Paved with Gold: The Hidden Costs of Free Transportation
How Charging for Infrastructure Creates Better Mobility Options for Everyone
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Along its 12,000 miles of curb, New York City has more than three million parking spaces—and only 2.5 percent of them metered. In a city where land routinely sells for thousands of dollars per square foot, that means millions of square feet of some of the world’s most valuable real estate are effectively given away for free. The idea of charging for some of that space is now under discussion at City Hall, and it makes a lot of fiscal sense: a recent report estimates that metering only 25 percent of existing free on-street spots could raise $1.21 billion in new revenue annually. In a city facing a major budget crunch, the streets themselves may be paved with gold.
Yet the policy debate in New York is oddly inverted. At the same time City Hall is considering charging for curb space, it is also debating eliminating fares on city buses. Both questions turn on the same basic issue: how should scarce transportation infrastructure be priced?
The logic is easy to see in parking. As economist Donald Shoup showed in The High Cost of Free Parking, when curb space is priced at zero the consequences show up elsewhere: more congestion from drivers circling for spaces, more idling and cruising, and less street space available for other uses. Pricing even a fraction of New York’s curb space would force the city to confront what that land is actually worth. Some of it may still be best used for parking, but pricing makes that trade-off visible rather than hidden, opening the door to higher-value uses like bus lanes, wider sidewalks, or outdoor dining.
Charging for curb space is commonplace. Cities large and small across the United States use parking meters and residential permits to manage demand for street space. Yet transportation debates rarely unfold in such practical terms. Instead they are quickly recast as ideological battles: transit denounced as socialism, highways celebrated as freedom.
But this systemic ideological framing largely misses the point. The United States already operates a deeply hybrid transportation system in which public infrastructure and private vehicles coexist across every mode. Roads are publicly built but used by all types of vehicles and services; rail infrastructure may be public or private while passenger service often runs across both. The only fully private passenger transportation network in the country—and the tenth largest transit system by ridership—is owned by none other than Mickey Mouse.1
The real ideological conflict is not about ownership, but about the instincts that shape how the system is run.
One of those instincts is what Ezra Klein has called “everything bagel liberalism.” The phrase captures the tendency to load a single policy with every worthy progressive goal at once. Transportation policy is no exception. Instead of focusing on moving people efficiently from one place to another, transit systems are layered with policy poppy seeds and onion flakes: climate goals, labor rules, equity mandates, environmental reviews, and social justice objectives. Each may be reasonable on its own, but taken together they can make transit systems slower, more expensive, or impossible to build at all. In New York, where every project must satisfy a stack of environmental reviews, labor mandates, procurement rules, and political oversight, the result is a system that isn’t just slow but prohibitively expensive—contributing to construction costs more than $2.5 billion per mile, among the highest in the world.
It’s the poor outcomes this instinct yields that generate most of the vitriol from opponents on the right. But the right has its own flawed instinct, which we might call “car-brain conservatism.”
Whereas transit is often derided as socialism, driving on government-built roads in government-licensed vehicles manufactured to government-dictated safety and fuel standards, powered by government-mandated ethanol, and parked on government-provided spaces somehow remains an emblem of American freedom. Decades of highway expansion, “free” parking, and auto-oriented land use have trained us to ignore the enormous subsidies embedded in car infrastructure, making alternatives seem politically infeasible. As a result, policy continues to prioritize automobiles at the expense of other modes.
Freedom isn’t free—but parking must be.
But of course auto-centric infrastructure is not free. Gas taxes no longer cover the full cost of building and maintaining highways, forcing general taxpayers to fill the gap while cities inherit billions in long-term road maintenance liabilities. Even highway agencies are beginning to acknowledge the limits of this approach. The Texas Department of Transportation has warned that the long-standing “just one more lane” strategy cannot solve congestion in dense urban areas where land is scarce and expansion costs are rising.
The “everything bagel” and “car-brain” instincts also distort our perception of risk. Because we have socialized the cost of road space, we have normalized roughly 40,000 annual road deaths as the cost of a car-dependent society, while rare deaths on transit systems make headlines. Critics on the right are not entirely wrong to note that transit systems are often expected to function as de facto homeless shelters and refuges for people with untreated mental illness. But isolated crimes on buses or subways are then treated as evidence that transit itself is unsafe. Transit often takes the blame for failures elsewhere in public policy. What’s missed is that transit not only can and should be safe. New York itself demonstrated this in the 1990s, when enforcing fare rules helped restore order on the subways. It is also demonstrably much safer than driving on the streets: in 2025, New York City recorded 205 traffic deaths, including 111 pedestrians and 20 bicyclists, and more than 47,000 injuries—compared to the four people killed on the subway.
Safety is just one example of a broader problem: transportation debates are constantly diverted into symbolic or ideological arguments that obscure how these systems actually function. The real issue is simpler: transportation infrastructure is scarce and expensive. The practical question is how to allocate it—and pricing is one of the most powerful tools for doing so.
Three recent developments show how pricing reveals the trade-offs involved in allocating scarce transportation infrastructure.
In California, the BART regional rail system recently made headlines when it reported that installing more than 700 fare gates generated $10 million in new annual revenue while sharply reducing crime and maintenance costs. The lesson is simple: systems that allow unrestricted free access sacrifice both revenue and order, while systems that enforce fares recover both.
A second example highlights the opportunity costs involved in treating infrastructure as free. NYU’s Marron Institute has quantified the opportunity costs New York faces if it adopts fare-free buses. For roughly the same cost—$1 billion per year—the MTA could build forty-one miles of new subway lines, expanding access to transit deserts while enabling the construction of more than 167,000 new homes near sixty-four new stations.
Finally, a federal judge recently upheld New York’s congestion pricing program, which charges drivers a toll to enter Manhattan. Early results from the MTA’s first-year data show the policy is working: vehicle entries into the Congestion Relief Zone fell 11%, morning rush-hour crossing speeds rose an average of 23%, transit ridership increased 7% system-wide, and more than $500 million in new revenue is flowing toward transit improvements. Pricing scarce road space both reduces congestion and generates the resources needed to improve the broader transportation system.
Together these examples point to the questions transportation policy should actually be asking: Does the system reach people? Can they afford to use it? And are incentives aligned so that it functions efficiently?
In other words, it’s all about: access, affordability, and efficiency.
Of these three goals, affordability was central to Mayor Mamdani’s proposal to eliminate bus fares. The idea is meant to make transit cheaper, faster to board, and more equitable. But eliminating the farebox would also remove a critical revenue stream that helps sustain the transit system and fund improvements that could meaningfully improve travel times. As Works in Progress and Vital City have argued, buses are slow because they lack dedicated lanes and stop far too frequently. Prioritizing free fares would induce demand for buses, reduce demand for subways, and do nothing to address the infrastructure problems that make buses the slowest mode in the system, all while draining resources from it. If affordability is the true concern, the solution isn’t to turn a vital, capital-intensive system into a costly welfare-on-wheels program—it’s to make existing subsidy programs like New York’s badly under-enrolled Fair Fares program work.
But if affordability comes at the expense of access and efficiency, is it really affordable?
In fact, putting a price on infrastructure can improve access, affordability, and efficiency all at once. Congestion pricing has reduced traffic, improved travel speeds, and generated new funding for transit improvements. Charging for curb space would extend that same logic to another scarce part of the transportation system. Pricing even a fraction of the city’s free curb parking could manage demand for street space while generating significant new revenue for transit improvements or expansion. And the roughly $1 billion per year that fare-free buses would cost could instead fund major subway expansions, bringing rapid transit to neighborhoods that lack it today. Revenue from transportation pricing doesn’t just improve the system—it expands what the city and its transit agencies can afford to do.
Neither everything-bagel liberalism nor car-brain conservatism offers a useful guide to transportation policy. If we want to help those who struggle to afford transportation, we should let welfare be welfare and let transit be transit. That means acknowledging scarcity, pricing infrastructure in line with its real costs, and investing where it expands access the most. Transportation infrastructure is both essential and expensive. Our goal should not be to make it free, but to make mobility abundant.
The streets of City of Yes are not yet paved with gold. If you enjoyed this essay, the best way to support work like this is to become a paid subscriber.
As Andrew Miller has documented, the United States operates one of the world’s largest privately owned rail networks, which remains a rare example of large-scale private transportation infrastructure. Florida’s Brightline, often cited as a private example, still relies partly on public rail infrastructure.
This is gold.
Very good. Working in transportation I find it so hard to get people to focus on the nuts and bolts of transportation versus the ideological causes attached.