Sharing Isn’t Caring

by Marc Scribner on October 4, 2010 · 11 comments

in Economy, Environment, Global Warming, Mobility

Late last month, Washington, D.C. launched its Capital Bikeshare (“CaBi” to its groupies) program to much acclaim from the usual suspects — New Urbanists and bicycle imperialists. For those uninitiated, contemporary bike-sharing programs involve the placement of controlled bicycle racks (usually by government or through large government-financed private operators) around a city so that residents, tourists, and commuters can rent bikes for a fixed period of time and then return them to other racks around the city. All for a nominal, generally subsidized fee.

New Urbanists and Greens love these programs because, for them, any government intervention that puts more people on bikes is a good one. After all, they’ve already spent a lot of political capital zoning out parking and narrowing car lanes to construct special bicycle lanes. They might as well try to get people to use their “livability” boondoggles — or at least provide the illusion thereof.

Oh, the hopes were high on September 20. On a blog run by MetroBike, a pro-bikeshare lobbying/consulting outfit, the owner declared the launch of CaBi to be “a dream come true.” He goes on to cite other programs in Copenhagen, Paris, and Amsterdam as great models for D.C. to emulate. Of course, these fawning portrayals rarely mention the costs. As someone who doesn’t own a car, rarely uses public transit, and who uses a bicycle for the vast majority of excursions in Washington, D.C., let me explain why I’m not thrilled with bike-sharing and why you shouldn’t be either.

First, every one of these systems operates at a loss. Just like transit fares, bike-share user fees do not generate enough revenue to maintain existing capital, let alone provide for expansion (or even cover the initial public investment). For example, Paris’ oft-lauded Vélib program experienced a stock loss rate of nearly 80 percent after launch. That is to say, of the initial 20,600 Vélib bikes  — with an average cost of $3,500 per bike when initial investment and maintenance are included — 16,000 were either stolen or damaged beyond repair. Tourists love ‘em, but they’re not the ones subsidizing most of the cost to the public. Another example is Montreal’s BIXI program, which is currently more than $30 million in debt.

Second, proponents claim externalities from increased bike-share use — less congestion, less pollution — provide benefits not shown by simple fiscal accounting. This appears at first glance to be a valid point. However, when looking at experiences with similar programs in other cities, the positive externalities argument falls flat. Law professor and bike-share skeptic Steve Clowney points to this report on BIXI. Researchers at McGill University released a study with the following key findings:

  • Eighty-six percent of BIXI trips replaced rides on personal bikes (25 percent), walking (28 percent), or public transit (33 percent).
  • Eight percent of BIXI trips replaced cab rides.
  • Two percent of BIXI trips replaced private car rides.
  • Four percent of BIXI trips add trips that otherwise would not have been made.

So, assuming for a moment that transit, walking, and cycling (using your own bike) are all desired “green” forms of urban mobility, only 10 percent of BIXI trips replaced car trips. Even under the most alarmist global warming scenarios, the positive public health and environmental externalities cannot justify this fiscal black hole.

Third, bike-share programs are administrative nightmares. As some starry eyed proponents are starting to discover, land-use regulations, politically entrenched NIMBY interests, and odd government management regimes present big hurdles for new transportation models. D.C. transportation junkies are shocked to learn that the National Park Service, which manages a decent chunk of parkland in D.C., is an inept, opaque government bureaucracy. They’re also flabbergasted that politically connected resident groups might adamantly oppose this little scheme. Color me unsurprised by any of this. Land-use regulations have been twisted to benefit specific entrenched constituencies and the government is generally incompetent when it comes to any issue related to mobility (or virtually everything, for that matter).

Let me make it clear that I’m hardly anti-bicycle (although, I am strongly opposed to subsidized mass transit and highways). What I’m opposed to is misguided utopianism and spending taxpayer dollars on programs where there is significant risk of failure. We’ve already had one failed bike-share program in D.C., and it looks like we’re going to have two.

Richard Layman October 5, 2010 at 5:24 am

Ahh, you forget that the road system operates at "a loss" too. Gasoline taxes, tolls, and fees pay for about 50% of the cost of the road system. The rest comes from general funds.

And that doesn't get into the environmental or military impacts (e.g., the cost of the war in the Mideast is mostly about maintaining access to foreign oil).

Plus there is that pesky issue of subsidized parking, in part through requirements in zoning codes, but also on city streets.

When you start advocating for significant increases in the cost of driving to eliminate the current subsidies, then maybe I'll begin to listen to you about biking, walking, and other forms of sustainable transportation.

WRT the point about Bixi, it is in true that in cities where you have the right urban form such as Montreal and Paris, you are going to get a substitution effect, whereas the issue is how to reduce automobile trips by outlying residents. OTOH, given the fact that transit systems in those cities are also crowded (if you've ever ridden the subway in Montreal, you know what I am talking about), adding more capacity to transit by diverting trips that can be met by other sustainable means is also a benefit and a proper function of overall transportation demand management planning.

Marc Scribner October 5, 2010 at 6:28 am

1) "The road system" is multifaceted. Most of the general fund subsidies go to local roads, rather than highways. Of course, this is a problem. Users should pay for use.

2) I'm no expert in Middle East geopolitics, but I'm willing to go out on a limb and say that it's a bit more complicated than that.

3) I'm not a fan of minimum parking requirements, but the distortions are nowhere near as large as grand scale New Urbanism-style planning. That said, sure, get rid of them.

4) Auto mobility has more direct benefits — you can move a lot more people and more goods in a lot less time. The rule of thumb for the time an individual is willing to spend daily on transportation is one hour. People are far more sensitive to transportation time than the price of transportation (opportunity costs). When you start subsidizing bicycles for a demographic that already walks, rides bikes, or takes public transit (i.e., younger, and more likely to be single without children), you're not taking drivers out of cars (10% of BIXI trips were those where riders were forgoing cars). Being constrained by time, trips just don't get made, people are less productive, and they've satisfied fewer preferences than they otherwise would have if transportation were faster.

That said, I'm in favor of getting rid of *all* subsidies in the current transportation system. See my previous posts on turnpike conversion, private financing, and private provision of infrastructure.

You talk about "the right urban form," etc., where I'm no urban-density advocate. Nor do I think there is a "right" way for a city to look. I have no moral problem with the suburbs, don't fault people for living there, and don't think they should be punished by urbanites for their choices. Now — I also don't think their transportation should be subsidized, which is why I favor variable road pricing and oppose most commuter rail. I'm all about adding more capacity, but just assuming alternatives to cars are suitable substitutes or compliments is misguided. My bet is that the suburbs are still the future, many people will likely be able to telecommute from anywhere in the coming decades, and the idealized urban form will continue to matter less and less to more and more people.

Richard Layman October 5, 2010 at 6:44 am

You might find this interesting too.

http://www.governing.com/hidden/Paul-Weyrichs-Sof

Richard Layman October 5, 2010 at 6:46 am

Do you think that Iraq, Afghanistan, Iran etc. would really matter to U.S. policy if oil wasn't a factor. Why don't you look into the overthrow of Premier Mossadeqh in the early 1950s and get a sense for what motivated changes in Iran's leadership, fomented by the CIA.

Anyway, until your blog trumpets the absolute necessity of increasing road charging, you're a blowhard, on this issue at least.

Richard Layman October 5, 2010 at 6:48 am

Sure local roads are paid for out of general funds. But again, isn't the local/state gasoline excise tax supposed to be the primary source for such funds?

Do you think that Iraq, Afghanistan, Iran etc. would really matter to U.S. policy if oil wasn't a factor, especially the proximity to Saudi Arabia and its low production cost oil sources. Why don't you look into the overthrow of Premier Mossadeqh in the early 1950s and get a sense for what motivated changes in Iran's leadership, fomented by the CIA.

Anyway, until your blog trumpets the absolute necessity of eliminating subsidies for automobility, you're a blowhard, on this issue at least.

Marc Scribner October 5, 2010 at 7:00 am

Additional excise taxes for whatever good or service are local political footballs. As such, they vary greatly across jurisdictions for a variety of political reasons. Personally, my preferred solution would be neighborhood ownership and financing — more radical BID-style revenue capture and management institutions — as opposed to broader excise taxes.

No need to name call. Yes, automobility is subsidized, but to a far lesser degree than transit and intercity rail. Where's your complaining over that? Why just cars? If you look at how many people are moved how far (passenger miles) over a given period of time, you'd see that intercity passenger rail, rail transit, bus transit, and even air travel are more subsidized than automobile travel. Many New Urbanists just don't like cars, so the facts don't really bother them.

John October 6, 2010 at 7:23 am

Good lord, where do I start? You seem to be extremely misinformed when it comes to bike-sharing.

First, with regard to the theft rate…the high rate of theft in Paris can largely be attributed to a less-than-impressive lock design. Going into the sixth month of operation, Denver's B-cycle system has lost only ONE bike out of a fleet of 500.

Second, with regard to the … you say "only 10 percent of Bixi trips replaced car trips". For some reason, you chose to omit the fact that the 10 percent amounts to no fewer than 200,000. Think about that for a minute. TWO HUNDRED THOUSAND fewer car trips have clogged Montreal's streets since Bixi's launch.

Finally, with regard to bike-sharing programs being "administrative nightmares", I have worked with various cities on bike-sharing implementations, and have found evidence to the contrary. Businesses and residences are overwhelmingly in support of bike-sharing stations being installed on or near their property. A staff of 5-10 people can successfully plan for, organize, install, and operate a bike-sharing system in a city. And while there will indeed be hiccups and struggles along the way, the administrative complexity pales in comparison to the installation of any other public-transit infrastructure.

Your bias and emphasis on facts that support your personal feelings severely cripple your quality of reporting.

Marc Scribner October 6, 2010 at 8:41 am

Where to begin, indeed.

Well, news out today shows that system use is now averaging one trip/bike/day. Capital Bikeshare has reached SmartBike levels! And, anecdotally, while biking into the office today, I even saw ONE PERSON using a shared bike.

First, the point of highlighting the Paris example was to emphasize extreme mismanagement that characterizes tragedy-of-the-commons problems inherent in bike-sharing. Of course, there are technical ways around Vélib-scale failure. Now, do you dispute that user fees don't come close to financing these expensive projects that cater to a small, wealthy urban minority?

Second, absolute numbers are meaningless without context. There are something like 17,000 BIXI trips each day — actually, being charitable, I'll say it's 20,000 daily trips (or 4 trips/bike/day). There are approximately 8 million car trips per day in the Montreal area (yes, imperfect comparison, but BIXI does indeed exist within a metropolitan area and presumably serves the needs of commuters, tourists, etc.). Of the 20,000 daily BIXI trips, 2,000 are replacing car trips (400 private car trips and 1,600 taxi trips). 2,000 forgone trips out 8 million is 0.025 percent. I don't think there's any way for a sane person to claim this as a victory over automobility and for the environment/congestion. And based on present traffic patterns, this is in line with my claim that BIXI does nothing to reduce congestion, even in the central neighborhoods.

Third, I'm sure you're glad that DDOT is subsidizing your hobby, as you seem to have a direct financial interest in the scaling up of these bike-share boondoggles. Personally, I'm waiting to see a dirigible-share program. Fingers crossed! But you are at least right that "the administrative complexity pales in comparison to the installation of any other public-transit infrastructure." Then again, those other forms actually have a non-trivial impact on mobility.

Jim Titus October 25, 2010 at 11:10 am

Please allow me to take issue with your comment "The road system is multifaceted. Most of the general fund subsidies go to local roads, rather than highways…."

The Maryland State Highway budget is only about 25% gas tax, 25% registration fees, 25% car sales tax, and 25% other. Though in a sense the 25% on the car tax is paid by users, in another sense, not really, since the alternative expenditures would have a sales tax. And registration fees protect one from really feeling the incremental cost of the driving. And this does not even address the fair-market value of all the land used for highways.

I think a simpler argument for you to make would be: Bike-share has to be subsidized to compete with all the other forms of transportation subsidies. Get rid of the subsidies for motor vehicles, and then the private sector will be able to run bike share.

Casey Anderson October 25, 2010 at 7:25 pm

London's bike sharing system is about to become profitable on an operating basis after a little more than *10 weeks,* which seems pretty good compared to any road project I have ever heard of:

http://www.guardian.co.uk/environment/green-livin

Marc Scribner October 26, 2010 at 3:37 am

Jim,

The point I was making was that more general funds go to non-highways than highways — that the direct public subsidy of local roads is greater than that of highways. I then said I want more user-based revenue capture for the highways. That said, I more or less agree with your comments on highway subsidies.

My main reasons for skepticism of bike-share programs don't stem from autos. It's that they're expensive, unpopular, and face administrative hurdles that makes them less desirable than, say, expanding BRT. Most are also not just subsidized, they are owned and managed outright by the municipal government.

Casey,

If by "about" you mean "projected in two to three years," then you're still not even close. How much freight is being moved by these bikes? How many billions of dollars worth of goods are brought to market using these bikes? And that's just commerce. Even while London's roads are not "profitable" per se, they produce far, far greater economic benefits per mile traveled on them on a holiday than it's bike-share program ever will on the busiest workday.

However, London's program seems to be using a superior price structure when compared to most, so it's got that going for it.

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