3 ms·

If it's more efficient, is that not an arbitrage opportunity?

by gryfft 1mo ago

bryanlarsen 1mo ago
- it's less convenient. If the cost difference is small because trucking is cheap people will pay more for convenience. - the cost difference is smaller than it should be. Trucking is highly subsidized, since diesel taxes don't come anywhere close to paying for the roads. OTOH railroads have to maintain their own infrastructure.
- andrew_lettuce 1mo ago
  ... Usually on the best land they were gifted for building the railway line on the first place, so heavily subsidized as well
  - bryanlarsen 1mo ago
    They were gifted the land when the land was close to worthless because the transport costs for western products were higher than their value. The train is what made western land valuable. That land had value before the train came through was almost pure speculation -- people bought and settled land assuming that it would have value once a train arrived. It was a real subsidy, but it was small and it was > 100 years ago. OTOH, the land the freeways and roads were built on already had significant value before it was expropriated for road construction and wasn't paid for with diesel tax revenue, so it's yet another subsidy for truck traffic.
Zambyte 1mo ago
It's efficient in terms of energy, but slow after decades of neglect. People pay for fast.
Mawr 1mo ago
Ah yes, the "free market" fallacy. Watch this: - My trucks require roads and do more damage to roads than trains do to rail tracks? No problem, roads are paid for by the taxpayer, while the rail companies have to pay to build and maintain their tracks. - My trucks produce harmful emissions and particulates that trains don't? No problem, I don't pay for any of that. - My trucks kill people in accidents? Again, no problem, not paying for any of that. Yay, we've successfully optimized out any inefficiencies of trucks by externalizing literally all that's possible to externalize. Isn't the free market great?

If it's more efficient, is that not an arbitrage opportunity?

by gryfft 1mo ago

If it's more efficient, is that not an arbitrage opportunity?

- it's less convenient. If the cost difference is small because trucking is cheap people will pay more for convenience. - the cost difference is smaller than it should be. Trucking is highly subsidized, since diesel taxes don't come anywhere close to paying for the roads. OTOH railroads have to maintain their own infrastructure.

andrew_lettuce 1mo ago
... Usually on the best land they were gifted for building the railway line on the first place, so heavily subsidized as well
- bryanlarsen 1mo ago
  They were gifted the land when the land was close to worthless because the transport costs for western products were higher than their value. The train is what made western land valuable. That land had value before the train came through was almost pure speculation -- people bought and settled land assuming that it would have value once a train arrived. It was a real subsidy, but it was small and it was > 100 years ago. OTOH, the land the freeways and roads were built on already had significant value before it was expropriated for road construction and wasn't paid for with diesel tax revenue, so it's yet another subsidy for truck traffic.

Zambyte 1mo ago

It's efficient in terms of energy, but slow after decades of neglect. People pay for fast.

Mawr 1mo ago

Ah yes, the "free market" fallacy. Watch this: - My trucks require roads and do more damage to roads than trains do to rail tracks? No problem, roads are paid for by the taxpayer, while the rail companies have to pay to build and maintain their tracks. - My trucks produce harmful emissions and particulates that trains don't? No problem, I don't pay for any of that. - My trucks kill people in accidents? Again, no problem, not paying for any of that. Yay, we've successfully optimized out any inefficiencies of trucks by externalizing literally all that's possible to externalize. Isn't the free market great?