I don't think you are missing anything. People who stop and do the math are likely to be surprised by the incredible cost of the existing private car traffic system that we tolerate. Every reasonable option is dramatically cheaper.

People may quibble with the constants in that model. Even after eliminating competing private passenger traffic, a hop on/hop off local bus is probably not going to average 20 MPH. It would probably be more like 5-10 MPH.