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Wednesday, November 1, 2000

Freeing the Freeways

Private Industry Could Build and Manage Superior Highways

Leigh Jenco is pursuing a Ph.D. in political science at the University of Chicago.

Sitting in rush-hour traffic every working day of your life is enough to make you forget how much highways used to represent liberation. That’s why a popular exhibition that ran recently at the National Building Museum, titled “See the U.S.A.: Automobile Travel and the American Landscape,” offered more than just a walk down a pop culture lane. It provides a solution to the modern mismanagement of highways: a story of how the free market freed the roads.

Since the Eisenhower administration and its aggressive road-building policy, many people have concluded that only the federal government has the wherewithal to coordinate a huge, multistate project like a coast-to-coast highway. Since the road benefits the entire community, it is difficult to determine how much a road is worth to each individual user—and once a road is built, individual users are unwilling to pay for its funding and upkeep since they can literally free ride. Added to all this, the project’s sweeping geographical scope makes participation by the private sector and even local governments seem unlikely.

However, the facts of history stand in direct opposition to the theories of politicians. Private initiative provided not only roadside conveniences but, in the case of the Lincoln Highway, also the road itself. In 1912, Carl Fisher, father of the Indianapolis 500, envisioned a well-paved, reliable cross-country road to avoid urban congestion, encourage travel, promote the automobile industry, and build up the rural communities along the way. His idea was so popular and necessary, in fact, that droves of private citizens, fed up with muddy backcountry roads, paid $5 each to become members of the highway organization that Fisher founded with Frank Seiberling of Goodyear and Henry Joy of the Packard Motor Car Company.[1] Local communities, in exchange for providing labor, received free road-building materials from the organization and, more important, a significant boost to local commerce.[2] Automobile manufacturers saw the highway plan as an essential foundation for the growth of their industry and volunteered substantial funds.

Despite its lack of federal support, the highway plan was anything but uncoordinated. As a 1916 guidebook touted, the Lincoln Highway cut the time needed for cross-country travel by two-thirds and reduced the cost to an affordable $5 a day.[3] Even when lack of funds threatened the future of the road, the association worked with local governments to build sections of the highway to connect with the “seedling miles” of concrete road built in strategic locations by the association.[4]

The federal government realized too late the importance of what the Lincoln Highway Association was the first to promote, and by 1921 it was anxious to catch up. The private initiative symbolized by the highway association was crowded out by the Federal Highway Act, taking with it the knowledge of where roads were most needed. New, less-direct federal highways wound through those states and towns that could muster the most political clout, adding hours (or days) to cross-country driving time.[5] It was political lobbying, and not the “failure” of a market, that led to uncoordinated and unnecessary highway building.

Mismanagement Abounds

The situation today is much worse. The federal highway budget (which provides 80-90 percent of all state highway money) requires no appropriations action from the legislature (that is, the part of government that is supposed to be representing you), divesting it of its fiscal responsibility to those who actually use the roads.[6] Examples of mismanagement abound: President Eisenhower began the modern highway system for purely military purposes, and levied huge taxes that supported more than just the military-industrial complex: for decades, the trucking industry has enjoyed free capital inputs at the expense of taxpayers in the form of government-subsidized road building. Political conditions unresponsive to actual economic demands for new roads have led to notorious environmental degradation, as when the Forest Service builds access roads into pristine national forest for the lumber industry, or when the federal government funds miles of unnecessary highways around Los Angeles, resulting in unprecedented congestion and dangerously high levels of pollution.

Today private industry has begun, little by little, to pick up where the Lincoln Highway Association left off: four private highways in California join the Dulles-Greenway toll road in Virginia as examples of profitable, well-managed private highway projects.[7] As federal highway agencies become ever more susceptible to pork-barrel spending and special-interest groups, the history of America’s first major highway speaks for the ability of localized and private development to serve the needs of an entire nation—profitably and appropriately.


  1. Chris Lewis, “Ambition Paved the Way,” Oakland Tribune, October 19, 1997, p. 17.
  2. “See the U.S.A.: Automobile Travel and the American Landscape,” National Building Museum Exhibition, Washington, D.C., John Margolies, curator. 
  3. Lewis, p. 17.
  4. James Lin, “From Dirt to Concrete: 1913-1925,” The Lincoln Highway: A Brief History. Available at
  5. Ibid.
  6. U.S. Department of Transportation, Federal Highway Administration, “Financing Federal Aid Programs: Authorization.” 
  7. Peter Samuel, “The Case for Privatizing America’s Highways,” USA Today Magazine, January 1997, pp. 5, 7.