TELECOM Digest OnLine - Sorted: Re: Clean Technology Bigger than Internet Claims Bill Joy

Re: Clean Technology Bigger than Internet Claims Bill Joy
21 May 2007 10:14:45 -0700

On May 17, 8:20 pm, wrote:

> There is no place in the world where public passenger transportation
> does not require a subsidy; in most cases, outright operation by a
> governmental entity.

Highways (and airways) require a general subsidy too, but it is
unknown because it is indirect and buried in other accounts:

Highways and airports take up enormous amounts of land. Land is
taxable, but when a highway or airport grows, that land is taken off
the tax base. That's quite a nice subsidy. When transit was provided
by private companies, they had to pay very high property taxes where
their competition paid nothing.

Highways require extensive public safety services -- police, fire,
rescue -- that is generally paid by local residents, not the users of
the highway. On serious accidents, quite a few public safety
responders and their equipment are tied up assisting in cleanup and

Highways and airports were built with tax free safe bonds which
accordingly paid low interest. Transit systems were built with
private bonds that had to pay a much higher interest rate. The Fed
picked up the difference since the bonds were income-tax free. Note
that to this day many psgr rail facilities are still on private land
that is taxed.

Until about a few decades ago, private passenger trains were tightly
regulated and forced by the government to run unnecessary services or
charge fares too low to cover expenses. This hurt the system. When
such systems became public there was substantial rebuilding necesary.

Passenger train carriers have been hit hard with modern day
requirements, such as PCB and asbestos abatement of their inherited
infrastructure and handicapped accessibility reconstruction. All of
that is very expensive.

> Also, rail transit systems are tremendously expensive to build in
> established cities.

As are highways. The Big Dig in Boston cost $25 billion.

Transit lines have the advantage of being about to snake around things
and be underground, something impractical for most highways.

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