Salocin

Galileo, your new Big Brother

While the phrase "Big Brother" is vastly overused, some of the applications for the new Galileo positioning system might raise a few eyebrows amidst the more privacy-conscious in the UK.

Galileo is a network of 30 satellites similar to the American GPS system that will allow suitably-equipped cars to identify their exact location (to within a couple of feet) anywhere in the world. The first satellite went into orbit a few days ago.

On the back of this new infrastructure, the UK is considering a revolution in road tax [BBC news]. If these plans are implemented in their current form, we would see funding for the road system allocated more directly to those who use the road system itself. On the surface of it, this sounds like a good thing, but there are two areas of concern that will undoubtedly cause a number of raised eyebrows.

Implementation - I know where you are
The proposals for the new system would require that cars all be fitted with GPS navigation systems which would be used to calculate payments according to the roads used and the distance travelled, as well as what cities are visited at what time.

Economically, the thought of charging the users directly seems appropriate - it certainly appeals to a rather simple logic that implies that those who use something should pay for it. The idea can be taken quite far, and can also be used to charge individuals differently based on the time at which a road, bridge or tunnel was used.

This implies that differential payments could be used to increase the cost of travelling at rush hour - it could cost you £2 to use the M4 between 8am and 9:15am, but only £0.10 if you drive down it at 10am, when the traffic is much lighter. Theoretically, the London Congestion Charge would be debited from your account automatically when your GPS system reported that you'd passed the limits of the charging zone, and if you use the blackwall tunnel, then there goes another £1, to contribute to the cost of maintaining the tunnel.

The sacrifices required in terms of personal privacy are quite steep. In order to charge you £0.10 for use of the M4 between junctions 2 and 8 between 10am and 10:27am (hypothetically), the system would need to know that you got on the motorway at junction 2 and off at junction 8, and at what time that happened. It would have to know this in a verifiable way, and within a certain amount of time so as to be able to charge you in a timely fashion. This means that the whereabouts of the car registered to you would be known at all times. Not everyone will be comfortable with that, and it's likely to lead to yet another round of "why do you care if you've got nothing to hide" argumentation. I have no doubt that the government will be able to push this through if they choose, however.

Knowing where you are and when also allows the supervising authority to calculate exactly how fast you're travelling. This implies that speeding of any kind becomes a thing of the past, as the government's enforcement arm will know how long it took you to go from A to B, and can therefore calculate your speed.

Economics - It's less fair than it seems
While on the surface of it, it may seem fair to charge someone who uses the M4 every day to get to work for the miles that they drive on it, this doesn't always work. In fact, I would argue that there are enough exceptions to this to make the entire exercise economically unfair and distorting.

For example... Dell has a very large office in Bracknell. It's their European headquarters or something. It's not surprising that they should pick Bracknell as the location for this campus, as the town is a comparatively cheap location in which to operate a large business complex. The cost reductions available to Dell as a consequence of this choice of location have (by and large) been passed on to consumers in the form of lower prices for their computers. Some of this cost is reabsorbed by the taxpayer through the fact that they subsidise the infrastructure that allows the employees to get to the company. Were this subsidy removed, the cost of working at Dell would go up dramatically as each employee would have to stomach a greater charge as they used rush-hour motorways to get to work, and this would be reflected in increased costs, either for Dell, or for it's employees, which would have a negative impact on the company and it's products.

An easier example is the food you buy in the supermarket. Most of it is shipped around in trucks, and any attempt to charge the owners of those trucks the direct cost of their use of the road infrastructure will inevitably cause a huge increase in transport costs of produce. This will increase prices, decrease choice and negatively impact the freshness of the product as shipments are delayed to ensure trucks are as full as possible before they leave.

In other words, the current system whereby the government subsidises the road and transport infrastructure is a huge hidden subsidy that we all benefit from. The removal of this subsidy will merely cause the difference to appear in the prices we pay for the products and services that depend on that infrastructure.

In reality, we all benefit from the current setup in different ways, and forcing individuals to pay for the infrastructure element of their travel will increase the concentration of people living in towns and cities as it penalises those who travel to work. While it may cause some people to switch to the public transport infrastructure, many trains journeys are prohibitively priced (a return to Bracknell from Paddington is £29.10), often fail to run on schedule, take longer than a journey by car and are already overcrowded. Increasing the cost of roads should also lead to a further increase in the cost of alternatives, which would imply even more expensive train tickets.

Conclusion
I've yet to see a clear appraisal by anyone of what the impact on privacy and the distribution of income will be. Perhaps one will come, because such a plan is clearly several years away at best. Nevertheless, when I think about the people who are most likely to travel significant distances to get to work, I expect they work for companies that can't afford to be in central London, and have therefore had to move out as costs in the capital increased. These people are not paid as much as the bankers, lawyers and advertising execs of the capital who will not see an increase in their direct taxation costs, I believe it will be those who are paid somewhat less on average who will feel the brunt of such a change, and that this tax is therefore regressive. I also think that the impact on more remote towns and cities will be negative, as they will find it increasingly difficult to attract investments from corporations as the cost of travel increases.

Posted by nlvp at January 4, 2006 04:27 PM