Should we be subsidizing cars for low-income families?

By Kristin Toussaint – from Fast Company

When a woman named Tracy received a car from the nonprofit Vehicles for Change, a nonprofit that awards affordable, used cars to low-income families, she was able to triple her income. Before, she had only been able to work minimum-wage jobs that were within walking distance of her house or accessible by bus. With the car, she could travel further for work and landed a job at a telecom company, which paid her enough to allow her to afford to rent her own apartment.

Other Vehicles for Change awardees told Nicholas Klein, a regional planning professor at Cornell University who interviewed 30 of its recipients for a recently published paper, that a car saved them up to two hours of travel time; they could use that time to cook dinner and help their kids with homework. A car allowed people to choose a doctor with better hours or lower fees and spend less on groceries by price-comparing at stores further away. Some of these families had previously owned cars, but a vetted car from the nonprofit meant they spent less on repairs or didn’t go through multiple vehicles so quickly.

The positive evidence from Klein’s paper illustrates a transportation conundrum in our country: Better access to cars helps low-income residents economically and socially, but more cars on our roads runs counter to efforts to reduce traffic, increase public transit, and curb emissions. “Decades and decades of time, money, and work [have] created a landscape where for most people, a car confers great advantages,” Klein says. That’s not true everywhere; in Manhattan and other city centers transit, walking, and biking are realistic options, but most people don’t live in those places. What can we do for those people, especially low-income families, who need to get around?

In the long term, we can improve public transit and walkability and biking infrastructure in auto-dependent areas. “I certainly think we should do those things,” Klein says. “The problem is it takes a long time, it’s very expensive, and . . . what do we do for those people [without a car] while we’re building up transit capacity, while we’re building up biking and walking?” Subsidizing cars for low-income families, he says, could bridge that gap.

Driving is already highly subsidized across the country. We build cheap—often free—areas for parking, we invest in highways, drivers don’t pay for congestion or CO2 emissions, and zoning laws and taxes favor sprawl. “We have this very unequal landscape where people without cars face a lot of challenges to get around,” he says. Some nonprofits and local programs are leveling the playing field. Vehicles for Change is one; others, such as 1-800-Charity Cars or Cars 4 Christmas, give vehicles away for free. Klein noted that the government offers substantial incentives for buying electric vehicles but not for e-bikes, and subsidizing the latter could also benefit people closer to or within cities. There are programs in California that subsidize repairs for cars that wouldn’t pass a smog test or help people completely replace their older, polluting vehicles with a hybrid or electric car.

These programs seem to run counter to efforts to reduce our dependence on cars, but to Klein, it’s not fair to critique efforts that help a small number of low-income households while hundreds of thousands of people buy cars, including trucks and other high-polluting vehicles, every year. In 2019, Americans bought 17 million new vehicles in 2019. Only about 2% of that total—some 330,000 vehicles—were electric.

Low-income Americans will also continue to buy cars, whether or not they’re subsidized. According to his research, of the 30 people who received cars from Vehicles for Change, 25 had owned at least one car previously, and the median interviewee had owned three cars in their lifetime. People went through multiple cars because they couldn’t afford necessary repairs or because of other financial difficulties. One woman had bought seven “inexpensive and unreliable cars” over 11 years; another had bought a minivan on Craigslist that “only lasted a few weeks.”

By combining car subsidies with those programs that help repair or replace less-efficient vehicles, low-income families could have access to better jobs and a higher quality of life and could actually purchase fewer old, highly polluting vehicles. When we consider how people get around, it’s often framed as a choice between cars on one side and transit, biking, and walking on the other—but it’s not an either-or, Klein says.

“What’s the alternative if we don’t subsidize car ownership and people aren’t able to access safe ways of buying cars?” Klein asks. “I think for a lot of people, they’re going to venture into the used-car market, which is not nearly regulated enough, and they’re going to buy cheap cars that aren’t going to last as long. That’s not a good outcome.”

Link to article in Fast Company

Prediction/Causality Tradeoffs and Data Size Issues in Transportation Modeling Webinar

Fred Mannering

Prediction/Causality Tradeoffs and Data Size Issues in Transportation Modeling: The Example of Highway-Safety Analysis Paradigm shift towards smart and healthy cities —systems innovation at the nexus of transportation, environment, and public health

September 24, 2021 at 12:00 p.m. ET

Webinar link: Join Microsoft Teams Meeting (Conference ID: 495 510 442#)

H. Oliver Gao
Professor, Director,
Center for Transportation, Environment and Community Health (CTECH)
Cornell University

Abstract: Transportation-related air pollution, GHG emissions and energy problems are a significant issue in the U.S. and across the world. The World Health Organization estimates that urban air pollution causes 200,000 deaths per year worldwide. How do we meet the mobility needs in urban transitions without sacrificing environment sustainability and global health? In this talk Dr. Gao takes a systems approach to study the nexus of transportation and environment/health systems. We’ll examine the broad spectrum and necessary depth of models, tools, and insights for trans-disciplinary systems research in support of integrative transportation, environment, and health systems planning and finance/policy innovation such as public private partnership.

Bio: Dr. Gao, Director of the Center for Transportation, Environment, and Community Health (CTECH), is a Professor with the School of Civil and Environmental Engineering at Cornell University. Gao is an international leading expert in urban infrastructure systems research and policy innovation for healthy living in sustainable communities. His research focuses on modeling and development of systems solutions for sustainable and intelligent infrastructure systems, low carbon and low emission transportation systems, and human-centered design for environment and public health. Before joining Cornell, Gao was a QUANT in the mathematical and econometrical modeling division at the Rohatyn Group, LLG, a Wall Street hedge fund specializing in emerging markets including the BRIC countries.

Long commutes, home crowding tied to COVID transmission

traffic cars driving in city

By Blaine Friedlander

Long commute times and household crowding may be good predictors for a higher number of transmissible coronavirus cases in metropolitan settings, according to Cornell urban planning, architectural and public health researchers, in a July study published in the journal Buildings and Cities.

Neighborhoods that had populations with predominantly longer commute times to work – from about 40 minutes to an hour – were more likely to become infectious disease hotspots, the research said.

“We are trying to determine how the built environment influences coronavirus propagation,” said senior author Timur Dogan, assistant professor of architecture in the College of Architecture, Art and Planning.

“We found that high residential density and high percentage of people commuting by public transit do not relate to a higher COVID-19 case rate,” Dogan said. “Household overcrowding and longer commute times appears to impair the pandemic resilience of individual families, medically vulnerable communities and cities, as a whole.”

The study, “Urban Design Attributes and Resilience: COVID-19 Evidence from New York City,” was published July 6, to offer guidance for short-term responses in the safe recovery from the COVID-19 crisis, as well as long-term urban design and planning decisions for a resilient, inclusive and sustainable urban environment in future public health emergencies.

In-home crowding and urban density are two related, but different concepts, when considering pandemic-resilient design and planning. Crowding indicators, which include the number of units per building and the number of occupants per room, correlate with coronavirus transmission, according to the paper.

Neighborhood residential density, on the other hand, was not related to the daily COVID-19 case rate in New York City, as high density often entails other beneficial urban features that are advantageous for the pandemic resilience.

For example, dense and well-mixed neighborhoods can mean that job sites are closer to home, giving rise to a shorter commute time and improved mobility conditions – such as accessible travel modes like walking or riding a bike to work, Dogan said.

“High-density neighborhoods aren’t necessarily bad from a disease transmission perspective,” said Dogan. “A well-mixed neighborhood in a city could be beneficial.”

The group used ZIP code tabulation area data, and then combined it with other available urban information, to determine how population density and crowding affected infection rates, and how the spatial distribution of points of interest – such as grocery stores, shopping centers and parks, for example – impacted infection rates.

The points of interest-related mobility data in this study was derived by a computer-aided design software utility called Urbano, developed by lead author Yang Yang, a doctoral student in systems engineering and a design researcher at Dogan’s Environmental Systems Lab.

“The Urbano software assists with collecting, simulating, and analyzing urban mobility data,” Yang said. “It allows mobility-aware decision-making for designers and planners in building a sustainable and resilient city.”

Said Dogan: “This is where we start the idea of the 20-minute city, a concept where a person can fulfill all the daily errands, work and daily needs within a 20-minute walk or bike ride.”

“This kind of urban design paradigm promises benefits that make our cities more livable, sustainable and resilient,” he said. “Professional urban planners say that active mobility is a healthy thing to do. If we can reduce vehicle traffic, we can reduce pollution and reduce energy demand, we can get a healthier population.”

Dr. Nathaniel Hupert, associate professor of population health sciences, at Weill Cornell Medicine and co-founder of the Cornell-Oxford COVID-19 International Modeling (CoMo) Consortium, said, “This research helps us to see what features of the built environment might be beneficial or detrimental to health during this and future pandemics.”

In addition to Dogan, Yang and Hupert, co-authors are Yihong Li, a faculty member in the Cornell Master of Public Health Program; and Katharina Kral, a lecturer on architecture (AAP). Dogan, Kral, Li and Hupert are fellows at the Cornell Atkinson Center for Sustainability.

Group members Samitha Samaranayake, assistant professor in the College of Engineering, and Nikhil Saraf ‘22, helped to develop the Urbano software.

The research was funded by a COVID-19 rapid response grant from Cornell Atkinson.


How to reach 50 percent zero-emission vehicles


The Biden administration has set a goal for 50 percent of cars and light trucks sold in 2030 to be zero-emission vehicles. This is a critical step in the fight against climate change. The transportation sector accounts for nearly 30 percent of U.S. greenhouse gas emissions, and more than half of transport emissions are from light-duty vehicles. With electric vehicle prices falling and more models being introduced, the transition to electric vehicles is within grasp — but only if it is supported by the right mix of policies.

Two main types of policy support are on the table. The bipartisan infrastructure deal moving through Congress includes $7.5 billion for charging stations. The $3.5 trillion budget reconciliation package includes a to-be-determined sales incentive aimed at consumers, like (but different than) the current electric vehicle (EV) tax credit. The sales incentive is likely to have a high price tag: light duty vehicle sales average around 16 million annually, so if one-fourth of those sales are EVs and the tax credit is the current $7500, the annual fiscal cost would be $30 billion — a sum that increases with the EV sales share.

The question for Congress, then, is how to allocate funds across EV rebates and cost-shares for charging stations.

In principle, one can argue for both programs. Subsidizing EV sales will tempt consumers to try an EV and will provide a public benefit through expediting the decarbonization of light duty vehicles.

Subsidizing charging stations addresses a different challenge: the chicken-and-egg problem that few EVs beget few charging stations and vice versa. There are more than 150,000 gasoline stations in the US, but fewer than 5,000 level-three (“Fast DC”) chargers. While there are roughly 40,000 public level-two stations, which work with all EVs, they can take 8 hours or more for a full charge.

To examine the tradeoff between public spending on charging stations and on rebates, we undertook an economic modeling exercise that simulates the battery EV and charging station markets under different policy scenarios. We varied the size of the subsidies and total program budgets for both vehicles and charging stations. From this exercise, we obtain the share of battery EVs, the reduction in greenhouse gases, total governmental outlays, and the program costs measured in the standard units of dollars per ton of CO2 emissions abated.

Our main finding is that charging stations are key to the rapid electrification of this sector — especially if working under fiscal constraints. For example, if the charging station budget is fixed at $7.5 billion, EV rebates of $11,000 (roughly as proposed in the Clean Energy for America Act) would achieve approximately a 45 percent EV share in 2050, at a cost of $400 billion. In contrast, increasing charging station spending to $30 billion while halving the per-car rebate would achieve a 2030 EV share of 50 percent at a fiscal cost of $170 billion. 

These results strongly suggest that the $7.5 billion for charging stations in the bipartisan infrastructure deal is not enough. The results also make sense: A 2020 survey showed that driving range and the availability of public charging are key determinants of EV owners’ satisfaction. If you live in an apartment building or cannot otherwise install your own level-two charger, owning an EV currently simply isn’t an option.

Getting this right can help the U.S. catch up to other major economies in electric vehicle adoption. In 2020, the share of EVs including both battery EVs and plug-in hybrids among new vehicle sales was only about 2 percent in the US, compared to over 5 percent in China and over 10 percent in many European countries (a whopping 70 percent in Norway with most of them being battery EVs).

Our analysis underscores the importance of focusing on charging infrastructure. The current EV tax credits have largely subsidized the well-to-do, but jump-starting charging stations helps all consumers. While the costs of EVs are still higher than traditional gasoline-based vehicles today, as battery costs fall and EVs get closer to cost-parity, the main hurdle from large-scale adoption is going to be a lack of recharging infrastructure. Removing this hurdle requires a change in policy focus if we are to achieve deep EV penetration by 2030.

Christopher R. Knittel, Ph.D., is the George P. Shultz professor of applied economics at the Massachusetts Institute of Technology (MIT).

James H. Stock, Ph.D., is the Harold Hitchings Burbank professor of political economy, Faculty of Arts and Sciences and member of the faculty at the Harvard Kennedy School.

Shanjun Li, Ph.D., is a professor of applied economics and policy and holds the Kenneth L. Robinson Chair in the Dyson School of Applied Economics and Management at Cornell University.