Session Description:

With increasingly intelligent infrastructure generating increasing real-time data on the activity of our cities, how does the resulting analysis improve the efficiency and the social fabric of our communities?


Murphy: I’m Megan Murphy. I’m the Washington bureau chief of Bloomberg and I head up our political and government coverage.

So thank you so much. I wanted to start talking about something that you’re really immersed in right now, which is the Smart City Challenge.

Foxx: Yes.

Murphy: We talk a lot about technology today.  When people think about Smart City and they think about these initiatives, they think about how can technology and innovation resources improve the lives of city denizens. But there was one quote in Dallas’s application—this is a $40 million dollar grant that is designed to help cities with these type of projects. You’ve called it a moon shot. But I liked this from Dallas: “A smart city is composed of people who are aware and engaged, putting aside egos and agendas, and are willing to compromise for the benefit of all.” Are those two things, are they always working in tandem when you look at this, when you’re evaluating these challenges, is there room for both and is this a necessary component of a smart city in every one of these and what you’re looking toward is that type of initiative as well?

Foxx: Can you have a moon shot and keep it humble at the same time?

Murphy: Exactly. Can you have a moon shot and keep everybody compromising?

Foxx: I think you can, and I think we have to. Let me start by just saying that the Smart City Challenge has unleashed a lot of activity in our urban centers around the country. We wanted to put this challenge out to medium-sized cities because they’re big enough to have complex transportation challenges, but they’re small enough to allow a $40 million dollar grant to put a dent in those challenges. And we’ve already seen upwards of $500 million dollars in commitments from these cities to help tackle their transportation challenges. So if that is an indication of the level of working together that is happening in the seven finalist cities, if we can replicate that in other parts of the country, that actually bodes well for us.

But getting to your point, I think we have to think of our transportation system as a system of systems. And so you have a rail system, you have a transit system, you have a highway system. But from a federal perspective, those systems are stove-piped. We have different regulatory and funding streams for all of them. And so if you’re a mayor or city councilmember or just as citizen, it makes little difference or sense to you whether the funding stream is coming from one pot or another. What you care about is if you are at the bus stop, does the bus come, if you are waiting for the train, does the train come, and does it get you to where it’s supposed to get you. And so what I think the Smart City Challenge really has helped us do is, number one, it’s helped us imagine the future differently. And the way that we have structured it, we haven’t been prescriptive about how you imagine the future. We’ve actually allowed the cities to—actually encouraged them to create conversations in their own communities, with their own stakeholders, about what kind of future they want to have.

Secondly, we’ve gotten them thinking about how technology can play a role in shaping the future differently. How will autonomous vehicles, for example, how will electrification change things, how will land use policies help things.

And third, we have really emphasized partnerships. And so you know, I don’t think the future of transportation can be done well if our citizens don’t feel some level of ownership in the outcome. And that means all citizens. We’re in New York. I’m in the middle of the powerbroker—and, you know, there’s some great examples of smart thinking here. There are also examples here of decisions that were made that didn’t take everyone’s voice into account, and in fact did the opposite and made it harder for communities to thrive here. So we think a smart city also is one in which every citizen, no matter where they come from, is included in the thought process and that the areas in which they live are part of what is seen as a growing, thriving community.

Murphy: Of the seven cities, it’s really fascinating to go through and read the applications. There’s tremendous diversity, both in terms of demographic diversity. But a lot in terms of economic diversity. One of the finalists is Pittsburgh, and two of the finalists are San Francisco and Portland. Those are very different cities. They face very different challenges—Austin is also one of them. When you’re looking at this as well, one of the things you’re passionate about and you speak a lot about is using these type of initiatives to bring economic opportunity to disadvantaged neighborhoods and, as you said, bringing everybody into the mix back into the mix. When you look at that sort of range, from a Pittsburgh to a San Francisco, how do we do that when the challenges are so different? How do we leverage solutions that work and that can be harnessed to really deliver benefit, to reduce the inequality issues?

Foxx: It’s a great question. And you know, one of the things we know about transportation in the twenty-first century is that our population is urbanizing. People are moving to cities. And that’s having an impact in different ways in different places. San Francisco, for example, is a city that actually is well-known for having a very diverse, very active community. But one where the pressures, the economic pressures are making it hard for people at the lower end to stay in San Francisco. Pittsburgh is obviously a city that in the ‘70s and ‘80s went through some very tough times, but you’re starting to see a city that’s reinventing itself in some dramatic ways. And so I think one of the challenges that we take seriously in evaluating these cities will not be how would Pittsburgh handle the problems of San Francisco or San Francisco the problems of Pittsburgh, but how are they developing an inclusive vision of their cities and how does technology and the role of transportation in that particular place play a role in creating that climate of inclusivity?

Murphy: I mean, one of the things that stands out in so many of the applications is the creation of almost a hub of innovation and technology connects university, that connects government, that connects private as well, which in mind is less about the funding than it is about the structure.

Foxx: Yes.

Murphy: And I see that as one of, you know, one of the biggest moves in some of these applications that you’re seeing. Is there a way to get that to happen independently, naturally, grassroots level up, as sort of at the core of a lot of this change that we’re seeing.

Foxx: You’re touching on one of the key things that made us want to do this challenge in the first place, which is, whoever the winner is, that’s great. But what we really wanted to do was to start a wave of thinking in the country that started cities and communities thinking about the future in radically different ways than we had. You’re talking about a country where we’ve not had a surface transportation built for a decade or so until last year. And so the planning process and the thinking process––we really, to the extent we’ve been thinking, we’ve been thinking in a box and we wanted to kind of blow that box open a little bit.

So we got 78 applications for the Smart City Challenge between December 7th when we opened the Challenge and February when we closed it. Seventy-eight cities. That means 78 cities have begun this thought process about how all of these things fold into their futures. And our goal as a department isn’t just to have one winner, but it’s actually to take all of those 78 applications, look at our programs and to figure out how we could help each of those cities advance those plans.

Now, if we have 78 cities thinking differently today, it’ll be twice that tomorrow. So I think it will happen organically if we do the follow-up correctly. And our goal of course is to ensure that all the cities are able to advance their plans.

Murphy: Speaking of moon shots and autonomous vehicles, which you brought up, which is at the heart of a lot of these plans, electric fleets, let’s pare back a little bit of the hype about driverless cars.

Let’s actually look at the reality of this. In your mind, in the Secretary Foxx mind, how soon are we to this actually becoming a reality? How transformative are they actually going to be in terms of mobility, particularly for the elderly disabled? And is there a possibility that as much as we view this as a true panacea, a true ability to build connected, less-trafficked, smarter cities, isn’t there also the converse possibility that it’s more traffic as people flood to the roads. It actually can be less energy efficient as we take decades for people to go away from their cars. Pare away from the hype and give me your vision of what the reality is of autonomous vehicles.

Foxx: So, a couple of things. I do think autonomous vehicles have transformative power. Some of the studies that we’ve seen on both connected autonomous vehicles suggest an 80% reduction in accidents and fatalities, which would be hugely significant. You add on top of that the potential for better mobility—I have a 98-year-old grandmother who’s never had a driver’s license in her life, and the possibility that she could decide to take a trip to her doctor’s office or wherever using one of these things, it’s—the ability of people who’ve previously not had a great level of mobility to have that mobility is actually pretty astounding.

So let’s get to like the art of the possible here. Look, I think that the technology is going to be ready in a period of years. And I would say single digits. I think that what we have been trying to do as an agency is to make sure that we don’t reach a point in time where the industry’s saying, “Okay, we’re ready to put this in the marketplace, we’re ready to put it in the marketplace” and we haven’t gone through some analysis to figure out what we need to do to determine whether it actually is market ready. And so we have promised to put out some guidance this summer that, if you think of the framing of the house, this will be kind of like the frame of the house. There’ll be a lot more material that will get added to it over time, but we want to make sure that we’ve thought about what is the federal role here, what is the state role, where should we be thinking towards putting out regulations, where should we be thinking about putting out guidance, what kinds of standards might be different here?

I’ll give you just one tangible example. The federal role with automobiles has historically been to regulate the vehicle itself, just the physical car. And they all have to go through tests through our National Highway Traffic Safety Administration. We’ve left the role of regulating the operator primarily to the states. So that’s why you go to, you get your nice––

Murphy: D.C. DMV.

Foxx: Yeah, you get to have your nice experience of DMV every once in a while. Well, what happens when there’s software that behaves like the driver and the hardware behaves like the car? You know, does that mean that we regulate at the federal level and once we’ve seen one of a type of vehicle that we’ve approved, that we have some additional set of standards that then say that the software’s okay, and therefore, what does that mean for you? Do you have to go to the DMV now? Those are the types of things that we’re trying to at least make an assessment about so that there is a pathway for the layers of regulation and guidance to be built on top of this. So we’re hoping to put that framing up in short order.

Murphy: Let’s go one step deeper on this.

Only because I’m a former lawyer. I was at a dinner recently with some executives who are in head of the driverless unit of a car company. And I was stunned by what they said, in that they feel the technology is ready. They feel we don’t even need separate lanes, that actually they could deploy the fleet right now onto the road. One of their biggest concerns was product liability and what happens when there will be a catastrophic accident, and how we can get to a point as a media, number one, and as a society, that will accept these early accidents, these early fatalities that are due to the fault of a programming error, of an algorithmic error in terms of––and what they were saying was, just as what you said there about putting the framing on and actually wanting that type of thing. But also wanting sort of a discussion of how are we going to get through these early stages of liability issues. And I’m wondering how much that comes up through you as well.

Foxx: I think there are two issues there. One is sort of how do you imagine those standards to be. Is this an extension of our current model, where the individual driver, or perhaps the rider in this case, has some measure of insurance? Is this like an airline model, where the operator is considered to be the creator of the software? And these are questions, this is the type of thing that I’m hopeful that we’re able to cast some like on and start providing some measure of clarity on these issues over the next several months.

The other issue though is the issue of acceptance by the public. And I think here I would say the auto industry is taking an incrementalist approach to this technology. You actually have some automated-like functionality coming into cars today. And I would hazard a guess that most of the automakers are probably thinking that consumers probably want to be gradually brought into this, as opposed to having it come at them in one fell swoop. And you know, frankly, if you look at our accident rates today, we have 33,000 or so deaths every year on our highways and every one of those is a mom, a dad, a son or daughter, somebody who’s a real person, a three-dimensional person. And we don’t want to lose any of them, anybody. The possibility that we could reduce those accidents and fatalities by 80% is pretty amazing. But you also have to take into account that, I think like 94% of the accidents and fatalities we have are attributable to human error. So if we eliminated human error from the equation and we could reduce––that doesn’t mean eliminate accidents. It means reduce. And I think that, you know, if the public has the expectation that these are going to perform perfectly, that’s probably an unreasonable expectation.

And the other issue that we think about, frankly, is this transition period between the time where you have a close to 100% autonomous environment and the time when you have sort of a mixed grouping of traffic, a mix between human beings and automated cars. And that’s also an area of concern that we’re thinking about and hopefully developing some good ways to work towards.

Murphy: We don’t have that much time left, sadly, but I want to close with something I spend a lot of time thinking about as well, and which touches on what they closed on with the last session there. You just said, you know, until last year, we hadn’t had an infrastructure bill. We continue to struggle to get a long-term infrastructure funding bill. It’s one of the perennials of Washington. We have underfunded public transport in our cities at $86 billion; I think the number’s over $300 billion for under. And one thing that people say to me that’s so fascinating is people complain about it—you know, you know what’s going on with the Washington Metro right now—but they don’t vote on it. They don’t vote on it. You still can’t get people to put their vote where their mouth is on infrastructure. And year after year, election after election, we sit in this totally stymied, our bridges are crumbling, our roads are where they’re at, but still, even though it’s the one thing that almost unites us all as a people, we still can’t get action. And if you were looking ahead—and you look at your legacy, what do we need to make that change? Where do we get to towards it clicks and we get that infrastructure that we so desperately need?

Foxx: I think we need a new era of big ideas. And that’s one of the reasons why technology is so interesting in this space now is because there really are some big ideas that could dramatically transform the way we travel. You know, this great city that we’re in today has one of the finest subway systems in the world, if not the finest. But it is part of the same system of those $86 billion dollars of backlogged infrastructure needs that we have. But when it was proposed, it was a huge idea. And there was a lot of opposition and a lot of food fights over it, but it ultimately got done. I think we need to go bigger as a country. And you know, in other words, when I was a mayor, I kept arguing for big things because the last thing you want to do is go ask people to pay more money for the same lousy commute they have every day. You want to give them something better. And to give them something better, you’ve got to go bigger. And that’s why I think we’ve got to just have an era of big ideas. That’s one of the reasons why I came up here almost a year ago and said it was almost criminal we hadn’t fixed the Hudson Tunnels. Because, yeah, it’s a big project, but we need the project. And by the way, if we don’t do it, it’s going to be cataclysmic economically up here. And you know, we had some interesting dialogue with your governor. But at the end of the day, the project is moving. And that’s the most important thing.

So I’ve been trying to push for big things, but I think the money follows big things. I don’t think the voters are motivated by telling me my commute gets to stay the same if I invest. I think they’re motivated by what’s going to get me there faster, safer, and more efficiently.

Murphy: Great. Thank you so much. That was fascinating. I could talk about this all day.

Foxx: Thank you.