Would Eliminating Road Subsidies Encourage Transit Use?

Not only are transit systems subsidized, but so are America's roads. While some advocate for the reduction of road subsidies to better incentivize transit use, Josh Barro argues for more effective ways to make mass transit work better.

2 minute read

July 15, 2012, 9:00 AM PDT

By Andrew Gorden


Barro, writing in City Journal, points out the sometimes conflicting arguments regarding transit subsidies versus those of road subsidies, finding that roads require a much lower subsidy than transit, at ~8% and ~41-55%, respectively. "More important is that the 41-to-55-percent figure is misleading: it refers only to the cost of roads, not to the total cost of driving," says Barro, "[t]hat total cost includes not only public spending on roads but also a host of private purchases-of cars themselves, maintenance, gas, and insurance."

"All told, then, $1.08 trillion was spent on road travel, with government subsidies providing only $83 billion of the total. That's a subsidy of less than 8 percent," writes Barro, who argues against the commonly-held concept that eliminating these subsidies will encourage greater transit use. "An end to road subsidies would raise gasoline prices by about 50 to 60 cents a gallon. Over the last decade, fuel prices rose much more sharply than that, which led to a modest reduction in vehicle-miles traveled, but there hasn't been any sea change in our transportation practices."

Instead, he argues for a drastic change in the way Americans approach planning and zoning. Leveraging the fact that properties near transit increase property values and, therefore, property taxes, Barro believes "[c]ities should allow dense development, collect the property taxes that are generated, and use them to finance transit."

Thursday, July 12, 2012 in City Journal

portrait of professional woman

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching. Mary G., Urban Planner

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching.

Mary G., Urban Planner

Get top-rated, practical training

Wastewater pouring out from a pipe.

Alabama: Trump Terminates Settlements for Black Communities Harmed By Raw Sewage

Trump deemed the landmark civil rights agreement “illegal DEI and environmental justice policy.”

April 13, 2025 - Inside Climate News

Logo for Planetizen Federal Action Tracker with black and white image of U.S. Capitol with water ripple overlay.

Planetizen Federal Action Tracker

A weekly monitor of how Trump’s orders and actions are impacting planners and planning in America.

April 16, 2025 - Diana Ionescu

Black and white photos of camp made up of small 'earthquake shacks' in Dolores Park in 1906 after the San Francisco earthquake.

The 120 Year Old Tiny Home Villages That Sheltered San Francisco’s Earthquake Refugees

More than a century ago, San Francisco mobilized to house thousands of residents displaced by the 1906 earthquake. Could their strategy offer a model for the present?

April 15, 2025 - Charles F. Bloszies

People walking up and down stairs in New York City subway station.

In Both Crashes and Crime, Public Transportation is Far Safer than Driving

Contrary to popular assumptions, public transportation has far lower crash and crime rates than automobile travel. For safer communities, improve and encourage transit travel.

April 18 - Scientific American

White public transit bus with bike on front bike rack in Nashville, Tennessee.

Report: Zoning Reforms Should Complement Nashville’s Ambitious Transit Plan

Without reform, restrictive zoning codes will limit the impact of the city’s planned transit expansion and could exclude some of the residents who depend on transit the most.

April 18 - Bloomberg CityLab

An engineer controlling a quality of water ,aerated activated sludge tank at a waste water treatment plant.

Judge Orders Release of Frozen IRA, IIJA Funding

The decision is a victory for environmental groups who charged that freezing funds for critical infrastructure and disaster response programs caused “real and irreparable harm” to communities.

April 18 - Smart Cities Dive