More train talk! (I know, I am sorry.)

designWith Union Station getting a make-over due to crowding and WMATA constantly in the news, I felt it was time to talk about trains again.

And, to kick it off, there’s a predictably myopic pro-private* critique of the DC Metro system over at the United Liberty website, laying out “5 Policies keeping WMATA Dysfunctional.”

The critique’s points are often obtuse in that they outline problems that plague both unaccountable public sector and unaccountable private sector organizations.

For example, their No. 5, “Focus on appearance rather than performance,” is a classic private-sector corporate strategy. It’s essentially how most marketing works, selling a brand rather than a product or service. The entire phenomenon of positional value (i.e., luxury goods) is predicated on appearance over performance.

Where WMATA gets it wrong on this one is by emulating the worst of private-sector, supply-side behavior: maximizing personal gain (for WMATA leadership) while minimizing what’s provided to a monopolized consumer base.

And, No. 4, “Untransparent, unresponsive communications strategy,” is in the same vein. What private-sector corporation responds eagerly to requests for info (from anyone other than NSA)?

United Liberty quotes noted WMATA critic Chris Barnes:

“What WMATA does with those complaints or feedback,” Chris says, “is usually spin it into something that was the rider’s fault or somehow removes WMATA from the equation.”

Sounds like every corporate defense ever argued in a court of law: the plaintiff wasn’t using our wading pool correctly when it sucked the intestines out of her baby daughter.

Again, I agree with the criticism, but not sure how it supports the website’s solution set.

Their No. 3, “Free funding from federal, state, and local governments,” is the meat of the advocacy, and is absurd at face. The funding is not “free,” because there’s no such thing as free money. What they really mean behind this clumsy terminology is that the funding is unaccountable.

SheldonFranklyAlthough mutual accountability is the real driving force behind free-market prosperity (which anyone who has read Wealth of Nations should know), private-sector advocates usually dance around this by cherry-picking certain types of accountability, namely private profit, and certain barriers to accountability, namely poorly designed public policy/regulations, while pretending other factors don’t exist.

For example, United Liberty tries to address the lack of accountability at WMATA by pointing out how government funding undercuts the feedback from profit, but the idea that the profit motive is the only method of market accountability, or even a consistent one, is a fallacy. WMATA has a near-monopoly on mass transit in the DC area, and this would be unlikely to change if the system were privatized. We might achieve some sort of oligopoly, but this is basically a question of frying pan or fire, because the primary barrier to accountability in any urban mass transit economy would persist: the consumer’s difficulty in exiting the market.

When dealing with products and services that, due to exit barriers, cannot operate in a truly free-market way, vectors of accountability other than consumer choice and profit motive have to be implemented. Luckily for people who genuinely understand how economics work, an alternative vector exists: democracy.

Of course, democratic processes can be gamed and corrupted just as market processes can be, but the reasonable response isn’t to privilege one corruptible vector over the other, but to insist on the integrity of both and apply each where they are most effective. In the case of mass transit, consumer choice simply cannot ever be an effective vector of feedback, no matter what percentage of revenues come from rider fares. Most mass transit customers are pretty much cornered, and will stay in the market until at the utmost end of their budgets.

However, if the continued income of WMATA leaders were more effectively accountable to the opinion of the people through democratic processes, feedback would be achieved without resorting to the non-solution of privatization. Ironically, United Liberty’s list hints at this issue in No. 4 when it points out how unresponsive WMATA is to the Riders Advisory Council.

Want a practical, real-world solution? Imagine if riders could use their SMART cards at Metro kiosks to voice their opinions, cast votes of no confidence, and even oust WMATA administrators.

No. 2, “Travel subsidies that blunt WMATA responsiveness,” is essentially a restatement of No. 3 since most of those subsidies are for federal workers. “Did I mention how we’re against the public sector ever doing anything?” Yes, you did. But, you didn’t mention why the dubious theoretical responsiveness of private sector suppliers often doesn’t manifest in the real world.

I understand United Liberty is a supply-side hammer looking for a laissez-faire nail, but some things that look like nails are actually screws and require a different tool. Mass transit is one of those things.

No. 1, “WMATA’s unionization,” has some good points about bad task assignment policies and promoting poor performers. But the real problem isn’t unionization itself, even though the aggregation of labor interests has the same consequences for competition and accountability as the aggregation of capital interests.

The real problem is the lackadaisical attitude toward inane union demands by an executive class at WMATA that is insulated from consequence.

Again the solution is to provide greater feedback power to riders via democratic processes—because consumer exit issues make the market an inefficient feedback mechanism. Give riders a way to provide direct and meaningful feedback, let riders who can’t walk away from the Metro force Metro leaders to walk away from their jobs, and you’ll see that leadership stand up to the union’s performance-sabotaging ideas far more effectively than they do now.

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* I will not call this sort of anti-republic, pro-private-power politics “free market” because it’s no more genuinely free market than the Soviet Union was genuinely communist. Maps do not make territory, and labels do not make reality. Supply is one category of competitor in the market, and its advocates are therefore in the game, not for the game.

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