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But that's the point - the profitable tracks were probably profitable before privatization, too (no idea about Japan, but it was the case in Germany). Service i

But that's the point - the profitable tracks were probably profitable before privatization, too (no idea about Japan, but it was the case in Germany). Service in low density areas is the crux of the matter: railroad is a necessary infrastructure there, and if a nation wants to keep quality of life high in these areas, the tracks have to be operated at a loss. It's the same with postal services, broadband access and similar infrastructure. Of course a society as a whole can decide to stop subsidizing these low density areas, but that discussion is largely orthogonal to the privatization topic.

chmod775 8y ago
So much this. On top of that, railroads (the actual rails and public transport lines) also tend to be a somewhat natural monopoly, so even the high profit lines veer towards minimal service and maximal price.
- ekianjo 8y ago
  Completely wrong about the monopoly part. In the US most of the road tracks were created and driven by private companies. And they were competing on destinations and cost. In Japan right now there are multiple lines that you could take to reach the same destination so there is actually a lot of competition going on.
  - chmod775 8y ago
    There's a limit on the amount of subway lines you can squeeze under a city. Nobody is going to run a parallel lines. The most a government can do is figure out beforehand which private company would build and run those cheapest for a certain line, but then you end up with the cheapest solution again, which is not the solution you actually want for infrastructure your economy depends upon. Also, as the parent pointed out, Japan is a good example for why private companies by themselves aren't enough to run infrastructure like that, since you still need it even if they are unprofitable. And so they need government subsidies. You end up with a company paid for by the tax payer - as if it was nationalized - but with much less control by the government. Basically a money sink that isn't accountable to the tax payer. We have that in Berlin after the public transport was privatized. Can't recommend.
    - ekianjo 8y ago
      > There's a limit on the amount of subway lines you can squeeze under a city. Nobody is going to run a parallel lines. Tokyo is a good counter example: you have metro lines and multiple ground lines, and buses, all competing against each other. > Japan is a good example for why private companies by themselves aren't enough to run infrastructure like that, What is your point? Japan is exactly the right example here, you have country-wide private companies operating and running an excellent service (world class) at reasonable cost.
      - chmod775 8y ago
        > What is your point? Japan... Only a bunch of them are profitable and some are even incurring record losses this year and relying on government money to keep operating. Can't let them go bankrupt because they're still important. Honestly I explained this in my earlier post, good job cropping that.
ekianjo 8y ago
Your comparison is probably not accurate. The situation now is completely different from 30 years ago. Cars have become much cheaper at the same time, there are low cost options for travelling larger distance like planes and buses, that did not exist as much before. This is not a single variable environment here.

chmod775 8y ago

So much this. On top of that, railroads (the actual rails and public transport lines) also tend to be a somewhat natural monopoly, so even the high profit lines veer towards minimal service and maximal price.

ekianjo 8y ago
Completely wrong about the monopoly part. In the US most of the road tracks were created and driven by private companies. And they were competing on destinations and cost. In Japan right now there are multiple lines that you could take to reach the same destination so there is actually a lot of competition going on.
- chmod775 8y ago
  There's a limit on the amount of subway lines you can squeeze under a city. Nobody is going to run a parallel lines. The most a government can do is figure out beforehand which private company would build and run those cheapest for a certain line, but then you end up with the cheapest solution again, which is not the solution you actually want for infrastructure your economy depends upon. Also, as the parent pointed out, Japan is a good example for why private companies by themselves aren't enough to run infrastructure like that, since you still need it even if they are unprofitable. And so they need government subsidies. You end up with a company paid for by the tax payer - as if it was nationalized - but with much less control by the government. Basically a money sink that isn't accountable to the tax payer. We have that in Berlin after the public transport was privatized. Can't recommend.
  - ekianjo 8y ago
    > There's a limit on the amount of subway lines you can squeeze under a city. Nobody is going to run a parallel lines. Tokyo is a good counter example: you have metro lines and multiple ground lines, and buses, all competing against each other. > Japan is a good example for why private companies by themselves aren't enough to run infrastructure like that, What is your point? Japan is exactly the right example here, you have country-wide private companies operating and running an excellent service (world class) at reasonable cost.
    - chmod775 8y ago
      > What is your point? Japan... Only a bunch of them are profitable and some are even incurring record losses this year and relying on government money to keep operating. Can't let them go bankrupt because they're still important. Honestly I explained this in my earlier post, good job cropping that.

ekianjo 8y ago

Your comparison is probably not accurate. The situation now is completely different from 30 years ago. Cars have become much cheaper at the same time, there are low cost options for travelling larger distance like planes and buses, that did not exist as much before. This is not a single variable environment here.