills them electronically by credit card. This eliminates the inconvenience of calling a taxi and often provides higher quality service. Car-sharing services such as Zipcar have provided a viable option for non-car owners for running errands. Since tasks such as grocery shopping are impractical via transit and inconvenient by cab, the ability to pick up and drop off a car after an hour or two can be quite valuable.

While mobility within cities has improved, a renaissance of intercity busing has also increased mobility between cities. The sector shrank consistently from the 1960s until the early 2000s. Smartphones appear to be the turning point. The industry began to grow in 2002, led by curbside bus companies such as megabus that rely on online customer bookings. The fact that people can buy tickets online and display them on their smartphones makes intercity bus travel a more attractive alternative to driving for many in the U.S. Northeast. This trend has spilled over into Southern Ontario and the U.S. Midwest. This erodes yet another rationale for car ownership.

While car-free living will likely increase in large urban centres, it is unlikely to have the same impact in smaller cities. Many journalists and pundits, apparently unaware of the existence of smaller cities, seem to believe that automobile ownership has become irrelevant.

The culture of mid-sized cities is very different from that of major cities. In places without the critical mass for a large urban centre, most people who can afford to drive do drive. There are trendy enclaves such as the Cathedral neighbourhood in Regina and Osborne Village in Winnipeg (my former and current neighbourhoods) where this does not apply, but these are small, self-selecting communities.

Despite Canada’s urban revitalization, suburbs account for the majority of population growth. This is not likely to change. Young middle-class people who want to raise a family in a home with a backyard see compelling benefits to suburban life, which means car ownership. The fact that most Millennials grew up in suburban homes has likely created some stasis. They remember their parents’ aspiration of suburban home ownership.

While car-free living has gotten much easier in major cities, three political barriers are undermining this trend. The first protects entrenched interests such as taxi medallion owners. The second, ironically, is regulations aimed at increasing urban density. The third is our top-heavy tax system.

Taxis are an under-appreciated contributor to urban mobility. They help car-free people get places in a rush, and they give people a safe alternative to drinking and driving. Yet, taxi regulations in virtually every North American city are written specifically to restrict the supply of taxis and to keep out alternatives to taxis.

The reason is simple: A small number of licence holders have a strong interest in constricting the supply of licences in order to inflate their value. They argue that restrictive licensing is required to ensure that drivers earn adequate wages. Of course, drivers would be better off not paying exorbitant lease fees to licence holders, but most people are not aware of how the taxi industry actually works. They do not have the same incentive as licence holders to pay attention, since the direct cost to each person of a constricted taxi supply is small. It is also impossible to quantify the cost of a chronic undersupply of taxis, which alters people’s behaviour. If people do not think they can rely on taxis to get where they are going, they are more likely to drive – even after a few drinks.

Legislation crafted specifically to encourage density often backfires. Instead of removing barriers to density, many planners and politicians prefer to punish sprawl. Restrictions on low-density development punish high-density development by driving up the cost of urban land. Perversely, this pushes many people even further out into the suburbs. This phenomenon – leapfrog development – is taking hold throughout the Greater Toronto Area. The City of Toronto has stagnated, while surrounding municipalities have grown. Indeed, several of the fastest growing municipalities in the country are small towns cum bedroom communities that lie well outside the urbanized area. The same is happening in smaller metropolitan areas such as Calgary’s Okotoks and Regina’s White City.

Another barrier to car-free living is the federal government. While it does not intervene directly in municipal affairs, it does control the majority of tax revenue. This reduces the ability of municipalities to raise revenue for the types of amenities that car-free urbanites like, while funnelling money for infrastructure that they would not necessarily choose to pay for through municipal taxes.

The federal government collects far more money than it actually needs to meet its constitutional obligations. One-third of federal government expenditures could be eliminated if the government ceased spending in areas of sub-national jurisdiction. The same thing occurs at the provincial level. Provinces generate more revenue (partly through federal transfers) than they require, leaving municipalities reliant on transfers. Hence, municipal governments need to negotiate with upper levels of government to secure funding.

While this may not seem problematic at first, voters tend to treat transfers as found money. They are happy to get something, rather than nothing, from upper levels of government. Moreover, which projects are most likely to be funded? Highly visible transportation projects such as highways and mass transit to serve suburban voters. Meanwhile, there is no money to fix sidewalks.

Consider the extension of Toronto’s subway to Vaughan. Not only would it not be a priority for Torontonians, but it will also make transit in Toronto objectively worse by adding stress to an already overcrowded subway line. Yet the proposed Downtown Relief Line, which would de-stress that line, is likely decades away from fruition. Why? It probably has something to do with the fact that the Vaughan subway extension travels through political terrain that decides federal and provincial elections. This makes it more of a political priority than funding for downtown Toronto transit, since downtown Toronto voters are less electorally relevant. Their votes only really matter at the municipal level. The only way they will get the infrastructure they want is if upper levels of government free up tax room to allow municipalities to raise their own revenue.

Legislators need to understand that their ability to nudge people’s lifestyles toward specific outcomes is limited. Rather than trying to encourage trends, they should accommodate them. However, this has to be done locally. Attempts to impose national trends regionally or locally simply will not work.

Cities have different needs, and individuals have different preferences. The role of legislators should be to match services and urban design to those demands, while internalizing the cost of people’s lifestyle decisions. Rather than being pro- or anti-automobile, legislators need to let people decide how they want to live. Mounting evidence suggests that more people would choose car-free living in a free market. Governments should sit back and let them.

Steve Lafleur is a Frontier Centre for Public Policy analyst currently based out of Winnipeg. This essay originally ran on C2C Journal.

www.troymedia.com © Troy Media

 

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