This essay explain why luxury safer electric (or plug-in hybrid) cars should
be free-to-the-user at the point of sale in the USA, and why this will
reduce US taxes overall. Essentially, unsafe gasoline-powered automobiles in
the USA pose a high cost on society (accidents, injuries, pollution,
defense), and the costs of making better cars would pay for themselves and
then some. This essay is an example of using post-scarcity ideology to
understand the scarcity-oriented ideological assumptions in our society and
how those outdated scarcity assumptions are costing our society in terms of
creating and maintaining artificial scarcity.
""Groundbreaking AAA report shows traffic crashes cost American motorists
$164.2 billion per year: AAA report on Crashes vs. Congestion - What's the
Cost to Society? "
"The societal cost of crashes is a staggering $164.2 billion annually,
nearly two and a half times greater than the $67.6 billion price tag for
congestion, according to a new report released today by AAA. ... According
to the study conducted by Cambridge Systematics, the $164.2 billion cost for
crashes equates to an annual per person cost of $1,051, compared to $430 per
person annually for congestion. These safety costs include medical,
emergency and police services, property damage, lost productivity, and
quality of life, among other things. ... “Nearly 43,000 people die on the
nation’s roadways each year,” said Darbelnet. “Yet, the annual tally of
motor vehicle-related fatalities barely registers as a blip in most people’s
minds. It’s time for motor vehicle crashes to be viewed as the public health
threat they are. If there were two jumbo jets crashing every week, the
government would ground all planes until we fixed the problem. Yet, we’ve
come to accept this sort of death toll with car crashes.” ..."
From the report:
• In the urban areas studied, the cost of traffic crashes is more than two
and one-half times the cost of congestion – $164.2 billion for traffic
crashes and $67.6 billion for congestion.
• The safety costs include property damage; lost earnings; lost household
production (non-market activities occurring in the home); medical costs;
emergency services; travel delay; vocational rehabilitation; workplace
costs; administrative; legal; and pain and lost quality of life. The economy
and the environment also are impacted but those costs are not quantified in
the study. According to FHWA, in 2005 dollars, the average cost of a
fatality is $3,246,192 and the average cost of an injury is $68,170.
• Improving safety may improve congestion. Forty to 50 percent of all
nonrecurring congestion is associated with traffic incidents.
• The cost of crashes on a per person basis decreases as the size of the
metropolitan area increases. An inverse relationship occurs with the cost of
congestion, which becomes worse with an increase in the size of the
To further underscore the impact of safety, it is possible to calculate
the health care impact of traffic crashes in selected states. For instance,
Maryland, which has the Crash Outcome Data and Evaluation System (CODES),
can determine how much traffic crashes are costing the health care system,
specifically Medicare and Medicaid. For example, in 2004, 7,283 persons were
admitted to a Maryland hospital because of a traffic crash. Their collective
hospital charges totaled $99,986,245.46. Of those, 393 (5.4 percent) used
Medicare, totaling $5,032,976.63 (5.0 percent of total Medicare costs). In
addition, 893 (12.3 percent) used Medicaid, totaling $16,200,085.52 (16.2
percent of total Medicaid costs). In 2004, 78,674 persons went to a Maryland
emergency department because of a traffic crash. Their hospital charges
totaled $27,049,265.23. Of those, 1,528 (1.9 percent) used Medicare,
totaling $647,423.65 (2.4 of Medicare costs). In addition, 3,903 (5.0
percent) used Medicaid, totaling $1,391,833.86 (5.1 of Medicaid costs).
4.4 Cost of Crashes and Congestion per Person
In every city, the crash costs on a per person basis exceed the congestion
costs. For very large urban areas, crash costs are nearly double those of
congestion. In other words, for every dollar spent on congestion in very
large urban areas, $1.84 is spent on safety. In large urban areas, crash
costs are nearly three times more than congestion; for medium areas, crash
costs are over four times more than congestion; and for small urban areas,
crashes are seven times more costly than congestion. Table 4.3 and Figure
4.2 show the ratio between the per person cost of crashes and the per person
cost of congestion. ...
When you think about it, this is another case of market failure, and how
scarcity-oriented thinking (creating artificial scarcity) costs a lot of
money compared to post-scarcity thinking.
Much of the costs of these crashes is medical costs and the costs of fatalities.
One can think of it this way. The cost per accident per car is then about
164 billion US dollars annually divided by about 16 million new cars sold
annually (ignoring trucks and buses where the occupants are probably not
hurt as much):
This is a cost of about US$10,000 per car purchased.
Now, that is probably about the difference in cost between a Volvo and a
less safe car. Granted, people who tend to buy Volvos are often more safety
conscious, but the car itself is still much safer than average. One might
expect the fatality rate to drop by 50% or more.
So, if every car got at least an extra half of $10,000 invested in it
towards safety, the investment would likely pay for itself, as opposed to
many people buying the cheapest car they can afford. That extra money could
buy a much better car for most people, especially given that if *everybody*
was getting safer cars, the cost for such improvements would drop for mass
production reasons and due to less need for marketing costs for such
features, so the real extra money might be equivalent to spending an extra
US$10K or more per car. Or about the difference between a 2010 Ford Taurus
(US$25,170 starting MSRP)
and (also owned by Ford) a Volvo S80 (MSRP $40,050.00):
So, this is a case of market failure and social failure, as the external
costs of less safe products are passed on to society. And, in either case,
Ford would still be selling you a car for the same amount of money to you,
it is just safer in one case. There is a huge positive externality from
safer cars that is not being considered here in pricing cars.
Insurance costs would also be cheaper. Although, like many things in our
society, this is a case where poorer people can not afford to invest up
front and so have to pay statistically in suffering and death and higher
insurance costs down the road.
Still, here are a couple positive trends in our society.
It has been suggested that Electronic Stability Control could reduce
accidents significantly, and that is finally (after much resistance by car
companies) being mandated to be phased in.
"Electronic stability control (ESC) is a computerized technology that
improves the safety of a vehicle's stability by detecting and minimizing
skids. When ESC detects loss of steering control, ESC automatically applies
the brakes to help "steer" the vehicle where the driver intends to go.
Braking is automatically applied to individual wheels, such as the outer
front wheel to counter oversteer, or the inner rear wheel to counter
understeer. Some ESC systems also reduce engine power until control is
regained. Electronic stability control does not improve a vehicle's
cornering performance; rather it helps to minimize a loss of control. The
NHTSA estimates 5,300-9,600 traffic fatalities could be avoided if all
passenger vehicles were equipped with the feature. According to the IIHS
one-third of fatal accidents could be prevented by the technology."
Although that has been accomplished with a legal mandate, not a subsidy.
In general, cars are safer now through better design than 50 years ago:
"Technology'09 Malibu Vs. '59 Bel Air Crash Test"
Again, with most car companies having fought that pretty much all the way.
Just like they fought to put lead in gas and keep it there:
"The Shadows of Consumption: Consequences for the Global Environment"
By Peter Dauvergne
"Why did U.S. regulators declare leaded gasoline "safe" in the 1920s? Why
were critics, once so loudly calling for precaution and further research, so
quiet in the following decades? And, finally, why were so many scientists,
activists, and government agencies in the United States suddenly -- a half
century later -- beginning to challenge the "facts" and "safety" of leaded
gasoline? The answers reveal important lessons about how and why ecological
shadows form, intensify, and shift. They reveal how the pursuit of profits
and markets can trump calls for precaution even in the face of high
uncertainty and significant risks, how corporations and state allies can
silence critics and control "research" for generations, and, finally, how
knowledge and technology can both cause and begin to mitigate ecological
"The Leaded Gas Scare of the 1920s"
"The Secret History of Lead "
Although unleaded gas is safer from not having lead, it has other pollutants
in it, and burning it contributes to smog and CO2-related global climate
change, so there is another huge external cost of having cars that use
"MTBE is a gasoline additive, used as an oxygenate and to raise the octane
number, although its use has declined in the United States in response to
environmental and health concerns. It has been found to easily pollute large
quantities of groundwater when gasoline with MTBE is spilled or leaked at
Note, this amount of money saved by safer transportation or using less
fossil fuels is also ignored in an analysis like at the following link that
argues against social investment in safer mass transit or any sort of social
investment in transportation based purely on up-front direct costs:
(Even as it is true that the USA has built its infrastructure and housing in
a sprawling way that makes mass transit not very cost-effective compared to
Anyway, this failure tn auto safety investment is yet another example of
scarcity thinking, in this case an obsession with rationing access to safer
"luxury" cars, which is costing society a lot of money by creating
artificial scarcity through worse and more frequent car accidents.
Of course, I'd suggest that ultimately the safest cars (or also better in
other ways like reliability and maintainability and low cost) will be ones
with open designs that millions of people can critique, and even run their
own virtual crash tests on using computer simulations. :-) So, the cost of
proprietary design in cars may also be in that range of ten thousand dollars
Note that the true cost of gasoline related to defense costs is also expensive.
Milton Copulus, the head of the National Defense Council Foundation, has a
different view. And as the former principal energy analyst for the Heritage
Foundation, a 12-year member of the National Petroleum Council, a Reagan
White House alum, and an advisor to half a dozen U.S. Energy Secretaries,
various Secretaries of Defense, and two directors of the CIA, he knows his
After taking into account the direct and indirect costs of oil, the
economic costs of oil supply disruption, and military expenditures, he
estimates the true cost of oil at a stunning $480 a barrel.
That would make the "real" cost of filling up a family sedan about $220,
and filling up a large SUV about $325 (when oil was $10 a barrel cheaper
than it is now!).
Due to the enormous military cost of protecting Persian Gulf imports, the
hidden cost of oil from that region amounts to $7.41 per gallon of gasoline.
The cheapest gas out in my part of the Bay Area is $3.11 a gallon for
regular. Add them together, and the true cost of my gas is probably around
$10.52 a gallon.
We use 21 million barrels a day of oil. At $480 a barrel, that's $10
trillion a year draining from the national coffers.
Note also that it takes about as much electricity to make gas as cars get in
travel distance from the gasoline:
"It takes about 7.5 KWH to refine a gallon of gasoline. An electric car can
go 25 miles on that much electricity. Except that the cars mostly draw at
night when there is spare capacity while the refineries draw all day long.
That refining energy loss is only going to go up as the better grades of
crude oil become more scarce and more expensive."
So, essentially, if that is accurate (not sure if it accounts for
transmission losses) it is energetically completely pointless to produce
gasoline instead of just power cars electrically, since most cars get about
25 mpg or so. Essentially, the gasoline is being used as an energy carrier,
like a charged battery or like hydrogen.
Note also that green safe electric (well, plug-in hybrid) cars now exist:
"We were already aware that Volvo has been working on a plug-in hybrid
version of its compact C30 for some time with the intent of introducing a
production model in 2012. In Frankfurt this week, Ford's Swedish outpost
also showed off a full battery electric version of the hatchback. Volvo has
apparently been testing several prototypes already this year. The 24 kWh
lithium ion battery pack is installed in the center tunnel of the car. The
electric motor and electronics remain in the standard engine compartment.
Volvo claims the C30 BEV can go 93 miles on a full battery charge. The pack
takes about 8 hours to charge from a 230 V 16 A outlet that is standard in
Put the cost of crashes together with other costs of bad design, and add in
the indirect cost of oil (all aspects of fundamental market failures), and
essentially, luxury electric cars produced using open designs (similar to
the Volvo above) should essentially be *free* to the user, paid for in cost
savings to society. :-) And, if that was the case, as a whole, our society
would *save* money on medical costs from injuries, costs related to deaths,
maintenance costs, production costs, defense costs for oil, and pollution
costs that are associated with other related health costs and global climate
change issues. :-)
Essentially, I am suggesting that not giving away free safe luxury electric
cars to everyone who wants one is purely based on scarcity ideology, and
charging money to buy proprietary cars is costing the USA literally
trillions of dollars a year in hidden costs. :-)
And, because we do pay those hidden cost one way or another in the USA,
through higher insurance costs, higher medical costs, less volunteerism that
can be put into other areas than responding to car crashes, and higher taxes
to cover the uninsured or pay for police and non-volunteer firefighters and
ambulance cores, I'll go out on a limb here and say, overall, if the USA
started giving away free-to-the-user electric cars (especially as trade-in
for "clunkers"), then US taxes would actually go *down* in the long run. :-)
As a rough approximation, sixteen million new cars a year times US$30,000 a
car (lower price through volume) would be US$480 billion a year, an amount
easily found by reducing some of the about US$1 trillion defense budget
(including everything) and US$2.5 trillion health care cost which is about
half paid in taxes (total US$3.trillion for those two things, about US$2v25
trillion in takes). Essentially, US$480 billion a year for free-to-the-user
safe electric cars would be only about 20% of the US$2.25 trillion a year in
taxes we spend on health care and defense. And in turn, we would save a big
chunk of US$164 billion a year for accidents, and a big chunk of the defense
budget spent to defend oil supplies, and a big chunk of other medical costs
related to environmental pollution, and a big chunk of costs related to
global climate change. So, overall, the US tax payer would probably save
money on taxes by giving away free open-source safe luxury electric cars
(or, at least plug-in hybrids to start).
Beyond that, then there is the additional benefits that more research in
auto safety (even to the cost of hundreds of billions of US dollars a year),
especially in perfecting cars that drive themselves at night using radar.
Such cars might eliminate virtually all driving accidents eventually, as
well as let the human "driver" of such a car use the internet or sleep
during the trip (about 90% of serious accidents happen at night, often
related to poor visibility or tiredness). One such example of great research
in this area (although it may not be FOSS yet?):
"Princeton Autonomous Vehicle Engineering"
There is other research one could do on end-of-life recycling for cars too,
so they are overall less polluting to construct and recycle:
"Sustainable and Lifecycle Information-based Manufacturing"
"The United States needs to prepare for a future where products are 100%
recyclable, manufacturing itself has a zero net impact on the environment,
and complete disassembly and disposal of a product at its end of life is
routine. To document and monitor these changes, US industry will require key
resources and methods that will enable it to measure sustainability along
several dimensions (such as carbon foot print, energy accounting and
recyclability of materials) allowing accurate assessment of status and
So, why don't we do this right now? I'd suggest it is mainly due to scarcity
ideology creating artificial scarcity. For instance, the same computer
technologies that can be used to design and operate safer cars are instead
used to manage electronic credit or to produce fancy advertising and
astroturfing related to promoting free market fundamentalism.
Essentially, it's all ideology (or ignorance, or corruption, or vested
interests, which may all be essentially the same thing), because as I show
above, it is even financially cheaper to be both financially-subsidized
free-as-in-beer and open source free-as-in-freedom. There are also other
various freedoms that safer free-to-the-user electric cars would give us
(including freedom from seeing loved ones die in car accidents, by cancer
caused by gasoline additives, or by hurricanes caused by global climate change).
So, I'd suggest, over the next ten to twenty years, this is a major change
we will likely see in the USA's personal transportation system --
self-driving free-to-the-user safer electric cars (or plug-in hybrids) built
using FOSS methodology. And, taxes will then go *down*, along with other
direct to the user expenses for insurance, maintenance, and energy, because
our transportation system will then, by adjusting for externalities (like
national security, pollution, and health care costs), be cheaper overall to
design, build, operate, and recycle.
Note: Because the rest of our society is not yet free-to-the-user, there
might need to be a nominal deposit or surcharge on such cars to discourage
waste for a time. That is another issue to explore.
I know there is some handwaving here, but it at least may be a promising
place to start thinking from. :-)
I BCC'd this to my old advisor in a graduate transportation program, just
for fun. Maybe refining this ideas will be worth granting someone else a PhD
for that eventually. :-)