The problem with urban transport systems is that no one sees them for what they really are... an expensive thing that drives the economy. There seems to be an obsession in the west with making public transport pay for itself, but the reality is that a few billion invested in better public transport results in a lot more billions being made elsewhere.
We need to get away from this idea that public transport systems need to break even or turn a profit. They are there to help make money in other ways. An efficient reliable transport system should cost the taxpayer money, but they will get that back in profit elsewhere through a thriving local economy.
Nobody expects the NYC subway to "break even or even turn a profit." The subway historically recovers less than 50% of its operating expenditures from fares, compared to 70% for Berlin, 88% for Amsterdam, and over 100% in Tokyo, Taipei, Hong Kong, and Singapore: https://en.wikipedia.org/wiki/Farebox_recovery_ratio.
Sorting that wikipedia table by recovery ratio, I see most of the profitable ones are in East Asia and distance based:
Osaka (OMTB) 137%,
Hong Kong MTR 124%,
Osaka (Hankyu Railway) 123%,
Tokyo Metro 119%,
London Underground 107%,
Singapore (SMRT) 101%,
Taipei Metro 100%.
Clearly it is possible to have profitable subways, so I don't think we should drop profitability as a goal.
The business entity that owns the subway being profitable is not the same as the subway being profitable. MTR for instance is a real estate developer as well as a subway operator:
"As compensation for the cost of building railway networks, the government grants the MTR Corporation land development rights along its rail lines, stations and depots – an increasingly lucrative business in recent years amid a red-hot property market."
It's well understood by the locals that the Hong Kong (and possibly other Asian cities) system reaps most of it's revenue from land rights around/immediately above the stations. In
In Asia transit hubs are often also retail hubs and the commercial rents become profit for the public transit system. This makes perfect sense as the retail value of the nearby land can most obviously be credited to the transit system.
I'd imagine that the problem with the United States is that this real estate was sold early on or was never owned by by the transit system allowing the spillover benefits of transit hubs to be captured by private interests.
Farebox recovery ratio is not a measure of net profit, it is a measure of operating profit specifically for transit assets, with only fares counting as revenues. In other words, the MTR's subway lines are profitable entirely by themselves. The real estate profits are just a cherry on top.
Isn't that part of the problem? Correct me if I'm wrong, but I recall hearing from someone that the MTA sold a good portion of its real estate and so lost sources of income.
I'm not all knowledgeable in this, so if someone who knows more of its history can chime in please do.
The statistics are misleading. I can say a bit about Japanese subways; they generally have handful profitable lines (e.g. Midosuji line in Osaka Metro---previously known as OMTB---, or Ginza line in Tokyo Metro) and lots of non-profitable lines. For private subways like Hankyu, the codevelopment of subway lines and neighboring metropolitan area was crucial for their long-lasting profitability (in this sense, Hankyu is not a subway corporation). If we want profitability as a goal, we should just drop those non-profitable lines or subways in general, but of course that would be a public disaster.
Just because a profitable subway exist does not mean it's possible anywhere in the world. The location, geography, culture and population density all affect profitability.
Its true subways have lots of positive externalities not captured by the fares, that it would actually be better to have a deficit subway system than to not have it at all, both for economic reasons and plain welfare, but there's no need to abandon the profitability goal for that.
IT is possible to devise a tax system that will capture some of that positive externality and make the subway better. It should be intuitive that the properties that got amazing value increases due to the subway should have an increased tax burden on them. A subway-proximity tax could be enough to turn subway profitable: and to easily fund expanding it!
Yeah, but they offer extensive coverage and are reliable - also somewhat expensive. To get such thing for NY - you need to drill a lot more tunnels and fast and make sure trains run on time.
I don't think you need to drill tunnels. That hasn't happened (much) in London, yet there's been a marked improvement in the core service over the last 20 years.
London's network is older and has smaller tunnels. It also only has single tunnels in each direction (so if a train breaks down the whole line stops).
The difference is that the network has had steady investment under single management for a prolonged period. Londoners have suffered through closures for engineering work, but ageing systems have been upgraded and gradually the benefit is being felt.
Never been to NYC but I think that the MTA rail coverage is way lower especially in the non Manhattan boroughs compared to the London Underground, Overground, DLR and National rail. You could get from any point in London to anypoint for less than an hour only by rail and walking.
> You could get from any point in London to anypoint for less than an hour only by rail and walking.
Whilst in general I agree with the sentiment of your comment, this is not true. Lots of residential areas in Greater London will have ~20 min walk to nearest tube or overground, and if you're going across the city, the train part of your journey can definitely be > 40 min.
As an example, I've got two friends, one lives in Wimbledon (far south), the other in Barnet (far north). It takes quite a bit longer than an hour for one to get to the other's house.
> I've got two friends, one lives in Wimbledon (far south), the other in Barnet (far north).
That isn't a fair assessment. Metro lines are used to enhance mobility within urban areas. Their goal is to replace cars and 20-30min walks with a 5-10 metro ride with an additional 5min walk. That's why typically subway stations are placed about 500m to 800m apart, and the system's commercial speed is designed to be around 50km/h.
For long commutes, such as going from far north to far south, there is an entirely different system: commuter rail. Their stations are further apart, their commercial speed is higher, and so is the passenger volume.
Just to provide an example, Madrid is served by both rapid transit network (madrid metro) ans a commuter rail system (madrid cercanias). It takes between 30 and 40 minutes to cross Madrid riding the metro network, but the commuter rail takes about 15 or 20 minutes.
Taking London as an example, there aren't many ways to cross London in such a way using commuter rail (ThamesLink currently and Crossrail in the future are probably the only two?). Most people would still use the tube.
That's why 1hr + journeys in London are not uncommon.
(edited to add) London and New York are also much much larger cities than Madrid. It's not really a fair comparison.
It is a fair assessment, because I did take into account commuter rail, which is not any faster - a quick Google maps check says both tube and rail (of any form - overground, national rail, etc.) journeys come to around 1 hr 40 mins.
Ha, what? My old commute on the Singapore MRT - 5 stations - cost me the grand sum of SGD$1.07 (USD0.78). Even to the airport is only a couple of bucks.
Tokyo isn't quite as cheap but it's still very affordable.
I don't know about the others, but Hong Kong's system has far fewer stops and is mostly cheaper (it's distance-based and exceeds New York's flat fee at the high end) than New York's. The reliability difference rings true, though.
That's fuzzy accounting. For example tax revenue from NYC subway-generated activity isn't counted (and missing taxes on subway generated windfalls are ignored completely), but Japanese commercial profits near trains is counted. The Subway is a multi billion (trillion?) dollar handout to landowners.
Thank you for the link. The ratio in Paris where I live is 30%, but I think it's not just subway that's included, but also light rail around the city, tram and buses. Still with the price we're paying I would have though the ratio would be higher. It must be caused by fare jumpers and the work for renovation/new lines. It's also not helped by the yearly strikes by the local union for political reasons.
I expect it to break even or turn a profit. It's the most perfect way to gauge it's true economic value. Unfortunately for tax payers, it's only subsidizing otherwise intolerable commuting conditions, and acts as a strong subsidy to downtown property owners.
Well, why? The OP has asserted that NY transit delivers vast economic benefits that offset its loss making nature. Fine, I can buy that to some extent, but how big exactly are these benefits? How do we know they're actually so big and not in reality quite small?
Well, we could do some one-off studies and hope that Excel is used properly, but why? We already have mechanisms that figure out the value of things and allocate resources appropriately, they're markets. The unviable nature of public transit suggests systematic resource allocation problems, created politically. If there were really such huge beneficial side effects, it wouldn't matter if ticket prices rose a lot, that'd just get priced in to other things like cost of goods near transit stops.
For instance maybe every ride in NY should be 2x or 3x the current price for the costs of the system to be worthwhile, but public transit is usually government owned and politicians aren't willing to bite the bullet on that.
(This is all kind of beside the point that NY's transit problems are mostly due to localized cost absurdity, but...)
I don't disagree that it's hard to quantify the exact economic value, but you can't use a free market to solve coordination problems like public transit.
Coordination failure in stages:
1) A transit line that goes where you want, when you want for only a fraction of your trips means you need a second means of travel the rest of the time.
2) Having a second means of travel on hand (e.g. a car) means that you're less likely to use the transit line when it would work for you.
3) Lack of use of the transit line leads halted growth and reduced service.
4) Reduced service further drives users away
5) Evidence of failure causes a loss of investor/government support.
6) Transit line dies slowly to the extent that political inertia allows.
Or to put it another way, asking a transit line to pay to for itself is like saying "if human beings really wanted world peace they could have all just disarmed!", ignoring the fact that until everyone else is disarmed you'd be a fool to disarm yourself.
And if you succeed and build a critical-mass, sustainable system you've just swapped your market problem for a natural monopoly and have to use non-market techniques to deal with the monopoly service provider. (And now we're back to NY)
> (This is all kind of beside the point that NY's transit problems are mostly due to localized cost absurdity, but...)
This is the entire point. You cannot dismiss it. What conditions allow the costs to rise so high in NYC?
> A transit line that goes where you want, when you want for only a fraction of your trips means you need a second means of travel the rest of the time.
Why should anyone want to go any place, and what makes them so entitled to receive such a transportation service? People, like businesses, will follow economic incentives. I'm sure landlords and real estate developers love the metro system, it brings great value to the otherwise less desirable realestate. For ever dollar someone doesn't pay to ride the metro, that's a dollar more in rent an apartment can charge.
You have to look at the big picture and figure out who these mass transit systems actually benefit.
Everyone wants to go everywhere - because people live Everywhere and have jobs Everywhere and their friends live Everywhere and there are stores Everywhere.
No one is entitled to anything - you added that word apropos of nothing in my post.
It's also interesting how people don't see public roads in the same way—people don't expect roads to cover their own expenses directly, expect free parking as a human right and bridle at toll roads or gasoline taxes.
People need to see public transport as "roads that don't need cars".
Except that most of the wear and tear on our roads isn't caused by people's cars. People pay much more than their fair share of road maintenance via gas taxes etc than the industries that cause the most damage to the roads.
> People pay much more than their fair share of road maintenance via gas taxes etc than the industries that cause the most damage to the roads.
Maybe. Reduced transportation costs to businesses permit lower cost goods to end consumers. Your car transporting you to work isn't your only reliance on the road grid.
You are correct, however, I was refuting the post that said that those paying gas taxes and tolls aren't covering their own maintenance costs. We're all subsidizing the industries that cause the most damage to roads, whether you commute by car or by train.
Misleading as this is just the direct marginal costs, you have to account for the indirect costs. Weather and water obviously play a massive factor in wear, a road would not last 1400x longer if used by 1 car rather than 1 semi.
Subsidized car travel is a convenience for ordinary citizens; subsidized truck travel is an advantage conferred on businesses that move a lot of stuff by truck, making their goods unfairly cheap compared to more local alternatives, or alternatives moved by more efficient means like rail and sea.
Buying less stuff > spending tens of extra hours per week getting from place to place.
Or the externalities are properly priced and the vast majority of the miles of transport are done by train, which would be cheaper if trucks had to pay for the road maintenance they cause. And cause less pollution (both in ton-miles and from reduced emissions during repaving). And the potatoes end up costing what they cost to get to you?
I'm not sure the potato subsidy is worth distorting the transport economics.
Trucks do “pay.” They move goods that are sold and taxed. Until subways start shipping things other than people, they can’t be considered the same as roads. A subway can move people around; roads also move significant goods around. Every single thing in a store has arrived by road for at least some portion of the journey. Farmers aren’t shipping carrots via tram.
I said trains, not subways. I said "majority of miles" not "to the store". The tax is the same on goods shipped by other methods, so you can't count it as somehow balancing out the economic distortions caused by subsidizing trucking infrastructure.
The problem is that non-truck solutions cost more relatively due to government intervention, messing up the market's ability to find more optimal solutions. This one is simple, it doesn't even require you to think about carbon taxes to do the math. It's direct costs, subsidies to a certain technology. Don't pick winners and losers, create an environment where capitalism can function and find the actual best solutions.
Charge trucks for damage they directly cause to roads. Simple.
A trucker can cut road damage 10x just by adding more axles. This saves you money. But they'll only do it if they save money too. If everyone has to pay for wear, then the truckers have a reason to make those upgrades.
It does matter though. If the cost of road wear was added to the products that caused them those products would become more expensive and sell less. Suddenly there's an incentive for Potato Inc. and friends to figure out how to transport such that there's less wear etc.
To me it matters a lot. Capitalism only works when the true costs of things are accurately reflected in their prices.
If the road maintenance cost of transporting the potatoes is priced into the potatoes, then the potato company might opt to transport the potatoes in a different (cheaper) way.
But if the road maintenance costs appear free or near-free to the potato company, they have no incentive to care about it. Also it makes drivers who don't eat potatoes subsidize the potato consumers.
> To me it matters a lot. Capitalism only works when the true costs of things are accurately reflected in their prices.
That's actually not true. Capitalism always works, no matter the problem. However, free markets don't account for externalities, and in some cases supply/demand constraints create unacceptable non-economic problems. Thus, to avoid the effects of non-economical problems then it's preferable to create economic incentives that reflect the non-economic constraints.
The price is included. Potatoes are sold and the proceeds taxed. Those taxes go to pay for roads. If we didn’t have to fix roads, taxes could be lower, resulting in higher profits for the potato farmer.
So in your model, road wear is priced into the costs of all goods, no? That's one way to do it, but the problem is that then a single potato logistics company has no incentive to use a (presumably more expensive) transport method that causes less road wear, because the benefits are spread evenly across everyone, and costs are borne entirely by the switching company, so nobody would switch. (unless you made some rule forcing everyone to switch, which is another way to do it)
If road taxes are directly tied to the things causing wear, then every company causing that wear has an incentive to find a transport method that causes less wear (assuming that the additional cost of that transport method is lower than the cost of the road wear - that's why some people argue that using markets is better than using rules; if you've properly priced the market, the market will balance between road and rail based on cost.)
That's why it's important to make sure that all externalities are directly tied into the cost of whatever is creating those externalities.
Or, if potatoes had to be shipped at market cost, potatoes from far away would be less competitive to potatoes grown closer.
Net result would be better prices for local farms, less road maintenance needed, no impact to the end consumer overall (less taxes to support less roads).
People might see roads different from public transportation because they are directly affected by poor Management on the part of public transportation companies. If your bus is always late, you can't sit on the subway because the seat is soaked in piss, and there is no customer support for the $100 card you just purchased which isn't working, you might become disinclined to defend the exorbitant costs of public transportation. As paradoxical as that might seem.
Usually the complaint is that road money is misallocated to surface fixes that result in more potholes in the long run. In some states and municipalities, this has to do with how government employees steer construction contract awards. I see wanting to change this as analogous to the desired reforms in public transportation.
He's likely referring to how (some) people enjoy driving because of the sense of freedom & control it gives them. But he is asserting that this is just an illusion.
Honestly, I feel the same way, since most time I spend driving I spend sitting in traffic or something.
There are few things I get more enjoyment out of than driving a car that corners well through a beautiful mountainous road like the Blue Ridge Parkway through the Appalachian, or up through Yosemite from Fresno.
When I need to clear my head, I still hop in the car and go for a drive with music. Not also afraid to admit -- I've had some of my most cathartic, emotional-cleansing crys in the vehicle by myself.
In this day and age where there are fewer and fewer places to go to truly be alone with one's own thoughts, sometimes my vehicle is my own personal sanctuary.
Of course other countries with excellent public transit also have plenty of scenic country roads. It's not like we have to pick between the two. (I don't think you were claiming we do, I just wanted to highlight that argument.)
Sounds like your typical car commercial. I wish cars were only used for these types of infrequent trips, rather than for nearly all of one's transportation.
How many of the miles driven are cornering on interesting roads in the mountains and how many miles are dull city traffic during rush hour? I'd wager that most people never drive a road that you'd find interesting in a car that would make it worth their time.
That's right (I'm the OP) - I love driving and work in the auto industry. The biggest pitch of the car(look at the commercials) is that your car defines you, and provides you a lifestyle and freedom.
However, there really is an element of freedom. You can drive where you want when you want. It's just that the average person sits in bumper to bumper traffic.
I used to feel that way, too, but since I moved to Seattle, I traded my car in for a motorcycle, and that feeling of freedom has returned in full force. Maybe it is just a different illusion, but the wind and the noise on my morning commute wake me up better than any coffee I've ever had. Getting forty-some-odd miles to the gallon on a vehicle that can go 130 MPH ain't bad, either.
In Tokyo, the rail transit system (including subways) is operated by a network of private companies. These train operators make a net profit from fares and other revenues, and the system is generally well liked by its customers. Even if the idea of privatization makes you cringe, the idea that public transit is inevitably a money pit or loss leader is misguided.
It's worth noting that they got there because at the time of development, the rail companies were able to buy up the surrounding land and develop that. They reinvested their real estate profits into more rail and more real estate, creating a virtuous cycle. (Hong Kong, one of the only other profitable systems, did something similar by having the government effectively transfer land for free initially.)
American rail systems largely didn't develop around their stations, and if they bothered to develop around their stations they sold the land after construction and that was it. For them to do so today would require billions, if not tens of billions of dollars to provide fair compensation for eminent domain for land and property around stations. And that's before the legal costs to fight all the resulting litigation, if they even were allowed to do it.
That’s actually the same model the Hong Kong MTR company applies for the subway lines it manages in mainland China (like lines 4, 14, and 16 in Beijing). Buy land right where lines will pass and near stations and develop it.
The key difference with Tokyo probably isn't privatization, but that the rail operators own the land around the stations, so often get to charge both ends of each trip: the rider and the business the rider travels to.
Sounds like a smart policy: the railway operator is pressured to serve areas where there is actually demand for the service, thus avoiding wasteful spending building non-performing lines, and is pressured to provide quality services to keep real estate prices up.
Well, Japan privatized rail in the 90s, well after the majority of the rail was built using billions of dollars of investment by the Japanese government. So I don't know if it's really correct to call this a success of privatization, considering that the major costs were basically socialized.
Absolutely -- and you can see this even in the article. They talk about raising fares and cutting service, with no acknowledgement that their primary source of income shouldn't be fares, and their primary budget cuts shouldn't come from reduced service.
NYC subway fares are insanely cheap compared to the rest of the (developed) world. $2.75 single for any distance is incredibly low.
In London that same fare in rush hour would be anywhere between $4 and $15+ depending on the length of the journey (and NYC has much higher GDP per capita than London, plus the £ is on its arse at the moment). Even Berlin is marginally more expensive, in a much smaller & less economically prosperous city.
Keep in mind also that if you don't raise fares you are effectively cutting them because of inflation.
> NYC subway fares are insanely cheap compared to the rest of the (developed) world. $2.75 single for any distance is incredibly low.
Europe isn't the only "developed world," mate. My morning commute in Hong Kong (which is roughly the same distance as Brooklyn to the LES or, say, King's Cross to Paddington) costs around $0.50. I can go all the way to mainland China for ~$3.00.
$2.75 is roughly the maximum fare in Tokyo (where an unlimited day pass can be had for $5.25), and $3.00 in Seoul will take you 145 kilometers away.
The maximum fare in Tokyo is nowhere near 2.75 USD. It's kind of a moot point because there is no such thing, lol. But for example the fare from Nippori to Kichijoji, which are both comfortably in Tokyo, is almost 5 USD.
Not exactly a valid comparison. Nippori to Kichijoji requires a change of systems (JR to Keio), and therefore multiple fares -- it would be like MTA+LIRR or MTA+PATH in NYC.
I'm neither upset nor in China; just pointing out that if you expand your definition of the "developed world" beyond Europe and the US, the NYC MTA goes from "insanely cheap" to comparably priced or even mildly expensive :)
There’s an international border between Hong Kong and mainland China. A Chinese citizen needs a visa to come here and a Hong Kong citizen needs (what is basically) a visa to go there.
You don't know what you are talking about when it comes to Tokyo, mate. 600 yen covers a day pass for the Tokyo Metro only, doesn't cover any JR lines at all. And even then, it is only for the local/regular express trains not commuter express trains. Additionally, Tokyo metro lines mostly only cover, well... the metro area. Not the suburbs or places where a lot of people live.
One way to work for me in Tokyo is about 500 yen and I live relatively close by, I just have to switch train operators twice (you get charged both on distance, and a flat fee by each train operator). Many of my coworkers who live out in the suburbs with families pay a lot more, but luckily most Japanese companies cover transportation fees as part of your salary.
As far as the rest of what you are talking about, you are very much ignoring the difference in economies between those places. 10 HKD goes a lot farther in Hong Kong than the equivalent would in New York.
> You don't know what you are talking about when it comes to Tokyo, mate.
As I said elsewhere, I'm specifically only talking about the Tokyo Metro. I didn't include JR just like I wouldn't include the LIRR when talking about the NYC subway.
> Tokyo metro lines mostly only cover, well... the metro area. Not the suburbs or places where a lot of people live.
The same goes for the NYC subway. If I took the A train from one end to the other (uptown to queens), it's about 45km - only 5km more than going from Wakoshi to Shin-kiba, or riding the Yurakucho line end-to-end.
> 10 HKD goes a lot farther in Hong Kong than the equivalent would in New York.
I don't know how you're coming to this conclusion; Hong Kong is one of the most expensive cities in the world.
It's not insanely cheap compared to the rest of the developed world. Paris metro costs 1.90 Euros or more likely 1.49 if you buy books of 10 tickets or whatever.
I've been to plenty of developed world cities where the cost is under $3.
Paris has a zonal system though that goes up past €10, which NYC doesn't do. I'm not saying that 'central zone' fares aren't ~$3 in many cities, it's very odd to only have one zone and the fare be that low.
Keep in mind the distances that the subway does (and has express service on) make it similar to the RER in Paris more than the metro.
It's been a while since I took the Metro but I had been all over on it including to "end of the line" stops outside the boundaries of Paris and it was always the same price, EUR 1.40 (back then).
You might be thinking of the RER, that has different pricing.
I understand your point now though: it's the long fares that are insanely cheap, due to the flat pricing model. There are only a few comparison points I guess since very few cities have a "subway" system that large (some may have large transit systems that reach the suburbs, but they are often separate from the subway and with a different pricing structure).
I've always thought that fares should be more symbolic than a real source of revenue. They should definitely be low enough that even the poorest residents of the city can easily afford to travel on public transportation.
Most of the people who ride the subway are not poor, and the average subway rider is probably richer than the average NYS taxpayer. Why subsidize the transportation of all the middle class and rich people who ride the subway every day?
Why? Transport for London is close, if not past, covering operational (and some, but not all, very significant capital) expenditure from fares, property and advertising revenue. MTR in Hong Kong also is profitable, as I believe many Japanese networks are.
Being run entirely from fares means you are not at the whim of politicians for subsidies and grants that can change overnight with an election, which makes it very hard to think longer term.
I think this is what NYC should be aiming for - operationally covering its own operational costs from fares, advertising and property revenues with then state/federal grants for larger capital projects.
I think the conclusion from this sub-thread is that the London subway is insanely expensive compared to most of the rest of the world. There might be local reasons that afford it such price gouging power, like the lack of any reasonable transport alternative and the nature of London's road infrastructure, congestion and parking fees etc.
A fee increase to that level in other cities might have the opposite effect of reducing ridership and total revenues, against a largely fixed expense base, condemning the subway to a real "death subway".
The externalities of transport are massive, if a small number of people device to spend 15 minutes more in traffic to save the 8 pounds subway fare, the costs to society are simply astronomical because now everybody else has to spend those 15 minutes more too to get to where they need to go, even if they don't have the option of public transport for their route.
The other way to look at it is that it is a high quality reliable product that can charge a "premium" so to speak. While people in London complain, all lines will have CBTC in the next couple of years (the vast majority already do), running at 30-36trains per hour per direction across rush hour depending on the line. It is very rare for there to be major service issues on more than one or two lines at a time, comparing that to service status in NYC which often has dozens of lines with various issues.
My point really is that "even" £8 isn't that expensive in the grand scheme of things. And that money going into the system allows it to work well.
London is priced as it is because from this year or next, I forget which, it has no government money. All running costs must come from fares and advertising. Prices have changed accordingly.
Unlike roads which are entirely funded by government. So a comparison is always going to make "public transport" (ironic considering it's the transport not receiving public funds) look more expensive.
Ironically in London the trunk road network maintenance will be paid out of TfLs public transport fare budget, as TfL has a legal duty to maintain the major roads in London but has no government operating grant. Hopefully this will be resolved soon!
The Underground is cheaper and/or more reliable when compared to the national rail network many use to commute into London. Ridiculously so. I think that contrast helps those in London value the Underground. Also the reason many choose to still live where there's a tube line.
It's also worth noting buses are much cheaper than the tube and quite accessible compared to a lot of places, though much slower.
I have no argument with transit systems being self-sufficient, nor with fares providing a reliable source of funding. But what needs to happen, ethically, is for the relief valve to be elsewhere when it comes time to balance the budget. Maybe that means more advertising, maybe it means cutting costs. But it shouldn't be taken from the users of the system, because their demand is flexible (as we're seeing in NY), and the inflexible ones are the people who already have no alternative and are hit the hardest.
No, not at all. It is a very blunt tool to say fares should be cheap so that poor people can afford them.
There are much better ways to do this, eg offer discounted trip cards to people on certain social security programs (Medicaid eligibility comes to mind). Price differentiation 101. This should be funded out of social security budgets, not transport budgets IMO.
I guess that's because the greater Vancouver area is made up of multiple localities officially designated as cities, even though in many cases there are no visible gaps between them anywhere other than on the map. The transport system is divided in zones, so travelling to, say, Coquitlam will cost you twice as much as travelling within the Vancouver downtown.
> There seems to be an obsession in the west with making public transport pay for itself
Not a crazy idea considering how some systems operate in the East - Tokyo, Osaka and Hong Kong systems not only pay for themselves, but churn out profits along the way. Singapore’s MRT is designed to operate at break-even.
The trick is to allow the transportation authority to own and manage its own real estate. This way when a new station or line is built out, the sharp increase in land value is captured by leasing the space above it to a giant mall, office complex or a mixed-use megacomplex like Roppongi Hills.
The US model seems to reward random real estate developers who just happened to own the land near the future station. It also seems to frown upon the idea of concessions or any commercial exploitation - for instance, San Jose or San Francisco Catrain stations receive more foot traffic than many commercial centers in the area, yet choose to wow their visitors with a mediocre coffee stand and a dirty bathroom.
> The trick is to allow the transportation authority to own and manage its own real estate.
Well, that seems like a pretty major subsidy. So if a new line or station is built, the government uses eminent domain (or equivalent) to buy the land, and gives it to the transport authority?
I mean, it might be better in that it lets the transport authority operate without being dependent on government handouts that can vary wildly from year to year due to local politics.
> The US model seems to reward random real estate developers who just happened to own the land near the future station.
The government should apply some form of land value taxation to (partially) fix this. Would fix a lot of other problems too, but I digress.
If by subsidy, you're implying that the transit system is receiving freebies they don't deserve, then I'd have to disagree with you.
Transportation hubs create far more value via their impact on nearby real estate values than from the fares they collect. Asia cities correctly capture the value created by public transit by having major retail hubs above or surrounding subway stations, all of which is paying rent to the transit authority.
Even this is a generous compromise, because the benefit to real estate value really radiates outward to the entire walkable radius, it's just the immediate retail hub that could attribute most of it's value to the station.
So if anything, the problem with the US is that public transit is just a massive economy handout to private landowners, leaving just the scraps (the fares) to the transit authority.
I’ve seen people in Seattle ballyhoo this sort of thing as a subsidy to whoever the transit company would let the real estate to and consolingly they’d rather keep their car
I am not sure how land ownership typically works - it seems that governments anywhere pretty much have to own a large chunk of the land to bore tunnels, build the station proper, accommodate parking, onramps, roads, pickup zones, etc. E.g., how did BART pick the location for San Jose Beryessa extension?
The ideas you're saying are quite common in the West, as you say, but that's not the attitude in NYC. Everyone realizes it's worth funding and fixing. The disputes are about the who, what, how, and paid by whom.
The issue is really that the MTA is funded and controlled by the State of New York, while it predominantly serves the City of New York. Since the population (especially the voting population) of the city is <0.5 of the state population, but the city is an outsized chunk of the state's total economy, the state uses funding of the transit system as a weapon to get the city to acquiesce to other demands.
Hence why the NYC mayor is so intent on funding worthless streetcars and ferries; they let him get out from under the thumb of the state.
Incorrect. According to the NYT, redirection of MTA funds amounts to about $1.5 billion over 20 years. That’s $75 million per year, or what MTA spends in 2 days.
I read his statement as .5% first as well and then realized that he meant 50% because otherwise there would have to be 1.6B people in NY state to make the number work.
> Hence why the NYC mayor is so intent on funding worthless streetcars and ferries
I'm assuming you're using the "worthless" adjective only for the streetcars - I use the NYC Ferry regularly (a stop opened near my apt last year) and it's way better than the subway. I have to walk a bit further on the other side, but it's still way more comfortable.
Streetcars aren't even necessarily worthless. They're called trams in Australia and Sydney has recently rolled out a network after seeing how heavily utilized they are in Melbourne, and how convenient they are for short-distance travel. Pretty much everyone who works in the city has a tram trip somewhere in their commute. Provided the tracks run past places people need to go, there's no reason they need to be worthless.
No one would consider suggesting it as a "replacement" for surface transport.
However, it is a valuable augment to the surface system. The point is that it helps "connect the dots" (providing more options for people to get from A to B) - hence making the system more effective as a whole.
And the ferries are heavily subsidized and very expensive to operate, and they pollute quite heavily.
They don't compare remotely favorably to the subway along any axis except start-up cost (it's cheaper to buy a boat and build some piers than to build a subway tunnel).
Even if you could afford to run enough ferries to make a dent, which you can’t, they simply don’t have the bandwidth.
Some people tried to make the math work for the L shutdown and even if you had a line of ferries just following each other as close as safely possible it wouldn’t be nearly enough. Subways are incredibly efficient at moving large numbers of people.
People keep saying that the street car will be worthless, but I simply don't buy it. It connects all of the fastest growing neighborhoods in the city, where there have been increasing large amounts of effort around economic development within the areas that these places connect, where it will massively increase the value and in turn ability to build real estate along the waterfront, as one of the key determiners of land value in NYC is access to transit.
Trams run on metal rails because steel has a much lower rolling resistance than rubber, and suffers less wear and tear. So you can carry more people more frequently with less maintenance.
NYC wouldn't last a week without its subway and light rail. Everyone uses it, except maybe for the billionaires who have private helicopters. Its critical infrastructure just as sewage system and powerlines.
Japan is doing pretty well I believe because they privatized the transportation system and set up the incentives so the better the transportation does the more profit the transportation company makes.
The Tokyu Corporation (one of the 10 or so companies running trains in Tokyo) is currently building several 20 to 40 story buildings in Shibuya, one of which Google Japan will move into next September. They make money renting the building all of which are next to their station
> 'in 2017 there were 99 fare-free public transport networks around the world: 57 in Europe, 27 in North America, 11 in South America, 3 in China and one in Australia. Many are smaller than Dunkirk and offer free transit limited to certain times, routes and people.'
I wrote a letter to the Sydney Morning herald about 15 years ago saying, OK, starting today, let's make all public transportation free, by not paying for it anymore. All it takes is everyone acting together. They didn't publish my letter. I really shouldn't have given up so easily - I still think it's a good idea. Just need to set a date and get everyone talking about it.
I am not sure why you intend it to make a loss, even though I agree with you on benefits to the economy.
Once a public transit system is convenient and is used by a large percentage of the population, let's say 30-90%, then it will surely be profitable except if it's grossly mismanaged.
Incidental tip: buy stocks of Hong Kong public transit companies, they're doing amazing.
I agree with you in principle, but in practice, attempting to break even puts some accountability on the system. If it’s a money pit, then taxpayers are getting cheated. I strongly support national defense, but if you want an example of a public good that is a money pit, that’s a good example. A P/L statement on public transport helps prevent endless spending without accountability.
It’s not bad for the service to fund itself in ongoing costs, Transport for London is self-sufficient for instance, as long as the money goes back into the service. That’s a good discipline to maintain an efficient service. But agree that initial capital investments should be thought about in the way you’re discussing.
Public transport in Singapore is privatised (well less of it has been as of last year) and it's the cheapest, cleanest, and most reliable system in operation today.
Except you are deadly wrong. Your interventionism ideas area probably thanks to a dead economist.
How about seeing that once the Subway was private and ran well and it ended up the way it did thanks to state intervention trying to make the subways out of business and then buying it out?
We need to get away from this idea that public transport systems need to break even or turn a profit. They are there to help make money in other ways. An efficient reliable transport system should cost the taxpayer money, but they will get that back in profit elsewhere through a thriving local economy.