B-cycle is Boulder’s new bike share program. Denver’s B-cycle program is a year old. Does “B” stand for boon or boondoggle? The Boulder program’s start-up costs included half a million dollars taken from taxpayers: half collected by the City of Boulder, half from federal “stimulus” funds. Denver B-cycle received $210,000 from the “stimulus.” Yes, B-cycle’s bikes and technologies do sound impressive. But if it’s a true boon, then it should have been able to raise sufficient start-up funds from investors, sponsors, and donors.
Some might argue that private funding could not have built B-cycle. But as economist Henry Hazlitt would say, B-Cycle “has in fact been built by private capital – the capital that was expropriated in taxes.” We won’t see the goods, services, and non-profit ventures that never materialize because governments took money by force from people who would have spent it differently.
Potentially expensive bike maintenance may deter private investors from investing in bike-share ventures. As law professor Steve Clowney describes: “No individual bears a significant portion of the costs if they damage a bicycle … users have little incentive to take care of the bikes.” The New York Times reports that sustaining Paris’s bike-share requires the repairing “some 1,500 bicycles a day,” or seven percent of its fleet.
Or maybe Montreal’s experience deterred investors. Because of high start-up costs, “the non-profit agency that runs the city’s bike-rental program … is running a $31.7 million deficit,” reported the CBC.
Voluntary donations, sponsorships, and investments should fund B-cycle. It should be a revenue source for Boulder and Denver, not an expenditure of taxpayers’ money. For example, they could charge B-cycle for placing “B-stations” on city-owned land.
A version of this article was published in the Boulder Daily Camera on May 21, 2011.
The Henry Hazlitt quote is from his excellent book, Economics in One Lesson, which the Foundation for Economics Education has put on-line.