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Adam Summers: Increasing transit subsidies as ridership declines is crazy

March 24, 2026

Based on transportation patterns, particularly in recent years, transit is an increasingly inefficient and unpopular option, so why do we keep pouring so much money into it?

In 1960, most of the nation’s transit was private — and profitable — notes transportation researcher and former Cato Institute senior fellow Randal O’Toole. But government monopolies increasingly crowded out, if not outright prohibited, private operators. By 2015, after a 130% increase in the nation’s working population and substantial government subsidies, transit usage was still slightly less than it was 55 years prior.

Even prior to the COVID-19 pandemic, public transit use in California was only in the mid-single digits, comprising about 6% of total trips in the Bay Area, 4% in San Diego and 5% in the rest of Southern California, according to a 2018 UCLA Institute of Transportation Studies report. Those figures declined significantly during the COVID-19 outbreak, and ridership still has not recovered to pre-COVID levels.

Despite this low usage, transportation agencies tend to spend an inordinate amount of funds on transit. For example, of the San Diego Association of Governments’ $125 billion regional transportation plan for the next 25 years, a whopping 58% — more than $72 billion — would be devoted to public transit.

Transit is so expensive because it requires heavy subsidies. While the costs of car travel are almost entirely covered by the taxes, fees and tolls paid by drivers, public transit is subsidized to the tune of 82% of total spending.

Public transit is often justified as a necessary means of providing transportation options to those who are unable to afford their own vehicles. While there certainly are a number of such people who benefit from transit subsidies, this form of transportation welfare is a very inefficient way of improving their financial fortunes, primarily because many, if not most, of the subsidies end up benefiting people from middle- to upper-income households.

Transit usage among low-income commuters has been falling, while the greatest growth in transit commuters has been among those earning at least $75,000 a year. Moreover, the median income of transit commuters is higher than that of people who drive to work. So we are increasingly subsidizing wealthier passengers as transit usage among low-income users declines.

COVID-19 was not the only reason for declining transit use. In fact, transit usage has decreased for decades. One major reason for this, the UCLA ITS study concluded, is that there has been a dramatic decline in the number of households without a vehicle, particularly among lower-income households.

This offers a couple of important lessons. First, many former transit riders simply outgrew their need for public transportation. The increase in the number of people able to work from home has only accelerated this trend. And, second, once they had a good alternative to transit, people chose the convenience of a private vehicle over transit.

When so much money is dedicated to subsidizing such a relatively small portion of the population, it makes one wonder what other transportation priorities are being overlooked. Given that California ranks a pitiful 49th in the nation in the condition, safety and costs of roads and bridges, according to the Reason Foundation’s 2025 Annual Highway Report, taxpayers’ transportation dollars would likely be better spent elsewhere.

There is widespread agreement that transit costs are rising and ridership and revenues are not sufficient for many systems to remain viable in the long run. Rather than accept this fact, however, central planners have continued to try to force people out of their vehicles, despite their preferences for this form of transportation, and pressure taxpayers to bail out an inefficient system.

“If you find yourself in a hole, the first thing to do is stop digging,” humorist Will Rogers famously quipped. Unfortunately, when it comes to government management, this “first law of holes” is superseded by the first law of bureaucracy: If a government program is successful, give it more money; if it is a failure, give it even more money. And, so, we keep digging that hole and pouring more and more taxpayer money into it.

It simply does not make sense to provide greater and greater subsidies for fewer and fewer people. Private operators have much greater incentives to minimize costs and invest in innovative solutions, such as driverless vehicles, to meet consumers’ demands. Rather than continue to dump ever larger sums of money into an inefficient system that increasingly fails to meet consumers’ needs, we should once again privatize transit and eliminate subsidies to the greatest extent possible.

Adam Summers is a columnist, economist and public policy analyst, and a former editorial writer for the Orange County Register / Southern California News Group. He is also editor and coauthor of “Beyond Homeless: Good Intentions, Bad Outcomes, Transformative Solutions.”

Orange County Register

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