The Chief’s Thoughts: But How Will the Roads be Funded?

Libertarians already know who will build the roads – the same people who build them today. No politician or bureaucrat has ever built a road. Instead, they take money from the public and give it to construction firms who would have built the road just as happily on the request of another private company or group of companies.

The more difficult conversation, however, has always been how roads will be funded.

Those who are distrustful of freedom are apparently most concerned with the following:

  • Road infrastructure is insanely expensive – only something like the government can really afford it.
  • Tolls on all roads will make road travel unaffordable for the average person.
  • Poorer communities cannot afford to have roads laid to their areas – who will fund that?

These questions are, no doubt, difficult to answer. All of them, especially the last two, are emotionally-loaded, as a ‘wrong’ answer can provoke allegations of insensitivity for the poor and, in my case, white male privilege. There are also no hard-and-fast answers to them, since we know that there is not a truly free market in roads anywhere in the world; and where it might exist, it is likely tainted by a history of government involvement which distorted what would have happened in the absence of such involvement.

Here are my thoughts on each item.

First things first

Libertarians, or free marketeers generally, are ostensibly not allowed to answer “I don’t know” or “I don’t care.” This is intellectual dishonesty at its finest, however.

There is no rule which dictates that an alternative must be provided when change is sought. Indeed, the alternative to slavery was ‘not slavery’, and similarly, the alternative to government-funded roads can be ‘not government-funded roads’. Many libertarians take this line, saying their intention is simply to eliminate the coercion of government in any given context; the consequences of which be what they may.

Of course, it is not good marketing for the free market if we provide either of these two answers, but we nonetheless can provide them validly on an intellectual level.

Furthermore, the market is infinitely dynamic. In an area of the world where easy communication was a fantasy just a few decades ago, Africans now have access to smartphones and mobile data and can have videoconferences with anyone else anywhere in the world. This was not predicted or really predictable, yet it is now the status quo and more and more people are taking it for granted.

We really and absolutely don’t know how roads will be funded. At the end of the day, every road construction firm will devise its own strategy and best practices will eventually emerge and become the standard mode of payment. However, here are some ways it might be funded.

E-Tolls

A few years ago the South African government introduced its ‘e-tolling’ system (pictured above) on the highways in the Gauteng Province. Massive arch-like structures were erected at various points on the highways, and motorists were expected to buy ‘e-tags’ which are placed in the windscreen of their cars. Each time motorists drive underneath arches on the highways, the motorist’s e-toll account is charged a certain amount.

South Africans however, rightly, rejected the e-tolling system immediately, and most people refused and continue to refuse to acquire e-tags, myself included. This was not because of it being expensive, but rather because the government undertook this project without a mandate. Nobody wanted it, and we were already at that time one of the most heavily-taxed societies in the world. South Africans saw no reason to pay even more into a system for which they were already giving billions every year.

But this example illustrates that e-tolls are practical.

Private road owners can build such arch-like structures or even just place censors at various points on their roads which detect the e-tags in the cars which drive on them. These motorists’ accounts will then be billed monthly or weekly.

Separate censors on various portions of the road can detect for how long the motorist was driving on the road, and whether they just used the road briefly, thus charging more or less depending on the circumstance. Parking lots located on the road can similarly also have censors at their entrances which signal to the system that the motorist is parking and should thus not be charged for being on the road for several hours.

Those who refuse to install e-tags in their cars, yet use the roads regardless, can rightly be treated as fraudsters, and thus prosecuted by the State. It is also conceivable that every road owner will not simply use a separate e-tagging scheme – the system will likely be standardized to a significant extent so as to not cause motorists unnecessary inconvenience by having to install various different e-tags for different roads.

Rent

Another way to fund roads is to charge rent for those homes and businesses which are attached to the road.

In this way the motorists will not be charged directly for their use of the roads; instead, businesses will increase the prices of their goods and services to compensate for the rent they are paying for being attached to the road. In this way motorists will be paying indirectly in the same way consumers pay for various things indirectly today. As far as convenience goes, this is perhaps one of the most desirable forms of funding private roads.

Residential communities built on private roads will, if the residents’ association rather than a developer owns the roads, will likely charge a levy on all residences. Gated communities and business parks already practice this today, signifying that there can be no question of practical implementation.

What about the poor?

What is to become of the poor has a tendency to derail any conversation remotely related to moving away from statocentrism in any given sector of society. While it is an important and interesting question to consider, it should not be used as a cheap way to ‘win’ arguments. ‘The poor’, as a concept and as individuals who experience economic hardships, are not supposed to be a tool in the arsenal of statists to shoot down any attempt to progress toward an open and fundamentally human economy. It is both condescending toward the poor, and intellectually dishonest.

It is important to note that tarred roads, for the absolute poor, are the least of their concern. In South Africa, the quality of our roads are the concern of the middle and upper classes, whereas the poor desperately want employment and housing. Once the poor are employed, they are already on the road to becoming part of the middle class and thus being able to afford the rents and tolls associated with private roads.

It is inconceivable that the poor will be ‘cut off’ from society due to no road access, quite simply, because they are not. Much of the West has already been urbanized, including poor areas. The roads are already there. And because the roads are already there, it is more a question of maintenance than of construction.

In South Africa, roads in poor areas are, in any event, not maintained. I have read about a similar situation in other Western nations where the government-owned roads in poor areas are in a sorry state. Speaking for South Africa, at least, it goes without saying that a free market in roads cannot lead to anything worse for the poor than what they already have. This is not a satisfactory answer; however, it is a valid point nonetheless which must be seen against the backdrop of the poor being poor because of government policy in the first place.

Conclusion

‘The roads’ have become such an exhausted topic in libertarian circles to the point of annoyance. The fact of the matter is, however, that ordinary people still aren’t awake to the fact that roads will be built and will be funded without government’s direct involvement. While most will feign concern about the poor, the real reason they are unwilling to embrace a free market in roads is because government roads is all they have ever known. People are incredibly averse to uncertainty, and that is all the more reason why it’s important to understand that what will happen in a free market, is already happening now. From e-tolls to paying levies for private roads to the poor not remaining poor once they actually secure jobs and property rights, all these things are happening around us as we speak – in a free market it will simply happen unmolested by the interfering hand of government.

This post was written by Martin van Staden.

The views expressed here belong to the author and do not necessarily reflect our views and opinions.

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Martin van Staden is the Editor in Chief of Being Libertarian and RationalStandard.com. He has a law degree from the University of Pretoria. His articles represent his own views and beliefs, and not that of any of the organizations he is involved with.

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