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Monday
Jul232012

The Projections Fallacy

We spend billions every year in this country on our transportation network, large percentages of it based on traffic projections. This despite the fact that we have a long record of not being able to accurately project traffic. The answer isn't better projections but a better transportation system, one that is robust to modeling error.

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My home town newspaper recently ran the standard repeat-what-the-engineer-says article on traffic projections. Essentially, the report indicated that we're going to be inundated with traffic. As things continue to "full build out" (it was in quotes so I'm assuming it is an engineering term), traffic is going to increase by 75%, an astounding amount since most locals will attest we are already drowning in traffic (we're not, but most would attest that we are). The recommendation for dealing with all this traffic seems sensible: make some prudent investments today to acquire more land for future road expansion and then, as they are built, oversize the roads to meet this future demand.

A lot of the rationale for these projections -- as well as the public's acceptance of them -- comes from the fact that growth has been robust. In fact, if you go back decades and look at the projections that were made for the present time, they are laughable in how dramatically they underestimated the amount of traffic. We projected out based on what our experience had taught us to anticipate, but we were wrong, and it cost the city a lot of money to retrofit all of the places that were inundated with cars.

This reality fits a national trend. My experience is backed up by studies demonstrating that, the higher the functional classification and the larger the traffic volumes, the greater the degree of underestimate. This correlates with work by Patron Saint of Strong Towns Thinking, Nassim Taleb, who has made the same observations of economic systems, governments, etc... (For one example, go to the 5:10 mark of this recent video.)

Amazingly, the fact the we have been so consistently wrong doesn't make us any less confident today, either in my hometown or nationwide. We've "enhanced" our models now and believe we have it figured out this time, revising the data upward to reflect what we have experienced in the "real" world. This is the essence of modeling, and what else could be more rational?

Or more foolish. In these models, we've taken something that is unpredictable -- driver behavior -- and treated it as if it were actuarial science, akin to estimating life expectancy or your odds of drawing a face card when the dealer is showing fifteen. The idea behind our hubris is that, while one driver may be unpredictable, the average driver will react in a predictable way and, thus, we can model based on a normal distribution. These models are failing to account for things like consumer preference, the ability to access financing, overall market growth, cost of construction materials, gas prices, government employment levels, and on and on and on.... We assume all drivers make predictible traffic decisions. They don't.

I'll take my hometown as an example. Our old traffic projection models assumed that cars multiply like people (I guess that's what's going on in all those two car garages), so we projected traffic based on historical growth rates the same way we projected population. Then what happened? I live in a resort/tourist area with cheap, abundant land and lots of natural resources, just the kind of place retirees and near-retirees wanted to move to starting in roughly 1990. Fuel that desire with a stock market bubble (I wrote a lot of permits for people who paid cash for their new lake home after selling stocks) and then with a cheap credit housing bubble, and -- unexpectedly -- we are inundated with traffic.

Today we already have Super Walmart, Super Target, Home Depot, Menards, Fleet Farm, Kohls, JC Penny's, Best Buy, CostCo (under construction) and a myriad of chain restaurants, gas stations and other highway parasites sucking off of the hundreds of millions we've invested in the adjacent high-capacity highway system STROAD (street/road hybrid). The baby booomers are stuck in their existing homes, which are now worth much less than they had hoped, while many are also stuck in their job as their retirement savings suffers much the same fate. The cheap shoreline is gone, sold off decades ago to people who are now reaching the age where maintaining a lake home may not be worth the effort. The cheap gas is gone too and it doesn't seem too likely that the state is going to throw hundreds of millions more into shortening travel times from the Twin Cities.

Has any of this new reality informed our projections? Of course not. Like a mad scientist adding random chemicals to a potion they just don't understand (and then testing it on unwilling human guinea pigs), we've tinkered with our models now, convinced ourselves that this time will be different. And you can bet that there is no way we'll be caught underestimating. We've "seen" what happens and so we've "fixed" that problem. The new answer is simple: estimate high (which is, in the perverse vernacular of the trade, called being "conservative" with the estimate).

We have a couple of discussions going on right now at the Strong Towns Network about traffic projections. One of my friends there sent me the following: 

We're working on a traffic study for a small development. According to their comp plan (from 2007) we need to offer recommendations for a county road equivalent assuming 4 percent annual growth. We looked up the numbers and found that VMT has (of course) declined steadily in the area since 2003/4. Someone at our firm contacted the county about the growth rate (a 26 yr old traffic engineer by the way) and, from the message that was relayed back to me, we were instructed to just proceed with the Comp Plan's assumptions. Long story short, we're probably going to have to recommend a turning lane. 

In another conversation, one of our members from California is knee deep in the debate over widening I-710 to 14 lanes. In a note to the spokesman for the Los Angeles County Metropolitan Transit Authority, he asked:

I know that the analysis of vehicle trips and container traffic for this project were done prior to the global financial system collapse in 2008, and so the idea of traffic volumes or container shipment volumes decreasing by 2035 were not considered.

 However, when the Panama Canal is open, it looks like our region will be receiving less cargo simply because going through Panama is much cheaper than shipping to LA or Long Beach and moving via trucks, trains, etc.

 Is anyone at Metro thinking about this project differently now? Shouldn't the "No Build" alternative for this project (and all the alternatives) be revised?

Here is the answer he received:

The Ports re-evaluated their growth projections after the recession and made adjustments. The revised projections show slower growth in Port activity in the next decade, but the 2035 total TEU estimate remains the same: 42.7 Million. In other words, the Ports anticipate to handle 42.7 Million TEUs by 2035, even if growth is slower in the next few years.

In other words, it might slow down for a while, but we're confident it will go back up ultimately because our projections say it will.

There is a certain contingent out there that is already pounding out their email to me demanding that, if I'm so smart, I provide a better way of estimating. There's the fatal flaw in our current system. I'm not so smart, but neither is anybody else. The big difference here is that I'm not pretending to be able to predict the future.

Inherent with the auto-centric pattern of development that defines the Suburban Experiment is the hierarchical road network. Like a river swelling during a steady rain, changes on the periphery have an enormous impact on the trunk components of the network, as do many other things that have nothing to do with driver behavior. The reason we put so much time and effort into projections that we know will be wrong -- that we have no consistent history of getting right -- is because the cost of being wrong is so great. When the projection is off by even 10%, the level of service on major roadways can plummet. Since nearly every trip is funnelled into this network, failure is catastrophic. This is an incredibly fragile approach.

We don't need better projections, we need a system that is robust to modeling error. We need a system of growth and development where we don't need to project correctly in order to succeed. We need a system where we build incrementally in a replicable and evolving pattern, one where each fractal evolves continually and naturally over time. We need a system where we're not required to place huge bets on the future, oversizing infrastructure in service of projections, but instead can invest in high return endeavors where the likelihood of success is great.

We need a strong towns approach which, if you stop and look, is a lot like the pre-automobile approach that served us well for thousands of years. I'm not saying we get rid of the automobile, but when we build our entire environment around its propagation, we are slave to our own hubris and lack of understanding.

 

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Reader Comments (7)

Clark Williams-Derry at Sightline Institute in Seattle has done some excellent work on the portion of this fallacy that relates to driving. From a 2011 post at SI's site on Seattle traffic:

http://daily.sightline.org/2011/08/25/a-generational-shift-in-driving/

He just did a similar review for Spokane, the major city of Washington State's eastern half:

http://daily.sightline.org/2012/07/23/dude-where-are-my-cars-spokane/

These reviews show the flaws in WSDOT's expectations of the need for more and more stroads, a depressingly inaccurate document:

http://www.wsdot.wa.gov/NR/rdonlyres/380A1F61-EC09-478D-990C-4AA9B9292AFE/0/VMTForecastWorkGroupSummaryMay2010final.pdf

July 23, 2012 | Unregistered CommenterSophia Katt

A Better Way of Estimating: Plan for the future and not the past. The future is climate change and very likely the end of life on this planet if immediate action is not taken to curb greenhouse gas emissions. World "leaders" have agreed to a "hell on earth" increase of two degrees of climate change (we've only experienced .8 so far and the results are droughts, floods, fires, ocean acidification, etc.). In order to limit ourselves to that, we will need significant reductions in transportation-related fuel use. Put greenhouse gas/carbon reduction at the forefront of any transportation development plan.

So how much would that be? Many countries and states have goals of reducing emissions to 1990 levels by 2020 - a reduction of approximately 30 percent, and then an 80 percent reduction, below 1990 levels, by 2050.

July 25, 2012 | Unregistered CommenterLeslie MacKenzie

To me, the most glaring fault in traffic projections is that they don't acknowledge the effect of the roads we build (based on those projections). The engineers assume that they are the only agents and the larger population is just the unresponsive environment they work in. But the larger population does act as an agent. It responds to the envirionment that the engineers create. The roads we built in the past several decades were, in my estimation, the seeds of suburban sprawl. People adapted their behavior to the roads to the point of radically altering the economony and the land all around them.

We built big, fast roads. So people felt comfortable committing to a routine that involved drving long distances. Maybe they accepted a 40 mile commute where they might have only accepted a 10 mile commute before, Maybe they accepted a car-dependent routine where didn't use a car before. So we got a lot more traffic. Why did we get more traffic. Was it because people were naturally driven to drive more? No. It was because they were encouraged to drive more by their new environment.

Rather than trying to adapt the roads to changing behavior, why don't we build roads for the behavior we want and let people adapt their behavior to that environment?

July 25, 2012 | Unregistered CommenterEli Damon


Rather than trying to adapt the roads to changing behavior, why don't we build roads for the behavior we want and let people adapt their behavior to that environment?

Great talking point. I second that sentiment.

July 25, 2012 | Unregistered CommenterJake Krohn

It seems to depend on whether people will adapt their voting patterns to the change in road building philosophies.

July 25, 2012 | Unregistered CommenterSophia Katt

One of my job duties is running the City's population estimates and projections, which were is a very sad state when I came aboard four years ago. All of the projections were based on continuing astronomically high growth based on only one or two pieces of data --- which, to be honest, were fairly accurate at the year-to-year level until the bust. All the other departments based their projections and CIP projects based on those high numbers (for roads, water, sewer, etc). Even though I hadn't any experience is demographics, I knew that the way the City had been running projections was like spinning a top and expecting it to stay up/balanced/spinning indefinately.

I spent a few years cleaning up the tracking systems to get more rubust and more accurate data, and about two years ago instutued a model with three growth projection paths - introducing the idea of "maybe" into the equation (an uncomforable thought, but not rejected outright due to the obvious housing market conditions). I wasn't surprised to see us tracking at the low end of the new model, and about a year ago put forward the idea of modeling a "no growth" scenario as well. That DID NOT go over well. We've finally made some progress in getting some agreement with "slower (than double digit annual) growth isn't necessarily bad", but no one wants to look at and/or deal with the implications of what would happen (good and bad) if we stopped altogether.

I like what Leslie says above: "Plan for the future and not the past." As we start the process of updating our Comprehensive Plan, I'll be reintroducing the idea of having a plan that is resilient enough to work no matter what the "number" comes in at... I think it's a concept that will have to be talked about over a dozen times before it's heard.

July 30, 2012 | Unregistered CommenterBeckye Frey

Is your City Dallas/Fort Worth? Because I can well imagine that Texans would be culturally allergic to the concept of Not Getting Bigger All The Time. Seattle's planning is centered around the assumption that we will be much larger by 2030. So far, the incoming population numbers are trending that way, too, although the driving usage isn't matching up to expectations.

I know this posting community is trying to avoid moving climate change into the discussion a lot to avoid potentially divisive issues. Doing effective planning without considering the population influxes or diasporas that climate change would create has to be a tough job, though, especially for a state as affected by recent drought as Texas. Good luck!

July 30, 2012 | Unregistered CommenterSophia Katt
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