Nationalise the railways!

[Jacob]

Seems to me regardless of the length of the contract you're going to have the same end game suboptimality in the last X years.

The bigger problem is that private actors are not going to invest for the long term or obviously for goals which do not go to the bottom line.  Transportation infrastructure is an important economic tool for governments to use to influence economic development and shouldnt be left to companies who have a limited investment horizon.

In the abstract, it would seem that government should be responsible for much of the upgrades in infrastructure, and that should be reflected in the cost of the franchises?

[crazy canuck]

Seems to me regardless of the length of the contract you're going to have the same end game suboptimality in the last X years.

The bigger problem is that private actors are not going to invest for the long term or obviously for goals which do not go to the bottom line.  Transportation infrastructure is an important economic tool for governments to use to influence economic development and shouldnt be left to companies who have a limited investment horizon.

In the abstract, it would seem that government should be responsible for much of the upgrades in infrastructure, and that should be reflected in the cost of the franchises?

I think that is just another way of saying the private sector participation isnt profitable enough, or at all, for the private sector to participate if the costs of infrastructure was passed on to the private sector operator.  It if was profitable then we would be seeing companies competing on putting in infrastructure themselves so they can reap the profits of operating those systems.  The only way this becomes viable as a private enterprise is through government subsidy which brings in all the problems we have been discussing.

[Jacob]

At which point libertarians will say "if private actors can't turn a profit doing it, the public doesn't need such a service."

[Ed Anger]

Ewwww, trains. Only buses are worse.

Smelly poors with their diseases.

[Josquius]

A problem with those calling out for privatization at all costs is the emphasis on profits. The very idea that railways need to turn a profit is fundamentally broken.
You don't want then losing too much money certainly, but they don't need to be profitable any more than sewerage pipes or the fire brigade does.

[Neil]

I don't think it's a bad thing for state enterprises to turn a profit.

[Valmy]

At which point libertarians will say "if private actors can't turn a profit doing it, the public doesn't need such a service."

Libertarians would actually produce reams of selectively chosen data showing how private enterprise builds money losing infrastructure better than the government. 

[Valmy]

A problem with those calling out for privatization at all costs is the emphasis on profits. The very idea that railways need to turn a profit is fundamentally broken.
You don't want then losing too much money certainly, but they don't need to be profitable any more than sewerage pipes or the fire brigade does.

Private industry can be not-for-profit as well.  Just because there are not profits does not mean people are not being paid.  However they do tend to do very badly in big money losing scenarios like most public transit these days.  It is ridiculous how expensive it is for modern cities just to add light rail lines, back in the day it cost peanuts to do that.  I just do not get why it costs so much these days.  Even the freaking New York public transit loses money and it gets millions of customers a day.

The biggest advantage that private-non-for-profit as opposed to public companies these days, in the US anyway, are the brutal costs of the pensions and the benefits public employees tend to receive.

[Valmy]

I don't think it's a bad thing for state enterprises to turn a profit.

In Texas our nutty right wing government pretty much demands every public service do this.  The park service owns all these golf courses so they can get funds for actually maintaining parks and pools and things.

[garbon]

Even the freaking New York public transit loses money and it gets millions of customers a day.

I just looked it up and they reported 1.7 billion riders in 2013.

[OttoVonBismarck]

Canada has a state-owned rail carrier - Via Rail.  I'm sure the government would love to privatize it if it could - it's a leftover from when the government owned Canadian National.  But while CN is profitable and has been sold, Via loses money hand over fist.  It receives a subsidy of almost a half billion dollars per year.

That also means that, at least out west, passenger trains are rare as hens teeth.  I think the train through Edmonton comes twice a week.  When you consider the fact that there are multiple planes and busses leaving every day it makes rail a non-factor.

Even then though, the few times I've looked at taking the train, the cost is the same as taking the bus, with it taking just as long as well (if not longer).  There is zero reason to ever take Via.

That sounds exactly like Amtrak--except we spend $1.3-1.4bn a year of public funds keeping it afloat. I'm not sure how the Canadian version is, but a particular issue for Amtrak even beyond its cost (which I can forgive to a degree, we subsidize auto travel with road maintenance for example) is that it primarily runs on privately owned freight lines which create right of way issues for Amtrak trains. This is why on large segments of the Amtrak system it takes 20-40% longer to travel by rail than by car. In the Northeast Corridor Amtrak actually owns the track, and that's the area where Amtrak actually runs a decent service and is an area where it turns a profit.

Realistically I question the entire concept of Amtrak, which outside of the NEC is just about maintaining the "availability of long distance rail travel" something most Americans do not want and no Americans need. No one needs to be able to go from Philadelphia to Minneapolis by train. That's what planes are for, and if you are too poor for the plane that's what a bus is for and Greyhound is generally faster and cheaper than Amtrak and much cheaper than flying in most circumstances.

[OttoVonBismarck]

Even the freaking New York public transit loses money and it gets millions of customers a day.

I suspect New York could turn a profit on its public transit because so many people pretty much have to use it. But instead New York opted for lower fares to give greater access to economically marginal persons instead of operating at a profit. Not necessarily the worst thing ever if you're running a city like New York, but I do think you could run a profitable transit system in a place like NYC with very high ridership and a large population that couldn't just easily switch to another mode of transportation if you raised the fares to cover operating costs and generate profit.

[Neil]

I don't think it's a bad thing for state enterprises to turn a profit.

In Texas our nutty right wing government pretty much demands every public service do this.  The park service owns all these golf courses so they can get funds for actually maintaining parks and pools and things.

Yeah, but that's just taking a good idea too far.  Just because it's nice when things turn a profit doesn't mean that it's imperative that everything turn a profit.

[garbon]

Even the freaking New York public transit loses money and it gets millions of customers a day.

I suspect New York could turn a profit on its public transit because so many people pretty much have to use it. But instead New York opted for lower fares to give greater access to economically marginal persons instead of operating at a profit. Not necessarily the worst thing ever if you're running a city like New York, but I do think you could run a profitable transit system in a place like NYC with very high ridership and a large population that couldn't just easily switch to another mode of transportation if you raised the fares to cover operating costs and generate profit.

It is true that the fares have been at many points, lower than those in Boston. We also don't have any sense of zones (or distance sort of as SF does with BART) as same 2.50 will get you to all stops.

[Maladict]

Ewwww, trains. Only buses are worse.

Buses are terrible. Trains are awesome.