According to the most recent forecasts from the Washington State Office of Financial Management, drivers in Washington State will rack up about 65 billion miles on the highways in 2031.
I have no idea if that number is anywhere close to accurate. Nobody does. But what I do know is that the current estimate is 21 billion miles lower than the forecast that OFM made 3 years ago, and more than 10 billion miles lower than their forecast from just last year. The chart has the details:
It’s awfully tempting to suggest this chart shows that OFM is gradually groping towards more realistic traffic projections.
But does it, really? To be honest, I don’t actually know if the blue line is more “realistic” than the orange line. Sure, the blue line is more consistent with the actual traffic trends over the last decade—a period when annual VMT growth slowed to a crawl. But I don’t have a crystal ball that tells me which of the three lines is the most “realistic” depiction of the future.
Instead, I think the real lessons of the chart lie elsewhere.
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The first lesson is this: nobody has any special insight into the future. Future VMT trends aren’t a feature of objective reality that smart people can sit in a room and puzzle out. They’re just guesses. Sometimes new information comes in, and the guesses change. Sometimes they change radically, enough to make the best guesses from a year earlier look ludicrous. So it’s important to remember that even if particular forecast matches up with your world view, it’s still just a guess.
Which leads to a second lesson: nobody should take official VMT forecasts too seriously. Three years ago, the “official” guess was that there would be lots of new demand for road space, and lots of new gas tax revenue to pay for it. Today, the “official” guess is that statewide gas consumption peaked in 2002 or 2003, never to rise again; that gas tax revenues are going to decline unless the state ramps up the tax rate; and that the demand for new road space is going to slow to a crawl. Those are two completely contradictory views from the same agency in the same political administration. So all the hot air that was spewed about the dire need for new transportation megaprojects to avoid the near-certainty of a trafficopalypse showed nothing more than hubris, overconfidence, and a dismal understanding of how forecasting actually works.
And there’s a third lesson here: forecasts can be dangerous. People have a tendency to take official forecasts awfully seriously. But the decisions we made three years ago that we “had” to put lots of new megaprojects into the pipeline, based on forecasts of massive gridlock in 20 years, could very easily turn out to be dreadfully costly mistakes. When we place too much confidence in any one forecast, we can wind up making terrible decisions.
To me, the rapid change in traffic forecasts argues for a new way to think about transportation investments: that we make them smaller, more versatile, more nimble, more creative, and less likely to lock us into huge long-term expenses for projects that we might not actually need. In short, it argues for an approach that’s the exact opposite of all the multi-billion dollar bridges, tunnels, and highway expansions that are on the docket in the Northwest.
Great post as usual.
As a side note to actual state VMT, the most conservative estimate of the unrecovered costs of driving is $0.15/mile (source: FHWA) (a subsidy by any other name, but anyway…). If we were to asses just the most direct costs, Washington state and its communities would receive $9.75bn every year. That money would go a long way toward dealing with pavement condition, structurally deficient bridges, and even Sen Haugen’s beloved ferries — and would reduce a bit of VMT to boot.
I’ve seen this graph before and it used to justify why we don’t need the vast road infrastructure that the state is planning. I take the point that the WSDOT estimates are based on models and are just projections, but the obvious point hasn’t been made. I don’t know whether its justifiable, but I’ll make the point anyway.
Doesn’t the “rapid change in traffic forecasts” seem to correspond nicely to the drop in our economy and the shedding of jobs? Would it therefore suggest that these traffic improvements are not unnecessary when the economy returns, jobs return, and people begin commuting to work again?
The economy is definitely a major force in the trends from 2008.
It’s possible that forecasters are feeling gloomy, and their long-term GDP growth forecasts have been affected by the short-term economic woes.
But reading the numbers, VMT growth slowed WAY before the economy cratered. As I read things, it looks like the forecasts are moving towards a belief that “things in the future will look like they did from 2001-2007, rather than from 1992 through 2000.” In some ways, what’s happening is that an OLD vintage of super-over-optimistic forecasts that seemed reasonable in the 1990s is going away, and a NEW vintage of semi-optimistic forecasts that match the early 2000’s is coming into force.
Here’s what I think has changed in the models:
1) Forecasters now think that oil prices are going to remain high. As recently as 2008, ALL of the major oil forecasts showed oil prices at ~$30/barrel and roughly flat/declining as far as the eye can see. The runup that started in 2005 was seen as a temporary blip. But even though the economy is still struggling mightily, oil prices are high — so high & ascending oil prices are now built into the models. (Incidentally, from what I’ve seen the models are based on assumptions that gas will be ~$3 per gallon).
2) Forecasters now better understand how consumers react to high gas prices. For a couple of decades, gas price blips had no appreciable effect on demand. When gas prices went from $1 to $1.20, nobody batted an eye–everyone kept buying. So the “professional” opinion was that gas price elasticity was incredibly low — people would continue to drive no matter how high prices got. But it seems that gas at $4 a gallon has really made a dent in people’s appetite for travel. Elasticity is higher than people thought. Couple that with higher than expected gas prices, and you get a significant dampening effect on driving.
3) The understanding of demographics — seniors driving less, fewer teens and young people working — may have changed, altering long-term estimates of trip generation.
There are probably other factors. The important thing, though, is that the long-term projections now show that the future will be like 2001-2007, not like the roaring 1990s. That may still be too optimistic! But it’s not *just* that the sour economy in 2011 is changing expectations for economic growth in 2030; it’s also that the models are catching up to the reality of what was happening in the early 2000s.
These sorts of grossly inflated forecasts have disastrous consequences for long term planning and economics. Right now there are two different sewer projects being planned on Whidbey Island that are based on straight line projections of 10 year old OFM “high-mid” population forecasts that are demonstrably way higher than has actually occurred. This is the result of a combination of the lag in updating the County’s GMA population forecasts, attributable to the lack of planning dollars available right now, and the boomers previously in power consistently choosing from the high end of OFM population forecasts, despite hindsight consistently showing that the reality was different. So, now Oak Harbor (current population: about 23,000) is planning a $60 million new sewage plant and the non-municipal urban growth area of Freeland (current population: about 4,000) is planning a $40 million sewer.
Looking at census data since 1970 reveals that since 1980 the rate of population increase has dropped by about 50% for each succeeding decade. If this long term trend continues the 2010-2020 population increase rate will be close to 0%. In fact, Island County has actually lost population (a bit over 3%) in the last 3 years. So, Whidbey and Camano Island may be about to achieve a steady state population or decline. This is something boomers just can’t comprehend.