In recent months, environmentalists and economists have worked themselves into a frenzy over pay-as-you-drive auto insurance, also known as PAYD. If you believe the advance notices, this is the greatest thing to come down the pike since the double-double.
As the name implies, PAYD insurance more closely links the cost of a motorist's annual insurance policy to how much they drive. The concept has been touted by the authors of "Freakonomics" and has also received major ink in a number of publications, including The Times.
Now, PAYD is coming to California. California Insurance Commissioner Steve Poizner released draft regulations Wednesday and has been a big proponent of PAYD. My colleague Marc Lifsher has the story in today's editions of The Times. When exactly PAYD will be available and which carriers will offer it is not yet known.
Proponents of PAYD claim it will result in people driving less to save money. And that's the part that always stops me. How do we know that knocking $200 to $300 off the cost of annual premiums yield that kind of behavior change? In my view, getting Californians to stop driving is kind of like getting them to stop breathing. Besides, we're not exactly living in a mass transit utopia.
So, I phoned Pascal Noel who with Jason Bordoff co-authored a study on PAYD in July for the Brookings Institution. They also did a follow-up report on how PAYD could impact Californians. Among their findings: 64% of California households would have lower premiums under PAYD, with an average savings of $276 annually per vehicle. Low income residents, in particular, would benefit and a majority of the citizenry would be driving less, they concluded.
How do you know?, I asked. Even the Brookings study says there is a paucity of data out there that shows that the few PAYD programs in existence have massively reduced driving.
"There is a ton of data that shows that when marginal driving costs rise, driving declines," Noel told me. "The most obvious source is gasoline prices." And, furthermore, he said there is widespread agreement in the economist community that such pricing triggers alter behavior.
Noel said there are other reasons to believe that PAYD will catch on. Among those:
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I've been following the escapades of the price of gas at the Chevron at the corner of Colorado and Hill in Pasadena for almost two months. In late June, the cost of a gallon of regular gas cost as much as $4.739 in late June.
And now look at this: $4.019 as of an hour ago. And this particular Chevron is one of the more expensive gas stations around this part of the San Gabriel Valley.
The national average for a gallon of regular is down to $3.66, down from its record of $4.114 on July 17, according to AAA. The California average is now $3.93, a big dip from its record of $4.61 on June 19.
As you are well aware, there has been an onslaught of media stories over the summer that higher gas prices have resulted in people driving less. On Tuesday, I posted a pair of maps from the Sigalert website showing traffic speeds during the Monday afternoon and Tuesday morning commute, and from the look of things traffic was sailing along at 50 mph or better in most parts of Los Angeles County.
I asked readers if this could be true.
Six left comments. Four said their drives have recently been better. KateNonymous, a regular reader, suggested that the traffic speed map on The Times' website is often "hideously wrong." The map is provided, by the way, by Sigalert.com.
The sixth comment came from Chris S., who lives in the Netherlands. I thought his comment was the most interesting because he, like me, is skeptical that people will suddenly cease driving. He wrote:
I personally don't think gas prices affect traffic jams in the long term situation. In the Netherlands, we had gas prices 15 years ago which would be called astronomic in the United States, yet the number of traffic jams increased with 10%, year after year. A "normal" rush hour accumulates easily 200 miles of traffic jam on the peak moment, while over 300 miles is also not uncommon in our small country (barely larger than metropolitan Los Angeles). Remember gas prices have been hovering above 5 dollars already 10 years ago, and recently even hit 10 dollars a gallon. I remember when the gas price hit 2.5 guilders a liter ($5 a gallon) about 8 years ago, and everybody talked about how much the traffic jams would decrease. Now we know better than that. High gas prices might initially scare off commuters, but in the long term, people just adjust their spending budget to the higher gas prices.
--Steve Hymon
Photo: Steve Hymon / Los Angeles Times
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A gruesome crash claimed the lives of three people last night in the Eagle Rock community of Los Angeles. Among the victims was a pregnant woman and a 12-year-old girl. Police blame street racing that resulted in a car wrapping around a tree, reports my colleagues Tami Abdollah and Jia-Rui Chongin a story published this morning on The Times' website.
The accident happened on Colorado Boulevard at the intersection with Highland View Avenue. That section of Colorado is six lanes wide and resembles a freeway -- even as it travels through the Eagle Rock business district.
Even with the 134 freeway having been built just to the north, Colorado still carries heavy east-west traffic and that traffic can move very fast. Two years ago, and just five blocks away from last night's accident, bollards were installed outside the door of Swork Coffee to prevent wayward cars from rolling into the store. Seriously.
-- Steve Hymon
Peugeot is holding its fifth annual auto design contest, with the theme "Imagine the Peugeot in the worldwide metropolis of tomorrow." You can go to the company's website and look at the 29 finalists and vote for your favorite.
The top design is from Oskar Johansen of Norway. Below is a car/unicycle design from Thierry Dumaine, of France. The bottom design comes from Pierlot Damien of Belgium.
I'm of the view that there may be a lot more mass transit in the future, but that individual cars aren't going to disappear. Here's hoping they evolve and adapt to a changing world.
--Steve Hymon
renderings: Peugeot
A couple of readers have asked me what happened Tuesday on the northbound 405 Freeway during the afternoon rush hour. One reader wrote in an e-mail that it took her two hours to get from West Los Angeles to Moorpark.
The problem was a fatal motorcycle crash on the northbound 405, just after the Skirball Center junction. Here's the explanation from the California Highway Patrol press release: "On 8-26-2008 at approximately 5:36 p.m. CHP units were dispatched to a call of a traffic collision involving a motorcycle rider and dump-truck towing a trailer on I-405 northbound, south of Ventura Blvd. The motorcycle was traveling northbound in the #2 lane, alongside the dump-truck who was traveling in the #3 lane. For unknown reasons the motorcycle rider lost control of his motorcycle and collided with the left side of the dump-truck. The motorcycle rider was ejected and struck by the left rear tires of the trailer, where he was dragged an undetermined distance as the dump-truck came to a stop. The motorcycle rider sustained fatal injuries due to the collision and was pronounced dead at the scene. The cause of this collision is still under investigation."
The victim was identified as Thomas Brough, 55, of North Hills. The driver of the dump-truck was identified as Ulices Cruz, 35, of Sylmar.
I think it's important to emphasize that fault hasn't been assigned. That said, I do want to point readers to a recent post here at Bottleneck Blog on the declining number of vehicle-related deaths in the U.S. and the rising number of motorcycle fatalities.
I also would like to encourage everyone on the freeways and roadways to please, please, please be careful. Earlier this year I wrote another story about Sunset Boulevard in Brentwood being closed after a fatal accident in which a motorcyclist hit a truck and got stuck under it.
-- Steve Hymon
The city of Los Angeles released its environmental impact report earlier this week for the proposed development of the parking lots at the Universal City subway stop. The report shows that the 1.5 million square feet of development, including a relocation of NBC Studios from Burbank, will add to traffic in the area by generating about 14,000 new car trips daily.
The Daily News has a complete story online, with the predictable headline "Universal gridlock disaster?" The story quotes Los Angeles Councilman Tom LaBonge and County Supervisor Zev Yaroslavsky, both of whom say the development is too large -- as they've said in the past. The mayor's office continues to back the project, saying it creates needed jobs in the entertainment industry and is located atop a subway stop.
Here are 10 things worth knowing about the project and its impact on traffic:
1. The project's first phase includes a 24-story office tower and five-story studio space, with the second phase adding another 24-story office tower or hotel and residential building. The studio would host "The Tonight Show," which for decades has been taped in Burbank. NBC/Universal and its development partner Thomas Properties says it will bring 5,000 jobs to the city.
2. Most of the land is currently owned by Metro (the agency also known as the MTA). The agency has in recent years been looking for developers to build on land it owns at transit stops. This is part of that effort, although on a bigger scale. And, as I've written before, it will continue to be controversial because of possible traffic impacts.
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I took this screen shot of the SigAlert website Monday at 5:04 p.m. That's an awful lot of green for rush hour.
Blue stands for freeway speeds of 35 to 54 mph and green is 55 mph or over.
Then I took the screen shot below just after 8 this morning. A little more blue and red -- the 405 and Santa Monica Freeway are the main culprits -- but not all that bad.
Of course, it's the week before the three-day Labor Day holiday, so there are still people out on vacation and a lot of schools haven't returned from summer break.
My question for readers: Are these the driving conditions that you are really seeing out there?
And, if traffic is lighter because of high gas prices, is it worth the cost?
The comment board awaits.
--Steve Hymon
 As we predicted here last week, the price of a gallon of regular gas in California has fallen under the $4 threshold and now sits at $3.949, according to AAA. The price has been falling by 1 to 2 cents a day.
Over at the Chevron at the corner of Hill and Colorado in Pasadena that this blog has been watching, the price of a gallon of self-serve regular was at $4.099 as of noon.
Only Alaska and Hawaii still have average prices higher than $4 a gallon.
Of course, prices still have a way to fall before reaching their high-water mark for last year, when the price of a gallon of regular in California averaged about $3.40 in May, according to the U.S. Energy Information Administration.
The question is whether gas prices will rise before the upcoming Labor Day holiday weekend. I just drove to the Bay Area and back this last weekend, and I can tell you that it sure doesn't seem that there are fewer people driving -- even though I know that's what the media and the U.S. Department of Transportation are saying, based on information from about 4,000 road sensors.
Nor are the people who are driving, driving well. In the space of 10 minutes last night in downtown San Luis Obispo, I watched three motorists -- including a tour bus -- blow through red lights. Memo to SLOPD: Revenue enhancement opportunities seem to await.
-- Steve Hymon
Chart: U.S. Energy Information Administration
Like many other readers of The Times, I read an article on our opinion page last week that carried the headline "A Big Surprise on Gas." And, indeed, co-authors Indur M. Goklany and Jerry Taylor wrote something that surprised me: they concluded that by their measure, gasoline was more affordable now than it was back in 1960.
Goklany and Taylor based their findings by measuring how much Americans spent on gas versus Americans disposable income (which is basically income after taxes) both in 1960 and now.
That's a reasonable calculation, of course, with one obvious problem: lumping everyone's incomes together in one big calculation wipes out the disparity in Americans' incomes.
Curious about their assertion, I began playing around with some statistics that are available to everyone on the web. Here's what I found:
1. If you visit the U.S. Bureau of Economic Analysis website, you can look up disposable income over the years, as well as the amount Americans spent on gas over the years.
Using the latest numbers available, I calcuated that Americans spent about 3.2% of their incomes on gas in the fourth quarter of 2007 versus 3.2% percent in the fourth quarter of 1960.
2. Next, I went to the U.S. Census Bureau website, thinking it may be a more accurate measure to see how much gas cost the average household. But I quickly encountered a bump in the road: the Census Bureau changed the way it calculates household income in 1967 and going back to 1960 would likely produce an inaccurate result, said Andy Hait, a Bureau statistician.
So, I went with the best numbers available and tried to determine how much 500 gallons of gas would cost the average household in 1967 compared to 1,000 gallons of gas 2006 (I was trying to account for the fact that Americans drive more now, albeit in more fuel efficient cars). The average price of a gallon of regular leaded was 33 cents in 1967 and $2.59 for a gallon of regular unleaded in 2006, according to the U.S. Energy Information Agency.
The result: Americans spent about 2% of their household income on gas in 1960 and 3.8% in 2006. I would advise taking that calculation with a grain of salt because of the variables involved: the fact that gas is more expensive in 2008 than 2006, the mileage driven by Americans now versus in the 1960s, the number of cars owned by Americans, the number of women working now versus then and so on.
3. Finally, I did the easiest calculation of all: I went to the Federal Reserve Bank of Minneapolis' online inflation calculator and typed in the average price of a gallon of regular gas in 1960 -- 31 cents. The calculator said that if the price of gas tracked the rate of inflation, a gallon of regular should be $2.26 these days.
So there you have it -- like a lot of things involving statistics, determing how much gas costs Americans depends on how you look at it.
And, for what it's worth, I happen to think Goklanky and Taylor raised a very good point in their article: Americans tend to notice gas prices because of all the big signs and media attention focused on it. We tend to forget about all the other things we spend money on that didn't exist in 1960 -- like the iPhone sitting on my desk.
--Steve Hymon
 As noted earlier by my friends at LAist, parts of the 710 Freeway are going to be shut down Thursday night between 9 p.m. and 4 a.m. for filming purposes. Caltrans says the closure is to accommodate a new television program on the CW network called "Valentine" and that there are no explosions involved.
What? No explosions? As my colleague Veronique de Turenne from our L.A. Now blog just wrote in an e-mail to me, "Who shuts down a freeway without blowing stuff up? That's un-American."
I am in complete agreement. When the "Matrix Reloaded" closed a freeway (that's a shot from the movie) at least things got wrecked.
As for "Valentine," here's an excerpt from the very long description of the show on the CW website: Have you found your soul mate? Because, let's face it, these days it's not that easy. In a world where online dating shows millions of possibilities, they could walk right past you and you'd never know it. But thankfully, help is on the way. The gods of love are on the case. Turns out the Greek gods of myth and fable are alive and well ... and living among us in Mount Olympus, just off Hollywood's Laurel Canyon. From Executive Producer Kevin Murphy ("Desperate Housewives," "Reaper," "Ed") comes Valentine, a story about what a rare, strange, and often hilarious thing love is -- a gift that brings out the divine in all of us.
And later... And the gods need all the help they can get. If you think your family is complicated, imagine being stuck with the same band of misfits for thousands of years! They may think they're above the petty squabbles of men and women, but they're worse than any of us. With all the rivalries, affairs, and schemes, it's a wonder that any work gets done. And just wait until their relatives start showing up!
One of the characters apparently has a secret gun that he shoots at people to make them fall temporarily in love. Gives new meaning to "I'm hit," I suppose.
Details of the closure? They're after the jump ...
-- Steve Hymon
Photo credit: Melinda Sue Gordon / Warner Bros. Pictures
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