The debate raging over fuel prices in Europe is a signal that something has to be done about transport.
The answer is within our grasp. It is time to put prices on roads - to bring in "congestion charging" all over Britain and not just in London. We have the electronic technology to do so and, in reducing the traffic jams that plague our lives, the country would benefit enormously.
Road tolls would make our roads flow again. That would be good for firms' profitability, for people's marriages and stress levels, for the environment and especially for our grandchildren's well-being.
The money raised could be spent in useful ways, such as reducing other taxes - including those on fuel - and improving public services and infrastructure. Our present fuel tax is a blunt instrument: it penalises those on empty lanes as much as those on the M25, and it does little to change the amount of traffic.
Building roads is not the answer. In the past 20 years car traffic has doubled. The rise shows no sign of flattening. Yet Britain still has far fewer cars per head than the US. Something has to be done if the next generation of Britons is not to be overwhelmed by jams, smog and concrete.
Although we pay petrol and road fund taxes, we are free to use any particular British road. Imagine what would happen if supermarkets gave away their products for free or nearly free. There would be queues outside every store. People would have to get up early and allocate periods in their diaries just to buy food.
It would be no use building wider front doors to these supermarkets (the let's build more roads approach), or having special paths into supermarkets that only certain people could use (the bus lane approach). As soon as the queue started to shorten, other consumers would notice and come to the new wide-entrance supermarkets.
The supermarkets would be better advised to put prices on their goods. That is what they do - and it works. Britain's roads could be like this. They could flow without queues.
Every economist knows that a queue forms when a demand and supply mechanism fails. Using the price system to ration things is the most sensible way. This is what we do for steel ingots, newspapers, cream teas and everything else. It is especially necessary on roads because drivers do not bear in mind when they make a journey that their presence on the road creates an "externality" for others.
Traffic congestion especially distorts the lives of our most highly skilled workers. Commuting time for Britons with university degrees is one and a half times as long as for others. In south-east England, a quarter of all those with university degrees spend more than two hours a day travelling to and from work.
The British simply shrug their shoulders and accept that it is impossible to drive to Heathrow airport at 8.30 am; we design our lives around traffic jams. We should not. Road pricing would make our roads run freely again - and that would be good for the efficiency of the economy.
There are objections to road pricing. The most common is that road tolls would raise firms' costs. It would not. Road pricing would make life cheaper for firms in Britain. Tolls would be set at the right level to make traffic flow freely - and no higher.
A road toll of £5, say, would be negligible for a lorry carrying £100,000 of goods. But it would be a lot of money to a person going to the shops for a newspaper or heading off to a leisure centre for squash before work or a parent taking a child to school because it is raining. The toll would take such users off the road and out of the lorry's way.
A lorry journey time that is cut by 10 minutes would easily be worth the toll. Thus road pricing would cut companies' costs and make the economy work more efficiently.
It would be a simple matter for a government to set tolls on lorries at a different level from those on cars.
Why then do some road users say they are against congestion charging? It is because people do not realise, when answering opinion polls, that road tolls would clear the roads. After an experimental week of road tolls, Britain would never wish to go back to the jams of toll-free roads.
Another criticism is that road pricing would hurt the poor. It would not.
Sensible road tolls would be designed to be high at peak times. Those on high wages would travel then and pay for the privilege. People on low incomes could choose to travel at other times of the day when the tolls were low or even zero.
Most people in the lowest fifth of income distribution in Britain do not own a car. They would be unaffected by road charges.
Several methods of tackling road congestion are possible:
electronic road pricing (ERP) schemes, cordon tolls or toll booths;
restricted access at certain times or on certain days to different coloured/numbered cars - as in Athens and Mexico City;
metered parking in residential areas near central business districts;
closing roads to cars at certain busier times (Oxford);
and toll bridges (the two Severn bridges).
Schemes that involve directly banning drivers infringe personal freedom and are less desirable than road pricing.
The best method would be ERP, where variable tariffs reflect the marginal external costs of a trip.
In Spain, France, Italy, Japan and some US states, the toll revenue is used to finance new motorways. Other ERP systems have been installed in Barcelona, Lisbon, Dallas, Oklahoma and Florida.
Oslo has had a system in place since 1990 using electronic tags and beacons around the central business district. Singapore is testing a newer system and Stockholm is beginning a similar scheme for its ring road.
• Andrew Oswald is professor of economics at Warwick University
