Missouri's 7th District, U.S. House of Representatives




Congressional Issues 2010
"What About Roads?"

Government Roads Free Market Roads

The 112th Congress should
  • close the U.S. Department of Transportation;
  • eliminate the federal gasoline tax;
  • end all federal transportation subsidies and entrust states and municipalities with maintaining infrastructure such as highways, roads, bridges, and subways (for now);
  • repeal the Urban Mass Transit Act of 1964;

Congress could start by:

  • eliminating federal highway, transit, and other surface transportation programs; and
  • devolving to the states and local areas full responsibility for highways and transit.

Failing that, Congress should

  • fund state highways in block grants based on each state’s land area, population, and road mileage;
  • fund regional transit in block grants based on each metropolitan area’s population and transit fare revenues;
  • eliminate any conditions on the use of those funds, such as air pollution mandates or requirements for long-range planning;
  • eliminate “flexible funds,” that is, funds that can be spent on either highways or transit;
  • encourage states and local areas to rely more heavily on user fees to fund all forms of transportation; and
  • ensure that any efforts to save energy or reduce greenhouse gas emissions are cost-effective, that is, that state and local governments only invest in projects that can be shown to reduce energy consumption or greenhouse gas emissions at a lower cost than alternative projects.

New Ideas for Roads

Introduction: A Future of Private Roads and Highways by Walter Block

Walter Block's astounding new book The Privatization of Roads and Highways (Mises Institute, 2009). Reviewed by Jeffrey Tucker.

      Is there nothing new in the world of libertarian ideas? There is plenty with Walter Block's remarkable new treatise on private roads, a 494-page book that will cause you to rethink the whole of the way modern transportation networks operate. It is bold, innovative, radical, compelling, and shows how free-market economic theory is the clarifying lens through which to see the failures of the state and to see the alternative that is consistent with human liberty.
      But let me first set the context.
      Stuck in traffic with a friend in the passenger seat, those of us with libertarian views try the following from time to time. We observe the massive bog of cars and trucks before us, and the time being sucked away. It strikes us and so we blurt it out: if this road were private, we wouldn't be suffering like this. We don't wait in endless lines at the private grocery store or the private car rental. Why do we put up with state ownership and management of the roads? The roads should be privately built, owned, and managed.
      Our passenger is shocked and alarmed. You libertarians are really nuts. Roads are too expensive to be built privately. We'd be bumping into tollbooths every few feet. And don't you realize what would happen? Some mogul would raise prices and restrict access. We would all be dependent on the rich guy with the road title and our freedom to move around would come to an end. Why depend on the willy-nilly whims of some capitalist exploiter when the state is there to provide this wonderful service for free?
      And so we sit there, stuck at a standstill, because there are too many cars attempting to crawl around too few roads. Americans spend two billion hours per year tied up in congested roads. And then there's road construction, which the government decides to undertake whenever and wherever it so desires, reducing a three-lane road to a one-lane road in the name of expanding it to a five-lane road but taking as long as a full year to do it and generating hazards along the way.
      And then there are accidents, which tie up traffic for miles and hours, especially on interstate highways. The whole system is oddly unprepared for anything to go wrong even though something goes wrong every day. The pileup happens, with a truck stretching across the entire highway, and everyone just sits there waiting for the government to send its police, its ambulances, its cranes and devices, so that traffic can continue.
      Just last week, I sat on an interstate for two hours and missed a flight, and thereby had to eat my $300 ticket, and also had to buy another one on a different airline for another $350. Normally, in private markets, if some service is responsible for making you lose $750 — say, if the CD in the software package is blank — you would have some recourse. But who am I going to charge for my losses due to shoddy road management? The DMV? Forget it.

      There are other costs. We pay through the nose for gasoline in order to fund road construction and maintenance. Some 40,000 people die on government roads every year. We are constantly harassed by policeman on the make who hand out tickets for doing things that hurt no one, like not buckling up or driving fast or changing lanes without signaling or rolling slowly through stop signs. Do these really endanger others? Sometimes, perhaps, but that is not why we get tickets. We get tickets because they provide a revenue stream for state and local governments.
      Road failures define massive swaths of our lives. They influence where we live and where we choose to work. They eat away at our household budgets. They introduce horrible tragedies in our lives, when friends and children are maimed or die on the killing fields of public roads.
      Anyway, for the person who wants a full catalog of the inconvenience, the outrage, the incompetence, the coercion, the massive social costs of government-owned and government-run roads, there is more than enough of that in Walter Block's astounding new book The Privatization of Roads and Highways (Mises Institute, 2009). He shows that even the worst, off-the-cuff scenario of life under private ownership of roads would be fantastic by comparison to the existing reality of government ownership of roads.
      But that is only the beginning of what Professor Block has done. He has made a lengthy, detailed, and positive case that the privatization of roads would be socially optimal in every way. It would save lives, curtail pollution, save us (as individuals!) money, save us massive time, introduce accountability, and make transportation a pleasure instead of a huge pain in the neck.
      Because this is the first-ever complete book on this topic, the length and detail are absolutely necessary. He shows that this is not some libertarian pipe dream but the most practical application of free-market logic. Block is dealing with something that confronts us everyday. And in so doing, he illustrates the power of economic theory to take an existing set of facts and help you see them in a completely different way.
      What's also nice is that the prose has great passion about it, despite the great scholarly detail. He loves answering the objections (Aren't roads public goods? Aren't roads too expensive to build privately?) and making the case, fully aware that he has to overcome a deep and persistent bias in favor of public ownership. The writer burns with a moral passion on the subjects of highway deaths and pollution issues. His "Open Letter to Mothers Against Drunk Driving" is a thrill to read!
      It should go without saying that roads were originally private in the United States and were only later taken over by government, before public ownership had become an accepted convention. The dramatic expansion in road building took place after mass ownership of cars became essential to the American way of life. So we know it can be done, but is it practical? In fact, quasi-private roads are being built every day and run well, in California, Virginia, and Pennsylvania. Governments are increasingly turning to private solutions out of desperation.
      What's interesting too is how Block explores the role of modern technology in making private roads more viable than ever, with digital readers that can scan cars as they go by and send monthly bills or debit your bank account. He explores how competitive solutions can overcome the limits of geography, and allocate road space optimally according to the highest priority of consumers. We have many options in groceries, movies, computers, and household services. Why should it be any different for travelers?
      There is a bracing realism about Block's treatment. Again, this is not a utopian scenario. He is dealing with realities that affect your hometown and presents a scenario for managing the transition to private ownership in accordance with principles of justice and workability. In short, this man is very serious about this topic. His footnotes are gargantuan and the bibliography covers the entire field and back again.
      He is particularly tough on those who have advocated public-private partnership in the name of privatization or toll-based solutions for congestion that do nothing about the core problem of who owns the roads in the first place. Just so that we are clear, this book is an uncompromising call for the authentic and full application of the principles of free enterprise: no government taxes, construction, management, or ownership of roads at all.
      People have known that Block was working on this book for many years, and some chapters have been seen in journals here and there. But there is something thrilling about seeing it all put together in one place. It comes together as a battle plan against government roads and a complete roadmap for a future of private transportation.
      Is there anything new in the world of Austrian and libertarian ideas? This book answers the question with a resounding yes. It offers a way out of one of the most persistent problems of modern life. The problem with the roads is government. The answer is free enterprise. If you doubt it now, this book will make a believer out of you.

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"What about roads?"

This question is always asked when "Liberty Under God" is proposed with relentless consistency. In case you're not asking this question, here's how it comes up:

When your current Congressman was first elected in 1996, the Republican Party National Platform promised to move America in a "Free Market" direction:

As a first step in reforming government, we support elimination of the Departments of Commerce, Housing and Urban Development, Education, and Energy, and the elimination, defunding or privatization of agencies which are obsolete, redundant, of limited value, or too regional in focus. Examples of agencies we seek to defund or to privatize are the National Endowment for the Arts, the National Endowment for the Humanities, the Corporation for Public Broadcasting, and the Legal Services Corporation.

Libertarians would pursue this course of action with relentless consistency. "The State" is not the best way to ensure efficient commerce, plentiful housing, quality education, cheap energy, or tasteful arts and humanities.

"The State" is also not the best way to provide transportation.

But right now, the government builds nearly all our roads, so when we propose cutting government, we inevitably get asked, "What about roads?" "How can we have roads if the government doesn't build them?" "What about roads?"

  • Sometimes a question is just an argument, or a rationalization. Sometimes a question is meant simply to ridicule. This is called "a rhetorical question."
  • Some people feel that if the government is needed for roads, and if the Free Market cannot do a good job with roads, maybe the Free Market isn't the best way to provide groceries, clothes, houses, and cars.
  • Maybe we shouldn't even start going down that "road" of eliminating government programs and creating smaller government.
  • On the other hand, if government is the best way to provide roads, it's certainly the best way to provide everything else.

If you're asking the question, "What about roads," because you want to know for sure that the Free Market system is better than socialism, and you really want an answer, here goes:

Should "the State" provide our clothes, our food, our computers, and our cars? Most Americans say No. But some people believe some socialism is always necessary; that some things just can't be dependably provided by the Free Market, and require compulsion and threats of violence from "the State." Roads, they say, are one of these things.

Historically, this is not true. In early America, roads were built by "turnpike companies," that realized a profit could be made by providing safer, easier, more efficient ways to get from one place to another, to consumers who wanted to travel.

Many of America's Founding Fathers were distrustful of government. Men like Jefferson, Madison, Monroe, and Calhoun did not want the government to get involved in the business of "internal improvements" like roads and canals. They reasoned that if politicians were able to take money from taxpayers and build roads, they would build roads that served political purposes rather than the needs of consumers. Politicians would build roads that benefited campaign contributors or special interests.

Example: suppose an amusement park on the outskirts of town realizes that they would have more customers if tourists could be diverted from the main drag through town onto a road that goes directly to the amusement park. If the wealthy amusement park owner had gone door-to-door through the town in a democratic way asking for donations to build a by-pass to his place of business, doubtless few would have contributed. But in a "democratic republic," the "elected representatives" can levy a tax on everyone to build a road for the benefit of the amusement park and its wealthy owner.

Private businesses will only build roads if they conclude that it will serve consumers. Politicians don't have to worry about making a profit by serving consumers. They just pass a law to increase taxes, or they print up the money they want and steal purchasing power from consumers through "the inflation tax," and then build whatever benefits the politicians or rewards their supporters.

The idea of Free Market Roads confuses many people because many people are confused about capitalism. Should "the State" provide our clothes, our food, our computers, and our cars? Most Americans say No. But they don't know why. Economic theory and economic history both proclaim that capitalism is better than socialism. But most Americans don't know why capitalism is better, and how it works to provide the things that give us a higher standard of living than socialist nations.

In a sense nobody knows why or how capitalism works so well. Adam Smith, writing the first treatise on capitalism in 1776, attributed capitalism's success to "the Invisible Hand." Our Declaration of Independence, signed in that same year, spoke of this "Invisible Hand" as "the Protection of Divine Providence." Nobody knows exactly how it works, but we do know that it works.

Nobody knows how to make a pencil, but we know that the Free Market gets pencils manufactured and sold. That statement may confuse you: "What do you mean, 'Nobody knows how to make a pencil?'" It takes the knowledge and decisions of millions -- no, billions -- of people to make a pencil. We don't have a government Department of Pencils. The manufacture and distribution of pencils is overseen by "the Invisible Hand" of the Free Market. You may want to take a few minutes to read about Providence and the Pencil.

But unfettered Capitalism has been given "a bad rap" by the mainstream media, university professors and politicians. They think capitalism is based on "greed" and "cut-throat competition," while the government is based on compassion and fairness. Businessmen like Dick Cheney are part of "Big Business," which is bad, but when "we the People" elect businessmen to become politicians, all of the sudden they are no longer greedy and ignorant, they are wise and philanthropic.

Some people think "profit" is bad. Profit is good if it's voluntary. Profit is proof of service to consumers. Consumers don't give businesses their money unless businesses give consumers something of greater value. In a Free Market, if the Smith Corporation doesn't serve consumers, it doesn't make a profit. (In the world of politics, on the other hand, the Smith Corporation can make a profit by making contributions to the Senator So-and-So campaign, even if it doesn't serve consumers.)

Some people think "competition" is mean and nasty.
Competition is good if it's unregulated and non-violent.
Competition is the ability to serve consumers better. If the Smith corporation isn't serving consumers, or is wasting natural resources trying to do so (and therefore is charging a higher price than they would if they had to consumer fewer resources), competition means the Jones Corporation can enter the market and compete for consumer profit by doing a better job of serving consumers than the Smith Corporation.
Competition means freedom.
Competition means choice.
Competition means improvement. (In the world of politics, on the other hand, the Smith Corporation can make a campaign contribution to Senator So-and-So in exchange for regulations and laws which prohibit anyone from competing with the Smith Corporation. Without competition, the Smith Corporation wins; the politicians win; consumers lose.)

So if the Jones Road Corporation builds a road that goes nowhere consumers want to go, the Smith Highway Corporation can enter the market and make a profit by building roads that go where more consumers want to go.

Or if the "Ma and Pa Road Company" has a road which is always jammed with traffic, the Wal-Mart Highway Corporation can build a road that doesn't have traffic jams. This might put the "Ma and Pa" company out of business, but consumers get what they want.

Typical of how government works is "The Bridge to Nowhere." Government action is summed up in the word "pork." A private corporation, held accountable to consumers by the laws of profit and loss, doesn't build a superhighway just so it can be called "The Senator So-and-So Memorial Highway" even if no consumers are benefited by the road. Free Market corporations only profit if they serve the consumers and use good stewardship of their resources.

The same economic system that has given Americans the highest standard of living in all of human history -- capitalism -- can be trusted to provide efficient transportation. We trust the Free Market to give us groceries, clothing, computers, cars, and cell phones -- why not roads?

Private Enterprise Does It Better by John Stossel on

Who Would Maintain Roads Worse Than the State?

Objections: "Market Failure"

How do we get there from here?

How do we get from expensive government roads which are jammed with traffic and kill tens of thousands of people a year, to libertarian roads which are cheap, safe, and quick? How do we wean transportation from the government teat? This is a tough question. The reason it's tough is because so few people are busy brainstorming the answers. Those answers will come when more people are convinced that capitalism is better than socialism, that socialism, in fact, is immoral, and bridges that serve the needs of consumers are better than Bridges to Nowhere.

  • Existing roads should be auctioned off to the highest bidder.
  • Regulations which interfere with a competitive Free Market (such as those listed at the top of this page) should be abolished.
  • There needs to be a national conversation about this issue, so that more people think like capitalists rather than like socialists.
  • "Necessity is the mother of invention."

Suppose we lived under a completely socialist government. All of our shoes are made by the government and distributed to the people by the government "Ministry of Shoes." Suppose someone proposed turning over the business of making shoes to a competitive, profit-based system. We might hear something like this:

How could you? You are opposed to the public—and to poor people—wearing shoes! And who would supply shoes to the public if the government got out of the business? Tell us that! Be constructive! It's easy to be negative and smart-alecky about government; but tell us who would supply shoes? Which people? How many shoe stores would be available in each city and town? How would the shoe firms be capitalized? How many brands would there be? What material would they use? What material lasts? What would be the pricing arrangements for shoes? Wouldn't regulation of the shoe industry be needed to see to it that the product is sound? And who would supply the poor with shoes? Suppose a poor person didn't have the money to buy a pair?

Libertarian economist Murray Rothbard answers these questions:

These questions, ridiculous as they seem to be (and are) with regard to the shoe business, are just as absurd when applied to the libertarian who advocates a free market in fire, police, postal service, or any other government operation. The point is that the advocate of a free market in anything cannot provide a "constructive" blueprint of such a market in advance. The essence and the glory of the free market is that individual firms and businesses, competing on the market, provide an ever-changing orchestration of efficient and progressive goods and services: continually improving products and markets, advancing technology, cutting costs, and meeting changing consumer demands as swiftly and as efficiently as possible. The libertarian economist can try to offer a few guidelines on how markets might develop where they are now prevented or restricted from developing; but he can do little more than point the way toward freedom, to call for government to get out of the way of the productive and ever-inventive energies of the public as expressed in voluntary market activity. No one can predict the number of firms, the size of each firm, the pricing policies, etc., of any future market in any service or commodity. We just know—by economic theory and by historical insight—that such a free market will do the job infinitely better than the compulsory monopoly of bureaucratic government.

How will the poor pay for defense, fire protection, postal service, etc., can basically be answered by the counter-question: how do the poor pay for anything they now obtain on the market? The difference is that we know that the free private market will supply these goods and services far more cheaply, in greater abundance, and of far higher quality than monopoly government does today. Everyone in society would benefit, and especially the poor. And we also know that the mammoth tax burden to finance these and other activities would be lifted from the shoulders of everyone in society, including the poor.

In the particular circumstances of a given age or nation, there is scarcely anything really important to the general interest, which it may not be desirable, or even necessary, that the government should take upon itself, not because private individuals cannot effectually perform it, but because they will not. At some times and places, there will be no roads, docks, harbours, canals, works of irrigation, hospitals, schools, colleges, printing-presses, unless the government establishes them; the public being either too poor to command the necessary resources, or too little advanced in intelligence to appreciate the ends, or not sufficiently practised in joint action to be capable of the means.
John Stuart Mill, "The Principles Of Political Economy", Book 5, Chapter 11.

Ozarks Virtual Town Hall - July 21, 2007
More links and info

More by Prof. Walter Block

The political process is not the best way to allocate scarce resources and meet human needs. Businesses in a Free Market are held accountable to meet consumer needs or go bankrupt. Businesses will build roads and bridges where people like you and me want to go, and get us there safely and quickly. Political incentives are altogether different, and result in things like "The Bridge to Nowhere":

An excerpt from the 1958 "Disneyland" TV Show episode entitled "Magic Highway USA."

When "Liberty Under God" prevails, optimism and dominion can be seen.

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