A well-designed carbon price is the most efficient lever available to a modern state. Every serious analyst now concedes the point, and the mechanism is well understood. Pricing carbon directly is the single most effective policy a government can adopt. When we turn to transit, the funding question divides the field. Dedicated fuel levies should underwrite the bulk of new transit capacity. Others read the ledger a different way. General revenue, not user fees, ought to carry the cost of expanding transit.
