6 ms·

It's very impressive to see these decades-longs projects pay off, in one way or another. Every single line extension, station change, is an entire political bat

by rtpg 5y ago

It's very impressive to see these decades-longs projects pay off, in one way or another. Every single line extension, station change, is an entire political battle and story. A fractal of stories waiting to be discovered. One extremely important detail for me when I hear about JNR (Now JR East/West etc) and privatization: during privatization, all the Shinkansen debt in particular was held onto by the public. Extremely expensive infrastructure (now a money printer, at least the Tokyo <-> Osaka segment), just handed to private investors. Of course JR works well as a whole now and it's not like society is worse off, but it's always left a bit of a poor taste in my mouth. (For people wanting some more interesting transportation content: here[0] is an excellent overview of IC cards and integration of all the systems in the 2000s) [0]: https://www.ejrcf.or.jp/jrtr/jrtr62/pdf/6-15_web.pdf https://www.ejrcf.or.jp/jrtr/jrtr62/pdf/6-15_web.pdf

deleted 5y ago
[deleted]
mlindner 5y ago
> Of course JR works well as a whole now and it's not like society is worse off, but it's always left a bit of a poor taste in my mouth. Wouldn't it be the case that society is now better off because of it? The "poor taste in your mouth" is a mental block from extensive propaganda in the last few years especially against private ownership.
- rtpg 5y ago
  The counterfactual isn't "JNR collapses entirely without privatisation". Hell, it's not "JNR collapses after privatization due to existing debts". There are so many possible universes involved here. It should be pointed out that privatization of JNR involved a lot of stuff! Regional breakups, the debt load, there's so much stuff going on there that assuming that privatization happened in an orthodox way is much more succumbing to propoganda than my statement. The coupling of so many things to a single event titled "privatization" means it is extremely hard to untangle everything. In any case I think "infrastructure-based train company suddenly doesn't have to pay its 65 billion dollar debts, and is able to function better after that" is not surprising, and I do not believe you need a bunch of bankers to figure out a business plan for that. There is an alternate universe where the debt is still taken on by the public, but JNR can continue to be a public good.
  - mlindner 5y ago
    > It should be pointed out that privatization of JNR involved a lot of stuff! Regional breakups, the debt load, there's so much stuff going on there that assuming that privatization happened in an orthodox way is much more succumbing to propoganda than my statement. I don't disagree. And I'd throw in the dissolution of the JNR labor unions that were preventing mass layoffs (some half of JNR's employees were laid off in the process of privatization) also heavily helped things.
    - rtpg 5y ago
      Yeah that's a good point, union-busting is a qualitatively different strategy that is much less doable as a public institution. There's also some quantitative stuff around payment of the management class. I don't believe that you need to pay someone millions of USD for them to do a good job, but there are plenty of important jobs done by public servants that would benefit from simply paying people more and getting access to people trained up in private industry.
    - fomine3 5y ago
      Seriously rotten union was one of a big reason for JNR privatization.
  - ant6n 5y ago
    That's what happened in Germany. The rail system was made debt free, turned into a for-profit company, but kept in ownership of the federal government. Overall I'd say it's doing much better than a completely private system would. In Canada CN Rail was made debt fee flogged for 2B on the stock market. After 30 years it's now worth much more, so it's been great for shareholders. But a lot of branch lines were cut, freight prices increased as much as possible, and there has been zero movement on passenger rail, both urban and Intercity (well, except Toronto bought a bunch of rails in their city, a tiny fraction of the CN Network for a significant fraction of the privatization gains..) Privatizing monopolistic infrastructure doesn't usually work well.
    - jabl 5y ago
- modo_mario 5y ago
  Did blinders cause you to only look at the private ownership bit? OP seemed relatively clear that it was the concept of privatising the profit, socialising costs part he didn't like much.
  - sanxiyn 5y ago
    "Privatising profit but socialising cost" didn't happen. Profit and cost were privatised together. It's rtpg's misunderstanding. See my comments above. From rtpg's reply, rtpg is in fact against privatisation itself, not just against socialising cost.
paganel 5y ago
> It's very impressive to see these decades-longs projects pay off, Just read recently that Moscow is now in the process of building a couple of dozens metro stations outside of its ~60-miles long ring-road, to add to the existing ~230 stations. I wish someone would also write a more in-depth write-up of that and how do the Russians manage to do it (including how do they manage to keep the whole network running at what I assume to be reasonable costs), out in the West the knowledge of how to maintain such a system at low-ish costs and how to extend it seems to have been lost.
- Tade0 5y ago
  There's an interesting study showing the modal split in various cities. Moscow is particularly interesting: https://www2.deloitte.com/content/dam/insights/us/articles/4331_Deloitte-City-Mobility-Index/Moscow_GlobalCityMobility_WEB.pdf https://www2.deloitte.com/content/dam/insights/us/articles/4... The 78% share of public transport dwarves figures from any western city. Car utilization is also fairly low. I think it has something to do with scale. The city is enormous, so cycling and walking (especially in winter) is just not viable and the statistics reflect that. High ridership means more revenue, so hopefully a high percentage of costs covered by fares. I don't know about Moscow, but I grew up in Warsaw where the subway rolling stock is still in significant part the Metrovagonmash Series 81: https://en.wikipedia.org/wiki/Metrovagonmash_81-717/81-714 https://en.wikipedia.org/wiki/Metrovagonmash_81-717/81-714 - which serves in Moscow's lines as well. The train is fairly noisy and the design is dated, but it didn't change significantly throughout the years, so I guess a lot of money was saved on R&D.
  - deleted 5y ago
    [deleted]
- andrewl-hn 5y ago
  I don't think metro construction projects in Moscow are particularly cheap. But building extra stations makes a lot of sense due to scale and concentration. Moscow metropolitan area represents 1/5th of Russia's GDP and 1/7th of countries population. A new station in Moscow potentially benefits a higher proportion of Russians then, say, a station in NYC for Americans. Moscow is also one of the most congested cities in the world (n.1 in 2020 https://www.tomtom.com/en_gb/traffic-index/ranking/ https://www.tomtom.com/en_gb/traffic-index/ranking/). Expanding public transport is probably the only way the city can sustain itself. Also, metro is extremely popular among the population in general. Building new stations and lines is a crowd pleaser and voters winner. AFAIK lack of widespread public support is the reason many public transportation projects fail in the US.
sanxiyn 5y ago
Re: Shinkansen debt and privatization. That's not true? Yes, in 1987 privatization, Shinkansen Property Corporation (a public corporation) held Shinkansen debt, but it also held Shinkansen infrastructure. It was not handed to JR (and hence private investors), JR leased it. In 1991, JR East, JR Central, and JR West decided to buy Shinkansen infrastructure from SPC, funded by 60-year loans. They acquired infrastructure together with debt, and in fact they are still repaying the debt to this day. Yes, public assumed JNR debt and at the end it is now being paid by tax, estimated to be $240B, a staggering amount. But that debt is from unprofitable lines (they never could be profitable) sold by politicians to residents, not from money-printing Shinkansen. In a sense, it is right and proper that it is paid by tax.
- rtpg 5y ago
  https://www.jreast.co.jp/e/environment/pdf_2017/p129-131.pdf https://www.jreast.co.jp/e/environment/pdf_2017/p129-131.pdf At least if you look at this flowchart on the second page of JR East what I see is "all the debt was placed into the JNR settlement program, then a small fraction of it was taken on by the privatized structures, roughly half of that foisted onto the public, another half covered by sales of land and the share sales." I don't believe that the point of train lines is to be profitable (just like it's not the point of parks to be profitable, or roads etc), so "wow look at the tax burden" is ... fine for me. Public good, etc. The part I find objectionable is that there were a bunch of assets owned by the public that were transferred to private ownership! Maybe stuff needs to be broken up, maybe you do need to pay people a lot of money to come work on these hard problems, and privatization is one way of tackling this. But permanent ownership transfer of goods instead of, I don't know, just getting over it and paying public servants good money to do a good job, does leave a bad taste in my mouth. EDIT: I do think you're right about the contents of the debt though, at least that PDF seems to imply the debt is not from Shinkansen construction.
  - sanxiyn 5y ago
    The flowchart shows privatized JR assumed 40% of debt. I don't think "small fraction" is the right description. By the way, the flowchart was the plan, but it didn't go according to the plan. Land sales never happened for complicated reasons. I think you are moving the goalpost. Yes, privatization itself can be distasteful. But Shinkansen was privatized, not handed out. JR paid for the privilege, and it was fair price (at least it was market price). With the benefit of hindsight, it can be argued it should have been more, but JR took real risk. Money printing wasn't the foregone conclusion. I agree JNR could have been normalized without privatization, and probably should have. On the other hand, I don't think it was about paying public servants. Normalization of JR was mostly about making obvious but unpopular decisions, and that's in fact one thing the private does better than the democratically accountable public.
patio11 5y ago
Every single line extension, station change, is an entire political battle and story. Yep. A legendary one in my old stomping grounds of Gifu is that there is a shinkansen station in Gifu-Hashima, and not in places that would be far more convenient to have a station (e.g. Ogaki or Gifu City), because a politician local to there was able to decisively dictate the routing and, prior to the route being publicly known, acquired some real estate which was presently undistinguished but would have been extremely valuable if it were right next to a shinkansen station. (Interested individuals can Google the names if they want them.) A happier one which I use a lot in explaining why I love Japan: JR refused to close a particular station over one passenger. They ran one train there to pick her up and another train there to send her back every day for +/- a decade, until she graduated, because someone at JR thought that JR must convey a child to their school. (There are a few more anecdotes about that theme I am aware of, some reported to the press and some of which I know of through other ways, and in this I am in utter agreement with my rail buff friends that the railways see themselves as servants of the public trust in addition to capitalists.)
- dustintrex 5y ago
  That's a lovely story, but it's also why JR is bleeding red ink. Here's a typical story about one line that was serving an average of 19 (nineteen) passengers per day and made a loss of about US$3m/year for decades until it was finally axed in 2014 thanks to a providential landslide. https://spikejapan.wordpress.com/2012/05/20/minispike-the-end-of-the-line/ https://spikejapan.wordpress.com/2012/05/20/minispike-the-en...
  - rob74 5y ago
    Such extreme examples aside, but generally the expectation that rail transport has to be profitable is harmful. On one hand, people expect roads to be well-built and well-maintained so they can run their cars on them for free (with some exceptions), but when rail transport is subsidised with tax money to offer an environmentally friendly and competitive alternative to cars, they complain about it.
    - 5y ago
AniseAbyss 5y ago
Japan had an advantage: their cities got completely demolished. Railways are OLD. Cities got built around them that's how old they are. And our esteemed ancestors didn't plan 100 years ahead to a future where the population had trebled. You think you can double the tracks in Amsterdam? You'd have to either start tearing down 10s of thousands of buildings or dig tunnels. Very long tunnels.

by rtpg 5y ago

deleted 5y ago

[deleted]

mlindner 5y ago

> Of course JR works well as a whole now and it's not like society is worse off, but it's always left a bit of a poor taste in my mouth. Wouldn't it be the case that society is now better off because of it? The "poor taste in your mouth" is a mental block from extensive propaganda in the last few years especially against private ownership.

rtpg 5y ago
The counterfactual isn't "JNR collapses entirely without privatisation". Hell, it's not "JNR collapses after privatization due to existing debts". There are so many possible universes involved here. It should be pointed out that privatization of JNR involved a lot of stuff! Regional breakups, the debt load, there's so much stuff going on there that assuming that privatization happened in an orthodox way is much more succumbing to propoganda than my statement. The coupling of so many things to a single event titled "privatization" means it is extremely hard to untangle everything. In any case I think "infrastructure-based train company suddenly doesn't have to pay its 65 billion dollar debts, and is able to function better after that" is not surprising, and I do not believe you need a bunch of bankers to figure out a business plan for that. There is an alternate universe where the debt is still taken on by the public, but JNR can continue to be a public good.
- mlindner 5y ago
  > It should be pointed out that privatization of JNR involved a lot of stuff! Regional breakups, the debt load, there's so much stuff going on there that assuming that privatization happened in an orthodox way is much more succumbing to propoganda than my statement. I don't disagree. And I'd throw in the dissolution of the JNR labor unions that were preventing mass layoffs (some half of JNR's employees were laid off in the process of privatization) also heavily helped things.
  - rtpg 5y ago
    Yeah that's a good point, union-busting is a qualitatively different strategy that is much less doable as a public institution. There's also some quantitative stuff around payment of the management class. I don't believe that you need to pay someone millions of USD for them to do a good job, but there are plenty of important jobs done by public servants that would benefit from simply paying people more and getting access to people trained up in private industry.
  - fomine3 5y ago
    Seriously rotten union was one of a big reason for JNR privatization.
- ant6n 5y ago
  That's what happened in Germany. The rail system was made debt free, turned into a for-profit company, but kept in ownership of the federal government. Overall I'd say it's doing much better than a completely private system would. In Canada CN Rail was made debt fee flogged for 2B on the stock market. After 30 years it's now worth much more, so it's been great for shareholders. But a lot of branch lines were cut, freight prices increased as much as possible, and there has been zero movement on passenger rail, both urban and Intercity (well, except Toronto bought a bunch of rails in their city, a tiny fraction of the CN Network for a significant fraction of the privatization gains..) Privatizing monopolistic infrastructure doesn't usually work well.
  - jabl 5y ago
modo_mario 5y ago
Did blinders cause you to only look at the private ownership bit? OP seemed relatively clear that it was the concept of privatising the profit, socialising costs part he didn't like much.
- sanxiyn 5y ago
  "Privatising profit but socialising cost" didn't happen. Profit and cost were privatised together. It's rtpg's misunderstanding. See my comments above. From rtpg's reply, rtpg is in fact against privatisation itself, not just against socialising cost.

paganel 5y ago

> It's very impressive to see these decades-longs projects pay off, Just read recently that Moscow is now in the process of building a couple of dozens metro stations outside of its ~60-miles long ring-road, to add to the existing ~230 stations. I wish someone would also write a more in-depth write-up of that and how do the Russians manage to do it (including how do they manage to keep the whole network running at what I assume to be reasonable costs), out in the West the knowledge of how to maintain such a system at low-ish costs and how to extend it seems to have been lost.

Tade0 5y ago
There's an interesting study showing the modal split in various cities. Moscow is particularly interesting: https://www2.deloitte.com/content/dam/insights/us/articles/4331_Deloitte-City-Mobility-Index/Moscow_GlobalCityMobility_WEB.pdf https://www2.deloitte.com/content/dam/insights/us/articles/4... The 78% share of public transport dwarves figures from any western city. Car utilization is also fairly low. I think it has something to do with scale. The city is enormous, so cycling and walking (especially in winter) is just not viable and the statistics reflect that. High ridership means more revenue, so hopefully a high percentage of costs covered by fares. I don't know about Moscow, but I grew up in Warsaw where the subway rolling stock is still in significant part the Metrovagonmash Series 81: https://en.wikipedia.org/wiki/Metrovagonmash_81-717/81-714 https://en.wikipedia.org/wiki/Metrovagonmash_81-717/81-714 - which serves in Moscow's lines as well. The train is fairly noisy and the design is dated, but it didn't change significantly throughout the years, so I guess a lot of money was saved on R&D.
- deleted 5y ago
  [deleted]
andrewl-hn 5y ago
I don't think metro construction projects in Moscow are particularly cheap. But building extra stations makes a lot of sense due to scale and concentration. Moscow metropolitan area represents 1/5th of Russia's GDP and 1/7th of countries population. A new station in Moscow potentially benefits a higher proportion of Russians then, say, a station in NYC for Americans. Moscow is also one of the most congested cities in the world (n.1 in 2020 https://www.tomtom.com/en_gb/traffic-index/ranking/ https://www.tomtom.com/en_gb/traffic-index/ranking/). Expanding public transport is probably the only way the city can sustain itself. Also, metro is extremely popular among the population in general. Building new stations and lines is a crowd pleaser and voters winner. AFAIK lack of widespread public support is the reason many public transportation projects fail in the US.

sanxiyn 5y ago

Re: Shinkansen debt and privatization. That's not true? Yes, in 1987 privatization, Shinkansen Property Corporation (a public corporation) held Shinkansen debt, but it also held Shinkansen infrastructure. It was not handed to JR (and hence private investors), JR leased it. In 1991, JR East, JR Central, and JR West decided to buy Shinkansen infrastructure from SPC, funded by 60-year loans. They acquired infrastructure together with debt, and in fact they are still repaying the debt to this day. Yes, public assumed JNR debt and at the end it is now being paid by tax, estimated to be $240B, a staggering amount. But that debt is from unprofitable lines (they never could be profitable) sold by politicians to residents, not from money-printing Shinkansen. In a sense, it is right and proper that it is paid by tax.

rtpg 5y ago
https://www.jreast.co.jp/e/environment/pdf_2017/p129-131.pdf https://www.jreast.co.jp/e/environment/pdf_2017/p129-131.pdf At least if you look at this flowchart on the second page of JR East what I see is "all the debt was placed into the JNR settlement program, then a small fraction of it was taken on by the privatized structures, roughly half of that foisted onto the public, another half covered by sales of land and the share sales." I don't believe that the point of train lines is to be profitable (just like it's not the point of parks to be profitable, or roads etc), so "wow look at the tax burden" is ... fine for me. Public good, etc. The part I find objectionable is that there were a bunch of assets owned by the public that were transferred to private ownership! Maybe stuff needs to be broken up, maybe you do need to pay people a lot of money to come work on these hard problems, and privatization is one way of tackling this. But permanent ownership transfer of goods instead of, I don't know, just getting over it and paying public servants good money to do a good job, does leave a bad taste in my mouth. EDIT: I do think you're right about the contents of the debt though, at least that PDF seems to imply the debt is not from Shinkansen construction.
- sanxiyn 5y ago
  The flowchart shows privatized JR assumed 40% of debt. I don't think "small fraction" is the right description. By the way, the flowchart was the plan, but it didn't go according to the plan. Land sales never happened for complicated reasons. I think you are moving the goalpost. Yes, privatization itself can be distasteful. But Shinkansen was privatized, not handed out. JR paid for the privilege, and it was fair price (at least it was market price). With the benefit of hindsight, it can be argued it should have been more, but JR took real risk. Money printing wasn't the foregone conclusion. I agree JNR could have been normalized without privatization, and probably should have. On the other hand, I don't think it was about paying public servants. Normalization of JR was mostly about making obvious but unpopular decisions, and that's in fact one thing the private does better than the democratically accountable public.

patio11 5y ago

Every single line extension, station change, is an entire political battle and story. Yep. A legendary one in my old stomping grounds of Gifu is that there is a shinkansen station in Gifu-Hashima, and not in places that would be far more convenient to have a station (e.g. Ogaki or Gifu City), because a politician local to there was able to decisively dictate the routing and, prior to the route being publicly known, acquired some real estate which was presently undistinguished but would have been extremely valuable if it were right next to a shinkansen station. (Interested individuals can Google the names if they want them.) A happier one which I use a lot in explaining why I love Japan: JR refused to close a particular station over one passenger. They ran one train there to pick her up and another train there to send her back every day for +/- a decade, until she graduated, because someone at JR thought that JR must convey a child to their school. (There are a few more anecdotes about that theme I am aware of, some reported to the press and some of which I know of through other ways, and in this I am in utter agreement with my rail buff friends that the railways see themselves as servants of the public trust in addition to capitalists.)

dustintrex 5y ago
That's a lovely story, but it's also why JR is bleeding red ink. Here's a typical story about one line that was serving an average of 19 (nineteen) passengers per day and made a loss of about US$3m/year for decades until it was finally axed in 2014 thanks to a providential landslide. https://spikejapan.wordpress.com/2012/05/20/minispike-the-end-of-the-line/ https://spikejapan.wordpress.com/2012/05/20/minispike-the-en...
- rob74 5y ago
  Such extreme examples aside, but generally the expectation that rail transport has to be profitable is harmful. On one hand, people expect roads to be well-built and well-maintained so they can run their cars on them for free (with some exceptions), but when rail transport is subsidised with tax money to offer an environmentally friendly and competitive alternative to cars, they complain about it.
  - 5y ago

AniseAbyss 5y ago

Japan had an advantage: their cities got completely demolished. Railways are OLD. Cities got built around them that's how old they are. And our esteemed ancestors didn't plan 100 years ahead to a future where the population had trebled. You think you can double the tracks in Amsterdam? You'd have to either start tearing down 10s of thousands of buildings or dig tunnels. Very long tunnels.