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End of Line for Free Rides?

Charles Crumpley
Editor of the Los Angeles Business Journal

I took a ride in L.A.’s subway system one time a few years ago. It wasn’t bad.

Well, true, there were three thuggish guys in my subway car who were using profane language. They were loud, but at least they didn’t disturb most of the other riders. Of course, that’s because most of those other riders appeared undisturbable; they were passed out and sprawled across the seats. Luckily for me, I didn’t have to pay attention to those guys because I was buttonholed by a fetid bloke who earnestly insisted I understand the detailed history of the international conspiracy that’s oppressing him. (In case you’re curious: It all began with the Trilateral Commission. Or maybe it was Trini Lopez’s transmission. I couldn’t quite tell.)

OK. So maybe it was bad. All I can say is, I’ve never been back on the subway.

Now that I think about it, my first clue that something was wrong came when I bought a ticket. I noticed no one else was. At first I figured the others must have monthly passes or something. Then it quickly become obvious that many of them – how shall I say this? – did not appear to be long-term TAP card investors. In fact, it seemed many wandered onto any old train with no particular destination in mind.

I suppose the situation with the subway is the result you get when you have an honor system with scant officers to randomly check the honesty of the patrons. That kind of system attracts those who are dishonest. And scares off many who are honest.

That brings up an old business principle about pricing. If you charge money for something, customers value it. If you give it away, they don’t. Customers lose respect for it.

I was interested to see that the Metropolitan Transportation Authority this month is testing some of its newly installed turnstiles. It is activating them for a few hours at a time in selected subway stations and making riders prove they bought a ticket before they can pass and board a train.

Interestingly, Kerry Cavanaugh’s column in the Daily News last week said that ticket sales doubled – doubled! – during the first three-hour test. “That suggests there’s a lot more free riders than the official 5 percent fare-evasion rate,” she wrote.

Well, yeah. And if Metro is surprised that the volume of subway scofflaws turns out to be greater than 5 percent, I’d be surprised if it’s less than 50 percent.

Funny, but there’s a live debate about whether the millions spent on the turnstiles will be worth it. The basic argument against turnstiles is that the cost of buying and maintaining them may be greater than the additional revenue gained by Metro.

Maybe that’s true; I can’t say. What I can say is that I’d bet a turnstile system – if enforced and effective – will turn far more ticket evaders into real, paying customers than Metro ever predicted.

And it would do a second thing. A turnstile system – if enforced and effective – will probably draw far more new riders than Metro ever suspected. If the turnstiles screen out scofflaws, it will transform the subway system into a service that’s far more inviting to the masses.

If an effective turnstile barricade is put up, the business principle will kick in. Metro will essentially be declaring that it is offering something of value, something important. Customers must pay. Payments will be enforced. As a result, customers will start to respect the entire subway system more.

All I can say is, if they installed turnstiles that forced riders to pay, I’d sure give the subway a second try.

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