NCPA - National Center for Policy Analysis


August 25, 2006

Road systems around the world suffer from traffic congestion, unsafe conditions, high costs, political corruption, waste, environmental degradation and poor maintenance.  Fortunately, many of those roadways can be dramatically improved by applying the same principles that have brought significant improvements to other privatized industries, says the Independent Institute.

In its new book, "Street Smart," edited by research fellow Gabriel Roth, the Institute highlights several problems with current roadways, and offers private sector solutions, including:

  • Giving insurers the responsibility for testing and licensing cars and drivers in the United States; this would provide a financial incentive in the interest of safety.
  • Implementing electronic charging methods that enable road use to be charged and paid for without toll booths; this would cut traffic congestion and overcome a major impediment to market provision.
  • Outsourcing road maintenance to the private sector to reduce costs; Brazil has saved 20 percent and Columbia 50 percent through such efforts.
  • Expanding the High-Occupancy Toll "HOT" lanes that have been operating successfully in Southern California for 10 years and given travelers the choice of buying congestion-free travel.

The main obstacle to private road services thus far has rested with the reluctance of the political classes to give up their lucrative sources of power, wealth and influence through government road monopolies, says the Institute.  However, the need for road services determined by the free interplay of consumers and private suppliers to provide cost savings, quality and choice will be essential to providing more efficient roadways in the future.

Source: Gabriel Roth, Editor, "Street Smart," Independent Institute, August 2006.

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