By requiring car drivers to pay a fee to drive in a city at peak hours, congestion pricing reduces traffic and raises money that can be used to support public transit—both worthy goals.
Yet congestion pricing has dubious environmental value. Traffic jams, if they're managed well, can actually be good for the environment. They maintain a level of frustration that turns drivers into subway riders or pedestrians.
The author contends that by improving traffic flow, congestion pricing induces more driving, which in turn increases environmental damage: "If reducing it merely makes life easier for those who drive, then the improved traffic flow can actually increase the environmental damage done by cars, by raising overall traffic volume, encouraging sprawl and long car commutes."
Ryan makes the right arguments. I think Owen's got the economics flat wrong, which I'll elaborate in another entry. He's wrong because congestion pricing does not induce more traffic and because congestion pricing encourages more compact cities rather than sprawl.
But Owen's also got the environmental impact wrong. He ignores that traffic jams impose a cost -- a significant cost -- not imposed by free-flow traffic. That's health. Traffic jams concentrate particulate emissions in one location. High levels of particulate emissions are bad for people. They cause all kinds of health problems -- asthma and other respiratory illness, obviously -- but also higher risks of infant mortality.
If you need evidence, read this spanking new paper (h/t Matthew Kahn). It compares infant mortality rates near toll plazas to infant mortality rates after the toll plazas were replaced with an EZ pass system. They found that the EZ pass system "reduced the incidence of prematurity and low birth weight among mothers within 2km of a toll plaza by 10.8% and 11.8% respectively." Because toll plazas are notoriously congested and highways with an EZ pass system are not, this is a good proxy for the health effects of traffic bottlenecks.
Environmentalism is not only about carbon emissions. The wellspring of the movement was Rachel Carson's crusade against environmental contaminants that (allegedly) made people sick. Any calculation of environmental cost that omits the costs of making people sick is not just a bad cost-benefit analysis, it's bad environmentalism.