Here’s a cool infographic that shows how much money gets drained from a local economy through automobile ownership and use.
Infographic: Mgmt Design, courtesy of the National Building Museum
Posted 3.2.11 in The Kitchen Sink | Bookmark or Share
hmmm, not actually thought about this before! Interesting!
would be good to have the bicycle equivalent, Of course the monies are so much less…
I have to take issue with how they calculate money staying or leaving the local economy. My taxes stay in the local economy? Well, some do, some stay in Sacramento. If someone uses an insurance agent, some of my insurance money stays in the community. If I buy gas at the local gas station, some of that money stays in the local community. If I buy my car from a local dealer, some of that money stays in the local community. If I have a car, I can more easily go to town and buy stuff at my local store. In short, these numbers are bogus.
Great stats. I don’t think it’s enough to get people to move in this (right) direction, but perhaps the chambers of commerce can bring this to city planner’s attention. Yet another reason on how bicycling has such a great impact on local communities.
@ Jim: There are no facts presented in the graphic to support or refute its claim. Likewise with your response. It seems obvious that car ownership sends some money away from a local community. So does the purchase of shoe leather, mass transit vehicles and fuel, and bikes. But less.
Personally, I think it is likely that the sentiment of the graphic – that eliminating cars frees up money that can be spent locally – may be valid. It depends, though. If I use car alternatives, eliminate my car, and save $6,000 in the process, it won’t benefit my local community that much if I spend the savings touring Asia. On the other hand, there may be fringe benefits – I’ll be more likely to shop in my immediate community than to travel 40 miles to shop elsewhere.
The graphic says that eliminating cars “allows” money to remain local. It would be interesting to know whether any economist types have actually tried to calculate this. If it were true that there is a profound local economic benefit to alternative transportation, that would be a very powerful fact in an age when every community is desperately trying to boost its local economy, and with fuel prices again climbing.
@Jim, To be fair I think you can only argue that they are only “some” bogus. As you have indicated, a small fraction of all that money will stay in the local economy. As for property tax related to vehicle ownership, most times is set by- and goes to- the local municipality who also often have a vehicle registration fee of some kind. And having a car might make getting to town to shop easier for you, however many others would argue that cycling into their downtown area is easier and leaves them with more money in their pocket to spend on local goods rather than spending it on parking, car payments and gas. In short, the big idea here is fairly valid.
Given that the infographic above suggests only 16% of the money spent to operate and maintain cars stays local, I don’t think the figures are off at all. In California, for example, that local GasCo retailer selling their gas for $3.72/gallon had to buy it at $2.95/gallon and needs to recoup $0.55 in nonlocal taxes and fees. That leaves just two dimes (5.4% of the cost) for your local economy to recover from the sale (half in taxes, half in profits). Unless your local economy is ExxonMobil’s refinery or Chevron’s headquarters, that is.
Similarly, too, your local insurance agent. Chances are he’s underwritten by or reselling the product of a state- or national-level insurance provider and doesn’t see a terribly high amount of profit. Consider, too, the car itself: unless you live in Dearborn, the dealer had to buy the car from somewhere else in order to buy the car in the first place before he could sell it on to you. And if you bought it using financing from a state- or national-level finance company…
To be honest, I’m surprised the local recoup rate is as high as 16%. Pressed for a guess, I’d've pegged it at 5%.
If you want to make the argument that you can save money by not having a car, fine. It’s probably true for many people. Of course, having a car allows people to get to work too, so you need to look at that side of things. But does the money I save stay local? Is the food I buy, the clothes I wear, the bike I ride local, the vacation I take? No. The graphic is silly propaganda and really can’t be taken seriously.
I agree with Larry, Matt, et al. We don’t actually know what precisely was included or not included in the figures, but the point, I think, it not whether the numbers are 100% accurate, but whether the concept in general holds true, which I believe it does.
The graphic is an interesting tool to spark thoughts and discussion. Sometimes people respond more strongly to a visual. My saying \better bicycle and pedestrian infrastructure could benefit local business\ doesn’t often give a good enough conceptual ledge for people to rest their thoughts upon. For some reason this image helps. Whether it is based on accurate facts or not, the power of the image means more people might stop and think a little.
I can say that my commitment to be car-free Monday through Friday does means that I am spending money at locally-owned businesses. Now . . . I don’t spend a lot, as I am not one prone to shopping just for the fun of it. But I actually plan my week so I can cycle a little farther to the locally owned grocery store. I also buy birthday gifts, cards, art supplies, garden supplies and the occasional ice cream cone at local stores. I buy less items because they cost more than when I go to Target 10 miles away, but that is okay.
The reality is that it is our choice of where we spend our money. I would offer that there is a bit of magic at work when one rides a bike. It is so much more enjoyable than sitting in a car . . . I bet people would choose to buy local just for the fun of cycling to the store. I find myself smiling even more on rainy days. (and I schlep 2 kids too!)