Transportation in the United States– from municipal bus and subway operations to highways, railroads, and airlines–has endured a history of government-imposed pricing policies that require some users to subsidize others. Cross subsidies have been an integral part of national transportion policy, moving from provisions in railroad land grant charters more than a century ago to the myriad taxes, price regulations, and user fees affecting today’s transportation systems. They invariably bestow unearned benefits on some industries or consumers, while penalizing others with prices in excess of costs. Incentives aer distorted and inefficiencies created as a consequence.
Please note The Heartland Institute’s phone number and address have changed since this document was created. The correct contact information is The Heartland Institute, 19 South LaSalle Street #903, Chicago, IL 60603; phone 312/377-4000; fax 312/377-5000; email [email protected].