Congestion pricing for mass transit

If roads were priced properly, drivers would pay congestion charges for driving on overcrowded roads but would drive for free on uncongested roads.  Matthew Yglesias argues, correctly, that the same principle ought to apply to mass transit:

Currently, pretty much every transit agency I’m aware of receives a public subsidy that leaves it dependent on using fare collection as a source of revenue. This is a mistake. The fixed costs of quality transit construction are high, but the marginal costs of carrying additional passengers are very low, and the public goods associated with transit use are higher when more people use transit. Ideally, then, fares on uncrowded bus or rail lines should be very low or even non-existent. Fares should come into play when an at-capacity transit line is in danger of becoming overcrowded. For example, the portion of downtown Washington DC where the Orange and Blue lines run on the same track is, during rush hour, extremely crowded even given the fairly high fare. Under the circumstances, reducing fares would be counterproductive and possibly dangerous. But when crowding isn’t an issue, use should be encouraged through fares that are as low as possible.

And of course much the same principle applies to roads. Roads that are prone to overcrowding ought to have fees associated with them that are designed to bring the congestion under control. And other roads — or the same roads at uncrowded times — ought to be free.

We price everything wrong, of course.  We either don't charge for roads at all or we charge tolls without regard to congestion, over-charging drivers during off-peak hours and under-charging them during peak hours.  Or worse, we spend hundreds of millions of dollars to build a new road to relieve congestion on an existing road -- and then charge a toll on the new, lightly-traveled road while leaving the congested road free. 

In an ideal world, the revenue generated from pricing roads would be used to fund mass transit.  Because we don't price roads properly, we can't price mass transit properly.  No one has the money to run transit for free most of the time.