Why did Kamala ignore cars and transportation?
Mobility is a basic need.
Over the past 3.5 years, the cost of car ownership has become a major inflation pain point for Americans:
According to new survey of U.S. drivers, the average American is spending 20 percent of her monthly income on auto loans, fuel, insurance, maintenance, which is around twice or at the absolute upper limit of what financial experts recommend they spend on transportation costs, depending on who you ask.
But you wouldn’t know this if you listened to Vice President Kamala Harris’ economic policy speech yesterday, which surprisingly didn’t include anything about car ownership or transportation. I don’t write this piece to detract from other important drivers of the cost-of-living crisis — housing, health care, child care, and groceries — that she did mention, but to highlight a glaring omission that requires urgent political attention.
In contrast to Europe and Asia Asia, if you don’t have a car in the vast majority of the United States you can’t fully participate in the economic and social life of your community. The “American Dream” — for better or worse — is a house with a car in the driveway. (Whether that’s the optimal way to organize contemporary U.S. society is beside the point in the context of short-term presidential politics.) For most Americans, driving is how you get to work, buy groceries, and visit your friends. Over 90 percent of U.S. households own at least one car. But the cost of owning and operating that car has become unaffordable to an increasing number of Americans since the pandemic.
The cheapest new car available in the United States will soon cost over $20,000 and used car prices are only beginning to fall from pandemic highs. High interest rates have made car loans more expensive for those unable to pay with cash. Furthermore, since 2022, rising car insurance rates have outstripped inflation as major car insurers have reported higher profits amid concerns from state regulators about price gouging. One wonders why Harris didn’t propose federal action to reign in car insurers instead of supermarkets?
The threat of returning money is not an idle one. At the height of pandemic lockdowns in 2020, when many cars sat idle, insurers returned almost $13 billion to customers through dividends, refund checks and premium reductions for policy renewals, according to the insurance ratings agency AM Best.
California was one of the most active states: Insurers there returned $3.2 billion to customers in 2020.
Harris could also have endorsed an expansion of direct-to-consumer auto sales in order to make buying cars cheaper, the expansion of which requires confronting the powerful National Automobile Dealer Association. Even requiring more transparency from dealers operating under the existing model would represent significant progress for consumers.
Thinking outside the metal box, the vice president could have proposed slashing public transit fares, like happened in many European countries over the past couple years. For example, Germany introduced a €49 ($54) monthly ticket valid on all local and regional public transport across the entire country. Essentially, Germans get a month of public transport service for what Americans pay to fill their SUV or truck tank just once. In Spain, the government introduced free travel on a variety of rail services. Even Italy introduced a couple public transit voucher initiatives to support citizens with low incomes.
Perhaps Harris could have proposed additional federal support for transit agency operational budgets so they could cut fares or introduce cheaper unlimited ride passes that would benefit regular riders — such as low-income commuters who can’t afford cars — the most. Increased operational support would also help agencies restore Covid-era service cuts, which would further increase the functionality of transit for those who can’t or don’t want to drive.
Politically speaking, voicing concern about transportation inflation presents a valuable opportunity for Harris to differentiate herself from Trump, a politician who narrowly talks about the issue in terms of gas prices, which aren’t actually that high right now, and pretends public transit riders don’t exist.
It’s unclear why car and transportation costs escaped the attention of Harris’ aides preparing what was arguably the most important speech of her campaign thus far, but perhaps the oversight speaks to a broader lack of concern for policy details. Whatever the reason, voters — who mostly don’t ride Amtrak between DC and Wilmington or get chauffeured around in black SUVs — clearly need relief. Like shelter and medical care, mobility is a basic need.