> speed limits are generally well below what is safe

I used to think so, but no, not in a school zone or cities at least. They might be safe for the car, but not for pedestrians and cyclists. Those are road users, and speed limits take them into account as well. That's also why you don't see 25mph limits on highways: pedestrians are not allowed there, and the lanes are designed to support high speeds, so the risk for all allowed users is lower and limits can be higher.

Couple that with the fact that everyone wants to ride the fine-limit (and not the road limit) and a 50mph road becomes effectively a 55-60mph road, because you know, shaving 1m off a 1:30h commute is such an achievement.

Some people here complain about 30mph limits, but in EU many city/school zones are becoming 18mph or even 12mph. Two reasons:

1. An impact at 12-18mph might break your leg, but you otherwise have a very good 100% recovery chance. At 30mph, major injuries become more common, and you risk crippling another human being for life. And again, 12-18mph for many people really means +5-10% or more depending on the fine, so 15-25mph in reality.

2. (not accounting reaction time in the following) At 12-18mph, an SUV can break in 13-30ft on wet pavement, which means you might bump someone and they might break a bone or two, but will otherwise probably be okay. At 30mph that's 115-150ft, which means with the little space you might have, there's no way you're going to stop in time to not run them over and cause them major damage.

How do you decide the threshold of speed that is safe?

counter counter counter point: driving the speed limit on city streets makes your battery/gas tank last longer and has a minimal impact on your arrival time.