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A different Approach All together
Posted by ontheBNSF on Tuesday, September 25, 2012 6:58 PM

Not to obsess over subsidies but I view that FEDERAL (not local or city governments) government should get out of the transportation business. Because often when the federal government does things it often chooses winners and makes consumers loosers as a result. In my view federal transportation subsidies should just be done away including direct and indirect subsidies on all modes of federally supported transportation. Think about it this way how is a private rail company supposed to compete with the likes of Amtrak or subsidized airlines when they will have much of their costs covered by the government. In my opinion the only thing the government should do is regulate transit industry.

Amtrak: Discontinue it, sell routes and equipment to private investors. Long distance trips could be replaced by by long distance luxury land cruises owned by private companies, the Class 1's could operate it as a source of extra revenue and position it not as regular transportation but a luxury service similar to how cruise ships are operated. Short dense corridors could be built up by private companies in a similar fashion to the Private texas High speed rail or the All Aboard Florida service etc. 

Highways: End federal ownership of them and give ownership of them to local governments or turn them into private toll roads. Make it so they have to cover their cost because for the most part they only cover about 60% of their cost with tolls and gas taxes. Replace the gas taxes with a simple toll system that is proportional to the amount of cost, say a system that charges based on each exit and entrance you go through as a method of determining usage or distance. This applies to all transit modes, but remove the eminent domain power of government agencies which can effectively steal property for the purpose of transit project.

Air Subsidies: End subsidy direct or indirect. The most obvious thing is to get rid of essential air service. Privatize federally owned commercial airports and make air traffic control, security and other parts of the airport privately owned. A private institution could provide its own security or air traffic control.

Now ending the the partial private and public business model with a local and private business model would disrupt service for many people so a buffer period where property is sold off as to enable a smooth transition from the federally supported model to a consumer model. Ending such subsides would improve efficiency among all modes of transit, reduce cost to taxpayers, end corruption which almost always plagues government works projects, and present everything at its real cost. Presenting things at their real cost would enable the market to decide what mode of transit they want in a certain area and would enable transit to be used where it is best used. In the case of cities local roads and city rail systems are essential so those should remain in the hands of cities, but of course that is a local issue. 

  

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Posted by Anonymous on Tuesday, September 25, 2012 8:58 PM

ontheBNSF

Not to obsess over subsidies but I view that FEDERAL (not local or city governments) government should get out of the transportation business. Because often when the federal government does things it often chooses winners and makes consumers loosers as a result. In my view federal transportation subsidies should just be done away including direct and indirect subsidies on all modes of federally supported transportation. Think about it this way how is a private rail company supposed to compete with the likes of Amtrak or subsidized airlines when they will have much of their costs covered by the government. In my opinion the only thing the government should do is regulate transit industry.

Amtrak: Discontinue it, sell routes and equipment to private investors. Long distance trips could be replaced by by long distance luxury land cruises owned by private companies, the Class 1's could operate it as a source of extra revenue and position it not as regular transportation but a luxury service similar to how cruise ships are operated. Short dense corridors could be built up by private companies in a similar fashion to the Private texas High speed rail or the All Aboard Florida service etc. 

Highways: End federal ownership of them and give ownership of them to local governments or turn them into private toll roads. Make it so they have to cover their cost because for the most part they only cover about 60% of their cost with tolls and gas taxes. Replace the gas taxes with a simple toll system that is proportional to the amount of cost, say a system that charges based on each exit and entrance you go through as a method of determining usage or distance. This applies to all transit modes, but remove the eminent domain power of government agencies which can effectively steal property for the purpose of transit project.

Air Subsidies: End subsidy direct or indirect. The most obvious thing is to get rid of essential air service. Privatize federally owned commercial airports and make air traffic control, security and other parts of the airport privately owned. A private institution could provide its own security or air traffic control.

Now ending the the partial private and public business model with a local and private business model would disrupt service for many people so a buffer period where property is sold off as to enable a smooth transition from the federally supported model to a consumer model. Ending such subsides would improve efficiency among all modes of transit, reduce cost to taxpayers, end corruption which almost always plagues government works projects, and present everything at its real cost. Presenting things at their real cost would enable the market to decide what mode of transit they want in a certain area and would enable transit to be used where it is best used. In the case of cities local roads and city rail systems are essential so those should remain in the hands of cities, but of course that is a local issue.

Amen!  At last, a fellow traveler. 

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Posted by schlimm on Tuesday, September 25, 2012 10:26 PM

Other than the destruction of much of our road transportation infrastructure, another great libertarian idea! 

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Posted by John WR on Tuesday, September 25, 2012 11:25 PM

Why do you believe local governments would ever want to take on the Interstate Highway System?  Each locality would have a section where few of the users were its own taxpayers but it would have to bear all of the costs.  That would be a very expensive proposition.  Then, in the east where I live, our cities have to struggle to get along as it is.  Even if they were willing to take on the support of their interstates they couldn't afford to.  Rural areas with very few taxpayers would face similar difficulties.  What would happen  when interstates began to deteriorate and local government had no money to repair them?  I can't conceive of why any local government would accept responsibility for interstate highways that pass through its borders.  

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Posted by ontheBNSF on Tuesday, September 25, 2012 11:28 PM

schlimm

Other than the destruction of much of our road transportation infrastructure, another great libertarian idea! 

Sorry but how would it destroy our road infrastructure?

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Posted by ontheBNSF on Tuesday, September 25, 2012 11:30 PM

John WR

Why do you believe local governments would ever want to take on the Interstate Highway System?  Each locality would have a section where few of the users were its own taxpayers but it would have to bear all of the costs.  That would be a very expensive proposition.  Then, in the east where I live, our cities have to struggle to get along as it is.  Even if they were willing to take on the support of their interstates they couldn't afford to.  Rural areas with very few taxpayers would face similar difficulties.  What would happen  when interstates began to deteriorate and local government had no money to repair them?  I can't conceive of why any local government would accept responsibility for interstate highways that pass through its borders.  

There would also be the option of private ownership.

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Posted by cx500 on Wednesday, September 26, 2012 12:25 AM

"Highways: End federal ownership of them and give ownership of them to local governments or turn them into private toll roads. Make it so they have to cover their cost because for the most part they only cover about 60% of their cost with tolls and gas taxes."

But I don't understand why you say "Give".  They should be SOLD into private hands, whether owned by the Feds, the state or the municipality.  The new puchaser can then charge tolls and make a profit.  The various levels of government all win.  The seller gains a windfall from the sale.  Then the local municipality can tax the right of way and all the improvements such as bridges and interchanges, thus balancing its own books.  And of course the new owner will now have the responsibility for fixing pot holes and the like, so don't bother calling your local elected representative. The new owner also will pay income taxes on the profit he makes from operating the road. 

Of course your own neighborhood crescent generates very little traffic so the toll to drive to the neighborhood store will be punitive if the new owner is to make a profit.   Probably it will be closed and you will have to walk several blocks before reaching a road that is still in operation.  But it is hard to justify keeping the road open for just a few people, and the vast majority will never need to use your street.  And the new owners may decide the large tracts of land presently used as interchanges may be more profitably redeveloped with warehouses, theme parks, shopping centers or new residential subdivisions.

Yes. the preceding is mostly tongue-in-cheek.  Ending subsidies is a wonderful idea in theory.  But in reality many transportation subsidies are hidden, either calling them by another name or simply keeping the cost, or opportunity cost, off the balance sheet.  Railroads, since they are private in both fixed plant and operations, do not enjoy the same level of hidden benefits that most other transportation  modes do. 

John

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Posted by Anonymous on Wednesday, September 26, 2012 12:27 AM

It is certainly an interesting thought the OP expresses in his post, but I am afraid he has a rather simplistic view on a complex issue.

Following his idea would most likely bring the US back into the stone age, as the public infrastructure would just collapse. I can only suggest he´d do some reading - the most prominen material being Adam Smith´s "An Inquiry into the Nature and Causes of the Wealth of Nations"

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Posted by ontheBNSF on Wednesday, September 26, 2012 12:43 AM

Sorry I meant to use the word sell if I was unclear there. Anyways the profit made from selling federally owned properties could be used  as a means of providing loans for future transit projects. In my view James Hill's transcontinental railroad is an example of how the private sector does better it was one of the most efficiently built systems, it managed to survive while most of the other systems didn't. The great northern managed to be built completely by private investment. The great northern had no land subsidies, no politically influenced stops, and the route design itself was much more efficient that of rival transcontinental railroads. 

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Posted by henry6 on Wednesday, September 26, 2012 8:22 AM

We formed and have governments because there is a need for social structure and physical infrastructure to support all of us.  Our Constitution gives the Federal government the duty to oversee interstate commerce and business.  It was recognized then, and should be recognized now, that there are somethings that have to be done for the good of the country, its businesses and its people.  We put that responsiblity in the hands of our government.  Not everything can be or has to be capitalistic, private enterprise, somethings just have to be so that private enterprise can operate and succeed.  This is good for all the people.  Libertariansim does't seem to grasp this concept of how a society organizes itself to take care of itself, its individual and corporate citizens, in an orderly and, hopefully, even handed way.  Jobs are in big cites.  People live up to 100 miles a way from the center of the city but have to get to work.   A road, a railroad, a bridge or tunnel, built under government auspicies, helps the citizen get to and from work and helps the capitalist by making it easy for his employees to travel from an to home.  They all prosper by the pooling of resources under the umbrella of government.  We have also been taught that bigger is better, that having a four lane highway across a state is great, but works better if it hooks up to a four lane highway in the next state, and so on, so that you can link states and ther cities with other states and cities in a single lane of continuous pavement for speed and safety, and for preactical application of the technology.  LIkewise, air traffic control, and the regulation of interstate commerce, all come under the government operating for the good of its citizens and businesses.  Some could be contracted out but would still be paid for by the government.  We've got to stop stopping ourselves with definitions and fears, rhetoric and procrastinations, that wrap us up dialogue and argument instead of doing things that will make things happen.  Know where we've been and why.  Accept where we are and why.  Plan and act on where we've got to go because if we don't we won't.

RIDEWITHMEHENRY is the name for our almost monthly day of riding trains and transit in either the NYCity or Philadelphia areas including all commuter lines, Amtrak, subways, light rail and trolleys, bus and ferries when warranted. No fees, just let us know you want to join the ride and pay your fares. Ask to be on our email list or find us on FB as RIDEWITHMEHENRY (all caps) to get descriptions of each outing.

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Posted by Anonymous on Wednesday, September 26, 2012 8:30 AM

schlimm

Other than the destruction of much of our road transportation infrastructure, another great libertarian idea! 

All of the ideas ideas expressed by the author, which are potentially practicable solutions, have been espoused by people of different political persuasions.

The beginnings of the Interstate Highway System go back to the 1920s, when the notion of lighted, divided highways were developed. President Roosevelt was keenly interested in an interstate highway system and even laid out his vision for six highways that would cross the country from east to west. Apparently he saw the system as one supported by tolls.

The first segments of today's interstate highway system were toll roads. The Pennsylvania Turnpike, New Jersey Turnpike, New York State Thruway, the Ohio Turnpike, etc., which are part of the interstate highway system, were toll roads. The Pennsylvania Turnpike, at least, still is a toll road. Initially, until the politicians nixed the idea, the interstate highway system was to have been a system of toll roads paid for by the users without direct subsidies.

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Posted by Anonymous on Wednesday, September 26, 2012 8:55 AM

The federal government does not own any highways. The states control the federal roadways that pass through them. They build them and they oversee their maintenance. The federal government collects a variety of taxes from users and transfers monies from the U.S. Treasury to help pay for the federal highway system.  It also sets standards for the highways so that they are essentially the same from state to state.  But there are allowable differences, i.e. speed limits, pavements, etc. 

The federal government funds approximately 80 per cent of the federal highway system, with the states picking up the remainder, although in some locations the funding formula can be different. The federal highway system includes all federal highways. It is not just the interstate system.

The United States spends an average of $160 billion a year on roadways. Approximately 25 per cent of the monies are collected and distributed by the federal government.  The remainder are funded by state fuel and use taxes and property taxes.

Most of the roadways in rural Texas, the largest network in the nation, are funded by the state and counties through which the roadways pass.  The federal government has nothing to do with them.

The author is espousing what I have been saying from the get go.  Stop subsidizing all modes of transport and allow the best mode to emerge.  Subsidies distort the pricing mechanism and cause sub-optimum behavior, e.g. Americans tend to favor large, gas guzzling vehicles because the true cost of gasoline is not reflected at the pump.

Passenger rail probably can be viable in relatively short, high density corridors, without the need for massive subsidies if all transport subsidies are removed.  

I would have the federal government collect user fees (fuel taxes, fees, etc.) as it does now.  But I would make sure that it collects enough from the users so that it does not have to raid the general fund to make up any shortfalls.  I would also consider tolling the interstate system, as well as any other limited federal and state access highways. In fact this is what is being done in Texas because the federal and state politicians have been unwilling to raised the fuel taxes to meet the needs.  

It is not practicable to toll roads with open access, i.e. county roads, local streets, etc. I would pay for them with fuel taxes imposed on motorists at the pump, which would help reflect the true cost of driving, offset by a corresponding reduction in property taxes. This could raised the price a gasoline by $1 to $1.50 per gallon, which would cause many motorists to rethink the size of vehicle that they drive, how far from work to live, and whether public transport is a good options.  

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Posted by Anonymous on Wednesday, September 26, 2012 9:02 AM

Sir Madog

It is certainly an interesting thought the OP expresses in his post, but I am afraid he has a rather simplistic view on a complex issue.

Following his idea would most likely bring the US back into the stone age, as the public infrastructure would just collapse. I can only suggest he´d do some reading - the most prominen material being Adam Smith´s "An Inquiry into the Nature and Causes of the Wealth of Nations

No one knows whether the ideas espoused by the author would work. One thing is for sure however. If one does not give it a go, one will never know.

Adam Smith was speaking in generalities about transport infrastructure. He had no idea of what the modern transport system would look like. There were no cars, trucks, trains, planes, or even steam engines in his day.  

Referencing Adam Smith, who is long dead, is akin to referencing Thomas Edison for electric energy. His early visions laid the groundwork for electric energy in the United States, but no one I know believes that we should follow his views and methods with respect to our current system.  Most of my working life was spent in the electric utility business.

Suggesting that someone's views are simplistic or that he needs to read a treatise that is several hundred years old is a put down. If you disagree with the author's views, say so with specifics to support your point of view.  Saying that his views would put the United States back in the Stone Age adds no value.  

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Posted by Anonymous on Wednesday, September 26, 2012 9:17 AM

cx500

"Highways: End federal ownership of them and give ownership of them to local governments or turn them into private toll roads. Make it so they have to cover their cost because for the most part they only cover about 60% of their cost with tolls and gas taxes."

But I don't understand why you say "Give".  They should be SOLD into private hands, whether owned by the Feds, the state or the municipality.  The new puchaser can then charge tolls and make a profit.  The various levels of government all win.  The seller gains a windfall from the sale.  Then the local municipality can tax the right of way and all the improvements such as bridges and interchanges, thus balancing its own books.  And of course the new owner will now have the responsibility for fixing pot holes and the like, so don't bother calling your local elected representative. The new owner also will pay income taxes on the profit he makes from operating the road. 

Of course your own neighborhood crescent generates very little traffic so the toll to drive to the neighborhood store will be punitive if the new owner is to make a profit.   Probably it will be closed and you will have to walk several blocks before reaching a road that is still in operation.  But it is hard to justify keeping the road open for just a few people, and the vast majority will never need to use your street.  And the new owners may decide the large tracts of land presently used as interchanges may be more profitably redeveloped with warehouses, theme parks, shopping centers or new residential subdivisions.

Yes. the preceding is mostly tongue-in-cheek.  Ending subsidies is a wonderful idea in theory.  But in reality many transportation subsidies are hidden, either calling them by another name or simply keeping the cost, or opportunity cost, off the balance sheet.  Railroads, since they are private in both fixed plant and operations, do not enjoy the same level of hidden benefits that most other transportation  modes do. 

John 

The probability of ending transport subsidies is very low. The federal highway bill is one of Washington's biggest pork bills. The politicians are not likely to give it up.

The railroads get some hidden subsidies. Recently the Norfolk and Southern, as well as CSX, got ARRA monies to daylight some tunnels so that they can run double stack trains from the east coast to the heartland. They also got some low cost government loans. Also, the railroads pay no fuel taxes on the diesel that they burn, but the truckers with whom they compete pay substantial diesel fuel taxes, etc. I don't know whether they offset.  And this is the major problem with subsidies. At the end of the day most people don't know what who gets what.

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Posted by henry6 on Wednesday, September 26, 2012 9:22 AM

Sam1

The beginnings of the Interstate Highway System go back to the 1920s, when the notion of lighted, divided highways were developed. President Roosevelt was keenly interested in an interstate highway system and even laid out his vision for six highways that would cross the country from east to west. Apparently he saw the system as one supported by tolls.

The beginnings of our highway system go all the way back to Colonial times.  First with private turnpikes which were abandoned and taken over by governments or just lie uncared for.  Second, with the Federal Post roads desingnated and maintained to carry the U.S. Mail.  Then there were roads like the National Road blazed through wilderness so that people could trave west and goods so retruned.  A lot of the roads were infact, elnargment of paths both animals and Native Americans had used for hundreds or more years. Some were created out of military need: look at US Route 202 as it draws a semicircle around what we now call the Eastcoast Corridor, planned by Washington as a route to move armies and equipment around instead of through NY City, one of many such federal highway projections still in place today.   In the early 1900's there were attempts by states especially, to design and designate routes for the emerging automobile.  As truck were added by the 20's a need for interstate roads which were paved, came to the attention of the powers that be.  FDR's need to create jobs spurred on the building of these concrete paths.  There were some early forms of turnpikes built and operated by state governments at this time but really bloomed post WWII into the 50s.  Oil and highway interests played on Eisenhower's military experience to build the interstate highway system.  Our road and highway system has been an evolution and progession from before the arrival of Europeans in the 16h and 17th Centuries to today and not a system of less than 100 years development and use..

RIDEWITHMEHENRY is the name for our almost monthly day of riding trains and transit in either the NYCity or Philadelphia areas including all commuter lines, Amtrak, subways, light rail and trolleys, bus and ferries when warranted. No fees, just let us know you want to join the ride and pay your fares. Ask to be on our email list or find us on FB as RIDEWITHMEHENRY (all caps) to get descriptions of each outing.

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Posted by oltmannd on Wednesday, September 26, 2012 9:59 AM

Interesting ideas, but it's awfully hard to draw bright lines around who owns what or figure out what the unintended consequences might be.

I can see the intercity portion of interstates being converted to toll roads pretty simply.  But, the tolls would have to be pretty high if all the funding for them shifted from gas tax to tolls.  But how much traffic would be chased off onto parallel US highways?  What would be the safety impact?

As for air traffic control, who is the "owner"?  Commercial aviation?  The military?  Does the "tenant" pay the incremental cost of their traffic or do they have to pay a cut of the capital - even if they wouldn't need such a fancy system if it were just them?  What about general aviation?  What do they have to pay?

I've always thought that the US should "give" total responsibility for urban/suburban interstate highways to the states.  No need to involve the Feds on intrastate projects.  Let the states handle the funding 100%.  (Let them handle 100% of the transit funding, too) No need for the money to make a round trip to Washington DC.

As for private passenger rail - even with tolled interstates - I'm skeptical that you can find a private outfit to design/build/operate and make a profit. Some quickie back of the envelope guess at the FEC proposal leave me scratching my head.  Also, high density, high speed  corridors tend to only work when they have a subsidized feeder network in place.  These feeder networks share infrastructure with HSR operations.  Once again, drawing bright lines is difficult.

-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/

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Posted by John WR on Wednesday, September 26, 2012 11:33 AM

ontheBNSF
There would also be the option of private ownership.

The idea you suggest is unique not only in the U. S. but among all western governments:  That all transportation be privatized and regulated by the government.  To my knowledge, no country has ever tried it.  It is, as you point out, a completely new way to looking at transportation.  

Today your idea is not impossible as it was for many years.  We now have EZ pass.  With EZ pass every single road could be tolled; all we have to do is to require all vehicles to have EZ pass by a certain date and put up the devices to read EZ pass.  We could enforce the requirement easily.  When a car owner registers his vehicle each year he is charged for a transponder, an account is set up and he is sent a transponder in the mail.  Within a year ever single car on our roads would have EZ pass.  

Initially we could have the tolls go to the part of government that owns the roads.  However, over time we could sell off roads to private investors along with the right to collect the income the road would generate.  This would provide a huge input of funds into every level of government.  It would also rationalize our road system in that people would pay for roads in exact proportion to their use of the roads.  

No doubt problems would arise.  But problems arise from our present system of public ownership of roads too.  The problems would have to be addressed.  

The main argument I can think of against your argument is Abe Lincoln's definition of conservatism:  "Preference for the old and tried rather than the new and untried."  For your idea to succeed you would have to persuade enough U. S. taxpayers to form a consensus for it.  However, many would oppose it both in the private sector as well as the public sector.  Some opponents might be trucking companies who would encounter tolls on roads that used to be toll free, road construction companies with ties to government authorities that provide contracts to build and repair roads, automobile clubs over the toll issues.  Also legislators who do not want to give up power would oppose it.  So my question is how do you build a political consensus for your plan?

PS.  I was reluctant to respond to your post on this forum.  It seems to me that it has little if any relationship to government passenger service such as Amtrak.  The money we spend on Amtrak is only a drop in the bucket compared to our hugh investment in all of the roads of the country.  Were we to privatize roads most likely we would privatize Amtrak too.  But I think privatizing roads would never be acceptable to our citizens.  You raised the issue and, for what it is worth, you have my own thinking on but from here on out I will try to stick to trains.  

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Posted by Anonymous on Wednesday, September 26, 2012 12:16 PM

henry6

Sam1

The beginnings of the Interstate Highway System go back to the 1920s, when the notion of lighted, divided highways were developed. President Roosevelt was keenly interested in an interstate highway system and even laid out his vision for six highways that would cross the country from east to west. Apparently he saw the system as one supported by tolls.

The beginnings of our highway system go all the way back to Colonial times.  First with private turnpikes which were abandoned and taken over by governments or just lie uncared for.  Second, with the Federal Post roads desingnated and maintained to carry the U.S. Mail.  Then there were roads like the National Road blazed through wilderness so that people could trave west and goods so retruned.  A lot of the roads were infact, elnargment of paths both animals and Native Americans had used for hundreds or more years. Some were created out of military need: look at US Route 202 as it draws a semicircle around what we now call the Eastcoast Corridor, planned by Washington as a route to move armies and equipment around instead of through NY City, one of many such federal highway projections still in place today.   In the early 1900's there were attempts by states especially, to design and designate routes for the emerging automobile.  As truck were added by the 20's a need for interstate roads which were paved, came to the attention of the powers that be.  FDR's need to create jobs spurred on the building of these concrete paths.  There were some early forms of turnpikes built and operated by state governments at this time but really bloomed post WWII into the 50s.  Oil and highway interests played on Eisenhower's military experience to build the interstate highway system.  Our road and highway system has been an evolution and progession from before the arrival of Europeans in the 16h and 17th Centuries to today and not a system of less than 100 years development and use..

No one is arguing that government(s) should not play a role in facilitating the development of transport systems. The key question is whether they should subsidize them or whether the users should pay for them.  The other key questions revolve around the government's form of support, i.e. low cost loans, etc.

According to Earl Swift, who authored The Big Roads, the plans for the interstate highway system were laid down long before Eisenhower signed the Interstate Highway Act. The notion that Eisenhower's experience as a young military man resulted in the interstate highway system is a myth, although it may have influenced his decision to sign the bill.

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Posted by henry6 on Wednesday, September 26, 2012 12:31 PM

But ... if the government is charged by the people and their enterprises to provide roads, etc., because they need them, benefit by them, in effect are the users of them, then why should they pay again?  This is where I don't understand your defnition of privatising.  Private is private...an enterprise funded completely by private funds for a return on investment.  As soon as the government steps in with a subsidy or owns part of the system either the property or the operation, it is public whether it is 100% government or 1% government.   The government buys something from me or hires me to do a job because the public needs it or benefits from it.  Simple.  If private enterprise buys something from me or hires me, it is private enterprise and has nothing to do with government.  SImple.

RIDEWITHMEHENRY is the name for our almost monthly day of riding trains and transit in either the NYCity or Philadelphia areas including all commuter lines, Amtrak, subways, light rail and trolleys, bus and ferries when warranted. No fees, just let us know you want to join the ride and pay your fares. Ask to be on our email list or find us on FB as RIDEWITHMEHENRY (all caps) to get descriptions of each outing.

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Posted by Anonymous on Wednesday, September 26, 2012 12:34 PM

Investors would be reluctant to back a totally private passenger rail initiative because of the capital costs.  

Part of the game plan for the California High Speed Rail Project was to attract private investors in a public/private partnership. As far as I know, with the possible exception of some of the equipment and materials suppliers, who have a vested interested in the project, private investors have not been forthcoming.

Privately funded and operated passenger rail might be doable in corridors where they can rent space on existing rail lines.  It might even be doable if they have to contribute capital to upgrade the lines. I am think of the possibilities of using the existing line between Dallas and Houston. It is not doable if they have to tote the note for a 220 mph dedicated system.  And it is not doable unless the subsidies received by competitive modes of transport, especially the pump price for gasoline, are removed.  

As an aside, the federal airways system belongs to the people of the United States. The air traffic control facilities are deeded to the Federal Aviation Agency. The users cover most of the cost of air traffic control, which is an earmarked fund, through user fees. This is not to be confused with the Essential Air Services Program or the Airport Improvement Program that receive significant subsidies. Whether the users pay their proportional share of the air traffic control system is debatable.  

Contrary to popular belief, the majority of air operations over the United States is general aviation, as per the FAA.  General aviation is not just single engine airplanes. It is Fedex, UPS, DHL as well as thousands of business jets and prop jobs that are aloft every day and are using the high altitude control environment. Accordingly, the argument that the system would be far less expensive if it did not support the commercial airlines is debatable.  

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Posted by Anonymous on Wednesday, September 26, 2012 12:40 PM

henry6

But ... if the government is charged by the people and their enterprises to provide roads, etc., because they need them, benefit by them, in effect are the users of them, then why should they pay again?  This is where I don't understand your defnition of privatising.  Private is private...an enterprise funded completely by private funds for a return on investment.  As soon as the government steps in with a subsidy or owns part of the system either the property or the operation, it is public whether it is 100% government or 1% government.   The government buys something from me or hires me to do a job because the public needs it or benefits from it.  Simple.  If private enterprise buys something from me or hires me, it is private enterprise and has nothing to do with government.  SImple. 

If the government allows a business to use the tax code to deduct R&D expenses, is that a subsidy?  Is it no longer a private entity?  

I don't know of anyone who has said that the government has no role to play in transport or any other activity for that matter.  The question is who should operate the systems and who should pay for them?

I worked for an investor owned electric utility for most of my working life.  We were a private entity, but we were regulated by federal and state regulators.  That is the way it should be.  So does that mean that we were no longer a private entity because we were regulated?

The Norfolk and Southern as well as CSX run over the NEC, which is owned by governments. Does this mean that they are no longer investor owned, private businesses?

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Posted by schlimm on Wednesday, September 26, 2012 1:14 PM

These highly ideological/political discussions are supposed to be off-limits on this forum.

C&NW, CA&E, MILW, CGW and IC fan

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Posted by Anonymous on Wednesday, September 26, 2012 2:24 PM

schlimm

These highly ideological/political discussions are supposed to be off-limits on this forum. 

You introduced the term "libertarian" into the discussion.

Discussing the role for government in funding passenger rail, i.e. having a government agency run the trains as opposed to a public/private partnership or private exclusively is not political. Take that off the table, and in the extreme we would not be allowed to discuss Amtrak or commuter rail or any other facit of transport in the United States.  Each mode is influenced impacted by government.  

I favor alternatives to Amtrak. So do a number of others posting to these forums. Others believe that Amtrak should be strengthened in its current format.  There are pluses and minuses to both sides of the argument. To call that political is a stretch.

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Posted by schlimm on Wednesday, September 26, 2012 2:59 PM

I simply correctly called the post for what it is.  This thread is merely another exposition of the policies of a user-pay-for-everything political ideology.

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Posted by blue streak 1 on Wednesday, September 26, 2012 3:00 PM

IMHO this proposal would BALKANIZE the USA just as Europe was at the turn of last century. Each state on its own and no co-operation on anything from roads to rails.

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Posted by MidlandMike on Wednesday, September 26, 2012 3:07 PM

As has been pointed out already, there have been private toll roads since colonial days.  In the midwest in the horse and wagon days, farmers  maintained the the roads that fronted their property.  But even before there were cars, the "good roads" movement was started by bicyclist.  With cars, it became obvious that government would have to get involved.  It worked out well with gas taxes as a sort of user fee, until politicians figured they could buy votes by lowering gas taxes below the costs to maintain the highway system.  Even if the highways were privatized, as been pointed out earlier, government has a duty to oversee and facilitate transportation.  Politics would still get in the way as they try to regulate thousands of private road companies in a Balkanized highway system.  In a globalized economy, I can't see how a fragmented road system would be an advantage to this country.

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Posted by Anonymous on Wednesday, September 26, 2012 3:24 PM

blue streak 1

IMHO this proposal would BALKANS the USA just as Europe was at the turn of last century. Each state on its own and no co-operation on anything from roads to rails.

The central and state governments would have to play a strong coordinating role.  They would have to set route, construction, maintenance, health, safety, etc. standards.  Having said that, there is no reason why private enterprise could not build, maintain, and operate parts of the infrastructure.

There is no reason for Amtrak to have a monopoly on intercity passenger rail, although I believe up to two routes can be bid. There is no reason why the government has to own all the roads. In Texas, overseas investors have built or are building some toll roads.  There is no reason why the airports have to be owned by the government or air traffic has to be controlled by government employees. In Australia, as well as several other countries, the airports have been sold and air traffic control has been bid out to the lowest effective cost operators with good results. And also in Melbourne, Australia, the commuter rail lines, trams, and bus routes have been privatized, with subsidies to be sure, and with very good results.

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Posted by Phoebe Vet on Wednesday, September 26, 2012 3:51 PM

I don't use it, so the government shouldn't be involved in it.  Let the people who use it pay for it.  Now where have I heard that before?

Try to picture a world where all roads are toll roads and the airlines have to operate the air traffic control system.

Dave

Lackawanna Route of the Phoebe Snow

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Posted by Anonymous on Wednesday, September 26, 2012 4:15 PM

Phoebe Vet

I don't use it, so the government shouldn't be involved in it.  Let the people who use it pay for it.  Now where have I heard that before?

Try to picture a world where all roads are toll roads and the airlines have to operate the air traffic control system. 

Who said anything about the airlines operating the air traffic control system?  

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Posted by Phoebe Vet on Wednesday, September 26, 2012 4:47 PM

Sam1

Phoebe Vet

I don't use it, so the government shouldn't be involved in it.  Let the people who use it pay for it.  Now where have I heard that before?

Try to picture a world where all roads are toll roads and the airlines have to operate the air traffic control system. 

Who said anything about the airlines operating the air traffic control system?  

 

That's odd.  I could swear he said that the government should get completely out of the transportation business and privatize everything.  Isn't ATC part of the transportation infrastructure he wants to privatize?

Dave

Lackawanna Route of the Phoebe Snow

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