Today’s Policy Agenda: Congestion Is a Serious Economic Problem

by Andrew Smith

Obama’s trying to persuade the elite establishment to support executive action on immigration.

Anna Palmer and Carrie Budoff Brown reported in Politico on the Obama administration seeking advice from and courting business leaders for coming executive actions on immigration. They write:

Earlier this month, senior aides from the White House counsel’s office, office of public engagement and the office of science and technology policy, among others, huddled with more than a dozen business groups and company officials to discuss potential immigration policy changes they could make. Smaller meetings with the White House and Department of Homeland Security aides have continued throughout the month. Administration officials are expected to present Obama with recommendations by the end of August.

Representatives from Oracle, Cisco, Fwd.US, Microsoft, Accenture, Compete America and the U.S. Chamber of Commerce were among those present at a wide-ranging Aug. 1 session that went through a list of asks for the tech sector that would involve rulemaking. Executive orders were not specifically discussed in that meeting, according to one source familiar with the session.

The ideas under discussion for executive action include allowing spouses of workers with high-tech visas to work, recapturing green cards that go unused and making technical changes for dual-purpose visa applications. Agriculture industry representatives have also been included in the meetings, discussing tweaks in the existing agriculture worker program.

The administration is also considering provisions for low-skilled workers for industries, like construction, that would allow individuals with temporary work authorization to gain work permits.

While the administration is clearly working to shore up political support for likely unprecedented executive maneuvers, there’s already a consensus in the both parties on most legislative questions. In their new podcast, “​Getting it Right,” Reihan and Patrick observe that George W. Bush and President Obama’s comprehensive immigration reform proposals appear remarkably similar and that elite preferences are fairly uniform regarding legalization and future flows. Reihan and Patrick speculate that this stems from big business – including the firms brought in by the White House to help shape coming immigration law changes – supporting such proposals out of self-interest, while the interests of native low-skill workers or even the preferences of their own constituents have less influence on elites.

Congestion is a serious economic problem.

In Urban Studies, Matthias Sweet from McMaster University explored the economic effects of traffic congestion, and finds that it slows job growth. sweet:

Traffic congestion alleviation has long been a common core transport policy objective, but it remains unclear under which conditions this universal byproduct of urban life also impedes the economy. Using panel data for 88 US metropolitan statistical areas, this study estimates congestion’s drag on employment growth (1993 to 2008) and productivity growth per worker (2001 to 2007). Using instrumental variables, results suggest that congestion slows job growth above thresholds of approximately 4.5 minutes of delay per one-way auto commute and 11,000 average daily traffic (ADT) per lane on average across the regional freeway network. While higher ADT per freeway lane appears to slow productivity growth, there is no evidence of congestion-induced travel delay impeding productivity growth. Results suggest that the strict policy focus on travel time savings may be misplaced and, instead, better outlooks for managing congestion’s economic drag lie in prioritizing the economically most important trips (perhaps through road pricing) or in providing alternative travel capacity to enable access despite congestion.

Given conservatives’ emphasis on work and spending time with family, fighting traffic congestion is a natural fit in a policy agenda. Replacing the gas tax with mileage-based user fees varied by time of day, as explained by Brad Wassink and Rick Geddes, could raise more revenue in a progressive manner while incentivizing drivers to avoid creating congestion. It would also make the costs of government more visible to the taxpayer than excise taxes included in the price at the pump. And all of it, it seems, could give the economy a boost too.

The costs alcohol imposes on society are incredibly high.

For Wonkblog, University of Chicago professor Harold Pollack recalls memories of serving as a health researcher around those who had been drinking and looks at the data to show how deadly alcohol can be:

Surveys of people incarcerated for violent crimes indicate that about 40% had been drinking at the time they committed these offenses. Among those who had been drinking, average blood-alcohol levels were estimated to exceed three times the legal limit. Drinking is especially common among perpetrators of specific crimes, including murder, sexual assault, and intimate partner violence.

Correlation does not equal causation, of course. If offenders all stopped drinking, we wouldn’t see a 100-percent reduction in their crimes. Yet alcohol does play a distinctive role. It lowers inhibitions and, among some people, fosters aggressive behavior that ratchets up the risk that violence will somehow occur. In my own career as a public health researcher, I’ve come into close contact with many intoxicated heroin and marijuana users. In these moments, I’ve never had reason to feel that my safety was at risk. I have been present for some scary incidents. Almost every time, alcohol was in the mix, often as things were getting a little late in a tough neighborhood near a liquor store . .  .

Almost 40% of the homicide victims tested had some blood alcohol in their systems when they were killed. These data do not indicate actual blood-alcohol levels. Our previous work indicates that many homicide victims have alcohol in their systems above the legal limits for driving.

Reihan has advocated for a significant increase in the alcohol tax before, and the logic for it is clear in this context: Alcohol is extremely expensive to society – in lives lost, domestic abuse committed, health-care dollars and resources spent, and families torn apart. Raising the alcohol tax would put consumers of the drug in a position where they bear the costs alcohol imposes on the rest of society. The price is the mechanism that best transmits information to the consumer that this must be used in moderation.

The alcohol experience also provides important lessons for the more politically relevant drug of the day: marijuana. While prohibition of alcohol was a failure and a strong case can be made that the drug war has also been a failure, that’s not to say that following alcohol’s path of relatively light taxation and regulation is the right course for marijuana. The data in Pollack’s story is pretty clear on the ways a liberalized alcohol policy has been harmful, and the ideas of Mark Kleiman – legalize, but heavily tax and regulate to mitigate abuses of the drug – offer a different path that could have better results.