Thanks to the wonders of social media, it’s easy to find large communities of car-loathing, bicycle-riding, transit-loving urbanists who view cars as “death machines” and insist they are the cause of every woe known to mankind. Many of these progressive scolds would love to ban them, or at least strictly limit their use. For instance, some left-leaning cities are hatching plans to make large swaths of their communities off limits to personal vehicles.
The idea of “costs and benefits” sometimes seems lost on urbanists. They rarely acknowledge that along with their drawbacks, cars provide access to jobs, time savings, comfort and a standard of living that can’t be matched by queuing up for the bus or pedaling a bike in the rain and snow. They refuse to admit that, although automobile ownership certainly is costly, it enables families to live in more-affordable suburbs with decent public schools.
Sure, that car might cost several hundred dollars a month in payments, gasoline and insurance, but the requisite savings in other areas (mortgage, tuition, taxes) probably makes up for it. But, primarily, urban evangelists don’t embrace the freedom an automobile entails – the ability to come and go as one pleases and live in a wider range of neighborhoods. Not everyone wants to live in a tiny characterless box apartment in the city, and the car is your ticket to better choices.
Urbanists like to tout figures about the soaring cost of car ownership. The American Automobile Association issued this report in August: “Based on the latest figures, the average cost of owning and operating a new vehicle in 2023 has increased significantly, with an annual expense of $12,182 or a monthly cost of $1,015. This is a sharp increase from 2022 when the average yearly cost was only $10,728, or $894 monthly.” Such costs still are rising.
That is, in fact, a staggering amount of post-tax income. AAA doesn’t go into a lot of detail, but its calculation includes a new-car payment, depreciation, gas and insurance. Double that number if you have two new cars. Following the pandemic, supply-chain issues have limited supply and driven up the cost of new cars. The average transaction price for a new car is nearly $49,000 and nearly $60,000 for a pickup truck, the latter of which account for 20 percent of sales.
From a personal financial perspective, buying a new car – let alone two – can be a financially ruinous decision. I like cars and have owned a variety of interesting and cool ones, but whenever I give advice to young adults (something that happens more as I get crotchety and old), I tell them: “Don’t be lured by shiny sheet metal and sign onto a payment for a depreciating asset that will reduce your ability to buy a home or invest in items that appreciate.”
That said, the anti-car folks generally aren’t trying to help people make wise financial decisions. As ideologues, they want to convince more Americans to give up their cars and move into a big city, where they can rely on buses and e-bikes to get around. They view cars as a threat to the planet and freeways as a threat to the land-use patterns they prefer. Yet as fun as it can be to be a young person living car-less in some urban playground, following this advice can be financially detrimental, as well – at least over the long term. Living this way can delay marriage, child-rearing and home buying, all of which (even number two) encourage wealth creation.
After reading the usual “cars are bad” arguments, I like to mention the obvious: Cars allow people to efficiently get to work. They expand the geographical area to which people can seek work. They save time and allow people to live in less-costly areas. Our car-based transportation system allows goods to be delivered in a cost-effective way. If I had to rely on a bicycle, I’d no doubt be trimmer – but simple tasks such as grocery shopping would consume the bulk of my day.
“As good jobs have migrated to cities, long commutes and rising housing prices have excluded those seeking to escape poverty,” noted a 2020 Quartz article documenting San Francisco’s efforts to discourage cars. “And few things are as important as transportation. … A 2015 Harvard University study found shorter commuting times are better predictors of communities’ upward mobility than elementary-school test scores or the share of two-parent households.”
The article focuses on the need for more transit, but it perhaps inadvertently advocates for the broader need for cars. Using federal Labor Department statistics, The New York Times concluded that “those who commute by public transit spend roughly twice as much time traveling to and from work as people who drive.” So if shorter commuting times are “better predictors” of upward mobility, then expanded car use offers a profound economic benefit for families.
I’m not sure how one might incorporate that predictor in the car-ownership cost-benefit calculation, but there’s some non-zero number that would go in the benefit column. It’s also hard to calculate the specific economic benefit of cars in terms of opening up workers to additional job opportunities. Not everyone aspires to be a work-from-home tech mogul or barista – and well-paid blue-collar jobs aren’t centered in big-city downtowns.
A 2014 study from the left-of-center Urban Institute study found “there is at least one group that may need help to drive more, not less: low-income residents of high-poverty neighborhoods.” It found that “housing voucher recipients with cars tended to live and remain in higher-opportunity neighborhoods – places with lower poverty rates, higher social status, stronger housing markets, and lower health risks.” It also found that those who owned cars “were twice as likely to find a job and four times as likely to remain employed.”
In other words, car ownership allows lower-income people access to better neighborhoods and job opportunities. The Urban Institute also needled the young elitists who are spearheading modern urban policy: “Even as highly educated millennials and baby boomers fantasize about car-free cities, car access is still indispensable for many families seeking safety and economic security.”
Consider also that the median home price in San Francisco is $1.2 million. The median home price in suburban Contra Costa County is $733,000, with median prices in exurban Solano County under $600,000. So, sure, it might cost $1,000 a month to own a new car – but you can literally save thousands of dollars a month in a mortgage or $1,600 a month in rent, as Solano rents are half as much as San Francisco’s. And most suburban residents have decent-enough public schools, whereas finding decent urban schools (especially in lower-rent neighborhoods) usually requires paying a private tuition. It isn’t exactly free to rely on transit systems and ridesharing, either.
So, yes, cars are expensive, but owning one can save its owner a lot of money. And car costs are somewhat controllable. One needn’t buy a fancy new SUV when a lower-cost used compact sedan is available. That lowers initial costs and depreciation. Eliminate a new-car payment from that AAA calculation (by paying cash) and car ownership suddenly looks like a good investment.
Finally, Americans are smart enough to make their own economic calculations, which might explain why San Francisco lost 8.6 percent of its population over the last five years even as nearby suburbs grew. If cities follow urbanists’ advice by limiting car use, more of them are likely to face a similar exodus.
Steven Greenhut is the Director of the Free Cities Center. This column was first published in the American Spectator.
