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EH.R: Path Dependency
posted by Rebecca Menes on November 29, 1999


The "GM killed the trolley" story is an amusing hypothesis for a movie
starring a cartoon rabbit, but it is not accepted without question.
>
>Dr. Pereleman, in California, can probably do a better job of describing how
>General Motors bought out the LA trolley system, in the guise of
converting it
>to rubber tired coaches, then declaring it unprofitable, and eventually
>shutting it down completely (ca. 1956). How conveeeenient! that 90% Federal
>funding for freeways became available that very same year...and still is
after
>all these 43 years. That's 90% for Interstate-designated Highways (from
right
>out of our gasoline-tax-payin' pockets -- OPEC restraints really he'ps fill
>them coffers). At least w/r/t "freeway/lane/miles" Say's Law has been
>ten-fold proven...

I find the explanation of GM's involvement presented by Scott Bottles to be
much more plausible. (As the alternative requires that the GM managers be
greedy and dishonest, but not quite as prescient, or as Machiavellian.) The
short version of the "true" story is that GM did buy out the trolley
system, and they did plan to close all the train lines, and they were taken
to court by the justic department and forced to divest themselves of the
system (which meant that the City of L.A. actually had the honor of closing
down the trolley.) But the motivation had little to do with increasing auto
sales by subverting mass transit, and everything to do with SELLING BUSES.
The trolley system in L.A. had not been well-designed and it had been even
more poorly maintained (the point of the trolley system had been to sell
suburban real estate, so it encouraged too much sprawl, even back in 1900.)
By 1950 it was clear that the trolley system was doomed (even before GM
bought it) and that buses were a better technology for a sprawling city
like L.A. GM had visions of a national holding company of urban transit
systems, with LA as the flagship system, all using GM buses. This is what
the Justice Department busted, under anti-trust law.

For more on this, and indeed on many of the issues in this discussion see
the fascinating history of L.A. transportation by Scott L. Bottles, Los
Angeles and the Automobile : The Making of the Modern City
                                  

>
>> While the individual might prefer to rely on the automobile within this
>context,
>> the QWERTY-like question is, would this preference hold within the
system of
>> rational urban planning.
>
>Bein' (in my youth) a long-tall-Texan, I prefer a big white horse; but that
>individual preference -- if additive and accepted -- would create a rather
>utilitarian huge pile of...<manure, I'm being polite tonight>.

This is exactly why I think externalities are a much more useful concept
than path dependence when we are thinking about transportation in cities.