Jun 29, 2019

Making cars pay to drive on the roads

Illustration: Rebecca Zisser/Axios

New York is about to become the first city in over a decade to implement congestion pricing.

Why it matters: City streets are more clogged than ever. The growth of e-commerce has driven an influx of delivery vehicles, while the rise of ride-hailing services like Uber has led city-dwellers to assume that a car is permanently available to drive them anywhere they want to go.

If something is underpriced, it tends to generate excessive demand. Urban streets are a prime example: It generally costs nothing to drive on them, and as a result billions of city-dwellers sit in traffic every day.

Previous implementations of congestion pricing have aimed squarely at congestion, with the target of minimizing the time that people are stuck in traffic.

  • London started charging for road access in 2003, and Stockholm in 2006. London traffic has already slowed down to below pre-congestion-pricing levels, even as the fee itself has steadily risen.

How it works: New York's scheme could be the first to focus primarily on revenue generation, with relatively little effect on traffic.

  • 666 Fifth Avenue sits on a 61,755-square-foot plot of land. When the Kushner family paid $1.8 billion for that building, intending to tear it down and replace it with a brand-new tower, the purchase price worked out to about $30,000 per square foot of land.
  • At that rate, the land under a Cadillac Escalade would be worth $3.4 million. Put that Escalade on the street outside 666 Fifth Avenue, however, and it currently pays nothing for the privilege.
  • Once New York implements congestion pricing, that Escalade will probably pay around $14 to be able to drive around midtown Manhattan.

New York's charge will use basically the same technology that toll roads have used for decades.

  • More sophisticated systems, which are already technologically possible, would charge by the minute based on the actual amount of time that cars were on the street.
  • The problem: Now is a bad time to try to introduce such a system, given how concerned we have become about privacy and surveillance. Just because you can identify the location of every car to the nearest inch, doesn't mean you should.

The bottom line: New York's success or failure will play a large role in determining whether the congestion pricing gets copied in other cities, including Los Angeles.

  • Yes, but: If the purpose is more to raise money than to reduce congestion, then no one should expect significantly faster traffic speeds.

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Maryland becomes latest state to issue coronavirus stay-at-home order

Gov. Larry Hogan. Photo: Jim Spellman/Getty Images

Maryland Gov. Larry Hogan announced Monday he is ordering residents to stay at home effective 8 p.m. due to the coronavirus, except for those engaged in essential services, including health care and government functions.

The big picture: Maryland is the latest state to announce policies to enforce social distancing, which have affected almost 250 million Americans. More than 1.5 billion people worldwide had been asked to stay home as of last week.

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Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 12 p.m. ET: 741,030 — Total deaths: 35,305 — Total recoveries: 156,838.
  2. U.S.: Leads the world in cases. Total confirmed cases as of 12 p.m. ET: 143,532 — Total deaths: 2,572 — Total recoveries: 4,865.
  3. Federal government latest: The White House will extend its social distancing guidelines until April 30 — Hospital ship the USNS Comfort arrives in Manhattan
  4. Public health updates: — White House COVID-19 response coordinator Dr. Deborah Birx said the 100,000 to 200,000 U.S. coronavirus death toll estimate is based on the presumption that citizens follow social-distancing guidelines "almost perfectly."
  5. Business latest: Macy's will furlough the majority of it's workers this week, as the chain's stores remain closed.
  6. 🎧 Podcast: Living with the coronavirus
  7. What should I do? Answers about the virus from Axios expertsWhat to know about social distancingQ&A: Minimizing your coronavirus risk
  8. Other resources: CDC on how to avoid the virus, what to do if you get it.

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