I read an interesting report about high speed rail development in Europe. It was comparing Spain and UK a lot. Spain has the biggest high speed network in Europe (second biggest in the world after China) and UK failed to build a single line after the costs reached $100B and project was scaled down. Spain is also building its network at lowest cost in Europe. According to the report the main reasons for that are:
consistent political backing: all parties support rail development so over the last couple of decades the entire process was optimized
consistent support on all levels of administration: central and local governments support rail so the plans don’t change all the time. proper planning can be done
mature public-private cooperation: over the years government and private companies learned to work together to build quickly and cheaply while maintaining quality
What is happening in UK and USA is that high speed rail is a for-profit project for private companies. Government promises them $20B and they start building. If they finish the money dries up so they never finish. When they spend everything government gives them more money. They can’t cancel the project because thousands of people work on it so they just limit the scope making it less and less useful. In the end the rail doesn’t even reach the cities it was supposed to, less people can use it, everything stops being economically viable and the whole thing collapses.
Basically in Spain private companies make profit as long as building railways makes economical sense. In US/UK they make money for as long as government can fund them. Building anything is not the goal.
You can also look at Japan, where railroad isn’t even the main moneymaker for the companies that operate them (pretty sure some even run at a loss). Instead, it’s the hubs that those railroads create (ie all the real state connected to the stations which is owned by the railroad companies and can be rented out to businesses).
In essence, railroads shouldn’t be built because they’re profitable. They should be built because they’re a basic necessity for unifying a country/region. The profit comes from the increased mobility and the new hubs and opportunity that mobility can create. But most politicians are too short-sighted for this.
The Western business mindset isn’t compatible with this approach. If you have a business that has 2 portions and only one is profitable you split it and dump the unprofitable part. If the government forces you to do both you just cut costs from the unprofitable train making everything shitty for everyone.
The Asian cultural Zeitgeist has more focus on stewardship so if someone gives you a responsibility (public transit) and a privilege (commercial hubs) you understand that the great power comes with the great responsibility. You’re still a capitalist and get rich as fuck, but society benefits too.
Yes, railroads are rarely profitable. It’s usually a investment which you recover in the form of greater mobility and economic opportunities it brings. What happens in US/UK is that after years of pumping money into the project and cutting scope in desperate attempts to finish it it becomes impossible to recover it in any form because it simply doesn’t move enough people. Government sees it as a failure and is reluctant to invest in other projects. Without continuity private companies can’t plan long term and focus only on one project trying to get as much money out of it as possible. And the cycle continues…
Another issue is the car-centric culture of the US and the fact that rail and any other form of public transportation directly impedes upon the car companies’ profits (including building sidewalks). This means that any project has to fight an uphill battle against corporate lobbyists or avoid simply being bought out and disbanded like what happened to the various highspeed rail companies in the 2000s.
France is another interesting one to take a look at. I watched a video awhile ago on the history of highspeed rail in France, and if I remember correctly, while they’re culturally closer to the US and the UK, highspeed rail has a history as a point of competitive national pride for the French and so they’re culturally favorable to it because they’ve held the title for the fastest trains in the world a couple of times.
I read an interesting report about high speed rail development in Europe. It was comparing Spain and UK a lot. Spain has the biggest high speed network in Europe (second biggest in the world after China) and UK failed to build a single line after the costs reached $100B and project was scaled down. Spain is also building its network at lowest cost in Europe. According to the report the main reasons for that are:
What is happening in UK and USA is that high speed rail is a for-profit project for private companies. Government promises them $20B and they start building. If they finish the money dries up so they never finish. When they spend everything government gives them more money. They can’t cancel the project because thousands of people work on it so they just limit the scope making it less and less useful. In the end the rail doesn’t even reach the cities it was supposed to, less people can use it, everything stops being economically viable and the whole thing collapses.
Basically in Spain private companies make profit as long as building railways makes economical sense. In US/UK they make money for as long as government can fund them. Building anything is not the goal.
You can also look at Japan, where railroad isn’t even the main moneymaker for the companies that operate them (pretty sure some even run at a loss). Instead, it’s the hubs that those railroads create (ie all the real state connected to the stations which is owned by the railroad companies and can be rented out to businesses).
In essence, railroads shouldn’t be built because they’re profitable. They should be built because they’re a basic necessity for unifying a country/region. The profit comes from the increased mobility and the new hubs and opportunity that mobility can create. But most politicians are too short-sighted for this.
The Western business mindset isn’t compatible with this approach. If you have a business that has 2 portions and only one is profitable you split it and dump the unprofitable part. If the government forces you to do both you just cut costs from the unprofitable train making everything shitty for everyone.
The Asian cultural Zeitgeist has more focus on stewardship so if someone gives you a responsibility (public transit) and a privilege (commercial hubs) you understand that the great power comes with the great responsibility. You’re still a capitalist and get rich as fuck, but society benefits too.
Yes, railroads are rarely profitable. It’s usually a investment which you recover in the form of greater mobility and economic opportunities it brings. What happens in US/UK is that after years of pumping money into the project and cutting scope in desperate attempts to finish it it becomes impossible to recover it in any form because it simply doesn’t move enough people. Government sees it as a failure and is reluctant to invest in other projects. Without continuity private companies can’t plan long term and focus only on one project trying to get as much money out of it as possible. And the cycle continues…
Another issue is the car-centric culture of the US and the fact that rail and any other form of public transportation directly impedes upon the car companies’ profits (including building sidewalks). This means that any project has to fight an uphill battle against corporate lobbyists or avoid simply being bought out and disbanded like what happened to the various highspeed rail companies in the 2000s.
France is another interesting one to take a look at. I watched a video awhile ago on the history of highspeed rail in France, and if I remember correctly, while they’re culturally closer to the US and the UK, highspeed rail has a history as a point of competitive national pride for the French and so they’re culturally favorable to it because they’ve held the title for the fastest trains in the world a couple of times.