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Britain's railway privatization was an abject failure

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Re: Britain's railway privatization was an abject failure

#431
post #355

Earlier quoted context omitted.

The study at hand seems to have considered only fatal accidents. Probably for good statistical reasons. But the most obvious next “what” to my mind would be accidents that did not result in fatalities. Followed closely by safety-involved “incidents” that were reportable somewhere (internally or to a regulator), but that luckily didn’t result in an accident that time. One imagines these must get really hard to measure…

> But the most obvious next “what” to my mind would be accidents that did not result in fatalities. This makes no sense as a criticism of "as measured by accidents". The fix for measuring by accidents is to measure by accidents?

I don’t mean it as a criticism! I think that their choice to study a dataset of accidents resulting in fatalities—was reasonable, and that it was admirable to reiterate that qualifier in the conclusion.

I’m also sensitive to the parent commenter’s point that the choice of indicator was kind of narrow. But it makes sense to me why academics might choose a narrow but highly reliable dataset, and try to be very transparent about that: safety is certainly much broader than just fatality-accidents, but fatality-accidents are awfully hard to fudge long-term records for.

Re: Britain's railway privatization was an abject failure

#432
Don‘t privatize infrastructure monopolies. There is simply not enough consumer choice and therefor not enough competition in the market, so companies would be punished for failures or rewarded for improvements and optimizations. Ultimatively capitalism is an optimization algorithm, but in can only work well, if objective functions are clear.

Re: Britain's railway privatization was an abject failure

#433

Our Dutch one is too (privatized in 1995, it's one of our biggest employers as well), we have a nice railway system but the car is generally cheaper, even when using it alone. It's always about how much money the railway system is loosing, but I don't see anybody crying about the money our roads are loosing. Isn't it all just transport infrastructure?

Maastricht-Amsterdam, a 2.5 hour journey, day return, with NS Flex Dal Voordeel (ie off peak) is 37.44 EUR. That to me is insanely cheap. Surely fuel would be like 45 EUR, not to mention the cost of parking in Amsterdam? Maybe it's just because a similar journeys in the UK (Manchester to London) would be about 130 EUR. (Assuming I've understood correctly - you pay about 6 EUR a month for Flex Dal Voordeel and get a 4…

Yeah that's in off-hours, where you get 40% off. So that means it's much more expensive when you need to get to the office during office hours. And your office is not next to the station.

Certainly there are times when it is worth it, and for example 's Hertogenbosch - Amsterdam has a train every 10 min. That is hard to beat. But NS is under a lot of pressure and will get more and more expensive and less attractive as a result.

Re: Britain's railway privatization was an abject failure

#434
post #202

Earlier quoted context omitted.

How would you quantify the money lost by roads?

Same as for railroads.

Not even close. You can walk on a road, take a cycle, take a car. You effectively need no maintenance for the most part of it, or someone running something on it. 1 car, 1000 cars, there is no difference in 'running the road'.

On the railroad it is vastly more complex, with schedules, personnel that takes to run it, how many people end up using it. If one person rides in a train, it is a disaster and you literally lose money on it. If 1000s ride on it, you might be making money.

With roads that factor is almost non-existent, given that both take initial investment to build.

Re: Britain's railway privatization was an abject failure

#435
post #231

Earlier quoted context omitted.

It was that kind of delusional decision making that justified the privatization in the first place. Rolling out fiber nationwide in a world where the web had only just been invented and everywhere else in the world was connected via modems would have been catastrophically expensive and supplied bandwidth nobody would have been able to use. The idea the internet could have skipped straight from 33kbaud to fiber speeds…

> Rolling out fiber nationwide [...] would have been catastrophically expensive It seems like they had managed to bring the cost below copper: > In 1986, I managed to get fibre to the home cheaper than copper > we had two factories, one in Ipswich and one in Birmingham But the British government was concerned: > BT's rapid and extensive rollout of fibre optic broadband was anti-competitive and held a monopoly on a te…

Planning ahead wasn't the issue. The issue was rationality, or economics if you want to call it that. You don't want to build out infrastructure way in advance of demand, it's just bad engineering and would have imposed huge costs on the already crippled British economy for no gain. In the period we're talking about home computers don't speak TCP/IP at all, there is no web, the highest bandwidth users of the internet are email / IRC, hardly anyone is selling internet access to homes and the biggest sites have uplinks of a few megabits/sec at most. What exactly are they going to connect to over all this fibre? Online video wouldn't become practical for decades, machines of the time couldn't even begin to handle it even with infinite bandwidth.

No, Cochrane was an idiot, exactly the type of central planner privatization was good for getting rid of. Look at what he's saying.

> In 1986, I managed to get fibre to the home cheaper than copper

According to a guy who hadn't done it. How do you make building out an entirely new physical network cheaper than using the existing one? What was this magic trick he found that let him snap his fingers and instantly replace all the wires in the ground? That claim just wasn't true, was it.

Lots of things in that interview were very wrong. "In 1974 it was patently obvious that copper wire was unsuitable for digital communication in any form". The first patent for what became ADSL was filed in 1979. Internet access was rolled out across the existing copper network successfully for decades after that. His engineering skills were "obviously" not that great because DSL isn't an unintuitive idea, it just runs data at different frequencies on the same copper lines as voice. There were high bandwidth copper links in the 1970s already. There's lots of details involved to make it work well to consumer residences, but the concept is simple enough. He didn't research that possibility first because being a nationalized monopoly meant there was no downside to just playing with the coolest tech whilst ignoring economic rationality. He had no history of running a profit-making business, he'd spent his entire career in nationalized monopolies.

You can see the problem here:

> "It's like everything else in the electronics world, if you make one laptop, it costs billions; if you make billions of laptops it costs a few quid".

Since when do laptops cost a few quid? And the costs of FTTH aren't dominated by the cost of fiber and switches, WTF. The cost is all in the manual labor of rebuilding the physical network and upgrading the homes themselves. You can't manufacture your way to a cheap nationwide fiber network.

This kind of economic illiteracy is exactly what brought the British economy to the edge of total collapse in the 70s and caused voters to bring Thatcher in three times in a row (and maybe they'd have gone for a fourth if the Tories had let them).

Re: Britain's railway privatization was an abject failure

#436
post #419

Earlier quoted context omitted.

Just looked through DB's annual report. There's no mentioning of any passenger rail operations in UK. It's "just" DB Cargo. So I don't understand what this "fact" has anything to do with passenger transportation in Germany. By the way, Cargo is the mode of operation where most profitable rail companies are. Hence the dualism of loss-incurring Amtrak and profitable North Amercian freight operators as well.

DB Cargo is producing more losses than the other branches, i.e. passenger rail. It doesn’t generate profits like in the US (shorter trains, more single rail car traffic, shorter distances, infrastructure held up to higher standard thus more expensive, lower priority compared to passenger rail)

You're missing the point: it is still less loss incurring than passenger rail (and has been at least profitable sometimes, or in some markets).

Re: Britain's railway privatization was an abject failure

#437
post #417

Earlier quoted context omitted.

> Rolling out fiber nationwide [...] would have been catastrophically expensive It seems like they had managed to bring the cost below copper: > In 1986, I managed to get fibre to the home cheaper than copper > we had two factories, one in Ipswich and one in Birmingham But the British government was concerned: > BT's rapid and extensive rollout of fibre optic broadband was anti-competitive and held a monopoly on a te…

Hmm, I didn't realise that's why the rollout was stopped. (Which doesn't really make sense as a given reason anyway because wouldn't the fibre just have become part of openreach anyway. So I think new technology is generated through research funding, either public sector (universities) or R&D depts in private companies (today companies like Apple, previously old school companies like pre-Welch GE). I guess BT was mor…

> wouldn't the fibre just have become part of openreach anyway

The issue was the subsidies. The fiber plan wasn't going to be profitable then or maybe ever, so it was dependent on tax funding that competitors wouldn't have access to. BT had to become an economically rational company which meant tossing not only the fiber stuff but around half their employees too. Building fiber and then giving it to OpenReach wouldn't have helped BT become competitive.

Re: Britain's railway privatization was an abject failure

#438
post #7

Earlier quoted context omitted.

Don't know about britain, but generally a popular neoliberal thing with PPPs is to copy the private sector and "turn capex into opex". If you lease a road or school for 20 years, it doesn't show up as debt in your books, which the city has made necessary for itself, because it has saddled budgeting framework with some arbitrary debt caps that are constantly at the limit. This can be sold as a success story depending…

This isn't really true, running things in the government also cost a huge amount of opex. Sure you do get one time payment and the resulting company will have to be hired but it will usually also have to start to compete. This could potentially result in more or less opex. Running an airline just so you don't have opex seems a bit silly to me for example.

Well, the brits eventually decided against it after a thorough investigation found it to be a waste of money - "a January 2018 report by the National Audit Office found that the UK had incurred many billions of pounds in extra costs for no clear benefit through PFIs". https://en.wikipedia.org/wiki/Private_finance_initiative#End...

Another antifeature is the lack of transparency. The costs and operations of the private company aren't public, which means the public doesn't know if the quality problems are due to skimping on costs or mismanagement etc and don't get the feedback necessary for decisionmaking for subsequent contracts.

Regarding your airline analogy: my criticism wasn't about the private sector, my criticism was about copying it (poorly) in the public sector. There's things to criticise in the private sector side accounting incentives as well but it's a different kettle of fish.

Re: Britain's railway privatization was an abject failure

#439
post #434

Earlier quoted context omitted.

Same as for railroads.

Not even close. You can walk on a road, take a cycle, take a car. You effectively need no maintenance for the most part of it, or someone running something on it. 1 car, 1000 cars, there is no difference in 'running the road'. On the railroad it is vastly more complex, with schedules, personnel that takes to run it, how many people end up using it. If one person rides in a train, it is a disaster and you literally lo…

Roads, bridges, tunnels all need to be maintained, restored. And there is always the environmental damage that STILL has no price on it. Our Railroads are powered by "green" energy (a combination of Wind and Solar) and there is far less energy use and fine particulate production per person traveling [0]

That said, the equation probably comes out different for my country (the Netherlands) and the US. The Netherlands is more like New York than the US.

[0] https://www.ns.nl/over-ns/duurzaamheid/fossielvrij/groene-en...

Re: Britain's railway privatization was an abject failure

#440
post #22

It implies railways were les safe post privatisation. This is misleading. There were more accidents and deaths, but that was because of a huge increase in miles travelled. Deaths per billion kilometers fell consistently before and after privatisation. A lot of the problems lie in tracks and their maintenance, and the tracks were re-nationalised many years ago. It is not efficiently run (see HS2!). They are expensive,…

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