The Economist offers, of course, an economic reason why buses in NYC should be free:
It's not as crazy as it sounds. Fares bring in a lot of money, but they cost money to collect—6% of the MTA's budget, according to a 2007 report in New York magazine. Fare boxes and turnstiles have to be maintained; buses idle while waiting for passengers to pay up, wasting fuel; and everyone loses time. Proof-of-payment systems don't solve the problem of fare-collection costs as they require inspectors and other staff to handle enforcement, paperwork and payment processing. Making buses and subways free, on the other hand, would increase passenger numbers, opening up space on the streets for essential traffic and saving time by reducing road congestion.But none of this should have anything to do with economic rationality; it should be about rewarding those who use public transportation and punishing those who use cars. Why? Because the market does not compensate the state for the enormous social, cultural, and environmental costs of car ownership. The state can, in this case, address some of the market failures by increasing the tax on gas and ownership and using that money to reward those who are more socially responsible. But the end of these incentives and disincentives is beyond economics—it's about the creation of a new ethic. It's ethical to use public transportation; it's economically rational to use the car.
Last month, Mayor McGinn made this announcement:
City departments to cut annual use of petroleum-based fuels by 1 million gallons by 2020...If you think about the amount of gas the City of Seattle alone uses (almost 2 million gallons a year), then you can start to think about the monstrous ocean of petrol the whole county burns in a year. And what are the yearly operating costs for Metro? Nearly $640 million this year. The one solution: Heavily tax that cheap gas.
Reducing consumption of petroleum-based fuels is good for the climate and good for the economy," said McGinn. "By ramping up demand on the government side we can help support businesses that are interested in innovating sustainable alternatives to petroleum-based fuels. I encourage my colleagues across the region and country to take similar actions."
Using the city's 2012 fuel usage as a baseline, a reduction of 1 million gallons of petroleum-based fuel would equate to a 42 percent reduction in overall petroleum-based fuel usage by the City's fleet.