Foxx and Recode Senior Editor Johana Bhuiyan talk about the future of self-driving technology and much more.

On this episode of Recode Decode, hosted by Kara Swisher, Recode Senior Transportation Editor Johana Bhuiyan spoke with outgoing Transportation Secretary Anthony Foxx. In a wide-ranging conversation, the two discussed, among other things, the practice of public-private partnerships, the place of government in local infrastructure and the role of self-driving cars in the future of transportation.

You can read some of the highlights from the interview at that link, or listen to it in the audio player above. Below, we’ve posted a lightly edited complete transcript of their conversation.

If you like this, be sure to subscribe to Recode Decode on iTunes, Google Play Music, TuneIn and Stitcher.

Transcript by Celia Fogel.


Kara Swisher: Today, I’m ceding my red chair to Recode’s senior transportation reporter, Johana Bhuiyan. Hey, Johana, who are you interviewing today?

Johana Bhuiyan: Hey, Kara. I’m talking to U.S. Secretary of Transportation Anthony Foxx. It’s his last week on the job; the new Secretary of Transportation, Elaine Chao, had her confirmation hearing last week. So we’re going to talk through some of the progress he’s made on things like self-driving regulations, what’s next for him, and what’s next for the next administration.

KS: And what he can do in just seven days, right? Or whatever. He’s only got a week left.

JB: Yeah, he actually has four days left at this point.

KS: And now the big job for Elaine Chao will be all kinds of things from infrastructure to where self-driving cars are going. So hopefully we’ll have her on at some point.

JB: Yup. And as well as drones and FAA regulations.

KS: Well, great. I am looking forward to hearing the interviews. Take it away, Johana.

JB: Thanks, Kara. I’m here with Secretary of Transportation Anthony Foxx. Thanks for joining me.

Anthony Foxx: Glad to be with you.

So. It is your last few days on the job. As someone who will never have the luxury of either entering or leaving federal office,

[I’m wondering] what is going through your head?

Well, it’s a mix of emotions. Obviously it’s been a labor of love to come serve our country and to work under President Obama. Knowing so many people, both political appointees and career professionals at the U.S. DoT, who come to work every day and bring it every single day, it’s just been amazing to work with such a great group of people and I’ll miss that. But you know, it’s interesting. When you get to the end of a president’s term and you’re so closely connected to that president, you do feel the sense of there does need to be a changing of the guard. And I’ve tried to do everything I can with every minute I’ve had, but when I put it down, hopefully I can look back and say, “I didn’t have any things I wanted to do that I didn’t at least try.”

Can you say that?

I think I can, absolutely.

You talk about your closeness to President Obama. Talk to me a little bit about your relationship with him.

Well, I first met the President in 2007. This was after he was pretty much going to be running for our president, and we all kind of knew it. I met him at an event at a little restaurant in Charlotte, North Carolina. We didn’t get a long time to visit at that point in time. But later, he got elected, obviously.

I got elected as mayor of the city of Charlotte, and then we spent a lot of time together. Charlotte was one of the hardest-hit cities by the recession, because so much of its economy is tied to the financial sector. So early in my tenure as mayor I got a group of business people to travel with me to Washington and to spend time getting briefings with different corners of the administration on recovery plans, because I wanted us to be aligned.

And that started a process of just getting to know the president and the people around the president. And it’s been a great pleasure.

So in 2007, you were a city council member, at that time, in Charlotte?

I was a city council member, that’s right. Yeah.

So you were nominated to be transportation secretary in 2013.

Yes.

And at that time you were mayor.

Yes.

Before that you, were on the city council.

Yes.

And you’ve had a long legal career.

Yeah.

Talk to me about what your ambitions were in politics. Did you always want to go into politics? Did you think it was going to end at mayor? Basically, what did you want to be when you grew up?

Well, I actually started out wanting to become a civil rights lawyer. It just so happened that by dint of when I was born and the time I came through law school, that civil rights lawyers were largely playing defense. There was a spate of voting rights cases, a spate of affirmative action cases and other cases where civil rights lawyers were really trying to hold onto gains that had been made back in the ’60s and ’70s.

It kind of feels like where we are again.

[laughs] Well, yeah. And I was looking for a venue where I could play offense. Where I could be part of introducing new issues and tackling new ground, so to speak. It took me several turns, but it was when I started working on the house judiciary committee in the late 1990s when I finally saw the legislative process and the political process and realized that you can actually raise issues, you can bring new issues to light and you can come up with some ideas on how to solve those issues. And you’re free of some of the constraints that you’re under when you’re practicing law. So from that experience I knew that at some point I’d want to get engaged in the legislative process, and it just so happens that I ended up at the local level.

Right. And so you know, having spent all of about 48 hours in D.C. in my entire life, [laughs] my proximity to the White House and policy making and things like that were obviously limited. But I’m based in New York and Donald Trump, President-elect Trump, is a couple blocks away from my office making very important personnel decisions. I don’t know if it’s just because of my proximity to it, but it seems like there is a level of transparency that we haven’t seen before with people who have been elected, between election and inauguration. Do you see that at all?

Well, I can speak from my experience. When I was nominated by the president, that actually was a fairly lengthy process. I actually came up to Washington probably 10 or 11 times when I was mayor and had several different meetings with different people along the way. And you know, that process takes a while. It took a while for folks to pick, and then once they picked, then there’s an FBI process and a lot of work that goes on to ensure that there are no surprises, and then you get into the committee process.

Once the president nominates you, then the process is turned over to the Senate. And the Senate had questionnaires they wanted me to fill out. I had to go through a confirmation hearing and then wait on the vote. That process, for me, was relatively short. It was from the nomination on April 29, 2013, to the confirmation vote on June 26, 2013. That’s about two or three months, and that’s not bad for confirmation. I’ve had people who work for me who got nominated and they were never confirmed. I think part of the challenge of getting good people to come into government is that when you put them through the wringer of vetting and all that stuff and you never vote of them, that’s a real problem. So that’s been my experience.

And so did President Obama ask you directly, “Would you like to be the DoT secretary?”

He did, he did. He called me. I remember, it was April 26, 2013.

Oh, whoa! Big deal. [laughs]

Yes, you know, it was afternoon. I got a call on my cellphone, no number came up, which usually means it’s someone who doesn’t want me to know that they’re calling — or the White House.

Right. Or a telemarketer. [laughs]

Exactly, exactly. So I picked up the phone and you get the operator saying, “Hold for the president,” and you know that’s a big deal.

How did you feel when they said, “Hold for the president?”

Well, you know, it’s always a remarkable event when the president calls you, because the president is pretty busy, and he’s got plenty of things to do. And for him to take the time to call me to ask me to join his cabinet and join his administration has been one of the highlights of my life for sure.

And so what was it about your experience — as mayor, your legal experience — that made you well suited to be the secretary of this department?

Well, I think fundamentally, the president and I have some parallels. When you get down to it, he’s a student of policy, and probably enjoys that as much or more than some of the other aspects of politics. And for me, that’s very much the case.

When I was elected to city council as a freshman city council member, one of the first jobs I had to get done was a budget for the city. And I actually worked to learn the budget and the mechanics of it and work with my colleagues to propose a city budget that was the largest transportation bond in the city’s history [and the] largest increase in housing. There were lots of things we did in that budget that made a difference in communities, but it’s actually spending the time getting underneath some of the big-picture topics and actually learning the mechanics of things that helps you get things done. So I think he recognized that in the work I did as mayor where we were working much more closely, trying to get my city and the whole country out of the Great Recession.

We did things in Charlotte like — we reformed our workforce development system to make it more demand-driven, to get people to trained up for jobs that actually exist and not, as my friend Tom Perez says, train-and-pray. We worked hard to make sure we had a better after-school environment for kids. We put our after-school programs on a competitive basis. And we did a lot on transportation. Extending a 10-mile light-rail line, getting a street car started, putting an intermodal facility at our airport, getting the final piece of a beltway done in the city … transportation was just something I gravitated towards.

Why is that?

I gravitated towards it because it’s what we experience every day. It’s one of the most fundamental ways people experience their government. And when it works well, it makes a difference. It makes our lives better, it makes our travel time shorter, it makes our ability to get to see our loved ones easier. And when it doesn’t work, it frustrates us. I learned in city government that it’s not just a throughput, it’s also how much community building goes on in transportation.

For example, when I went to law school, I used the New York subway system every day to get to school. And you’d be surprised at the wide range of people you find in the New York subway. You find the wealthiest person, the Mike Bloomberg, you might find someone who’s homeless.

And there’s a real power in that, because part of the challenge we have in our politics today is that people are invisible from each other. And when you have collector systems like a subway system or a public transportation system, or even some of our other modes of transportation, it’s like a community. We create a community on an airplane; every time an airplane takes off, there are new people sitting next to each other. And I think the more we create that closeness, the more we can build a kind of country and community we want.

Right. So now, more than ever, we are seeing the effect that people interacting with transportation, particularly in the technology side, is having.

You know, you guys have now been almost forced to deal with the tech industry. Whereas a couple years back it was just the auto industry, you were just talking to Ford, GM, Fiat, Chrysler. Now you’re talking to Google, Tesla, Uber. What has that adjustment been like for you?

It’s been an adjustment we’ve embraced, and we’ve wanted to do more engagement with the tech community. My own personal interactions with folks out in Silicon Valley, for example — and it’s not just Silicon Valley, there are other places where this is cropping up too — I recognize the rate of change in our space is going to be faster in the future. One of the things I’ve tried to really impress upon our agency is that that has implications on how we do what we do.

For example, our regulatory work, our rulemakings, can take something like four or five years on the normal course. Well, with a technology like autonomous vehicles or drones or something like that, we could be two or three generations into a technology by the time a rule comes out, so the rule could be outdated by the time it happens. So we’re rethinking how we approach these things.

I think you’ve seen it through things like our autonomous vehicle guidance, which was guidance, it wasn’t a rulemaking. And it was something that we intend to update every year, because we recognize this is a fast, quick, evolving area and we need to make sure we can be flexible and nimble.

To backtrack just a little bit, if you could choose, was the DoT the agency that you’d want to be the head of?

Oh absolutely, there’s no question. I look around the room when we’re in cabinet meetings, and I’m paying very careful attention of course, but when I look at some of the other agencies I feel like this is the one that I love to be coming to every day.

It’s partly because, in my view, it’s so people centered, but also because the things we do are long-term. When [Secretary of Education] Arne Duncan and I were in the president’s cabinet together, I used to say to him, “You know, Arne, the two of us are the ones who are the long-term ones, because if you do your job right, we’ll know in 18 years what the effect of it is. And if I do my job right, over the next 50 years we’ll know.” And that’s the way I think about it.

So you accepted the nomination, you stepped down as mayor. What did you think the priorities were going to be? Obviously, you get briefed when you actually take office, but what did you think the priorities were going to be? What did you want them to be?

I wanted transformation. And I wanted this period of time to be consequential for our transportation system. That meant, in part, fixing some things that had not been fixed. Like, for example, the need for a long-term surface-transportation bill. We’d been almost 10 years without one. And there are a graveyard of people who’ve pushed for them. But we were actually successful in being able to get it done.

On the other hand, I also feel like we were at an inflection point with technology. You mentioned it already, but [there’s] the so-called old world of transportation, and then there’s this brave new world we’re going into, where there’s a wave of technology waiting to come in and maybe make our lives easier and maybe help us be safer. But we can only capture that if we’re thinking about it beforehand.

That’s why we’ve sort of turned the agency inward to say, “Okay, what kind of competencies do we need as an agency to manage increased artificial intelligence,” for example. “Are there different disciplines we need to bring into the agency to deal with that? Is there a different approach we need to take? Is rulemaking going to be the way we do it, or is it going to be through guidance and creating frameworks?” And I think we’ve struck a pretty good balance in terms of laying a foundation. Obviously, there are more pillars to be laid on top of what we’ve done, but I’m very proud of what we’ve done.

We can talk a little bit more about that. But going into it, did you think that was going to be a focus of yours?

I did. And I thought technology certainly was going to be an area that I’d focus on. I also thought that creating more community connections would be a place I’d spend some time on, too. Having grown up in Charlotte, I brought [the] perspective of someone who had grown up on the “other side of the tracks,” so to speak, and I knew what those tracks meant to me when I was growing up. And I wanted to create a society where we had fewer infrastructure projects that substituted as lines of demarcation between haves and have-nots and people who were in and people who were out.

So what have you done on that front?

On that front, we’ve done several things. You have to realize that there’s no way to have a sweeping impact on this kind of separation we’ve created for ourselves in one action. It’s a lot of little actions, it’s a lot of projects that are happening on the ground and changing the mindset of both the planners and the people who are part of the public engagement process.

So we’ve done things like a pilot where we went to seven cities that were the hardest for someone who’s poor to reach into the middle class. We asked the mayors of the cities — cities like Baltimore, Atlanta, my hometown Charlotte, Baton Rouge, Indianapolis, Phoenix. And we went to those mayors, and we said, “Look, tell us if you’ve got a project that you think will make a difference in terms of mobility.”

Indianapolis picked a bus rapid transit project. Baton Rouge picked a streetcar project. Each city had a project they wanted to do, and we’re helping those projects happen. Those are projects that usually are the last ones to get done, but they’ve been moved to the top of the page both by the cities and by us. So we’re working to get those done.

And the idea behind it is that these new means of transportation will give people access to economic opportunity and things like that.

Yeah, the gaps in different communities are going to be different. If you’re out in a rural part of the country and you’re poor, that’s a different transportation problem than if you’re in an inner city. But the challenge is making sure that the conditions are top of mind for those decision makers, both at the local level and at the state level.

Speaking of living on the other side of the tracks, the high-speed rail program must also be a focal point for you. From where I’m sitting, it’s hard to see the progress. Talk to me a little bit about where it is today and what the next couple of years hold for it.

Well, a lot of progress has been made on high-speed rail. I’ll talk about the California project, but we also have two other projects that are at various stages today. In California, as with many big projects, it’s not been without controversy and without lawsuits. But the truth of the matter is that the funding is in place, they’re making progress, and they’re going to start turning dirt. Actually, they started turning dirt on the project that was out there just a few months ago.

What is the controversy around that?

Well, there were some land-use disputes. There were some disputes about the propriety of the state even doing the project. But those issues have largely been resolved, so they’re moving forward with it. But a project of that magnitude is going to take years and years to get done. A journey of a thousand miles begins with one step, so every day [that] they’re turning dirt and starting to put facilities in place is a day we get closer to seeing the service happen.

But look at a place like Florida, where a private group is working to build high-speed rail between Orlando and Miami — another big project that’s not without challenges, but it’s moving forward. And in Texas of all places — the area between Dallas and Houston, one of the most congested highways in Texas — they’re looking at high-speed rail too. They’re pretty early in the process, but the point I’m making is that the demand for high-speed rail is there, and we are actually making progress in not just one place but in three places across the country. I think over the long haul we’re going to see a much more interconnected high-speed rail system.

What do you think the next four years will hold for that program?

Well, California has to continue making progress. Dallas, Houston will eventually have to make a fish-or-cut-bait decision on moving forward with it. I think there’s a lot of energy in the region to do it. And Florida is moving forward. So we will have a service up and going within the next four years, I’m sure. The question is just, does that start a brush fire that moves across the country to demand more high-speed rail?

So with the introduction of things like hyperloop, for example, is high-speed rail still the most effective, efficient means of long-distance travel?

Well, it’s the technology we’ve known and have systems of regulation around that we understand. I’ve been very open to things like hyperloop. But hyperloop is going to have to have a regulatory structure built around it, and I’m not sure — in fact, I’m pretty sure that the federal railroad administration’s current regulations would be like putting a square peg in a round hole for hyperloop. The technology, the science behind it, is very sound, but it’s another one of those examples of, the technology may be there before the government is. That’s why we have to continue keeping our ear to the ground and move as quickly as we can to stay ahead of some of these technological changes.

So, when Elon Musk put this paper out, did you look at that and [think], “I really want to be the one who regulates that,” or were you like, “Please, God, no.” [AF laughs] “Let this not happen during my tenure. It’s literally a pipe that’s shooting a human being in a pod from city to city.”

Well, I’ve had an opportunity to talk to Elon Musk about the idea. When high-speed rail was proposed in California, this is an alternative that he developed in his head; it’s probably the biggest difference — you know, aside from the technological differences … In his mind, this would be a way of utilizing an existing right of way, not having to do as much acquisition of right of way, which is a huge portion of the cost of doing new transportation facilities.

So will it happen someplace? Absolutely, I’m sure it will. [I’m] not even sure it’s going to happen first in the U.S., to be honest. But I think there’ll be some proof points out there to show that hyperloop is a real thing. And whether it’s passengers first or freight first — probably more freight will move first on hyperloop.

How do you even go about regulating something like that?

You need Congress’s help, because we have sort of a “Simon Says” approach to technology in the U.S. in transportation, usually. Something like that, a complete system that is brand new, it’s very different than the autonomous car; we actually have authority to regulate automobiles, so we can adjust to some extent. But with something that’s brand new like this, Congress will have to lay out some ground rules for us to play within before we can really jump into it with two feet.

You mentioned that it might not happen in the U.S. first. One of the companies, Hyperloop One, has partnerships or has struck up contracts with places like Dubai, for example. Is this an aspect of transportation infrastructure that the U.S. is likely to compete with other countries on? You know, if another country gets it first, is it something that [our] government will be like, “We need to get this”?

I think getting the service is different [from] generating the ideas and intellectual capital that goes into putting something like that into place. In the U.S., one of our greatest virtues and one of the biggest challenges for us is that when new transportation technology is introduced, something like hyperloop, and say we want to be first, a lot of times what we say is we want to be safest. And I think that’s a good thing for us. It doesn’t always make us a fast mover, but it certainly helps us when we say to an individual who’s using that service or to a company that’s moving things through that service, we can say with a straight face that we’ve thought about the safety aspects of it, and that’s the No. 1 thing.

Gotcha. So would you ever take hyperloop?

I hope one day that I do. I’m not going to go to the moon, but hyperloop I might do.

Actually, I would much rather go to the moon than take hyperloop.

Would you?

Because if you’re just going from LA to San Francisco, the risk is not worth it, I think.

That’s funny.

Okay, great. So when we get back I want to talk a little bit more about the privatization of transportation infrastructure, but we’re going to take a quick break now. Here’s Kara Swisher with a word from our sponsor.

[ad]

So thanks Kara, I’m back with Secretary of Transportation Anthony Foxx. So, are you ready for people to call you by your first name?

Yeah, I am. You can start today.

Yeah? Do you have a nickname? I will be calling you by your nickname if you tell me.

Is that right? Some people call me just by my last name, Foxx.

That’s a pretty good last name. My last name is Bhuiyan, so … I like being called by my last name.

I like that too. Bhuiyan.

We sound like a really cool crime-fighting duo: Foxx and Bhuiyan.

Absolutely.

So let’s talk about public-private partnerships. I know that’s often talked about in the context of bridge building and highway building, but we’re seeing, increasingly, a lot of local governments partnering with companies like Uber to sort of fill in the gaps of public transit. Elaine Chao actually, during her confirmation hearing, she talked a lot about public-private partnerships. It seems like she went on and on about the benefits of it, and the benefits are pretty obvious. You know, it’s a cost-effective way to fill in the gaps that public funding and federal funding can’t fill.

But at the same time, there are, of course, inherent disadvantages. I mean, where do we draw the line so that public agencies, civilians, are not becoming over-reliant on private companies whose ultimate driving factor is, obviously, the business need? They’re making money.

It’s a really good question. And as a local official for many years, I was part of a lot of public-private partnerships. Sometimes, we could actually get infrastructure paid for by the private sector using devices like tax-increment financing and other transit-oriented development type of strategies.

Look, I think if you took the entire infrastructure deficit and you said, “Okay, can we put some of the burden of getting that deficit closed into public private partnerships?” The answer is: Absolutely you can. And I believe that.

I don’t actually believe it’s 100 percent, though. I think it’s probably more like 10 to 20 percent. But if you could get the private sector to foot the bill for 10 to 20 percent of the overall gap, that’s more than you would have had otherwise.

And so what we’ve done at the department is we’ve tried to build the infrastructure to accomplish that using the consolidation of our innovative credit programs, creating a new bureau that’s a one-stop shop for projects. It used to be that if you wanted to do a rail-loan program we call RRIF, you had to call the Federal Railroad Administration. And if you wanted to use our TIFIA program, you had to call the Federal Highway Administration. And if you wanted to use our bond programs, you had to call yet a different office. You had to know what you wanted and you’d have to know who to call.

What we’ve done is, we’ve created one place. Now, private sector stakeholders, our public sector stakeholders, can call us up and say, “Here’s the project I want to do, I want to talk to you about which of your programs make the most sense for this project.” That’s a much more sensible, customer-friendly way to do it. So I don’t doubt that there’s opportunity for public-private partnerships to happen. I just don’t think it’s going to be a 100 percent strategy.

How do you protect against, for example, [in] Uber and Lyft’s case, there have been a couple studies about discriminatory practices on the platform. If local governments are now subsidizing Uber in place of public transit, how do you prevent against that inhibiting access to transportation?

It’s a great question, and because that set of decisions happens more at the state and local level, we don’t tend to get involved in the service provision part of it. Although we are now launching a pilot called Mobility on Demand, where we are actually experimenting with our stakeholders at a local level to see what partnering with ride-sharing companies can do to cover last-mile challenges.

But when we partner, the partners, all the folks that are involved in the pilot have to follow our rules. So they can’t discriminate, that would not be an appropriate use of federal money. I think the more there is public investment in some of these partnerships, you’re going to see the regulatory strings come with it. And there may be situations where some of the ridesharing services decide not partner because of that. But some of these things, like the Americans With Disabilities Act, Title 6, these are important things to ensure fairness.

You talked a lot about public-private partnerships, even during your time as the DoT secretary. How does this affect the tax base and the revenue for either local governments or the federal government?

The traditional model for transportation is the public buys it, and the public owns it. And when you start talking about public-private partnerships, as you’ve already said, that means that we’re now financing. We’re now borrowing money somehow from the private sector to get a public asset in place. And I think where the shock value to the public comes in is when they realize that someone’s making money on what they believe to be a public asset.

The reality that we’re now facing is that our infrastructure deficit is so substantial that the public purse has fallen so far behind that we’re now trying to play catch up. The other side of it, if you’re just a general member of the public, is one has to ask, “Couldn’t this asset just using public dollars?” In many public-private partnerships, the answer is no. That’s the tradeoff we have to get comfortable with to make these more prominent in our culture. But I think there’s room. I just, again, I think it’s probably more like 10 to 20 percent of the infrastructure deficit, not 100 percent.

Increasing access to transportation: We talked about this a little bit already, but that was a focal point for you, you’ve written columns about it, and a lot of it comes from your background. Why was that something that you thought you needed to push forward?

It probably gets back to my own life story and growing up in Charlotte — again, not in what is the most privileged part of the city. Being sent to schools under a bussing order following the Swann v. Board of Education case. Being one of the first members of my family to go to integrated schools. And to live at that time in my life with the expectation that we really are all equal, we really are the same, and the differences between us don’t matter as much as the similarities.

Then you fast-forward into the world we live in, where there’s so much conversation about urban-rural divides and racial issues and so forth. I think we have an obligation as a transportation community to help bring people together. There’s a reason why people talk about “bridging” divides; they’re using transportation metaphors to explain what, in fact, we can do on the ground [to] bring people closer together.

What I’ve tried to preach at the department is that we don’t just have engineers at the Department of Transportation. A lot of people have engineering training. But they’re community builders. They’re building community with every single thing they do.

And it’s not just us, it’s the folks at the state level and local level who are doing a lot of the planning work as well. And if we plan for a community that’s whole, that brings everyone to the table and creates access points for everybody, it may even put assets in communities that have historically been underserved to help lift them up a little bit, that we’re actually bringing the country together in ways that we’ve needed to for a long time.

Is there a means to incentivize private transportation companies to also work toward that mission?

There probably is. But one of the challenges we have in terms of thinking about things this way is that the decision-making is so fractured in transportation. You go to a place like Singapore and it’s a federal system. France, a federal system. So they decide they want to build a train, they build a train. They want to build a highway, they build a highway. A lot of the facilities, the hard facilities, are built federally.

In our system, they’re really built at the state and local level, and a lot of the decision-making around service provision is happening at the local level as well. In other words, I don’t have the ability to change to approach that the service providers are doing.

Right, you can’t Uber would be better in this area.

Exactly, because it’s more of a state and local issue.

So there’s a hypothesis about self-driving cars which is that it will democratize access to transportation. Do you buy that?

I think it’s possible. I don’t think it will happen as an absolute eventuality. I think it will happen because people intend for that to happen.

I’ll give you an example with the Smart City Challenge. That, for us, was a big deal. We put $40 million of our money in place, and I think about $90 million in additional money from foundations and so forth. It was probably the most sought-after competition our department’s ever done, because there was only one winner. Usually there are a bunch of winners in our competitions.

We could have just made that about technology. We could have just said, “Show us the coolest stuff you can put on the ground and we’ll pick who wins.” But we actually went for more than that. We actually said, “As part of this exercise, we want our communities to think about the underserved and what are you going to do to ensure their access to the same technology.”

I actually think that’s a model that needs to be followed both publicly and privately. Because when we pose the question, people will think about it, and they’ll come up with some very good answers. We saw some good answers.

What were some of them? And just for those who don’t know, the winner of the Smart City Competition was Columbus, Ohio.

That’s correct.

For example what if you don’t have a bank account? Or a mobile phone to access an app? The cities came up with an idea of creating kiosks and putting them in places that are underserved, so that folks can use cash and they can access the technology without having to have a mobile phone or having to have a bank account. That’s a fundamental thing, but if you don’t think about it first, you don’t solve for it.

That’s the biggest challenge we face: There are a lot of great ideas out in the world, but if they don’t translate into access points for people, then they don’t exist.

It’s interesting you mention that a lot of what disability advocates are concerned about, with the pushing forward of guidelines for self-driving cars, is that a lot of these companies aren’t thinking about ways to create vehicles that fit wheelchairs, for example, from the get-go, which often means that they’re left out of the process. In the guidelines, I don’t know if you mentioned anything about wheelchair accessibility, but what is the DoT’s responsibility with that?

When we did the guidelines, what we were trying to do is to lay out a very broad framework for the technology itself. Meaning where do we, as a federal government, expect to play our role, and what role will we play? Will we play an assistive role, will we play an enforcing role? Where do we think states belong, and where do we think the private bears more responsibility? It’s a broad framework. To fill in some of the gaps, the second phase of what we’re doing is [that] we’re launching a federal advisory committee on automation. That group is going to help us wrestle with more specific questions like that, and we have representation from the disability community on that.

Is that a nonprofit group?

It’s actually a committee that will report to the secretary and provide ongoing feedback on second and third states’ questions that our first guidance wasn’t able to get to.

Interesting. And so is that something that you have discussed with the incoming DoT [head]?

No, it’s something that we’ve been working on for quite some time. I think out of respect for the confirmation process it probably wouldn’t be appropriate for us to have that conversation until a later stage.

And so now that you have established this committee, is it definitely going to be a part of the process? Do they have a choice of saying, “Oh well actually we don’t want it.”

Well, look, every administration can do lots of things, but everything I know about the president of the future is that we have many questions that need to be answered. Questions about ethics, questions about privacy, questions about cyber security, questions about folks with disabilities. And those are evergreen questions, we need to answer them. So I think there’s a strong case for what we’ve put together and I’m confident about its future and its stickiness.

Right, and so in your last few months as secretary, you pushed forward federal automated vehicle guidelines. Did you go into your term as DoT secretary convinced that the technology was ready to be regulated?

No, I wouldn’t say that. I would say that I was curious about how ready we were for rapid technological change in general and I was also looking for ways to enhance safety and the use of technology. So as we were going through and scanning the waterfront, what I realized was that there was a lot of technology out there that was going to be coming our way. And one day we would have someone walk into our doors and say, “Hey I’ve got an autonomous car, I need your stamp of approval,” or whatever.

Who is that person? [laughs]

I don’t know who it would be, but whoever it was, what kind of standard would we apply to that? What kind of requirements would we apply to that? We have federal motor vehicle safety standards that basically lay out the fundamentals of a car, and you’re supposed to adhere to that. So a car is supposed to have a brake pad that a human foot can touch. Well, what if a car gets presented to us that doesn’t have a brake pad that a human being can touch? You know? So there are all kinds of questions that we had not thought about at that time. And we now have a framework. So now people know how the federal government’s going to be thinking about this.

And we don’t have every little T crossed and I dotted, but people have a very good sense of where we think we’re going to regulate, where we think we’re going to be applying guidance, where we think we’re going to be assisting in figuring things out like in privacy and cyber security. So there’s a lot of detail to be filled in but I think the outline is pretty solid.

Was there something that happened that made you say, “Now we really need to start thinking about self driving cars”?

You know, I just called it Spidey sense. It was my sense that we were reaching an inflection point. I think you can look back at my life in politics and you can see that I don’t think in the present tense, I think in the future tense. And I’m always thinking about how do we get the country — or in the case of being mayor, my city — ready for what’s coming.

And this is an example of me and we as a department really trying to get ready for an avalanche of change that I don’t think we were ready for three years ago but I do think we are going to be ready for it when it happens.

And so obviously the jurisdiction of the DoT is limited in some regards. Especially related to labor, for example. However, things like the self-driving guidelines of course have labor implications. You guys today announced that you were appointing the head of the transportation trade department to your advisory committee on autonomous vehicles. Talk to me a little bit about what you think his responsibility will be, what the DoT’s responsibility is, in terms of labor.

As I say, this automation federal advisory committee’s job is to help us think ahead. It’s very close to what I just said. I can think about problems we may face in the next 10 or 15 years, but someone who is working in the labor community will have specific thoughts about that. Someone who’s an academic who’s been studying the ethics of liability laws will have a specific view of that. We’ve tried to bring the controversies under the tent so that they can be discussed openly and hopefully resolved to the best extent we can and reflected in how the federal government moves forward.

And so do you think that the DoT has some sort of responsibility toward the people whose jobs are going to be automated as a result of these regulations?

I absolutely think that across the board, government needs to think about that. And we’re taking our first stab at trying to understand the dimensions of potential labor market disruption. But that’s not the only challenge that’s out there. Again, we have cyber challenges, privacy challenges, ethical challenges. You know, people talk about, “What if the car has to choose between saving the occupants and saving somebody outside of the car?” Let’s think about that now. Let’s not wait until we have a situation in front of us.

Right. So we’re going to take another quick break now. When we come back, we’ll talk more about the new administration. Here’s Kara Swisher with another word from our sponsor.

[ad]

Thanks, Kara. I’m back with Secretary of Transportation Anthony Foxx, who was nice enough to spend an hour of his last few days on the job with us.

I want to go back to the self-driving regulations a little bit. We’ve talked about before, you had to do a little bit of an adjustment because now you’re not just dealing with the auto industry, you’re also dealing with the tech industry. On the side of the tech companies, do you feel like there was a little bit of a learning curve for them, learning how to deal with the government agency for one, but specifically the DoT?

Yeah, I think there has been, I think there will continue to be. They’re getting a little more sophisticated but for the most part — and I’m being very grossly general here — they’re used to just creating stuff. And in many areas, like in just creating apps, you can dream something up at 9 o’clock and be working on it at 10 o’clock and you might have a prototype by 3 o’clock. The rate of activity is just really, really fast. And there’s generally speaking very little patience for the processes of government. So I think they’re starting to figure out that there are some things, with 50 years of experience of regulating automobiles, that we know …

That they don’t.

Yeah.

It’s a very hard thing for them to admit. [laughter]

And there are things they know or believe that we don’t know. And I think part of the framework that we laid out in the guidance was basically we’re going to be educating a little bit. And they’re going to push us a little bit and we’re going to push them a little bit. And the goal for us is to ensure that we are raising the bar on safety, that we’re creating a more safe environment for people at all times. And I think there’s a lot of promise.

The tendency for Silicon Valley companies to move fast, break things, seek forgiveness — I just mixed five different phrases, but that is very much Silicon Valley’s way.

You’re very good at that. [laughter]

Did that contribute at all to the rate at which you decided to push forward these guidelines?

I do think there’s a culture difference. When you deal with some of the conventional manufacturers of automobiles, they’re very used to the process that we undertake. They’re patient, if you will, with the things that we need to do and want to do to ensure safety. And they’re very sophisticated on how to interface with us.

It’s different when you’re dealing with an entirely new set of players who are used to moving very quickly, and I do recognize that as a reality and probably did early in the process here. But I actually think the thing that really convinced me we needed to make a move was in 2014 when we released our vehicle-to-vehicle guidance. Actually, our intention to get a vehicle-to-vehicle rule put out before the administration has ended, which we’ve done. Some of the reaction I got to that was, “That’s cool that you’re doing that but there’s going to be some other technology that’s going to come up potentially faster than vehicle-to-vehicle.” And that was a lot of the community that’s been working on the autonomous car.

That’s so interesting that you mention that, because I was interviewing a couple of experts in the industry and I asked them about V-to-V communications and whether that was a necessary aspect of the autonomous system. And for them, they were like, “It’d be great to have, but it’s more of a redundancy.” So it’s interesting to me that the government decided to focus on that. Why is that?

My fear was that we were unintentionally putting our finger on the scale and saying one technology’s better than the other one because we’re ready for V-to-V, we don’t know much about the autonomous vehicle. So what I really was trying to do was level the playing field and let the best technology evolve. And our thinking right now is actually that they will converge and you’ll have autonomous cars that have vehicle-to-vehicle connectivity. But that may be some time off.

So, the new administration is coming in in a couple of days. You’ve met with Elaine Chao already?

Talked to her, yeah.

And so if you were the one writing the book that she gets on her first day, what would the top five priorities for you be?

First of all, I think it’s really important for me to say that giving the next secretary advice is probably not where I want to be. She’s a pro, she’s been at the department before, she served as the deputy secretary, she’s run a big agency, she ran the labor department in the last Bush administration. So, she’ll go her own way and have her own priorities. I think the way I could kind of answer your question is to say if I had more time, what would I want to be doing. And you know, fleshing out some of this technology stuff around autonomous vehicles and drones would certainly be a high priority for me. I’d say that we’d also want to continue to broaden the work on the opportunity front. We’ve done some things to teach the stakeholders out there how to be more context sensitive and more community minded in how we build transportation. But we still have some ways to go. And I do think it will continue but hopefully as robustly or more.

I think we would want to start building some greater support for some of the rail projects around the country. Not just high-speed rail but our demographics show us that areas out in the west and the southeast of the U.S. are going to be the fastest-growing areas of the country over the next 30 years. And those happen to be areas that are probably least prepared for that kind of growth. And so when you see a city like Los Angeles passing a major measure to accelerate their transit plan, that’s a huge deal because their growth is going to continue just exploding and they’re getting ready for it. But far too few communities in these fast-growing areas are really taking aggressive steps. So I’d love to see not only the project in California but I’d love to see the northeast corridor extended down into the southeast. To Atlanta, perhaps to Birmingham, because that inner-city passenger rail system will be for the southeast what it has been for the northeast as this population explosion continues. In addition to more transit and more mobility choices for people.

So Trump has this trillion dollar infrastructure plan that he wants to make a priority for his administration. Obviously that’ll take up a lot of the DoT’s focus as well. How realistic do you think it is that they will get the funding for that infrastructure plan?

I don’t know. I haven’t seen the proposal. It’s a funny thing though, having the battle scars of the FAST act on my back. A lot of the conversation — I’d say 95 percent of it, if history’s to be any indication — is going to be about how big it is and how it gets paid for. And those decisions actually are made by committees that aren’t on the side of deciding how the money gets spent.

So you go to the ways and means committee and you go to the Senate finance committee to figure out how to raise the dollars. And I think that’s where most of the debate will happen. The problem is, as I was saying earlier today, you could put $5 trillion into our infrastructure system, but if we’re not paying for the right things, we’re going to be challenged. And I think our system today is very much a supply-side system.

We say that we need, and we pay for 80 … For every dollar in the highway trust fund, 80 cents is going to roads and 20 cents is going to transit. Well, there’s some areas of the country that really would want to flip that. And there are other areas of the country that would say, “We’d just rather have 100 percent roads,” and they’d be right.

So we don’t have as flexible a system as I think we need to respond to our challenges, but the policy discussion always comes at the end and without a whole lot of thought. And so what I’ve been trying to urge the transportation community [to do] is to pay as much attention to the policy as they do to the funding because if we don’t get this right, we’re going to have a lot of infrastructure but it may not be the infrastructure that’s going to help us move forward.

And it’s interesting, I think a lot of people are worried about the incoming administration’s relationship to Silicon Valley and even the auto industry now, particularly as it relates to the infrastructure plan, because for example V-to-V for instance really relies heavily on the proper infrastructure. Are you worried at all that there will be a lack of communication that will result in infrastructure that in 10 years will become obsolete because of self-driving cars?

Well, I don’t know. I think what I can say is that everyone has an interest in figuring this out, and we are moving into a different time with transportation where connectivity can tell us all kinds of things that we couldn’t know before. Just on the analytics and data side by itself we can make a much smarter transportation system if we’re smart about it.

I’m always hopeful around this season that whatever administration’s coming into place is doing its best job to serve the American public. And if that’s the case then we’ll continue wrestling with these issues.

Do you think the focus on the infrastructure plan will take away focus from things like the automated vehicle guidance?

No, I think those things are on different paths and they have different people who are fired up about them. So I think in theory we can chew gum and walk straight at the same time.

So you expect progress to continue at the rate that it’s continuing.

I’m hopeful, I’m hopeful. That’s the word of the day is I have a lot of hope.

Okay, and so what is the next step for the self-driving vehicle guidance?

We promised to do six months of input and we’ve already been doing round tables around the country and that will continue beyond this administration. But we also call for the guidance to be updated annually. We debated that, actually, because guidance is good guidance if people can rely on it for a long time. But we figured that it was going to be enough of a break from our traditional way of approaching something like this that we needed to check in and have an ongoing conversation with our stakeholders about it, including safety advocates and a whole wide range of people. So I think annually is a good increment for now.

Yeah, because the industry at this point doesn’t even know what they don’t know.

Right, exactly. And you know, there’s some work that the industry’s going to have to do, and differently than they’ve had to do before. I’ll give you an example of that. Imagine you’re in an autonomous car and you come to a pothole and your car notices it, avoids it, and you keep moving. Well, can that learning about that particular road condition be shared not only among cars made by the same manufacturer, can it be shared across the board to other autonomous vehicles so that a car that doesn’t have that capability can at least learn the lesson?

In order to get there, government’s not going to pound the fist and make the industry do it, but we’ve had good success in our department with the aviation sector where the commercial carriers actually share anonymous data with us on accidents, near accidents, and we’re able to do a root cause and work with industry to ensure that it doesn’t happen again. So I think there’s some opportunities for the auto industry to partner.

Right, but they’re fighting it a little bit.

Well look, they’re in a highly competitive business, and what could be a high-level opportunity to enhance all vehicles sometimes yields to competitive pressures. But we think that the auto industry is well suited to a model that takes a proactive safety culture and builds on it. And anonymous data being shared isn’t a new thing. It’s something that they can do and we really think they should.

So do you think the government is prepared, as technology has become more and more advanced, to regulate things in self-driving cars as AI progresses? Is the government prepared to handle that?

I think the big difference between today and let’s say four years ago is that we know we need to be ready. And we’re now thinking about it, we’re building models like the AV guidance that we’ve been talking about to be able to wrestle with these questions in a way that we weren’t able to do even three years ago. So I think it’s really a more iterative process than are we ready, are we not ready. I think it’s: Are we asking the questions correctly? Are we talking to a wide enough array of people who can give us different perspectives? And then are we taking those learnings and starting to act on those based on what we know?

If you had to give the current administration a letter grade on its relationship with Silicon Valley, because that’s something a lot of people are concerned about with the incoming administration, what would it be?

I think we’ve done very well. If you’re going to pin me down … I don’t know what other agencies have done or not done, but I’d say it would certainly be in the A range in terms of what I know.

And what do you know? [laughter]

Well, I just know transportation, I don’t know defense or something.

Was there one tech company that was more aggressive, more active, that you were communicating with a lot more than others?

Actually, no. I mean, there’s so much that’s going on at any given time, I think there are people like … I’ll give you an example: Jeff Bezos. Amazon got really frustrated at the pace of our drone regulations.

Oh, interesting.

And so they were very vocal, talking publicly about it, even though we were working like beavers to try to move along our registry, to move along our small UAS rule and several other things.

Did they also communicate with you directly about their concerns?

I think they were talking to some folks in the FAA, but the communication with Silicon Valley is often kind of noisy. And that’s because you have people who feel like they’ve got the best idea and they’re ready to move forward as quickly as possible. And the government is a bit of an obstruction to them. So on the other hand I think folks are realizing that if a drone crashes someplace and creates a big problem or an autonomous car gets into an accident that there’s risks to the entire category. So I think they’re starting to recognize that there is a role for the federal government to play in laying out the safety markets and creating an environment where people not only have confidence in the technology but they have confidence in the safety regime around it.

Right. So what is next for you?

Good question. I don’t know. I don’t even know what I’m going to have for lunch on inauguration day yet, but I’ve had a ball at this job. It’s tested me in almost every way. I feel like we’ve moved the needle on so many things, important things. But I’m probably looking for another place to plant my flag. My biggest problem is that I’m not coming out of this job at 70. I’m going out of this job at 45. So you know, I don’t have the luxury of [retiring].

So everything else is going to be boring.

Yeah … Well, we’ll see, we’ll see. Maybe I’ll find some exciting things to do.

Would you consider a position in tech?

Maybe. One thing I’ve learned about this job and being a mayor is I like to run things. And I really like to lead people and set goals and try to attain those goals. I don’t know if Jennifer Aniston’s looking for a co-star for her next movie [JB laughs] but I might be available. We’ll see.

So you would not be looking for something in government again?

Not immediately. Look, I’ve been in public service for 12 years. My daughter is 12, not coincidentally, and we’ve got maybe seven more years with her in the house and then she’s going to be going off to college, and my 10-year-old’s not far behind her. So I’ve got some time to spend with them. And hopefully in a less chaotic way. But I’m always interested in mission-driven work. I’m always interested in trying to translate what I’ve done in the public sector. And I think there are ways in the private sector that you can do well and do good at the same time. And I’ll be looking for those opportunities.

So in tech.

I don’t know. [JB laughs] I don’t know.

There are a lot of tech companies that would want you.

We’ve done a lot on public-private partnerships. And there’s a huge world over there. There’s different modes of transportation. I don’t know. I haven’t really thought about it that deeply. I just know that whatever I’m doing I’m going to want to be leading.

Are you staying in D.C. for now?

For now. We certainly want to finish the school year. My kids have gotten very comfortable here, they’ve got some new friends, and moving them would be kind of hard.

Secretary Foxx, it was really great talking to you. Thanks so much for coming on.

Hey, thank you so much.


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