Levinson's initial piece did actually mention a couple of times that transit is competing with publicly subsidized roads and parking. In particular, he observes that, "An independent transit utility can raise fares, with the approval of a public utilities commission, so that average farebox recovery approaches and eventually exceeds 100 percent. This should be accompanied by full cost pricing for competing transportation modes — in other words, higher gas taxes or road fares."
Schweitzer devotes an entire blog post to every one of Levinson's seven "ways transit utilities could reverse the long decline the current governance model has provided" - except for Way #2, "raise fares," which I quoted above. I think this is actually an honest mistake on Schweitzer's part: she gave her commentary on Levinson's Way #1 a title beginning with "Part 2," so when she started "Part 3," she went on to Way #3. And yes, this can happen to self-described nerds, even ones with PhDs.
Unfortunately, in overlooking Way #2 Schweitzer skipped over one of the few really meaningful parts of Levinson's post. Here's the other main one:
From the mid-19th century through the mid-20th, transit was privately operated, usually running on public rights-of-way (which companies often were obligated to maintain), charging a government-regulated fare. This model was hugely profitable for decades, until it wasn't.
The causes for transit's decline are many, but rising incomes, suburbanization, and of course a much faster competitor in the automobile and highway system are among them. At that point, which ran from the 1930s to the 1960s depending on where you were in the United States, the private sector abandoned transit and the public sector took over.
Levinson himself acknowledges that transit was "hugely profitable" until competition from publicly funded roads and parking took away their ridership. And he acknowledges in his Way #2 that this could be reversed by charging the full cost for those roads and parking facilities. This is essentially the Magic Formula for Transit Ridership described by Michael Kemp back in 1973. And that's really all you need. No need for Way 1 or Ways 3 through 7.
What we need to talk about is how to get full cost pricing for roads, including potential challenges and ways to overcome them. But for some reason Levinson doesn't talk about any of that, he just goes on to talk about smart cards and land value capture and bond markets.
This is like reading an article about How to Keep Cool in Hot Situations that observes, "The causes for your house being on fire are many…" and goes on to list "seven ways burn victims could reverse the dramatic rise in heat-related discomfort." Way #2 is "put out the fire," and the rest are things like wearing an asbestos suit or putting a fan in front of a bowl of ice cubes. And then Dr. S writes a long post about the known dangers of asbestos suits, while forgetting to mention that you could just call the fire department except that the fire department is run by the arsonist's brother.
And this is the problem not just with Levinson and Schweitzer, but with other transportation experts like Jarrett Walker and Yonah Freemark when they talk about transit funding and profitability. Ultimately it's not a transportation problem at all, it's a political problem, and the transportation experts don't really have anything useful to say about it. But we insist that they say something so they come out with this kind of bullshit, which is not really wrong, it's just beside the point.