Tuesday, May 30, 2006

Trains, Public vs. Private

The whole transit strike thing in T.O. gives me an excuse to mention something I've been observing for a while, namely, how much better the trains are here.

In Canada, almost every large train company - and every public transportation system - is a government monopoly. Inside city limits, the business plan (if you can call it that) is to charge a flat rate for a lift anywhere inside the city. This is a great deal for commuters, because it keeps their visible costs low, but it ends up screwing over everyone who doesn't live there because their taxes inevitably end up bailing out that public transportation. Not only can it not turn a profit, it can't even break even.

This was the model in Japan up until the early 90s. Most of the trains were run by JR (Japanese Railroads), which became famous here for inefficiency, laziness, high prices, etc. When the bubble burst, any patience people had for JR vanished, and the entire thing was privatized. JR itself still survives - under its old name, no less - but as a private entity. Although there are other train lines (in Tokyo, the Keio and Odakyu lines, whose names translate as 'King Capital' and, mysteriously, 'Little Rice Field Fast'), JR remains the biggest, most expensive to use, and least efficient. There isn't really competition, except in very specific circumstances, due to the inherent economics of railways. Railways really are a natural monopoly, in that if you want to get a train somewhere you generally only have one choice; but Japan's experience shows pretty clearly that it doesn't follow that it should, thus, be a 'public' entity. The easiest way to see that? The business plan.

In Japan, when you take a train anywhere, you pay by distance. This makes the visible costs higher, but it also means that no tax money is required to support their public transportation, which I imagine (though lack the data and training to prove) keeps total actual costs significantly lower. At the very least, it means some hapless fisherman in Hokkaido isn't subsidizing the lifestyle of a Tokyo salariman (or, for that matter, a filthy gaijin such as myself.)


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