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, but that is partly because rail workers are well paid. Train drivers can be paid as much as aircraft pilots. Their ability and willingness to strike affects both costs and people's willingness to rely on public transport.
The big constraint is lack of subsidies. it probably makes little difference whether the system is privately owned but tightly regulated, or publicly owned so much as willingness to subsidise it. This is also shown by the failure of franchises taken back into public ownership to improve.
This is incorrect. The biggest accidents - Potters Bar, Hatfield, Southall - happened in the years immediately after privatisation, before passenger numbers had grown much.
The problem was more that - in typical privatised fashion - the industry was treated as a cash grab, and property speculation and other side quests got more management attention than running a safe railway.
That first incarnation was so bad it was quickly nuked, and replaced with the hybrid arrangement we have today, which has a much better safety record, but is still comically expensive and inefficient.
And franchises very clearly have improved, so that's incorrect too. Delays and cancellations are down across the network, and that's before the system is reintegrated.
The biggest disaster of privatisation was the loss of more than a century of engineering and management culture and knowledge. The UK invented tilting train technology, and it was given away to foreign corporations instead of being licensed and exploited in the UK.
This is the pattern behind all UK privatisation. Foreign countries and shareholders benefited hugely, while prices of essential services exploded, and service quality degraded.
> The biggest disaster of privatisation was the loss of more than a century of engineering and management culture and knowledge.
That's always the loss. In privitisation, in out-sourcing, and in downscaling engineering teams by firing senior engineers. And it's great for the those in charge of the budget cuts, because it is a loss that is very difficult to quantify financially, and will only show over a longer period of time. Typically, well after they cashed-out and left.
My commentary is this: It looks like around 1982, the trend reversed, well before the privatization. My takeaway is that whatever the government had done under nationalization was successful at addressing the concerns that existed and contributed to a downward trend that began before nationalization.
The British rail privatization was so successful in increasing passenger numbers it also increased the number of passengers taking the train in France (despite French rail still being state-controlled).
Or maybe, just maybe, there's another underlying casual relationship that explains why train use increased a ton in the 90s and 00s in both countries (and other European countries too, by the way, AFAIK passengers count also increased in Germany in that period). Who knows.
Much of the French high speed rail network (LGV Atlantique,
LGV Rhône-Alpes, LGV Nord,
LGV Méditerranée,
LGV Est, etc) was inaugurated in the 1990s and 2000s.
This alone would have been responsible for a big increase in French rail traffic.
UK rail infrastructure certainly received improvements during this era too, but besides HS1 it was mostly just renewing and upgrading existing tracks. Nothing like the thousands of km of new high speed rail that was built in France!
> The conclusion from the analysis of the accident data is that there is no evidence for the hypothesis that railway safety, as measured by accidents, has become worse since privatisation.
This article was written in 2007, just a few years after Network Rail was re-nationalised in 2002.
Since 2002, there has only been a single passenger fatality attributable to poor maintenance: the Grayrigg derailment in 2007.
This followed a cluster of high profile crashes during the Railtrack (privatisation) era in 1997-2002 that killed dozens, and were directly or partly attributable to poor maintenance.
I’d argue that the longer Network Rail’s good safety record continues, the more we can disregard that article.
Read the bottom of page 17 and page 18 of the article I linked to.
Given where it was published (a magazine backed by statisticians associations in three countries) it would have been very damaging to the author's (a professor at Imperial College) reputation to have been sloppy about conclusions.
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 reliably the further they get from concrete death records.
From the start, in 1994, there was this arbitrarily imposed structure with Railtrack owning all the track, and all the private companies leasing. The original plan was that this Railtrack thing would be publicly funded, and that's where that structure came from. Slowly over three years, then, the railway went private. Railtrack wasn't private until 1996. Then the railway was "properly private," but not really, because of this track-monopoly structure imposed on it by legislation, Railtrack being in effect government-run and a "private" company somehow too. Five years later (2001) there was bankruptcy, administration and re-nationalization of Railtrack (into "Network Rail") anyway.
Lurking in the background the whole time was the RMT, the National Union of Rail [etc.] Workers, led by "communist/socialist" Bob Crow, a moderate in the union.
So if this is viewed as an experiment in private ownership, experimental conditions were extremely messy and any conclusions are invalidated by cultural complexities and compromises.
> This is the pattern behind all UK privatisation. Foreign countries and shareholders benefited hugely, while prices of essential services exploded, and service quality degraded.
No kidding.
But of course, never underestimate the motivated reasoning of an HN user. After all, somebody made money off of the privatization. That could've been you, and you like making money, right?
There is a middle ground that is quite common across Europe: a private company that has the government as a shareholder. I think it is reasonable for subsidies to be structured just like private investments rather than a donation. The public should reap the rewards of the money they invest in their country through taxes, just like wealthy investors do.
It's a question of perspective. I've spent my life in countries where I've seen my taxes being spent relatively well, I feel the benefits of it daily both as a private citizen and a founder. Everywhere I've lived, when transport, utilities, healthcare and education, even part of the media, were publicly managed, they were simply better and cheaper.
But I understand that this is not universal and that most governments don't operate effectively for their taxpayers. And that, yes, if the whole system is set up for it, private solutions can also thrive and be superior. I suppose it's hard to privatize public services effectively in an ecosystem that doesn't support private enterprise as much.
That's interesting: it reminds me of the results we're seeing from workplace democracy in Germany.
Companies with workers on their boards are significantly less likely to go bust than companies where only investors' opinions matter.
But of course, whenever someone else's opinion matters, investors use their wealth to try to change that. Rich people seem to prefer worse outcomes as long as they get to be in charge.
Yes of course but there are downsides to this too. Workers will certainly prioritize survival and stability, but sometimes at the expense of innovation, efficiency and growth. They do not really have an incentive for the company to do better, but they definitely don’t want to lose their jobs or make them much more difficult.
For most established companies it is really not much of a challenge to prevent it from going bust if that is your priority, but it requires sacrifices, mostly opportunity costs.
>There is a middle ground that is quite common across Europe: a private company that has the government as a shareholder.
Becoming more common in the US too, because of Trump's policy of US re-industrialization and national security. Intel Corp (10% equity), MP Materials (15%), Lithium Americas(5%), Trilogy Metals (17.5%), US Steel (golden share), Vulcan Elements, ReElement Technologies
Obama used loan guarantees and grants, not equity stakes.
Solyndra $500M loan guarantee (defaulted 2011)
Tesla $500M loan (repaid early 2013 with interest)
First Solar $3B loan guarantees (currently being serviced)
SunPower $1.2B loan guarantee (bankrupt 2024 but loan repaid)
ARRA (2009) $25.6B grants disbursed
No equity positions taken. Trump's policy is direct equity stakes as condition for industrial subsidies/tariff relief. It's statist, but I wouldn't call it communist.
A lot of the things the administration is doing seem a bit socialist because socialism has some overlap with populism. The main difference is that it is framed as Trump doing favours to certain groups of people, with expectation of reciprocity or at least personal gratitude and loyalty, instead of more institutional wealth redistribution or subsidy policies.
Depending on who he is doing favours to, it looks right-wing or left-wing under the traditional political lens, but it's more about Trump doing whatever he wants with the governments resources.
> There is a middle ground that is quite common across Europe: a private company that has the government as a shareholder.
Interestingly, Quebec in Canada has been loosely following this model recently and it's working great. Long video but interesting if you like infrastructure stuff:
TLDR: CDPQ invests on behalf of the Quebec Pension Plan, and has been building infra on behalf of the pension plan across Quebec (and Canada) to great success comparatively.
Sure but pensioners care about consistency vs. gross returns. You really don't want your pension to lose a ton of value in a downturn because people are constantly drawing from it, it's a risk off investment. Bonds are also poor investments compared to an index fund from a gross return perspective, but that's not why people/funds buy them, they buy them to lower risk.
Maybe so, but I would contend it is worth considering the broader implications of those investments and the effects that new and upgraded infrastructure could have on the greater economy.
Speaking only for myself, I would be okay with a lower return if it also means we as a society have good public transit, roads that aren't more pothole than asphalt, water that doesn't have to be boiled on occasion, reliable power, modern internet, and so on.
> There is a middle ground that is quite common across Europe: a private company that has the government as a shareholder.
This is in fact the situation in major parts of the UK rail network now; much has been renationalised or has the DoT as sole shareholder.
The UK rail system is not now truly privately held; this has been slowly unpicked by both the previous Conservative government and the current Labour government.
Nearly a third of Train Operating Companies are now under state ownership; LNER has been state-owned since 2018 and Northern since 2020. I don't know about LNER, but punctuality and reliability on Northern has significantly worsened since nationalisation.
Last year, we had the absurd spectacle of the Department for Transport notifying the Department for Transport that the Department for Transport had breached their contract with the Department for Transport, because the Department for Transport didn't meet the performance standards set by the Department for Transport.
> They are expensive, but that is partly because rail workers are well paid
This is in fact an interesting by-product of privatisation: train drivers became rarer due to shareholder reluctance to train and recruit them. They consequently became more expensive. A somewhat fun side effect of the free market, especially given the prevailing assumption that moving public sector employees into the private sector would drive down their pay and conditions.
The idea is usually to de-skill workers and also to try to make their contractual terms worse.
In one very small way I actually sympathise on the railways, let me be specific, this is a long story:
The person driving the train clearly needs to learn how to drive that particular model of train, I think that's likely true basically everywhere. The UK's railway systems are however also reliant on drivers knowing the route. A driver must be familiar with exactly the rails their train will pass over to get from A to B, knowing what to expect ahead for some distance at all times. So it's possible that Jim, who is sat in a coffee room right now can drive a 450, but he doesn't know the Waterloo to Portsmouth via Southampton crazy bypass that's in place due to track work, so he is not able to drive the Portsmouth train that's right there, full of passengers and will now instead be cancelled because the scheduled driver did not arrive. In many of the world's railway systems route knowledge is not crucial (it might be good but it's not required).
However, because of https://en.wikipedia.org/wiki/Ding-ding,_and_away the modern rulebook also requires that the Guard have route knowledge. In contrast to the driver this is much less valuable, but it means that now your Portsmouth train maybe has to be cancelled because although the driver intended was available or the standby could do your route, the only available Guard knows the ordinary Portsmouth route, not the weird one.
I think this is a situation where we should fix systems instead rather than hoping that route knowledge for guards makes it work. But this means the guard is arguably de-skilled and less valuable than before.
Most European railways require a driver to have done some route familiarization for most routes, which tends to work fairly well. What does not work very well is that the UK has very patchy and antiquated train safety systems (AWS / TPWS are somewhat rudimentary and deployed - by far - not everywhere) and signaling. Even speed restrictions in the UK are placed very, very tightly and you better know them by heart because they didn't get placed with the idea that the driver must have sufficient time to reduce speed / react between where they get a warning signal and where the restriction comes into effect.
I suspect the move from public to private ownership did adversely affect the upgrades of those, as well as electrification on several key routes.
If I remember correctly they do not even have something as basic as an electronic coursebook - which became mandatory in Germany in the 90s already. And at least in NL if you have a set of routes in a certain direction / route set - drivers would get route familiarization both for the main routes and for the bypasses.
It's pretty much global fwiw. I wrote route qualification software for places outside of Europe.
It should also be made clear that you don't need to get an actual qualification from a bureaucratic org. You basically just need to document the last time the driver drove the route with another qualified driver and then document that they've kept the qualification up to date. It's a documentation process and just not that onerous. Also absolutely required for any railway since trains don't stop or accelerate quickly. You need the drivers to know what's coming ahead and no amount of signage or signalling can beat knowing the route.
The only concern i have is the guard qualification. That does seem overboard but... i don't know the UK and chances are there's nuance to this. So i'd have concern with anyone reading GPs post and thinking this is the cause of UKs railway inefficiency.
Assuming it’s similar to every other country; Route qualifications simply require first driving the route with another qualified driver. Once that is done you need to drive the route once every 6 months (this is in Australia ut i assume it’s the same) to keep that qualification up to date.
It’s not particularly onerous and understandably helpful for vehicles that take a long time to adjust speed.
The guard requirement does seem unnecessary though and is not a universal practice globally.
What makes knowing this route any more difficult than knowing the route you are driving on a road? Copenhagen has an automated metro system, so this doesn't seem like a particularly difficult problem.
So e.g. the UK does not have speed signalling. One yellow lamp illuminated means "Prepare to find the next signal at danger". OK, so, how fast can I go? Well, it depends, your route knowledge might tell you that the "next signal" is up a steep rise, you can go pretty fast, even if it is at danger that rise will scrub off all the speed and normal braking is enough. Or, you might know that there's a sharp bend soon and so even moderate speed is excessive because you'll de-rail on that bend.
In daylight there are speed signs but, trains accelerate and brake much more slowly than your car, so while they're a useful reminder you cannot correctly drive the train based on observing these signs. At night you may not see them at all.
Then does your route diverge? In some cases the intent to diverge is signalled, unlike speed, Flashing double yellow for example means "Prepare to find the next signal at: Prepare to find the next signal at danger" plus "Your route will diverge". However you really need to prepare some distance in advance of this information anyway in some cases, so you need to know, long before the signals and certainly long before being able to actually see it, that you will make a turn.
The UK also has unsignalled stations - places where a passenger train will ordinarily stop, and must obey signals, but there are no starting signals, so you need to remember whether you were under a cautionary signal say five minutes ago, which still applies now, even though meanwhile a dog escaped, some idiot threw yoghurt at people and then two hundred soccer fans boarded your train.
The "Driver's Reminder Appliance" is meant to help with this last part, it's basically just a button you can push, to remind you that you pushed the button and restore your mental state...
> In daylight there are speed signs but, trains accelerate and brake much more slowly than your car, so while they're a useful reminder you cannot correctly drive the train based on observing these signs.
Did the time it takes trains to accelerate and brake change recently? The time it takes to accelerate and brake should have been considered when placing the signs in the first place.
That ding, ding and away issue seems straightforwardly solvable with a small amount of technology (the train could refuse to go without the signal saying it’s okay) or something like the Japanese pointing and calling system, or even both.
Frankly, something like positive train control or the European Train Control System should be table stakes at this point. It should be difficult or impossible for a driver unfamiliar with a route to cause a crash.
> It should be difficult or impossible for a driver unfamiliar with a route to cause a crash.
This is a question that's occurred to me in a different context. In Shanghai, there are subway stations where the passenger area is separated from the tracks by a floor-to-ceiling wall, making it impossible to drop something onto the tracks, fall onto the tracks, or get pushed onto the tracks.
There are also stations where there's no wall, and anyone can just shove you onto the tracks at any time.
The presence of a wall is highly predictable: newer stations have them, and older stations don't.
Should the older stations be renovated? That would be an increase in safety. It would also be a pretty substantial expense to address a mostly nonexistent problem. The wall is a good idea and it makes sense to include it when you're constructing a new station. But that doesn't mean it makes sense to add it to an existing station.
Is that true? My understanding is they command very high wages because their unions are strong and they have a lot of leverage: by striking they can impose extremely high costs on the wider economy (not to mention bad press for politicians).
Yes. This was literally a case study for my Sociology degree in the '90s.
(I would also mindfully say that there is a lot of subtle political propaganda in the UK around this issue- the powers that be want the public to blame train drivers for the failures of privatisation)
That doesn't convince me. Companies commonly handle situations like this just fine. I know because I have seen it. I think you are the one who fell for the propaganda here.
But you haven't made an argument, so you're in no position to criticize. You asserted that "train drivers became rarer due to shareholder reluctance to train and recruit them" and then didn't back this strange claim up, just said "I'm right" in different words. A sociology degree isn't convincing btw.
Companies may or may not handle strikes properly. If it were that easy, industrial interests (and their emissaries, like Reagan and Thatcher) would not have spent more than a century trying to break unions.
Our ports in the US, which affects the cost of endless goods, are still running with 1950's level tech because the unions are so strong (and have heavy mob ties).
> You try it, you get a visit. Same way it's always been.
In that case, there's no obstacle. This is exactly what happened with containerization, and guess what? The ports that did containerize, including some ports constructed from scratch specifically because existing unionized ports blocked containerization, replaced the ports that didn't.
My understanding is that the mob extracted large payments in order for containerization to be permitted. Some half of the time they just live on container royalties which are exactly the mechanism the mob used for extraction.
So sure, there's no big deal, just pay the mob. People do argue for that.
Any evidence mob lives off container royalties? And what are container royalties to begin with???? (I had no idea when I borrowed a container for moving I was paying royalties.)
My problem with people asking for evidence is that they often are expecting me to do a lot of work to give them a better world model, when they nonetheless have no intention of accepting any evidence.
So I have a guideline of good faith: you can hire me and I don’t mind doing it for you; or you can go read up on the subject, reach some understanding of what these things are, and we can discuss; or you can go do some research of equivalent value to me and bring that to me as a barter[0].
Otherwise, it’s really not a big deal to me if you don’t believe something that’s true.
0: for the moment, I’m willing to trade for the DNA height model that some people claim exists. If you can find it for me, I’ll find you some sources for container royalties.
I want someone who cares to be driving the train I'm on. They also require in person participation which make outsourcing hard. I'm fine with self driving when the line is designed for it. It will be a very long time before existing lines are self driving, and its not because on unions.
Not really sure why people like moaning about train drivers. Are they jealous a train driver is making more than them? While in the case of tech workers they sit quietly and watch their £65k jobs go to India.
Definitely an interesting wrinkle. I wonder, though, if it's still cheaper to have extremely overworked but well paid staff, and few of them, versus adequate staff and normal pay.
> Train drivers can be paid as much as aircraft pilots.
Yes and that's as it should be, a fully loaded high speed intercity train has more souls on board than most commercial aviation planes (apologies pet peeve of mine because our media keeps banging on about how "overpaid" train drivers are when in reality their pay is fair for the responsibility it's everyone else who is underpaid).
A bad day at the office for me is I break production and cost the company some money, a bad day at the office for them is considerably more serious - it's a lot of responsibility.
A train may have more people on it, but it does have the luxury of being able to just stop when there is a problem. Airplanes not so much. Copenhagen has had an automated metro system for decades now. Train drivers aren't even strictly necessary anymore.
Each have their on individual problems. An aircraft’s ability to avoid obstacles is a massive benefit over a train’s only option being to very slowly come to a complete stop.
Train drivers are mostly obsolete. More than 20 years ago full self driving trains became a reality in several areas. Since a train cannot stop if something is on the tracks anyway, we can ignore safety issues. The computer tells the track to switch, and then the train to go when the track is clear. When it is time to stop the computer stops, and the doors are exactly in the right place to align with the doors on the platforms.
An automated train is better for everyone. So if your system doesn't have it they should be investing in getting it.
In some cases you need safety people at the platforms, or on the train, but their only useful control is the stop/go button.
What happens if signalling or mechanical failures occur and manual intervention is required? I will collapse the network, that’s why you see conductor-less operation only in separated environments, like subways (Nürnberg) or DLR (London)
We had a mass attack on a train recently, the driver radioed ahead and got his train shifted onto a different line so he could stop the train at the nearest station (which had a police station across the road).
That's the kind of thing that is hard to automate because while you can automate any routine operation (eventually) it's the none routine things that get you.
Planes and Trains have both had increasing levels of automation for decades and that's fantastic, humans are flawed/get tired/get distracted but you still need a human in the loop who can decide what to do when the unknown/unexpected happens and for that human to be effective they need to be able to operate large parts of the vehicle without the automation and understand the basic principles of the system as a whole well enough to decide what they should do that won't make the situation worse.
In planes that's the Pilot in Command, in Trains it's the driver.
Anyone with even a rudimentary understanding of railway operations knows that this isn't at all true.
For example, I've been on a Glasgow bound train where the driver was instructed to pass the signal at danger following a lengthy signoff process. Some scallywags had stolen wire for copper.
But trains are inherently safer (or at least, they should be).
If the train driver falls asleep and the train is about to go where it shouldn't, then safety systems should kick in and halt the train automatically. This is not possible (to the same extent) in airplanes.
This is something I have a hard time squaring away.
A train will likely always need to be manned, there are, in fact, checks that have to be made by a person and can't be made by a computer.
However, it seems like the part of actually driving the train could be nearly completely automated. The train is on a rail, about the only thing a person is needed for when the train is in motion is to push a stop button if things go wrong. Things like speed and indeed even a decent amount of visual checks could be automated based on location.
> I'm against trams because a bus can do the same thing - and if you maintain the roads to track standards they are just as comfortable.
But buses can't do the same thing.
The thing about LRT is capacity per driver. Even the fanciest, most expensive buses can take maybe half the passengers a standard 30-40m tram can. It's not even a competition. That alone makes trams win every time there's enough population to fill that capacity. Even if you wanted to pay for three bus drivers rather than one tram driver, you can simply not put enough buses on the same route to make up for the difference. Even if said route is independent of other traffic, which it never ever is.
Rail transport always has high up-front costs but low operating costs. But a BRT system truly designed to rail standards would cost almost as much as just building a frigging LRT system. And if you do the sensible thing and choose overhead rather than battery power – well, there's a reason trolleybus rapid transit systems do not actually exist. There's zero reasons you'd want such a thing rather than light rail.
Trams benefit greatly from being mature technology with economies of scale. There's a lot of knowledge in the world on how to build great rail infrastructure and how to make great LRT vehicles at a scale. There are maybe two companies in the world that make BRT vehicles, and no matter how excellent the infrastructure, the service lifespan of a bus is less than half that of a tram.
There also exists this thing called "rail factor". No matter how fancy your bus system, an equivalent thing but on rails will always attract more passengers, especially from demographics that would otherwise not use transit. Whatever the reason, this effect can not be ignored given how important it is to attract new transit users. Steel on steel is simply always more popular than rubber on pavement when it comes to transit.
In almost all cases you don't have enough passanges to fill a large bus though. And in most of the cases where you do you should be paying 3 drivers to get three buses because that increased service is highly valued by riders. Long before you reach the end of that a grade separeted metro that can go faster that a bus or tram should be built thus getting mose people off the but. Only a few places in the world are left after the above where you need more than a bus can do at grade level (which implies a lot of short trips), but if you are in one I'll grant a tram is needed.
the 'rail factor' is claimed often - but I've never seen it put to a fair test. When you give the train better service of course people choose to use it.
Yeah, you need a pretty high population density before you get to the point where rail makes sense. That said, having rail connecting major metros does make sense generally, especially with how often people travel.
In the UK, I had to take a train from Preston England to London (2004ish). It was absolutely packed. A good reason for that is the ticket price was about 60 gbp and the trip took 3 hours (IIRC).
That's where I think the US should both invest and subsidize. There's a lot of air travel that could be replaced with rail travel if the US rail wasn't so terribly ran. It usually costs more than an airline ticket (which is crazy) and often takes a lot longer due to delays waiting on commercial trains. A lot of that can be fixed by regulating commercial rail shipping (for example, limiting train length). But also building new dedicated highspeed lines between major metros. There's no reason you shouldn't be able to make a trip from Seattle to Florida in under 48h by rail and for less than $500.
I do not like this argument. Margins in most businesses are not very high. There is thus physically not enough cash to raise wages very much. Driving a train is less difficult than a plane, and trains have much worse margins due to lower ticket prices, so we should expect wages to be less.
Well, that and people don’t keep on turning themselves into a red paste on the front of your server rack. I’ve heard some fairly harrowing stories from a train driver that made me think all the money in the world wouldn’t be enough to get me to do that job.
Hang on a minute. How do you square your claim that it's as it should be that train drivers can be paid as much as airline pilots, with your claim that everyone else is underpaid, including, presumably, airline pilots?
Hang on a minute. How do you square your claim that it’s as it should be that none of us crabs should be in the bucket, with your claim that including, the crab closest to the edge of the bucket, presumably, should be climbing out of it?
EDIT: Oh, I think I understand what you mean. If I've got my understanding correct then my response is that noir_lord said that one of the crabs shouldn't be climbing out:
They are been pedantic by pointing out that the set "everyone else" excluding train drivers would still include pilots rather than reading it as intended which would conventionally and implicitly exclude pilots.
The "everyone else" is not meant to be read literally.
Many people are well-paid, or even overpaid. CEOs, for instance.
It's just that most people, in most common professions, are underpaid.
It only makes sense to talk about a blanket statement like that being a "contradiction" when someone is attempting to speak in the language of formal logic or detailed argument, not colloquial speech.
That's fine, then the response I was looking for is simply "I didn't mean literally everyone else, I just meant simply 'most people, in most common professions, are underpaid'". That's a perfectly valid point of view.
Then I would have replied that, despite perhaps being true, I don't how it's relevant to the question of whether it's fair to pay train drivers and pilots the same.
> Hang on a minute. How do you square your claim that it's as it should be that train drivers can be paid as much as airline pilots, with your claim that everyone else is underpaid, including, presumably, airline pilots
What is inconsistent about those two things?
You can simultaneously believe that train drivers and airline pilots deserve to be paid more.
Maybe I am, so let's stick to exactly what noir_lord said
> > Train drivers can be paid as much as aircraft pilots
> that's as it should be
I understand this to mean that it is fair that train drivers are paid as much as airline pilots.
> in reality their [train drivers'] pay is fair for the responsibility it's everyone else who is underpaid
I understand this to mean that train drivers are paid fairly, and everyone else, including pilots, are underpaid, i.e. it is not fair that airline pilots don't earn more than they currently do, i.e. as much as train drivers, from which I conclude that it is not fair that train drivers can be paid as much as aircraft pilots, in contradiction to the first claim.
Something you are not accounting for is that rolling stock is fully private still, and a huge huge chunk of the profits. Operators don't make much money, the govt owns and runs the rails themselves, but the rollling stock is where a lot of the money goes
Well, what do you expect? Rosa Luxemburg Stiftung is a far-left NGO (the N stands for "Near"), the official trust of the German political party Die Linke.
HS2 is nothing to do with the nationalised rail maintenance, that's just an example of the inability for the UK (and indeed most of the western world) to build large projects, a lot of corruption, a lot of outsourcing, and an infinite money tap.
Profit is literally the return on investment. Would you invest your money in a startup that guaranteed no profit?
Profit is essentially interest. The only reason new and growing companies get funded is because the EV of future profits (including the probability of losing everything) is higher than just stuffing that same money in S&P 500.
As a Scot who travels on Scottish, English, and Welsh railways, and on Swiss and German railways... Scotrail (now in Public ownership) is pretty good. And I say that as someone in the Highlands, which has had the worst of it in the last 30 years. There's been recent investment, and even the re-opening of closed lines and finally new stations where they've been desperately needed (Inverness Airport, Kintore, Laurencekirk). But still plenty more to do.
I visit the south semi-regularly, and worked in London in the 90's. Rail around London seems to have really improved over the last few years.
Swiss Rail (SBB) is still the poster child for a decent rail system. Clean, on time, reasonably priced (compared to UK rail), and easy to use.
What was eye-opening for me was recent travel in Germany (München to Basel in CH)... DB was dreadful and the stations were in an awful state of repair.
Fun fact: DB (Germany public-private national rail company) has become one of the UK's biggest train service providers - even the Queen's train was under their service.
DB (Schenker) buys stakes in transportation all over the world - with German tax payer money: A fact that many Germans do not like given the very poor train service in their own country.
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.
My wife uses ScotRail to commute and has no complaints. Yes, there’s the usual weather related stuff but nothing too bad. She probably has the same number of issues with her commute as I do by car - my journey was twice as long tonight as the road was covered in chickens after a crash.
> DB was dreadful and the stations were in an awful state of repair
DBs state is probably too unique to draw any conclusions (attempted privatization stopped just before IPO, so now it's lot of different state-owned private organizations with degraded infrastructure). But the stations are actually fairly straight forward: the platforms and the means to get there are still publicly owned, but 80% of the station buildings have been sold off to private operators. The bigger ones are glorified malls that are exempt from laws about shopping hours, the smaller ones mostly just decay
The problem with this assement is that it misunderstands the role of the private sector.
Yes, those crashes happened, and they were disasters, but they were only partially down to rail track being privatised. They were a result of systemic under investment both pre and post privatisation.
THe _other_ key thing that needs to be remembered is that rail is highly regulated. To the point that both price, timetables profit and pay are controlled by the deparment of transport.
The bigger issue is that actually the department of transport doesn't have the specialists needed to run the railways, they are hired in as consultants.
If you compare that to TFL, which operates both private (DLR and some of the overground) and public (most of the tubes, not sure about elizabeth line) and buseses (which are entirely private)
The railways are in the state they are because of poor governance from central government. and poor investment, also from government.
IF they had been publicly owned, we'd be in the same state, because the UK government is not currently able to run services effectively. Unless and until the political classes are willing to pay civl servants competitive rates of pay and trust data, then we will continue to be in a mess.
Yes, privatization is bad, but the lack of effective governance is the hidden crisis here.
I'm just not convinced that privatisation of natural monopolies is ever sensible. Especially when failure isn't option, you can't just stop the trains running because some operator spent all of their budget on executive bonuses. It's privatised profits and public liability.
You can see that it is highly effective even within the UK. Ofgem publish components of the energy price, of the average annual cost of £1300 I recall that profit was £40. Government subsidies are now £200-300 and are growing (I believe I read a story the other day that said that if the wholesale cost of energy fell to zero over the next few years, the cost of energy would not fall...that is how expensive the government's corporate subsidies to high-cost suppliers is...for some reason, no-one talks about this).
If you compare to the 70s when the government was throwing cash at these industries (largely because of the political incentives), it is unbelievable how low costs are. The problem is that the political intervention has been very bad, the public liability comes from bad regulation (which was just as true in the 70s).
For example, in energy the regulator has encouraged operators, like Tomato Energy the most recent failure, who are very clearly not operating in a financially sustainable way. If you look at who works for regulators (and look at what they get up to outside of regulation, in other parts of government), I am not sure how you can conclude that it could ever be any other way. We are paying for people who are largely unemployable outside of government to attempt to govern companies that are responsible for powering the whole of the country. Why does anyone think is wise?
Another example mentioned in the OP is retaining much in public ownership and then privatizing ROSCOs...it isn't just this is a bad idea, it is so clearly a bad idea that it is unclear who could have thought this is a bad idea. Again, this happened because of very ineffective regulation/political leadership.
Finally, what profits? One of the issues with most regulated industries is that the profits are very low because of the politics (for some reason, people think that public ownership will fix this...rather than make it much worse...we don't need to imagine, the UK has tried this several times, it has failed every time but the politics mean that there is no option but to keep trying it). The result has led companies to do things that are not wise because, otherwise, investors will pull capital. If you read any article about this is any paper in the UK, you would assume that the profits on offer in these industries are wild...they are not, share prices are collapsing, the reason why the government is taking over rail operating companies is because they are going bust, there is massive demand destruction in almost all of these areas because prices are sky-high, profits are non-existent, demand is being destroyed, and no-one wants to deal with the lack of supply because it would require admitting that the world isn't divided into Monopoly Man and a Victorian urchin.
There are countries that have made it work but the UK will never be one of them because of the political environment (significantly more raucous than the European style of managed democracy).
For some reason, people also tend to ignore the many other cases where this is also true: telecoms, energy, water, etc.
The problem is that there is massive political gain to both sides so we will likely keep rotating through the same options. In either case, the exact same people are in control, and no-one will ever ask whether the issue might be the people.
I also think that people fundamentally misunderstand why they were privatized: the public cost was massive, it was ever growing, and there was no capacity to fix this. Any discussion around money was completely impossible. Can you think of any part of the government where this is true? Actually, can you think of any part of the government where this isn't true? The government struggles to do bin collections, they struggle to police effectively, nothing works...and people assume that the problems will magically be fixed if they are given more control.
I think the lack of investment is a side-effect btw. There is a massive issue in the UK with management, it stretches across government, the larger public sector, and the private sector. It is true that in regulated industries, regulators have created bad incentives for the private sector, this is true generally of the incentives that government creates for the private sector...but even outside of those areas, it is generally quite bad. One of the sources of this problem is the complete and total obsession with politics outside of the outcomes that it creates i.e. the purpose of politics is politics, not running things effectively.
There is no real way to fix this (and we have done almost everything possible to make it worse).
> lack of effective governance is the hidden crisis here
but privatization makes that worse, by adding profit-seeking (which tends to minimize investments) to the lack of effective governance
the solution is improving governance and public investments, not privatization
(not to mention the problem with infrastructure paid for by the public over decades being sold off on the cheap to private companies who can reap the benefits thereof)
As always this is grossly oversimplifying. As well as the misleading safety stats, as graemep has noted, it ignores that journeys just absolutely exploded under privatisation [https://en.wikipedia.org/wiki/Privatisation_of_British_Rail]
Graham Dennis (author of the article) absolutely does not ignore this. He regularly points out that Irish rail ridership exploded almost in lockstep with GB rail network growth despite remaining entirely publicly run. Even right at the top of this article he points out that the growth had begun long before privatisation. He goes into a lot more detail in his book.
Possible complicating factor is that at about the same time Irish Rail started experimenting with radical new concepts like having trains that were not from the early 1960s, and having more than one commuter line in the entire country. So possibly hard to read too much into it; there’s an argument that Irish journeys just went up because the system was becoming rapidly less terrible.
(I remember being amazed as a kid in the 90s on encountering a mainline train that had automatic doors. Irish Rail was pretty behind the times for a long time.)
The growth didn't happen long before privatization in the UK though. It turned around almost exactly when the privatization process started (which wasn't an immediate overnight event).
I'd argue that the upswing had started in the 1980s and took a hit along with the economy between black monday (87) and ERM2 crash/black wednesday (92)
The privatization took years however, it wasn't an overnight thing. A lot of the process was just writing down and professionalising a lot of aspects that were previously ad-hoc, so the benefits started before the precise date drawn on the graph. The law was passed in 1993 but preparations began before that, it was clear this was going to happen even in 1991.
That certainly happened, but at the same time the ticket prices have consistently gone up above inflation, so what we're missing is the causal link - why did journeys go up so much? Was it in fact other transport policy to get commuters out of cars?
Ticket prices going up is actually good for mass adoption. If they are too low, you will see people riding the train who are only using the train because they are too poor to afford a car. That makes middle class people want to avoid the train.
Also higher revenue often means better service, which for most people is more important than the price.
I don’t think these points are accurate at all for people in the UK. There isn’t really a class divide, you ride trains in particular because it’s theoretically the most time efficient way to travel within metro areas and potentially across the country. Increased prices have not resulted in better service, and it’s purely a method to price gouge those who have no feasible travel alternatives.
You can't privatize what can't make money in itself. By that I mean, rail is beneficial to the entire economy of a country. This profit is not something a rail company can benefit from but a country can. Serving low traffic areas are a loss business but vital for a country to grow.
Same for fiber infrastructure, running fiber into a desolate town may not be profitable but giving the chance for some kid in that town to build the next unicorn from his home benefits the entire nation. Not all talent is in the cities.
In the Japanese model the rail company also owns land around the station, so they capture more of the value of rail transport. Rail in the UK does not capture all the value it delivers, so subsidies would be a pragmatic solution.
That sounds like an excellent idea. However I think rail transport depends more heavily on quality infrastructure. If a state doesn’t maintain its roads well and allow potholes to develop, it is probably rare for that to cause a fatal accident (I’ve heard of potholes causing damage to cars but not deaths). But improperly maintained rails lead to derailments and deaths.
Italy has seen tremendous success with privatizing High Speed rail.
I think the difference is that the infrastructure (tracks and stations) is still owned by the state and leased out competitively to private train operators.
They've been doing that here in Norway as well for regular trains.
The result is that the train operators get f'ed in the a by poor track maintenance and old trains. It has been so bad that when the trains run people joke it's "train for bus".
Also us customers can no longer buy one ticket that gets us from A to B but often have to contend with 2-3 different operators.
Italy has not exactly privatized high speed rail. The public rail operator Trenitalia is by far the largest high speed rail operator in the country. And it’s great.
What Italy has done is open the rails to access by private companies in addition to the public one, most notably high speed operator NTV/Italo.
Arguably this competition has helped spur on the public operator to greater heights. But it’s not the same at all as what Britain did (privatizing the public operator itself).
> Italy has seen tremendous success with privatizing High Speed rail.
I think whether privatization helps or hurts depends a lot on how corrupt or inept the government is, ie. the more corrupt or inept, the more privatization can probably help.
* Government is unable (for various reasons, the primary one being massive levels of corruption) to invest in expanding capacity. Demand on certain routes is multiples of the capacity that exists.
* The trains are owned by private companies, this was a bad idea.
* Operating companies have had to put prices up because of all the things outside of their control. Government has been happy to let them take the blame, it has allowed things to be moved into public ownership, more power, more control.
* No-one is making any money because the idea is for no-one to make any money. Making money is dirty so operating companies make no profit, and prices are sky-high.
Railway privatization is resolved in East Asia where they are also major real estate developers that plop luxury malls and apartments ontop stations. See the HK MTR as an example, which is far better than the average European subsidized metros.
The real problem, as always is NIMBYism and the western aversion to luxury malls and mass consumerism, which ends of in a self-reinforcing cycle of increasingly miserable public sphere as nobody wants to engage with it or make it better.
Japan's rail system has some of the best farebox ratio's across their system (many of their lines actually make money, which if you compare to other countries, is pretty much unheard of in North America). [1]
And they actually continue to expand their service.
In the US, one of the highest farebox recovery ratio transit systems has historically been BART, which is 2019 was 72%, and even today is around 50%.
Unfortunately, having a very high ratio also makes systems much more vulnerable to collapse during periods of economic downturn, which is exactly what BART has been dealing with since ridership collapsed during Covid.
I'm no expert in this topic (in other words, I just asked Claude this), but AFAICT part of the reason Japanese rail systems did better appears to be that they are owned by diversified companies that own numerous other assets, like hotels, restaurants, and office complexes.
Every major station I went to in Japan had a huge mall with restaurants connected to it owned by the rail company. Inside stations were rail company owned gift shops, convince stores, etc.
I think that connecting outlying areas (especially ones you the railroad build yourself) to department stores is what got Japanese rail companies going, but it's probably less important now than it was initially. Farebox revenue covers profitable operation of the railroad. It even appears to cover upgrades; browse around on the satellite view of Tokyo and you can see many private companies moving their above-ground infrastructure to (expensive!) subways because ... trains hitting cars interferes with their ability to earn money. It is honestly something that I have trouble wrapping my head around. The business is so good you can afford to make it better, but the business is a commuter train? Weird!
I think Japan is successful because of a less pervasive car culture than the US. People expect to walk 30 minutes to the train in the morning, that's just something you do. It would be unheard of in the US (and also dangerous in many suburbs, because they are designed to move as many giant SUVs as possible per hour, not to let pedestrians and cyclists get to the train station).
Also, a big caveat is ... all of this is Tokyo and Osaka, very large, rich, and dense cities. When you go out into the middle of nowhere in Japan (even an hour out of Tokyo, think the Hachikō line, etc.), rail service kind of sucks and is subsidized heavily.
I disagree and am working on an article arguing that Japan rail privatization represents a failure, as does its much lauded pedestrian friendliness.
The premise is basically that Tokyo is the busiest city on planet earth and so should therefore have the best public transit and pedestrian infrastructure by a huge margin, when in fact it still gives unbelievable space to cars (Shibuya crossing should have been permanently closed to cars 20 years ago).
As for trains, during rush hour trains can be so full you might be squashed against the door unable to move - incredibly unsafe, leads to daily injuries, and some argue have something to do with the heinous levels of sexual assault on trains. Not to mention even in Shinjuku station most platforms don't have guardrails to prevent accidental or purposeful death by trains, another outsized problem in Tokyo.
But the most glaring issue is around the very design of the system. Privatization results in requiring riders to sometimes exit a station of one company, go all the way up to ground level, walk a block or to two another different company station, and then ride another train. A government managed system wouldn't have this issue, it would simply combine the stations at design time.
>The premise is basically that Tokyo is the busiest city on planet earth and so should therefore have the best public transit and pedestrian infrastructure by a huge margin, when in fact it still gives unbelievable space to cars (Shibuya crossing should have been permanently closed to cars 20 years ago).
Tokyo has the top 3 busiest train stations in the world. 8 of the top 15, 9 if you count Yokohama. To argue that they're somehow failing to provide a service, and that privatization is the problem, just sounds insane. [1]
It's 'don't let perfect be the enemy of good' taken to the very extreme. I'm really not sure how to have a productive conversation with this premise.
>Privatization results in requiring riders to sometimes exit a station of one company, go all the way up to ground level, walk a block or to two another different company station, and then ride another train
Heavy emphasis on sometimes since they're often connected at a station if it's busy enough (yes you have to 'exit' a gate then enter another. There's plenty examples of lines in city subways not having tunnels between them as well, and having to walk outside.
There are problems with rail privatization but I don't think this is one.
> Privatization results in requiring riders to sometimes exit a station of one company, go all the way up to ground level, walk a block or to two another different company station, and then ride another train.
I believe this is the result of different private companies operating physically separate lines, rather than some privatization activities? For example, Shinjuku has stations of JR East (result of JNR privatization), Keio (private), Odakyu (private), Toei (public), Tokyo Metro ("private" but owned by Japan gov and tokyo metro gov). Sure, JNR privatization is controversial but without that, Shinjuku is still a mess of different operators.
Are you suggesting the government turn back time and banned private companies owning rail or they should buy out and nationalize all rails companies?
> A government managed system wouldn't have this issue
Well, if it's 2 different government levels and 2 entities, the issue still exists. For example, to transfer between Tokyo Metro and Toei Subway, you might need to tap or a transfer ticket https://www.tokyometro.jp/lang_en/ticket/types/connection/in...
It's also possible for public and private companies to cooperate. Keikyu main line (private) does through running on Toei Asakusa line that allows the subway to have connections to both airports through private rails.
Nowadays, with IC cards, transferring between systems is a breeze. For the walking distance, nothing much you can do besides moving the track itself (done sometimes) or station redesign with better walkways and tunnels (done often).
> As for trains, during rush hour trains can be so full you might be squashed against the door unable to move
I don't know why this never occurred to me before, but: is there a reason they can't run more trains or higher-passenger-capacity trains? The demand is obviously there, so the question is: do they like it super-crowded?
There's a hard limit on how frequently you can run trains, because you need to maintain safe separation distances. Try to pack too many trains into the timetable and the whole line is just one tiny error away from grinding to a complete halt, or worse. There are some tricks to pack in slightly more trains, but they generally require expensive and disruptive signalling upgrades. For commuter lines with lots of closely-spaced stations, the most effective way of increasing train throughput is to reduce dwell time at stations and ensure punctual departure, hence the often rather brisk attitudes at Japanese stations during rush hour.
There are several limits on the length of trains, but the primary one is platform length. It's no use running a 7 car train if all of your platforms are 6 cars long - anything you might gain in capacity per train is wiped out by increased dwell time. You can extend platforms, but it's expensive, disruptive and only works if you have sufficient space at all (or practically all) of the stations on the route.
Japan can't really justify major rail investment, because passenger demand has been steadily declining for decades. Peak-time trains get progressively less busy every year, simply because there are fewer commuters every year.
Length is limited by platform length and width is limited by tunnel loading gauge and platform sizes. To increase the platform length, you have to do it at most if not all stations. Crowded stations are usually in desirable areas which make it harder to dig or acquire land.
> run more trains
For lines at capacity, I believe it's usually limited by trains dwell time. Longer and bigger trains take longer for people to safely board. To improve this on the train side, you can have more doors and bigger doors. Station platforms also need to be bigger, have more stairs, bigger walkways, etc. Longer trains also make it tougher for train drivers and station staff to open and close the doors safely.
Tough but not impossible problems but many solutions contain trade offs. Only surefire way is to build another line but that costs tons of money.
It's just humans being humans. NYC has the same thing during rush hour for certain stations. A train might be 3mins away but people crush themselves into a subway car while I just wait for the next train which is pretty empty.
I’m not sure why you’re being downvoted when those are legitimate problems.
I disagree that this is a failure of privatization (other than the last point) and I also disagree that Japan’s success is a vindication of privatization (although it does show that above average systems are possible through privatization) but those are reasonable discussions to have
I believe the public transit systems in most countries are so bad and underfunded that Japan's seems holy in comparison. And don't get me wrong, it's one of the best.
For transit nerds like me though, it's frustrating when all the evidence points to the same conclusion: more trains, more pedestrian throughput, no cars, and yet no city has gone this route full throated.
I was genuinely shocked on at the amount of space given to cars on my first trip to Copenhagen last month. I was promised bicyclist utopia, instead I was presented with massive lanes for cars, confusing intersections, and in a construction area being forced onto a narrow sidewalk full of pedestrians.
Frankly I don't know any city on earth getting it right. I've heard maybe Shanghai but from videos I've seen of car culture in the PRC, I doubt it.
Japan has a culture of running trains on time though. There is no MBA figuring out that they can pay themselves a bigger bonus by firing the backup train drivers needed to ensure on-time service.
And even if there was they couldn't thanks to unions and some of the strongest worker protections in the developed world. That doesn't even touch on the loss of face for proposing such a thing.
Is it really their recipe for greatness? We have very strong unions and worker protections in France, and our trains are unreliable as fuck. I'd be more inclined to think that their highly developed feelings of pride and shame are bigger drivers.
Spoken to a few ojiisans here over the years and they'll always mention the value placed in making sure everything's well maintained. If you go out past midnight in Tokyo you'll frequently see gangs of workers on the lines doing inspections and installing new equipment. Can't comment on other countries but if you're not doing enough upkeep things will turn to shit fast.
British Telecom lost its monopoly around the same time it was privatised. Is today's (very competitive) telecommunications market more a result of privatisation or of the loss of BT's monopoly?
Another way to look at it would be, are BT's customers better off now, than when it was a government company?
BT was deep into preparations for a nationwide fiber rollout at the time of privatisation in the early 80s. The project was cancelled, the fledgling factories equipment and expertise were instead exported to South Korea, enabling their widespread fiber penetrance.
That delayed fiber rollout in the UK by decades.
Was that a success? Could be they were too early to justify the cost?
But without someone pushing ahead, who develops the technology?
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 is idiotic to anyone who remembers the state of the internet at that time. Most servers were not connected to the internet via fiber.
Unwittingly a brilliant demonstration of how short-term capitalistic behaviour hamstrings society. Japan, Korea and Hong Kong are way ahead of the UK and much of Europe precisely because of the lack of insight and vision reflected in your post.
The private market made the exact same choice in the 90s, but instead of just being something that cost maybe more tax money than it should, it was hyped up and full of lies and marketing and bullshit and burned tons of cash for really stupid projects and caused a serious recession.
So..... not really a point for privatization here.
The 90s were dominated by modems and around the turn of the millennium DSL connections. Fiber internet (to the home) didn't start until much later. The backbone was getting fiber deployed before then, but there was never some kind of unusual bandwidth crunch in the UK. The private sector managed the rollout just fine.
It's hard to tell with counterfactuals like that. One factor to bear in mind is that BT was close to rolling out nationwide fibre in the early 90's [0]. Would it have made more sense to decouple infrastructure and service, or would that have led to a nightmare like we have with the trains?
The New Economic Policy in Soviet Russia (1921) and Deng Xiaoping's reform and opening up in China (1980s) both saw privatizations and significant economic improvement. But those were corrections of rare cases of having way too much (ie, near-absolute) state control, where even stuff like private barbers had been illegal. That said, in the case of Russia of course, wider privatization in the 1990s was disastrous in many ways
In the UK the airline and telecom privatisations were largely successful (BA, Rolls Royce, BT, etc). BP did okay too.
For some reason things that happen in the air seem to privatise much better than things that happen on the ground.
MG might be the exception, but it’s a bit of a weird situation in that it went from being owned by a loss making British state owned enterprise (Leyland) to being owned by a loss making Chinese state owned enterprise (SAIC). Still makes popular, cheap and not very reliable cars though.
The key is competition. BP compete on the global oil market. BA compete freely with other air companies. RR with other turbine manufacturers (not many of those globally!).
The semi-successful ones are the "shell company" ones: telecoms, power, and railways. The user gets a choice of who to get customer service on, which feels nicer than a government bureaucracy, but the infrastructure is a natural monopoly so the actual hardware delivering the service is mostly the same.
Electricity markets work pretty well as a market and has miraculously managed a lot of carbon transition, but is now horrendously expensive (like trains) in a way that's becoming politically important. The public are going to demand that something be done. AI power use is not helping here.
The less successful ones are the actual big capital asset ownership ones: RailTrack PLC, OpenReach, water companies, the nuclear industry.
BT was only successful if you take a very narrow view of success. They dragged their heels on rolling out ADSL to maximise short-term profits from ISDN which has had a hugely negative effect on the country.
Government spent decades figuring out how to regulate it and even today OpenReach is far than ideal.
For some reason things that happen in the air seem to privatise much better than things that happen on the ground.
I know that there are some nuances to this, but this makes sense right? If you think you can compete on say London-Amsterdam, your airline can in principle decide to compete there (yes, they need slots, etc.).
If you want to compete with rail between Amsterdam and Berlin, you are either going to pay an insane amount for extra infrastructure (too expensive) or you have to let companies bid on exploiting a line. But you can never have two companies competing at exactly the same times.
But let's all take a moment to acknowledge that it would be awesome if they had them. Can you imagine the shenanigans you could get up to designing a nationwide 40,000-foot-high rollercoaster system?
These entities are not really the same kind of thing. BA and RR were successful private companies that ran into difficulty for one reason or another and took on the UKG as an investor of last resort. BT was an offshoot of the Post Office, a service that is run by the government even in the USA. BP was government controlled for...geopolitical reasons.
There are some nuances to it. British Airways (not the original British Airways Ltd [0], who merged to form BOAC) was established to manage several existing airlines that had already been nationalised (BOAC, BEA) and two regional carriers (Cambrian Airways and Northeast Airlines).
Of course BOAC and BEA had been made my consolidations of many smaller airlines which gets messy quickly when tracing the lineage. Even Cambrian and Northeast had formed British Air Services prior to this which was 70% owned by BEA.
So it is technically true that is was started as a state owned airline, but one made from companies that were originally created as private with a mixed history of state ownership.
The privatisation of the water industry in the UK certainly wasn’t and is considered a failure due to rising bills, poor infrastructure, and severe pollution from sewage overflows.
In the US, some have failed, some have worked. In my home state of Maryland, the PPP (P3) for redeveloping the Travel Plazas along I-95 is often cited as a success story and they are indeed widely considered top notch rest stops. It's a small-ish thing, but it did work.
All things where you can't have genuine competition are a disaster.
I'm not against taking these things away from government but it might be better to have a non-profit that isn't as directly controlled by the whims of politicians. Independent similarly like the Bank of England with very clear metrics/goals on how to run the company.
Hong Kong is considered to have the best subway system in the world and it is private and for-profit. Though the largest shareholder of its stock is the Hong Kong government.
That's the same model we have in Canada here mainly. Provinces pay for the service, but family doctors and most other practitioners are private businesses that then bill the government based on a set fee schedule.
The exception I guess is hospitals which are kind of a mixed structure of some kind and doctors in them are salaried employees not businesses of their own.
The problem with this approach is it intrinsically creates conflict between the doctors and the gov't about how fees are structured, and the patient gets stuck in the middle. That and inconsistent standards, structure, and quality. Couple that with conservative governments that sometimes have ideological antipathy to socialized medicine generally, and there's a recipe for difficulties.
I'm given to understand that the NHS in the UK is not like this, and most doctors are salaried?
CDPQ has been good at making transit in Canada, but they are working on behalf of the Quebec Pension Plan so it's kind of a weird situation. I largely agree with you.
The privatisation of BT meant that there was no specific monopoly on ISPs during the Internet boom. While the privatised BT had a monopoly on the wires - customers could choose from hundreds of different dial-up and, later, ADSL ISPs.
Similarly, the privatisation of the mobile phone networks means that the UK had some of the cheapest airtime contracts in the EU. Yes, there are still gaps in network coverage, but there were at the peak 5 different MNOs for customers to choose from each competing and driving down prices / increasing coverage.
Energy has been mixed. Companies like Octopus have provided things like real-time electricity APIs. I can't imagine an organisation like British Gas launching something like that. Similarly, if your power supplier has crap customer service, you can move. And people do! In that sense, it has been a success.
Pickfords was also privatised. People forget that house-moving companies were nationalised during WW2. The liberalisation of that market has been a success.
You can argue about things like Rolls Royce, BP, British Airways etc. But I don't think they offset the utter failures of privatising water, trains, etc.
LOL.
Yes, Scottish Water was never privatised, and that's been a great story of success... even if it's only because it's not any of the failed English water companies.
Yeah I was going to say. Every one of these privatizations was a success from the point of view of the people who made them happen. They weakened worker power and increased the amount of money available to be extracted by the wealthy. If they happened to also make these important systems worse, well, that's our problem.
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 on how it's told - it lets you get the school you need after all (even if it's wasting money vs doing it the normal way). And it's making the participating companies great profits, just don't mention whose pockets it comes out of.
PFI has been an absolute disaster in Scotland: not only incredibly expensive, but there were some substandard construction issues that became very public when a wall in a school simply fell over (fortunately outside hours so no injuries!)
That has happened in Britain. it was how Gordon Brown claimed a balanced budget while running up what would be classified as off balance sheet debt if anyone other than the government did it. A lot of things like hospitals were financed this way.
I would say the motive here was mostly to avoid increasing the government debt numbers. it would not work if the government did not exempt itself form the rules applied to everyone else.
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.
Depends, do you travel through any of the airports in Europe, use many of the train services in Europe, get power from spain, portugal or (non-nuclear) France? Fly on a Airbus, or a Boeing with RR engines?
There are legit reasons to be skeptical of privatization, but yes. It works well when it works.
Dogmatic responses (free market == everything, only government and unions can provide service) are not helpful.
Airbus is by all intents and purposes a (multi-)State controlled company with privatized profits. You don’t get to have hefty defense contracts in countries like Afghanistan or Saudi Arabia if you’re de facto a private company, which they aren’t.
>You don’t get to have hefty defense contracts in countries like Afghanistan or Saudi Arabia if you’re de facto a private company, which they aren’t.
This is false. Saudi Arabi buys equipment from private companies. Most US Defense contractors are private companies, of course countries all around the world buy from private companies.
The defense contracts of Airbus have nothing to do with them being partially state owned.
Some communist era enterprises failed (or would have failed) on open market and entirely deserved this.
Extreme absurdities included hunting whales to fulfil production quota, then dumping carcasses into sea as they were not needed for anything. Some species were hunted into extinction this way, for no benefit whatsoever.
I'd argue that privatising telecomms has been a win. I think because it's quite open to competition (even if there has been a good deal of consolidation).
The challenge with so many UK privatisations is that the idea of real alternatives/competition ranges from laughable to extremely laughable.
One could argue the rails were a success. The article argues deaths went up after privatization, but that's only because the miles being ridden went up significantly as well. Actual deaths per mile are down. Further the drop in ridership in 2021 was due to covid, and the financial strain was caused largely by the rail industry re-investing heavily before covid.
There have been lots of privatizations all over the Western world and most are not well known, its the negative examples that are very much talked about. And many or most are somewhere between fully private and fully public anyway, so the picture is much more muddy. I think to say its all a failure would be very reductive.
I think many of the telephone operator privatization worked pretty well in most places and buildup of user business for those companies and more competition, mostly from formerly public operators competing in other markets. But it also depends on the country.
Some of the airline privatization seems to me also sensible.
In my country (Switzerland) government owned some banks or partly old them and sold some stock in them, witch seems sensible to me.
Some water infrastructure was privatized and regulated in many countries and for the most part this has worked fine, maybe not in Britain.
Denmark seems to have done quite a lot of privatization and it was mostly considered pretty well done.
I was really surprised how much of this was done all over Europe, often by 'left' governments. Once you start researching you find more and more.
Would be the work for an economists thesis or something to try to do a full accounting of this across all European nations.
But but but... Someone got rich! Thus it has to work. (And if privatization doesn't work, we'll just repeat that it works over and over until people believe that it works.)
I'm the wrong person to try to steelman this, but lets have a go anyway with a couple I know well:
1. Internet Service Provision
Britain chose to separate the intrinsically geographic monopoly of Last Mile Copper Loops from its existing non-intrinsic monopoly telephony provision. British Telecom, which had once been publicly owned, was obliged to distinguish "BT Openreach", the part of their company which inherits the local loop monopoly and which also offers (non-monopoly) long distance network transit and other useful stuff - from the consumer facing BT, which is a fairly ordinary PLC. I know a BT employee, the regulators really care that they can't collude with Openreach.
This means that the tiny company providing my Internet access (Andrews & Arnold) doesn't need to own a large brick building down the street, or even a cabinet in that building, or negotiate a deal with a monopoly behemoth who can set their own terms unfairly. Instead, they pay Openreach to move packets from my home to a nearby city, and then they can choose to pay Openreach or its competitors to move those packets from the city to their routers. BT Openeach is a monopoly, but it's an ordinary public company just with a lot of regulations to ensure it behaves equally for A&A as it does for its owners BT. BT isn't a monopoly but it does have lots of customers, I think its services are crap or alternatively that they're too expensive (A&A is more expensive but much, much better, if BT were much cheaper than they are maybe that's a good deal for somebody)
This arrangement means most UK residents have dozens of potential reasonable ISP options, with a range of pricing and terms, including lots of "All you can eat" type packages, even if they don't live in a big city. People like me who do live in a big city get slightly more options (a Cable TV company, a local fibre startup), which can go cheaper and higher bandwidth, but only a few people are stuck with a single practical option as is common in the US - basically only people in very rural areas, and usually their option is community owned, so it may not be cheap but it's at least owned by actual people who might care.
2. Energy
Britain separately privatised the gas and electricity supply. Now on the surface this is lunacy because of course that's a geographic monopoly. But they're not complete idiots, so what was actually privatised was mostly the customer service/ end user billing part of the problem. My gas and electricity come from the same place as my neighbour, inevitably because they're the same pipes and wires, but my bills and my customer service are from my choice which happens to be Octopus.
Does this achieve anything useful? Eh, maybe. I don't think a local energy monopoly would be anywhere close to as good at either customer service or billing. Octopus seem to have some idea what they're actually doing. On the downside these firms have ended up costing tax payers a bunch of money because of course when one goes bust the gas and electricity are still working but the government is on the hook to ensure somebody else handles billing them for it and that's complicated. This happens far too often when there is stress on the financials of these firms e.g. the Ukraine situation fluctuated energy bills with little notice.
Edited: fix s/citizen/resident/ what matters isn't your passport but where you live
Yes, but it depends on how/why things are done. You don't hear about the successes because it's not a story worth telling.
Charter schools are a good example. They have mixed success when deployed. In many places they're deployed by right-wing politicians primarily to weaken public schools (and their unions). This can be done via a variety of ways, such as letting the charter schools charge extra (thereby essentially subsidizing private schools), allowing the schools to "expel" problem children, thereby dumping the public system with them, etc. The result is usually a framework that isn't designed to actually make education better.
In some places (Sweden is a good example), charter schools were implemented by a centre-left government because all attempts at school reform failed due to a variety of reasons. The result was by most measures successful as the charter schools couldn't pick and choose kids, were still held accountable, and it resulted in the public schools having to stop fighting reform in order to sort of compete.
The Canada line in Vancouver (metro link to the airport) was build on time and on budget and is still run by a P3 company, as is the new REM line in Montreal. The incentives here were ONE company was given a contract with clearly laid out incentives and minimal political meddling after that (as opposed to other P3s where the government is highly involved and subcontracts, etc get doled out to connected firms, etc).
The UK car industry was mostly privatized, but judgement on its post-privatization failure mostly goes down political lines (eg should a government continue to subsidize poorly made cars in the name of employment). Same with most of the rest of industrial Britain, which under public ownership was uncompetitive in most cases. That being said, most would consider Rolls-Royce to be successful and was privatized in the 1980s.
BP's privitization was mostly a success, even with all its issues.
Canada privatized CN rail and it is now one of the most efficient freight railroads in North America.
Telecom privatization in the EU has mostly been a success (though one could argue that the EU has pushed for too much competition, which has meant that while mobile prices are generally very low, it has made it harder for companies to invest).
Many airlines outside of the USA were also publicly owned pseudo-monopolies. Flying is cheaper than it's ever been, even if no longer glamourous.
The TL;DR is of course it's a mixed bag and depends on so many factors. Many UK industrial firms were so poorly run under private ownership that they were so far behind they couldn't catch up and compete once privatization did happen.
No. The UK refuses to accept reality, which is a poverty rate 12% higher than the US, and families with three or more children poverty rate of 47%. The cost of benefits and other costly boondoggles compete with these failed public works ventures. The largest water utility has £20 billion debt and will probably need to be un-privatized. They probably breathe a sigh of relief knowing that France is twice as bad financially, so that feeds the denial mass delusion. And the economy doesn't have the fantasy growth that was expected, so automatic additional borrowing. And it's budget season. Yay!
> The UK refuses to accept reality, which is a poverty rate 12% higher than the US,
I'm sorry but any US figure you use to support this allegation is probably nonsense. US figures about joblessness and poverty are a joke, and typically in international comparisons they still use things like "access to air conditioning" as an indicator of poverty even though they are meaningless.
The only rail privatization success story, that being the rail system in Japan, for some reason is not replicated much elsewhere. You make money on development, not running trains. You will never make money on public transportation, nor should you—it's a public service.
> You will never make money on public transportation, nor should you—it's a public service.
My understanding is that in the US Amtak runs a net-positive operating income in the Northeast Corridor (Boston-NYC-Philly-DC) but it all goes toward subsidizing unprofitable routes throughout the rest of the country. To the tune of the entire system running a $2 billion loss every year.
So in theory you could get some private rail to run trains up and down the northeast seaboard, upstate NY, Long Island, and possibly come out with a net profit.
Agreed. Transportation is a public service and economic engine. Subsidizing travel to help supply travel to demand is the easiest and likely most affordable thing we can do to ensure economic volume.
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?
I miss being able to spontaneously buy a ticket and travel off to see a friend in another town or city. I did quite a lot as a young man with the help of my 'young person's railcard'. The cost would be prohibitive nowadays because only tickets bought well in advance are cheap.
A lot of people in the UK seem to think the trains in Europe are so much better, but that's not the case, at least in my experience. We took an interrail trip a couple of years ago and spent half the time sat on the floor and waiting for delayed trains. If anything, the overall experience was much worse than trains in the UK, especially if you factored in the difficulty in procuring the correct tickets.
Talking about "trains in Europe" as one thing doesn't really capture the complexity of the system – it varies a lot between different countries and operators. For example Swiss trains (SBB) are extremely reliable but Deutsche Bahn is famously unreliable.
Apparently if a light-bulb blows at a station, two different contractors need to be called - one company has a contract for replacing consumables while another has a contract for repairing faults.
I remember that the UK was forced to privatise Rail in the way that it did because of EU competition rules. I was commuting by Rail at the time and the manner in which it was privatised was considered to be barmy by both myself and fellow passengers.
This is just another “bendy bananas”-tier myth. The UK was never forced to privatise because of EU competition rules, see, for example, France, an EU member state that retained publicly owned railways during the same period.
There are EU competition rules that require separating operations from infrastructure, but it is and always has been fine to do this as separate divisions under the same publicly owned umbrella.
I don't understand how is this "forced privatisation"? There's nothing preventing a state owned rail company from operating, no? All this says is that private companies must be allowed competitive access. Am I missing something?
No nothing preventing it but you cannot just have a state operator bid for it. The contract in question is basically the entire Netherlands passenger operations, with some small exceptions.
The key problem the EU has is the size of the contract. The contract cannot be for the entire country (more or less), it needs to be split into smaller ones (eg: one contract for intercity, one contract for local services near Amsterdam, etc). Netherlands defense is that the passenger rail system cannot be split up like this as it would cause operational problems and thus should not be franchised. I'm simplifying this from memory but it's roughly correct I think.
There is no doubt in my mind were it to be split up like the EU is requiring, that de facto some of it would be privatized. It has/is happening in every European state that has complied with the EU rules.
To me that is very close to forced privatisation. The current (Labour) UK model (government owned franchises with no bidding) would 100% not be allowed.
> so that decisions about the railways we use are made closer to us
I believe this is a mistranslation of "so that decisions about the railways we use are made by me" or more precisely "so that decisions about the railways we use are made by the sort of people that like attending committee meetings and working their way up the inside of political parties"
The privatisation was very likely botched, however, it was not as if it was done in a secret - the "fire sale" only happened at "rock bottom prices" with hindsight. The nationalisation itself was fairly botched and it is hardly as if the decimation of Britain's railways implemented following the Breeching Report (completed on a nationalised rail system) was particularly effective.
Similar problem with "Deutsche Bahn" in Germany. Probably also the reason why this German political NGO is writing this article. Are there any other countries with similar problems or history in their public transportation-systems?
How does the govt pick executives or companies for owning the railways?
I am thinking of the three credit bureaus in the US. These companies suck, and offer 0 innovations, but we are stuck them for the foreseeable long term.
It's really an open question - UK's railways were in a poor state & lacking investment when they were handed over. Rail journeys and infrastructure investment did increase in the intervening period.
It's not at all clear that railways will have consistent, adequate funding in the public realm, not least because the government is leery of capital expenditure and is always interested in ways to make debt levels look smaller.
Although, even with this in mind, it seems as if the UK really has a notoriously bad railway system. Most countries in the EU of a comparable size have a better railway system as such, even though they also have their own problems. One of the best in Europe is in Switzerland - the swiss really are clever. And also not in the EU.
This just isn't true on any measure (apart from affordability and true high speed penetration in some countries).
Affordability is really driven by how much the operators are subsidized by the govt. It's hard to calculate this on a like for like basis as some subsidy goes to the track operator and some to the train operator, and in eg Germany you have a hugely complex set of subsidies and fare zones in operation from various levels of government.
I don't expect the other European systems to be any cheaper - it's just hidden in the tax system instead.
Where the UK shines imo is two things. 1 is the frequency of many services. It's rare to have less than 2 trains per hour on an intercity route, and often far more.
This compares to France (outside TGV) which is atrocious. Non regular timetable with often 2-3 hour gaps on trains.
Spain (even on the high speed lines) is even worse. Some _high speed lines_ can't even manage an hourly service. This has got far better recently on high speed lines with private competition, but outside of that the timetabling is terrible.
The other is some of the ticketing options. Firstly, there is a no questions asked delay repay feature which means you get a substantial portion of the ticket refunded if there is any delay for any reason, starting at a 15minute delay. Obviously no delays are better than a refunded one, but I've had some atrocious delays in mainland europe and no option to apply for a refund.
The other is no composlary reservations (though I'm not sure how long this will last). If you have a valid ticket, you can get on. In many EU countries if a train is out of seats you don't even have the option to buy a ticket and stand. Combine this with poor timetables on many routes and it can cause huge problems if you are travelling at short notice.
Netherlands and Switzerland good for sure - better than the UK I would say. But Germany/France/Italy/Spain have a lot of issues.
I'd argue that subsidizing the railway system from the taxes is inherently a better way to pay for it. In the UK, the trains are ridiculously expensive out of pocket. They are vastly more expensive than in Switzerland (a really high CoL country), which as you say is a much better run system at the same time.
The total costs might be the same, but if paid out of the taxes, the cost is distributed progressively. People who earn more will pay more to keep the trains running. In the UK, the cost is regressive by definition, because the portfolio manager who earns 1 million pounds a year will pay the same expensive ticket fare that the nurse who earns 40k a year, but for the PM it's a trivial expense. And the portfolio manager can work from home, or just drive in to work if they fancy, the nurse cannot. The nurse is forced to use an aging, unreliable and at the same time really expensive train.
And the service itself is positively atrocious even in London when it comes to any non-mainline route. It's a complete tossup whether the trains will have severe outages due to strikes, engineering works or the frequent signal failures.
All privatizations of public infrastructur and services are failures, simply due to the discrepancy between the interests:
The public wants: Cheap, reliable, quality services.
A corporation wants: Maximized Revenue.
The two inevitably clash. No matter what business, no matter what country. Don't believe me? Go and find a single instance of a service that used to be provided completely by the government, that got BETTER FOR USERS (that is: The Public, not investors) after being privatized. I'll wait.
Public utilitis HAVE TO be run by the public, meaning the government. In pretty much every instance where this isn't the case, the provided service is more expensive, and/or less effective for the people.
And that's why I am sick and tired of the old trope "bUt pRivAtE sEcToR mOrE effIciEnt!" Sure. That would be the same private sector that caused almost every non-war related major economic crisis, is it not? I think the "efficiency argument" is already a moot point.
Why would public ownership deliver those benefits? Walmart is delivering cheap, quality and reliable service in retail. Soviet stores we not better than American ones.
This is only "true" because anything run efficiently by the private sector is so demonstrably better than any communist-fantasy alternative that no one bothers arguing any more.
Should Tesco be run by the government? I use Tesco more than I take trains.
May be of note also that the best train in London (the Elizabeth line) is run by a tendering process
>Don't believe me? Go and find a single instance of a service that used to be provided completely by the government, that got BETTER FOR USERS (that is: The Public, not investors) after being privatized. I'll wait.
You won't have to wait long: flying. Shocked? You shouldn't be. In the 70s, you'd have to pay thousands of dollars to fly across the country. Now you can get a flight between NYC and London for $200.
Air travel wasn't provided by the government before deregulation. The airlines have always been private companies. They were heavily regulated and run as public utility. Deregulation increased competition but nothing was privatized, the CAB was eliminated.
Air travel is also not privatized these days. The airports are nearly all owned by government entities.
It basically provides a bunch of graphs that confirms that flying is safer than ever, even as more people than ever fly at cheaper fares than ever. Embedded within the actual data is an unsubstantiated rant about enshittification and the danger of flying (despite the evidence they chose indicating the opposite), and a tangent about github.
Public transportation needs to be a public cost, paid for and funded by tax payers and not for profit. When transportation is subsidized but privately owned, then you will see maintenance neglected in an effort to raise shareholder value.
Public transit in the way we are used to it also cannot be run "for profit".
There is no public transit system where fares cover all the costs, never mind generating a profit. Riders would refuse to pay a fare high enough to do this.
Airlines barely make a profit. I'm not sure about intercity rail globally but in the USA, Amtrak relies on government subsidies to operate. All the private railroads gave up passenger service decades ago because it was unprofitable in the face of new competition (i.e. cars and air).
Local bus and light rail service will never be profitable as a private enterprise. We'll see what happens once drivers can be eliminated, but I'm still doubtful. Plus the public will still want some sort of authority figure on the bus or train. It's one thing to feel safe in a Waymo where you're not sharing the vehicle with 20 strangers but a bus or subway is different. So trade driver for security/customer service person and you're not really saving on payroll.
This all hinges on people utterly ignoring the expense of maintaining the road system.
If you factor in the spending on highways and road systems that can support high speed private vehicles at no direct cost to the end user, other forms of transport get incredibly competitive. Highway spending alone accounts for a quarter of a trillion per year. That doesn't account for spending at lower levels of government for streets and other car infrastructure.
>Plus the public will still want some sort of authority figure on the bus or train.
There are plenty of driverless transit systems. It is a very solved problem.
I'm saying that even with the current approach to taxpayer-funded roads, operating a local bus service cannot be done at a profit to the operator if they rely on fares alone. All public transit systems require substantial funding beyond what they receive in fares. And rail lines cost even more than roads do.
Privatizing such services and maintaining affordable fares is a complete non-starter. It cannot be done.
In the 1980s the nationalised railway was considering closing London Marylebone.
Today
The number of passengers on the railway is far ahead of the number in the 80s and 90s.
There is a persistent belief in the UK that privitisation of the railway was bad, yet it led to great things -- the constant Chiltern line investment, massive competition on the west coast mainline (you can walk up to the station and get a train from Manchester to London for £50 return taking about 3h30 -- it cost more than that and took the same time 30 years ago), Marylebone serving 16 million passengers a year pre-covid
There's been bad things too -- companies have failed and the government has chosen to bail the shareholders out rather than letting them fail and simply taking over, standard privatise the profits socialise the losses. Cross Country routes are screwed as it's a series of local services masquerading as a long distance one. Nationalisation doesn't help there.
But when we compare with German and French systems we see just how good the UK system is, despite the insanely cheap commuting (15, even 10p/mile) being subsidised by occasional long distance travellers.
I'm undecided if privatisation was a failure. I don't know the counterfactual scenario well enough. The article paints a picture that British Rail was doing just fine, making all capital investments necessary, and at low taxpayer cost. I'm somewhat skeptical that it would continue like that for 30 years. Any better analysis?
Me and a friend decided to dig into who makes the money here and in the end the big earners are the private equity companies that own the rolling stock and leases it out to the rail companies. The actual rail companies have slim margins. The leasing companies had much bigger profit margins.
The privatisation of the commons will endure as our generations' greatest folly.
I look at the Australian NBN as a great example of a project that is not economical for a private business to entertain - it requires "The Government" to build. How do we reason with this in the capitalist system?
I hear these stories about UK private rail system being terrible for more than a decade now. But, truth is, I go there frequently and the times I had to use it it was quite fine. Lots of trains and they arrived on time (and they were fairly clean).
It was much, much better - by any account of imagination - than the public railway we have here in Portugal. And I’m guessing they cost the taxpayers a lot less too (but that part I didn’t check).
I think there's a couple of things about typical foreign experiences of UK public transport to note (some of this may not apply to you in particular, of course):
(1) Most tourists visit largely London and its near surroundings. Public transport in (and to) London is generally much better than other parts of the country.
(2) A lot of the downsides don't manifest if you're a relatively infrequent user and you're largely travelling at off-peak times. As a UK resident who doesn't commute on the railway, this also includes me -- my experience of trains is generally good because I travel at quieter times and I don't travel so often that unreliability is a regular experience.
(3) If you ignore the costs (by not being a taxpayer or because you're less price sensitive for infrequent travel and especially for holiday travel), then you're ignoring the large part of the argument which is "this privatization had massive inefficiencies and costs".
FWIW, the UK government pays about half of the 25 billion/year cost of the "operational rail industry" (source: https://dataportal.orr.gov.uk/statistics/finance/rail-indust...). I couldn't find the equivalent stats for Portugal with a quick search, so I don't know how that compares.
London is particularly notable because it escaped forced privatisation of e.g. bus services. In London all the buses are red and work the same. You do not care whether your bus is a "Big Corp" bus or a "Tiny New Outfit" bus, they're both red, they both take Oyster, or credit cards or whatever, they're the same, the bus service is controlled by Transpot for London which responds to an elected Mayor. In most UK cities by contrast there are multiple, privately owned bus companies. The local government can try to persuade them to run services it wants but they don't have to, and indeed if the local government won't do what they want they can just fold up the service and go home, too bad, the government have to contract with a for-profit business and if nobody wants to do it then too bad no buses.
Until relatively recently (things have improved in Scotland especially and now increasingly in English cities) it would have been illegal to do what London does anywhere else. My city really wanted a single card that works on a bus or a train anywhere in the city, they couldn't persuade anybody involved to actually do that and the cards went away without ever being actually useful.
> You do not care whether your bus is a "Big Corp" bus or a "Tiny New Outfit" bus, they're both red, they both take Oyster, or credit cards or whatever, they're the same, the bus service is controlled by Transpot for London
Irish urban buses are like this in principle; they're branded TFI and operated by either Bus Eireann (state-owned) for non-Dublin stuff or Dublin Bus (state-owned) or GoAhead (private) for Dublin stuff. Only way to tell these days is a small notice on the door. However, you do care whether your route is Dublin Bus or GoAhead; if it's Dublin Bus it will probably merely be late, whereas if it's GoAhead it will probably be _very_ late or just cancelled. Is this not the case in London; ie are the operators all about the same in terms of level of service?
The government funding is interesting. It excludes HS2 for one thing.
The funding for oeprating companies varies a lot, according to the chart on page 6, 3p per passenger kilometer for Thames link, 30p for Scotrail, -1.1p for west coast.
Mmm, presumably big infrastructure projects like HS2 don't count as "operational" expenses. (Personally I put the huge costs of HS2 down to our complete inability to build anything in a reasonable timeframe and budget, rather than to privatisation in particular. The usual ludicrously long and extended consultation/legal objection/appeal process plus political meddling in the specification plus other stuff all factor in here.)
Yes, and a lot of money has been going into infrastructure, but its dominated by HS2.
Yes, its not anything like a uniquely British problem, its widespread. Bigger projects are a lot more difficult to run, and governments are drawn to big projects.
I think a lot of people in the UK would agree with this. It's not perfect but the rail system on the whole is pretty great for getting around the country. There's some annoying things like having to go to a hub to go back the way you came sometimes. But without a sprawling expensive network that's somewhat unavoidable. And obviously some lines are worse than others re delays and cancellations.
Most complaints in the UK are about cost of tickets. They are very valid complaints imo, the cost of getting a train in this country can be absurd. There would be a really positive attitude towards train travel in the UK and our rail system if it wasn't trying to bankrupt you every time you use it.
> I think a lot of people in the UK would agree with this. It's not perfect but the rail system on the whole is pretty great for getting around the country
In the South East, or if you're employer is paying for 1st class, definitely agree.
I prefer rail but public transport is very limited where I live, in Cheshire, and it is very expensive. It is fast for long distances, but it is a lot more expensive than driving, especially if you have more than one person in the car.
Trains get delayed and cancelled very frequently. They leave you stranded in the middle of nowhere because there's a technical issue fairly regularly: it's not a daily occurrence, but it's frequent enough that people will just go "ahhh classic british rail".
Trains are often packed, with literally nowhere to sit for hours-long journeys.
And this poor quality of service is very expensive. I know adults in their late 20s - early 30s with a fulltime job that choose to take the coach even though it's twice as long, because it's much cheaper. An ex-colleague was living outside of london, and spending £16k a year on train for commuting (you'd expect a big bill, but £16k is insane).
I'm sure there's plenty of countries that do worse, and as an infrequent traveller you'd probably be fine, but it's just... not great
I also go there rather frequently (much more before covid, though), and agreed, compared to the rail I'm using in the US (NYC, Boston, Amtrak), it is pretty good, but I've had some VERY bad experiences on it.
As a whole though, at least out of major cities London, Edinburgh, Glasgow, and Manchester, the rail system is great.
British trains are _terribly_ expensive, and get cancelled a lot, has been my general impression (from next door in Ireland, another country with a notoriously bad rail system, though it is at least cheapish).
As someone else mentioned, London (and really urban commuter services in general) are essentially separate; the problems are _primarily_ around the regional/intercity stuff.
One specific consequence of the privatisation. Earlier this year I visited Manchester. The airport to city route is operated by _two_ rail operators, on the same line. You buy a ticket for one service or other. I bought a ticket for operator A because their train was next. A few minutes later that train was cancelled, so I had to watch as a couple of operator B trains passed and wait for an operator A train.
I mean, no-one can tell me that’s a sensible way to run a railway.
(Mind you, this still beats Dublin airport, which currently has no rail at all, and under current plans will have _two_ separate rail lines around 2040-2050, and maybe a tram. Though, if that happens, at least the same ticket will work for both…)
It's too confusing but you can always buy an any operator ticket. On that route you have these options for anytime travel.
Anytime Day Single: Any permitted - £6.70
Anytime Day Single: TPE only - £6.50
Anytime Day Single: Transport for Wales only - £5.40
Unfortunately many apps don't make this clear enough. I suspect you bought a TPE only ticket when any permitted would only be 20p more. Many apps will show you the cheapest ticket even if it results in massive downgrade in flexibility.
While it seems ridiculous (and tbh it is) on these kind of routes, it is useful on some routes, which the slower operator (eg Birmingham to London) is 1/3rd of the price of the fast one.
Many operators do an "operator-specific, 10/20p cheaper" ticket because it means they receive 100% of the revenue, rather than just a portion of it. That's exactly what TPE are doing in this instance.
That practice should have been abolished long ago - it's totally anti-passenger.
GBR will likely solve this with removing the cheaper ticket, instead of making the cheaper ticket a generic ticket, of course :-)
Let's see. I don't know how far they will go with this - are they going to have LNWR the same price as "Avanti" for example, despite one being twice as fast?
> Earlier this year I visited Manchester. The airport to city route is operated by _two_ rail operators, on the same line. You buy a ticket for one service or other. I bought a ticket for operator A because their train was next. A few minutes later that train was cancelled, so I had to watch as a couple of operator B trains passed and wait for an operator A train.
As of June 2025, there is automatic ticket acceptance rules between those operators now in the case of cancellations and disruption, as both Northern and TPE are owned by the DfT.
Great British Railways will continue these kind of sensible changes (though not cheaper tickets, that's for sure!)
Oh, yeah, such changes take months or years. I'm sure even today barely half the staff know about the change. Give it another 6 months...
The railways in England and Wales are very adversarial. You have to do a lot of research and fight for your rights. It's about maximal revenue-extraction, not a customer-friendly experience.
(Nearly?) all of the the "private" rail operators in the UK are actually the national operators of other countries - Germany, France, Italy and I think Netherlands. The national rail operators mostly know how to run a decent service, but in the UK passengers pay multiples of what those operators charge in their home country and the service is definitely not as good.
You are aware National Express (UK company) operates a lot of train routes in NRW in Germany, too? Equally Ariva (UK company, was owned by DB, now UK) in the Netherlands?
The EU basically mandates privatisation of railways.
They require track and trains to be run by different operators (DB InfraGO in Germany, ProRail in NL, etc) to the train operators.
They then require (nearly?) all passenger rail operations be available to private companies to bid on. The EU is taking the Netherlands to the ECJ over the fact the Netherlands won't allow it: https://ec.europa.eu/commission/presscorner/detail/en/ip_25_...
Also the EU requires open access operators access to said separate tracks. That's why you're seeing all the competition in high speed routes (especially) in the EU. They have to pay a track access fee but are free to request to run whatever route it is.
The last point (well, all are really) is a big problem for many national operators as they make a lot of revenue from 'premium' intercity operations that cross subsidies the local trains. A lot of that "margin" is going to be eroded by the competition.
the service is often plagued by strikes, but the real problem is the cost. In what universe does it make sense for the train to be more expensive than a single person driving?
This is partly because of the UK's ticketing system, which (like airline prices) heavily discounts for people who can book ahead and travel at off-peak hours. If you're able to do that, then for instance, right now you can get a ticket from Euston to Manchester on Weds 10th December mid-morning for 35 quid. If you're really price sensitive you can get there for just 14 quid (you have to change at Crewe and take an extra hour and a half of journey time).
The downside of this pricing system is (a) everybody complains about its complexity (b) if you really do need to travel at peak time or at very short notice you're going to pay a lot (c) it's really easy to make it look like it's a terrible rip-off by quoting the anytime walkup fare for an intercity journey :-)
Denmark also does this — Copenhagen to Århus on 10 December at 10:52 is £16 if purchased now.
My example wasn't especially ridiculous. Try something like Stansted Airport to Birmingham — 200km, 45 minutes slower than driving, and £97 — or £67 off peak.
The other ridiculous feature of British train tickets is when some return tickets cost just £1 more than a single ticket.
> Hum, there are a lot of trains from London to Manchester today for between 42-47£. Those do take 3h45m.
Those are indirect train services. That can also be the return price, which is very very good value. You do have to be careful with travelling the right route and company
I live in a city in the UK and use the train to commute daily. Return travel on a peak train costs me £8.40 (arriving at work before 9am), and £6.50 if I go in after peak (arriving at work after 9am).
Every year without fail this goes up by a noticable amount, but the service is still unreliable. Looking back at my travel history, the train has either been late to arrive or late to get to my destination around 30% of the time. That delays can vary a lot as well between about 10mins (this morning for example) to 30 minutes on average.
But that's the average picture, the winters get so much worse for my route. There's a tunnel just before our station which frequently has water pouring through when it rains heavily which means no trains can run until it stops. Several times I've left my house with all the trains listed as running on-time and arrived at the station to be told by the (very nice) guard that he doesn't expect there to be any trains through until mid day.
They also get very crowded, at least on my route. They're meant to send a 3 carriage train but will frequently end up with only 2 carriages because they had a problem with one of them. This usually delays people boarding which means the resulting journey is around £8.40 for no seat and a 10-15 minute delay.
The UK rail sure isn't the worst in the world by any stretch. When a journey goes well it's seemless and I'm a big fan. But a lot of the time it feels like you're being bent over, especially when after several weeks of reduced services due to strikes you're suddenly met with a price hike of 5% with no improvement in the services reliability. All of that is just when you're talking about commuting as well. Any time I'm forced to head to London it's a miserable emptying of my wallet.
All of this is just my daily experience, but I'm so sick of this failed experiment. Each year it costs more, the service is just as unreliable, and the profits all leave the UK.
Maybe my expectations aren't reasonable, but it's something I'm effectively forced to use daily because of house prices.
The central claim of the article makes sense. Tickets are too expensive and that's all i care about as a consumer. I don't agree with many of the authors arguments and his proposed solutions.
> the case
against fragmented and
privatized operations
focuses on three key
arguments. The first is that
railways are complex systems where commercial
boundaries at engineering
interfaces are a threat to
safety and efficiency. The
second is that railway
operations are geographic monopolies where market
conditions are — at best —
contrived. The third is that
railways are a public service
that cannot fail — hence,
introducing private interests into the railways is
merely a way to sequester
income into private hands
while the state shoulders
the financial risk. In other
words, private interests’ role is simply to extract
profit that could otherwise
be reinvested into the
system.
That is true of most infrastructure. The closest parallel i can think of is the airline industry. It may never be perfect but these problems are solveable.
Next the claim that moving decisions away from Westminster will make things better. That is highly debatable.
Finally the main point. The nationalised railway worked well in the 90s so it would work well today. That is such an obviously flawed argument i won't even bother discussing it. I think the local government in London has far more direct control of local transport and it is horribly inefficient and expensive. Finally look at the ongoing, slow motion train wreck which is the hs2 rail project. At this stage it's just a government employment program for labourers. It's way, way too expensive and they should have pulled the plug on it years ago or drastically deregulated idk. As it is we have the worst of both worlds.
However, it is interesting that Thatcher didn't want to privatise the rails. Does anyone know what her opinion on it was?
Where I think privatisation went wrong (the core concept of having private operators bid on franchises is ~right imo) is the state lost a lot of 'management' knowledge that was in British Rail. This has really killed us because we don't know how to build complex civil engineering projects anymore, and _the management_ of them gets outsourced to large contractors like Arup at eye watering costs.
They also have a terrible conflict of interest as if they manage it well, they often get paid much less than managing a slow moving disaster of a project.
I think this needs to be solved first, not getting the state to operate train fleets.
Germany failed to privatize its Railways (it is still 100% owned by the state and directly financed through taxes) and it has an abysmal, totally dysfunctional railway system.
This is an article by a communist rag and NGO, which is also paid for by the German tax payer. Why would anyone care what they have to say?
For context: The website is called Rosa-Luxemburg-Stiftung. Rosa Luxemburg was a Polish and naturalised-German Marxist theorist and revolutionary. A very biased source
Two legacies from the 1980s and 1990s that haunt us to this day are:
1. The idea of trickle down economics; and
2. That public-private partnerships ("PPPs" were a stalwart of Thatcher and Blair) do anything other than simply transfer wealth from the public sector to the private sector. Put another way, PPPs socialize the risk and privatize the profits.
For anyone who pays attention and can think critically, this is the least suprising thing that can possibly happen and was evident decades ago.
For the railways in particular, railroads (technically, train operating companies or TOCs) in the UK have zero incentive to invest in rolling stock, track, signalling systems or stations because they own none of it. So all they do is engage in cutting costs and gaming politics to raise prices to increase profits. That's all that happens.
You can say that British Rail needed reform and funding but PPPs were simply not the answer.
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, but that is partly because rail workers are well paid. Train drivers can be paid as much as aircraft pilots. Their ability and willingness to strike affects both costs and people's willingness to rely on public transport.
The big constraint is lack of subsidies. it probably makes little difference whether the system is privately owned but tightly regulated, or publicly owned so much as willingness to subsidise it. This is also shown by the failure of franchises taken back into public ownership to improve.
This is incorrect. The biggest accidents - Potters Bar, Hatfield, Southall - happened in the years immediately after privatisation, before passenger numbers had grown much.
The problem was more that - in typical privatised fashion - the industry was treated as a cash grab, and property speculation and other side quests got more management attention than running a safe railway.
That first incarnation was so bad it was quickly nuked, and replaced with the hybrid arrangement we have today, which has a much better safety record, but is still comically expensive and inefficient.
And franchises very clearly have improved, so that's incorrect too. Delays and cancellations are down across the network, and that's before the system is reintegrated.
https://www.theguardian.com/business/ng-interactive/2025/oct...
The biggest disaster of privatisation was the loss of more than a century of engineering and management culture and knowledge. The UK invented tilting train technology, and it was given away to foreign corporations instead of being licensed and exploited in the UK.
This is the pattern behind all UK privatisation. Foreign countries and shareholders benefited hugely, while prices of essential services exploded, and service quality degraded.
> The biggest disaster of privatisation was the loss of more than a century of engineering and management culture and knowledge.
That's always the loss. In privitisation, in out-sourcing, and in downscaling engineering teams by firing senior engineers. And it's great for the those in charge of the budget cuts, because it is a loss that is very difficult to quantify financially, and will only show over a longer period of time. Typically, well after they cashed-out and left.
The difficulty is quantifying the relationship between risk and organizational knowledge.
Otherwise bloated, inefficient companies look the same as those retaining institutional knowledge.
I'm in the UK and services seem worse to me. I also remember pre-privatization British Rail. It was unbelievably awful.
The basic fact about rail privatization is captured in this chart. All else is commentary:
https://en.wikipedia.org/wiki/Impact_of_the_privatisation_of...
That chart doesn't normalize for population, service levels, social changes or any number of other extremely important variables.
Any facts taken from that chart need to be extremely caveated.
My commentary is this: It looks like around 1982, the trend reversed, well before the privatization. My takeaway is that whatever the government had done under nationalization was successful at addressing the concerns that existed and contributed to a downward trend that began before nationalization.
The British rail privatization was so successful in increasing passenger numbers it also increased the number of passengers taking the train in France (despite French rail still being state-controlled).
Or maybe, just maybe, there's another underlying casual relationship that explains why train use increased a ton in the 90s and 00s in both countries (and other European countries too, by the way, AFAIK passengers count also increased in Germany in that period). Who knows.
Much of the French high speed rail network (LGV Atlantique, LGV Rhône-Alpes, LGV Nord, LGV Méditerranée, LGV Est, etc) was inaugurated in the 1990s and 2000s.
This alone would have been responsible for a big increase in French rail traffic.
UK rail infrastructure certainly received improvements during this era too, but besides HS1 it was mostly just renewing and upgrading existing tracks. Nothing like the thousands of km of new high speed rail that was built in France!
I remember reading an article in the journnal of the RSS about whether it was actually less safe or whether it was just statistical clustering.
I don't however remember the conclusion!
I've tracked down the article to https://academic.oup.com/jrssig/article-abstract/4/1/15/7029... but I don't have access.
Its available in full online and concludes:
> The conclusion from the analysis of the accident data is that there is no evidence for the hypothesis that railway safety, as measured by accidents, has become worse since privatisation.
https://rss.onlinelibrary.wiley.com/doi/pdfdirect/10.1111/j....
This article was written in 2007, just a few years after Network Rail was re-nationalised in 2002.
Since 2002, there has only been a single passenger fatality attributable to poor maintenance: the Grayrigg derailment in 2007.
This followed a cluster of high profile crashes during the Railtrack (privatisation) era in 1997-2002 that killed dozens, and were directly or partly attributable to poor maintenance.
I’d argue that the longer Network Rail’s good safety record continues, the more we can disregard that article.
> as measured by accidents
Suspiciously specific denial. What about other metrics?
Read the bottom of page 17 and page 18 of the article I linked to.
Given where it was published (a magazine backed by statisticians associations in three countries) it would have been very damaging to the author's (a professor at Imperial College) reputation to have been sloppy about conclusions.
I always wondered what personality of software engineers leads to massive grab bag predicates.
Vs. Now I see. The latter would be suspiciously specific. I wonder if it correlates with belief in the Omnicause.Like what? Accidents are the only source of danger in the system.
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 reliably the further they get from concrete death records.
Accidents aren’t a cause of danger, they’re the result of it.
It says there’s no evidence for that hypothesis.
From the start, in 1994, there was this arbitrarily imposed structure with Railtrack owning all the track, and all the private companies leasing. The original plan was that this Railtrack thing would be publicly funded, and that's where that structure came from. Slowly over three years, then, the railway went private. Railtrack wasn't private until 1996. Then the railway was "properly private," but not really, because of this track-monopoly structure imposed on it by legislation, Railtrack being in effect government-run and a "private" company somehow too. Five years later (2001) there was bankruptcy, administration and re-nationalization of Railtrack (into "Network Rail") anyway.
Lurking in the background the whole time was the RMT, the National Union of Rail [etc.] Workers, led by "communist/socialist" Bob Crow, a moderate in the union.
https://en.wikipedia.org/wiki/Bob_Crow
So if this is viewed as an experiment in private ownership, experimental conditions were extremely messy and any conclusions are invalidated by cultural complexities and compromises.
> This is the pattern behind all UK privatisation. Foreign countries and shareholders benefited hugely, while prices of essential services exploded, and service quality degraded.
No kidding.
But of course, never underestimate the motivated reasoning of an HN user. After all, somebody made money off of the privatization. That could've been you, and you like making money, right?
There is a middle ground that is quite common across Europe: a private company that has the government as a shareholder. I think it is reasonable for subsidies to be structured just like private investments rather than a donation. The public should reap the rewards of the money they invest in their country through taxes, just like wealthy investors do.
It's a question of perspective. I've spent my life in countries where I've seen my taxes being spent relatively well, I feel the benefits of it daily both as a private citizen and a founder. Everywhere I've lived, when transport, utilities, healthcare and education, even part of the media, were publicly managed, they were simply better and cheaper.
But I understand that this is not universal and that most governments don't operate effectively for their taxpayers. And that, yes, if the whole system is set up for it, private solutions can also thrive and be superior. I suppose it's hard to privatize public services effectively in an ecosystem that doesn't support private enterprise as much.
That's interesting: it reminds me of the results we're seeing from workplace democracy in Germany.
Companies with workers on their boards are significantly less likely to go bust than companies where only investors' opinions matter.
But of course, whenever someone else's opinion matters, investors use their wealth to try to change that. Rich people seem to prefer worse outcomes as long as they get to be in charge.
Yes of course but there are downsides to this too. Workers will certainly prioritize survival and stability, but sometimes at the expense of innovation, efficiency and growth. They do not really have an incentive for the company to do better, but they definitely don’t want to lose their jobs or make them much more difficult.
For most established companies it is really not much of a challenge to prevent it from going bust if that is your priority, but it requires sacrifices, mostly opportunity costs.
That's a pretty broad statement about rich people. How do you define rich?
Yes, the desire for power is as important as the desire for capital.
If you have $100m your life isn't going to measurably change if you increase your wealth to $1b or $10b
At that point you start trying to accumulate power instead of money, and of course money is a by-product for power.
I think proxy is probably a better word than by-product "for" power. Or did you mean by-product OF power?
>There is a middle ground that is quite common across Europe: a private company that has the government as a shareholder.
Becoming more common in the US too, because of Trump's policy of US re-industrialization and national security. Intel Corp (10% equity), MP Materials (15%), Lithium Americas(5%), Trilogy Metals (17.5%), US Steel (golden share), Vulcan Elements, ReElement Technologies
But when the Obama administration tried to do this for renewables, it was called "communism" by the conservative right wing in the USA ...
Obama used loan guarantees and grants, not equity stakes.
No equity positions taken. Trump's policy is direct equity stakes as condition for industrial subsidies/tariff relief. It's statist, but I wouldn't call it communist.A lot of the things the administration is doing seem a bit socialist because socialism has some overlap with populism. The main difference is that it is framed as Trump doing favours to certain groups of people, with expectation of reciprocity or at least personal gratitude and loyalty, instead of more institutional wealth redistribution or subsidy policies.
Depending on who he is doing favours to, it looks right-wing or left-wing under the traditional political lens, but it's more about Trump doing whatever he wants with the governments resources.
> There is a middle ground that is quite common across Europe: a private company that has the government as a shareholder.
Interestingly, Quebec in Canada has been loosely following this model recently and it's working great. Long video but interesting if you like infrastructure stuff:
https://www.youtube.com/watch?v=XlHqqA0onn0&t=532s
TLDR: CDPQ invests on behalf of the Quebec Pension Plan, and has been building infra on behalf of the pension plan across Quebec (and Canada) to great success comparatively.
Those infrastructure "investments" will almost certainly not generate the same return for pensioners as putting the money in an index fund.
Sure but pensioners care about consistency vs. gross returns. You really don't want your pension to lose a ton of value in a downturn because people are constantly drawing from it, it's a risk off investment. Bonds are also poor investments compared to an index fund from a gross return perspective, but that's not why people/funds buy them, they buy them to lower risk.
Perhaps not, but you also get the infrastructure, which is worth something.
Would you get the same net result if you put the money in an index fund and then bought the infrastructure? That's the actual comparison.
Maybe so, but I would contend it is worth considering the broader implications of those investments and the effects that new and upgraded infrastructure could have on the greater economy.
Speaking only for myself, I would be okay with a lower return if it also means we as a society have good public transit, roads that aren't more pothole than asphalt, water that doesn't have to be boiled on occasion, reliable power, modern internet, and so on.
CDPQinfra deals in Quebec are wonky at best.
> There is a middle ground that is quite common across Europe: a private company that has the government as a shareholder.
This is in fact the situation in major parts of the UK rail network now; much has been renationalised or has the DoT as sole shareholder.
The UK rail system is not now truly privately held; this has been slowly unpicked by both the previous Conservative government and the current Labour government.
Nearly a third of Train Operating Companies are now under state ownership; LNER has been state-owned since 2018 and Northern since 2020. I don't know about LNER, but punctuality and reliability on Northern has significantly worsened since nationalisation.
Last year, we had the absurd spectacle of the Department for Transport notifying the Department for Transport that the Department for Transport had breached their contract with the Department for Transport, because the Department for Transport didn't meet the performance standards set by the Department for Transport.
https://www.bbc.co.uk/news/articles/cgl2j364kxzo
Truly, the writers of Yes Minister were documentarians. That line could have been straight out of the show.
The books actually have footnotes about the real incidents on which various aspects of the plots were based.
Where are these mythical countries you proclaim to have well managed public services and utilities?
Sweden, Denmark, Norway, Germany, Singapore...
People like to complain about public systems as if problems wouldn't exist in privately owned ones.
> They are expensive, but that is partly because rail workers are well paid
This is in fact an interesting by-product of privatisation: train drivers became rarer due to shareholder reluctance to train and recruit them. They consequently became more expensive. A somewhat fun side effect of the free market, especially given the prevailing assumption that moving public sector employees into the private sector would drive down their pay and conditions.
The idea is usually to de-skill workers and also to try to make their contractual terms worse.
In one very small way I actually sympathise on the railways, let me be specific, this is a long story:
The person driving the train clearly needs to learn how to drive that particular model of train, I think that's likely true basically everywhere. The UK's railway systems are however also reliant on drivers knowing the route. A driver must be familiar with exactly the rails their train will pass over to get from A to B, knowing what to expect ahead for some distance at all times. So it's possible that Jim, who is sat in a coffee room right now can drive a 450, but he doesn't know the Waterloo to Portsmouth via Southampton crazy bypass that's in place due to track work, so he is not able to drive the Portsmouth train that's right there, full of passengers and will now instead be cancelled because the scheduled driver did not arrive. In many of the world's railway systems route knowledge is not crucial (it might be good but it's not required).
However, because of https://en.wikipedia.org/wiki/Ding-ding,_and_away the modern rulebook also requires that the Guard have route knowledge. In contrast to the driver this is much less valuable, but it means that now your Portsmouth train maybe has to be cancelled because although the driver intended was available or the standby could do your route, the only available Guard knows the ordinary Portsmouth route, not the weird one.
I think this is a situation where we should fix systems instead rather than hoping that route knowledge for guards makes it work. But this means the guard is arguably de-skilled and less valuable than before.
Most European railways require a driver to have done some route familiarization for most routes, which tends to work fairly well. What does not work very well is that the UK has very patchy and antiquated train safety systems (AWS / TPWS are somewhat rudimentary and deployed - by far - not everywhere) and signaling. Even speed restrictions in the UK are placed very, very tightly and you better know them by heart because they didn't get placed with the idea that the driver must have sufficient time to reduce speed / react between where they get a warning signal and where the restriction comes into effect.
I suspect the move from public to private ownership did adversely affect the upgrades of those, as well as electrification on several key routes.
If I remember correctly they do not even have something as basic as an electronic coursebook - which became mandatory in Germany in the 90s already. And at least in NL if you have a set of routes in a certain direction / route set - drivers would get route familiarization both for the main routes and for the bypasses.
It's pretty much global fwiw. I wrote route qualification software for places outside of Europe.
It should also be made clear that you don't need to get an actual qualification from a bureaucratic org. You basically just need to document the last time the driver drove the route with another qualified driver and then document that they've kept the qualification up to date. It's a documentation process and just not that onerous. Also absolutely required for any railway since trains don't stop or accelerate quickly. You need the drivers to know what's coming ahead and no amount of signage or signalling can beat knowing the route.
The only concern i have is the guard qualification. That does seem overboard but... i don't know the UK and chances are there's nuance to this. So i'd have concern with anyone reading GPs post and thinking this is the cause of UKs railway inefficiency.
Assuming it’s similar to every other country; Route qualifications simply require first driving the route with another qualified driver. Once that is done you need to drive the route once every 6 months (this is in Australia ut i assume it’s the same) to keep that qualification up to date.
It’s not particularly onerous and understandably helpful for vehicles that take a long time to adjust speed.
The guard requirement does seem unnecessary though and is not a universal practice globally.
What makes knowing this route any more difficult than knowing the route you are driving on a road? Copenhagen has an automated metro system, so this doesn't seem like a particularly difficult problem.
So e.g. the UK does not have speed signalling. One yellow lamp illuminated means "Prepare to find the next signal at danger". OK, so, how fast can I go? Well, it depends, your route knowledge might tell you that the "next signal" is up a steep rise, you can go pretty fast, even if it is at danger that rise will scrub off all the speed and normal braking is enough. Or, you might know that there's a sharp bend soon and so even moderate speed is excessive because you'll de-rail on that bend.
In daylight there are speed signs but, trains accelerate and brake much more slowly than your car, so while they're a useful reminder you cannot correctly drive the train based on observing these signs. At night you may not see them at all.
Then does your route diverge? In some cases the intent to diverge is signalled, unlike speed, Flashing double yellow for example means "Prepare to find the next signal at: Prepare to find the next signal at danger" plus "Your route will diverge". However you really need to prepare some distance in advance of this information anyway in some cases, so you need to know, long before the signals and certainly long before being able to actually see it, that you will make a turn.
The UK also has unsignalled stations - places where a passenger train will ordinarily stop, and must obey signals, but there are no starting signals, so you need to remember whether you were under a cautionary signal say five minutes ago, which still applies now, even though meanwhile a dog escaped, some idiot threw yoghurt at people and then two hundred soccer fans boarded your train.
The "Driver's Reminder Appliance" is meant to help with this last part, it's basically just a button you can push, to remind you that you pushed the button and restore your mental state...
> In daylight there are speed signs but, trains accelerate and brake much more slowly than your car, so while they're a useful reminder you cannot correctly drive the train based on observing these signs.
Did the time it takes trains to accelerate and brake change recently? The time it takes to accelerate and brake should have been considered when placing the signs in the first place.
I imagine it's different for different types of trains. Freight trains probably stop a lot slower than small passenger trains.
That ding, ding and away issue seems straightforwardly solvable with a small amount of technology (the train could refuse to go without the signal saying it’s okay) or something like the Japanese pointing and calling system, or even both.
Frankly, something like positive train control or the European Train Control System should be table stakes at this point. It should be difficult or impossible for a driver unfamiliar with a route to cause a crash.
> It should be difficult or impossible for a driver unfamiliar with a route to cause a crash.
This is a question that's occurred to me in a different context. In Shanghai, there are subway stations where the passenger area is separated from the tracks by a floor-to-ceiling wall, making it impossible to drop something onto the tracks, fall onto the tracks, or get pushed onto the tracks.
There are also stations where there's no wall, and anyone can just shove you onto the tracks at any time.
The presence of a wall is highly predictable: newer stations have them, and older stations don't.
Should the older stations be renovated? That would be an increase in safety. It would also be a pretty substantial expense to address a mostly nonexistent problem. The wall is a good idea and it makes sense to include it when you're constructing a new station. But that doesn't mean it makes sense to add it to an existing station.
Is that true? My understanding is they command very high wages because their unions are strong and they have a lot of leverage: by striking they can impose extremely high costs on the wider economy (not to mention bad press for politicians).
Yes. This was literally a case study for my Sociology degree in the '90s.
(I would also mindfully say that there is a lot of subtle political propaganda in the UK around this issue- the powers that be want the public to blame train drivers for the failures of privatisation)
That doesn't convince me. Companies commonly handle situations like this just fine. I know because I have seen it. I think you are the one who fell for the propaganda here.
Your informative, water-tight argument has convinced me.
But you haven't made an argument, so you're in no position to criticize. You asserted that "train drivers became rarer due to shareholder reluctance to train and recruit them" and then didn't back this strange claim up, just said "I'm right" in different words. A sociology degree isn't convincing btw.
> I know because I have seen it
Companies may or may not handle strikes properly. If it were that easy, industrial interests (and their emissaries, like Reagan and Thatcher) would not have spent more than a century trying to break unions.
You missed the context. I am agreeing with you. This is the argument I'm responding to:
> train drivers became rarer due to shareholder reluctance to train and recruit them
Our ports in the US, which affects the cost of endless goods, are still running with 1950's level tech because the unions are so strong (and have heavy mob ties).
The mob "connections" in the International Longshoremen’s Association is is alive and well in this era:
https://archive.ph/wcMZK
What is stopping other ports in the US from adopting 2025 tech and growing to the point where existing ports have to get new tech or become obsolete?
The mob part.
The mob used to be a major issue in American politics. Today it isn't.
Are you arguing that it's grown more powerful with that change?
You try it, you get a visit. Same way it's always been.
> You try it, you get a visit. Same way it's always been.
In that case, there's no obstacle. This is exactly what happened with containerization, and guess what? The ports that did containerize, including some ports constructed from scratch specifically because existing unionized ports blocked containerization, replaced the ports that didn't.
My understanding is that the mob extracted large payments in order for containerization to be permitted. Some half of the time they just live on container royalties which are exactly the mechanism the mob used for extraction.
So sure, there's no big deal, just pay the mob. People do argue for that.
Any evidence mob lives off container royalties? And what are container royalties to begin with???? (I had no idea when I borrowed a container for moving I was paying royalties.)
My problem with people asking for evidence is that they often are expecting me to do a lot of work to give them a better world model, when they nonetheless have no intention of accepting any evidence.
So I have a guideline of good faith: you can hire me and I don’t mind doing it for you; or you can go read up on the subject, reach some understanding of what these things are, and we can discuss; or you can go do some research of equivalent value to me and bring that to me as a barter[0].
Otherwise, it’s really not a big deal to me if you don’t believe something that’s true.
0: for the moment, I’m willing to trade for the DNA height model that some people claim exists. If you can find it for me, I’ll find you some sources for container royalties.
TLDR - rene wiltford cannot be bothered to provide evidence.
I want someone who cares to be driving the train I'm on. They also require in person participation which make outsourcing hard. I'm fine with self driving when the line is designed for it. It will be a very long time before existing lines are self driving, and its not because on unions.
Not really sure why people like moaning about train drivers. Are they jealous a train driver is making more than them? While in the case of tech workers they sit quietly and watch their £65k jobs go to India.
Unions that can shut down important parts of society can and do get paid about as much as they want.
This is much more like blackmail than doing right by the working man.
Did the train drivers somehow not have this power before privatization?
Labour shortages makes finding scabs hard.
If that's the case, then it would be the case whether the railways are privatized or not (making the case for nationalization vs privatization).
These two things are related.
Definitely an interesting wrinkle. I wonder, though, if it's still cheaper to have extremely overworked but well paid staff, and few of them, versus adequate staff and normal pay.
> Train drivers can be paid as much as aircraft pilots.
Yes and that's as it should be, a fully loaded high speed intercity train has more souls on board than most commercial aviation planes (apologies pet peeve of mine because our media keeps banging on about how "overpaid" train drivers are when in reality their pay is fair for the responsibility it's everyone else who is underpaid).
A bad day at the office for me is I break production and cost the company some money, a bad day at the office for them is considerably more serious - it's a lot of responsibility.
A train may have more people on it, but it does have the luxury of being able to just stop when there is a problem. Airplanes not so much. Copenhagen has had an automated metro system for decades now. Train drivers aren't even strictly necessary anymore.
Each have their on individual problems. An aircraft’s ability to avoid obstacles is a massive benefit over a train’s only option being to very slowly come to a complete stop.
Train drivers are mostly obsolete. More than 20 years ago full self driving trains became a reality in several areas. Since a train cannot stop if something is on the tracks anyway, we can ignore safety issues. The computer tells the track to switch, and then the train to go when the track is clear. When it is time to stop the computer stops, and the doors are exactly in the right place to align with the doors on the platforms.
An automated train is better for everyone. So if your system doesn't have it they should be investing in getting it.
In some cases you need safety people at the platforms, or on the train, but their only useful control is the stop/go button.
What happens if signalling or mechanical failures occur and manual intervention is required? I will collapse the network, that’s why you see conductor-less operation only in separated environments, like subways (Nürnberg) or DLR (London)
Drivers cannot do much to in those cases anyway. Hit the emergency stop and wait for the mechanic. - computers can do the same thing
The better answer is do maintenance such that you don't have those failures in the first place.
We had a mass attack on a train recently, the driver radioed ahead and got his train shifted onto a different line so he could stop the train at the nearest station (which had a police station across the road).
That's the kind of thing that is hard to automate because while you can automate any routine operation (eventually) it's the none routine things that get you.
Planes and Trains have both had increasing levels of automation for decades and that's fantastic, humans are flawed/get tired/get distracted but you still need a human in the loop who can decide what to do when the unknown/unexpected happens and for that human to be effective they need to be able to operate large parts of the vehicle without the automation and understand the basic principles of the system as a whole well enough to decide what they should do that won't make the situation worse.
In planes that's the Pilot in Command, in Trains it's the driver.
Anyone with even a rudimentary understanding of railway operations knows that this isn't at all true.
For example, I've been on a Glasgow bound train where the driver was instructed to pass the signal at danger following a lengthy signoff process. Some scallywags had stolen wire for copper.
Even the DLR has drivers onboard to take over in an emergency.
> An automated train is better for everyone.
Until the manufacturer puts DRM in your fucking train: https://www.thedrive.com/news/hackers-beat-anti-repair-softw...
But trains are inherently safer (or at least, they should be).
If the train driver falls asleep and the train is about to go where it shouldn't, then safety systems should kick in and halt the train automatically. This is not possible (to the same extent) in airplanes.
This is something I have a hard time squaring away.
A train will likely always need to be manned, there are, in fact, checks that have to be made by a person and can't be made by a computer.
However, it seems like the part of actually driving the train could be nearly completely automated. The train is on a rail, about the only thing a person is needed for when the train is in motion is to push a stop button if things go wrong. Things like speed and indeed even a decent amount of visual checks could be automated based on location.
If you have a grade separated system - which you really want anyway - there is nothing that could get in the way.
I'm against trams because a bus can do the same thing - and if you maintain the roads to track standards they are just as comfortable.
> If you have a grade separated syste
Yeah, that's not realistic in 99% of the cases.
> I'm against trams because a bus can do the same thing - and if you maintain the roads to track standards they are just as comfortable.
But buses can't do the same thing.
The thing about LRT is capacity per driver. Even the fanciest, most expensive buses can take maybe half the passengers a standard 30-40m tram can. It's not even a competition. That alone makes trams win every time there's enough population to fill that capacity. Even if you wanted to pay for three bus drivers rather than one tram driver, you can simply not put enough buses on the same route to make up for the difference. Even if said route is independent of other traffic, which it never ever is.
Rail transport always has high up-front costs but low operating costs. But a BRT system truly designed to rail standards would cost almost as much as just building a frigging LRT system. And if you do the sensible thing and choose overhead rather than battery power – well, there's a reason trolleybus rapid transit systems do not actually exist. There's zero reasons you'd want such a thing rather than light rail.
Trams benefit greatly from being mature technology with economies of scale. There's a lot of knowledge in the world on how to build great rail infrastructure and how to make great LRT vehicles at a scale. There are maybe two companies in the world that make BRT vehicles, and no matter how excellent the infrastructure, the service lifespan of a bus is less than half that of a tram.
There also exists this thing called "rail factor". No matter how fancy your bus system, an equivalent thing but on rails will always attract more passengers, especially from demographics that would otherwise not use transit. Whatever the reason, this effect can not be ignored given how important it is to attract new transit users. Steel on steel is simply always more popular than rubber on pavement when it comes to transit.
Also, https://en.wikipedia.org/wiki/Green_track
In almost all cases you don't have enough passanges to fill a large bus though. And in most of the cases where you do you should be paying 3 drivers to get three buses because that increased service is highly valued by riders. Long before you reach the end of that a grade separeted metro that can go faster that a bus or tram should be built thus getting mose people off the but. Only a few places in the world are left after the above where you need more than a bus can do at grade level (which implies a lot of short trips), but if you are in one I'll grant a tram is needed.
the 'rail factor' is claimed often - but I've never seen it put to a fair test. When you give the train better service of course people choose to use it.
Yeah, you need a pretty high population density before you get to the point where rail makes sense. That said, having rail connecting major metros does make sense generally, especially with how often people travel.
In the UK, I had to take a train from Preston England to London (2004ish). It was absolutely packed. A good reason for that is the ticket price was about 60 gbp and the trip took 3 hours (IIRC).
That's where I think the US should both invest and subsidize. There's a lot of air travel that could be replaced with rail travel if the US rail wasn't so terribly ran. It usually costs more than an airline ticket (which is crazy) and often takes a lot longer due to delays waiting on commercial trains. A lot of that can be fixed by regulating commercial rail shipping (for example, limiting train length). But also building new dedicated highspeed lines between major metros. There's no reason you shouldn't be able to make a trip from Seattle to Florida in under 48h by rail and for less than $500.
I do not like this argument. Margins in most businesses are not very high. There is thus physically not enough cash to raise wages very much. Driving a train is less difficult than a plane, and trains have much worse margins due to lower ticket prices, so we should expect wages to be less.
Well, that and people don’t keep on turning themselves into a red paste on the front of your server rack. I’ve heard some fairly harrowing stories from a train driver that made me think all the money in the world wouldn’t be enough to get me to do that job.
Hang on a minute. How do you square your claim that it's as it should be that train drivers can be paid as much as airline pilots, with your claim that everyone else is underpaid, including, presumably, airline pilots?
Hang on a minute. How do you square your claim that it’s as it should be that none of us crabs should be in the bucket, with your claim that including, the crab closest to the edge of the bucket, presumably, should be climbing out of it?
Sorry, what?
EDIT: Oh, I think I understand what you mean. If I've got my understanding correct then my response is that noir_lord said that one of the crabs shouldn't be climbing out:
> their pay is fair for the responsibility
Where's the contradiction?
They are been pedantic by pointing out that the set "everyone else" excluding train drivers would still include pilots rather than reading it as intended which would conventionally and implicitly exclude pilots.
It is what it is with some people.
Thanks for trying to help me understand. I'm not sure if I do yet. Can I check my understanding? Did you mean, when you said
> in reality their pay is fair for the responsibility it's everyone else who is underpaid
that train drivers and pilots are fairly paid, whereas everyone else is underpaid?
You don’t get it because it doesn’t make sense. People’s understanding of money is horrible.
The "everyone else" is not meant to be read literally.
Many people are well-paid, or even overpaid. CEOs, for instance.
It's just that most people, in most common professions, are underpaid.
It only makes sense to talk about a blanket statement like that being a "contradiction" when someone is attempting to speak in the language of formal logic or detailed argument, not colloquial speech.
That's fine, then the response I was looking for is simply "I didn't mean literally everyone else, I just meant simply 'most people, in most common professions, are underpaid'". That's a perfectly valid point of view.
Then I would have replied that, despite perhaps being true, I don't how it's relevant to the question of whether it's fair to pay train drivers and pilots the same.
See sibling: https://news.ycombinator.com/item?id=45915649
> Hang on a minute. How do you square your claim that it's as it should be that train drivers can be paid as much as airline pilots, with your claim that everyone else is underpaid, including, presumably, airline pilots
What is inconsistent about those two things?
You can simultaneously believe that train drivers and airline pilots deserve to be paid more.
As payment is very much a "relative" problem, giving everyone else more, means essentially giving train drivers less.
> You can simultaneously believe that train drivers and airline pilots deserve to be paid more.
But that's not what noir_lord thinks. He/she specifically said
> their pay is fair for the responsibility it's everyone else who is underpaid [my emphasis]
which implies that train drivers are currently paid the correct amount.
It doesn't imply anything, they explicitly said they think it's fair:
> how "overpaid" train drivers are when in reality their pay is fair for the responsibility it's everyone else who is underpaid
You are the one who is implying something.
> You are the one who is implying something.
Maybe I am, so let's stick to exactly what noir_lord said
> > Train drivers can be paid as much as aircraft pilots
> that's as it should be
I understand this to mean that it is fair that train drivers are paid as much as airline pilots.
> in reality their [train drivers'] pay is fair for the responsibility it's everyone else who is underpaid
I understand this to mean that train drivers are paid fairly, and everyone else, including pilots, are underpaid, i.e. it is not fair that airline pilots don't earn more than they currently do, i.e. as much as train drivers, from which I conclude that it is not fair that train drivers can be paid as much as aircraft pilots, in contradiction to the first claim.
Where have I gone wrong?
> “It is not efficiently run (see HS2!).”
Sure, but HS2 has little to do with Network Rail, the government entity that owns and operates most of the UK’s existing rail infrastructure.
There’s a whole other inefficient bureaucracy (HS2 Ltd) behind HS2!
> They are expensive, but that is partly because rail workers are well paid
I must be an engineer for a different Network Rail
Something you are not accounting for is that rolling stock is fully private still, and a huge huge chunk of the profits. Operators don't make much money, the govt owns and runs the rails themselves, but the rollling stock is where a lot of the money goes
Sources? This just sounds like union busting propaganda. “Trust it’s bad”
> This is misleading
Well, what do you expect? Rosa Luxemburg Stiftung is a far-left NGO (the N stands for "Near"), the official trust of the German political party Die Linke.
HS2 is nothing to do with the nationalised rail maintenance, that's just an example of the inability for the UK (and indeed most of the western world) to build large projects, a lot of corruption, a lot of outsourcing, and an infinite money tap.
Great reply
> The big constraint is lack of subsidies.
Well, and profit, which is straightforwardly inefficient.
Does that mean investment is also inefficient?
Yes; absolutely.
how is that related?
Profit is literally the return on investment. Would you invest your money in a startup that guaranteed no profit?
Profit is essentially interest. The only reason new and growing companies get funded is because the EV of future profits (including the probability of losing everything) is higher than just stuffing that same money in S&P 500.
As a Scot who travels on Scottish, English, and Welsh railways, and on Swiss and German railways... Scotrail (now in Public ownership) is pretty good. And I say that as someone in the Highlands, which has had the worst of it in the last 30 years. There's been recent investment, and even the re-opening of closed lines and finally new stations where they've been desperately needed (Inverness Airport, Kintore, Laurencekirk). But still plenty more to do. I visit the south semi-regularly, and worked in London in the 90's. Rail around London seems to have really improved over the last few years. Swiss Rail (SBB) is still the poster child for a decent rail system. Clean, on time, reasonably priced (compared to UK rail), and easy to use. What was eye-opening for me was recent travel in Germany (München to Basel in CH)... DB was dreadful and the stations were in an awful state of repair.
Fun fact: DB (Germany public-private national rail company) has become one of the UK's biggest train service providers - even the Queen's train was under their service.
DB (Schenker) buys stakes in transportation all over the world - with German tax payer money: A fact that many Germans do not like given the very poor train service in their own country.
DB Schenker was sold recently. So your point is not entirely correct anymore. Also yes, it did invest tax payer money but was profitable doing so.
> DB Schenker was sold recently
Ah, the traditional privatize the profit, and nationalize the losses then. Great.
> the very poor train service in [Germany]
Amtrak has entered the chat.
(It was originally scheduled to enter the chat at 2:42 AM, but was delayed until 6:01 AM.)
3 hours, that’s not even a drlay.
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.
Scotrail was shockingly bad when Abellio were running it - much better now and certainly much better than the likes of Avanti West Coast...
My wife uses ScotRail to commute and has no complaints. Yes, there’s the usual weather related stuff but nothing too bad. She probably has the same number of issues with her commute as I do by car - my journey was twice as long tonight as the road was covered in chickens after a crash.
> DB was dreadful and the stations were in an awful state of repair
DBs state is probably too unique to draw any conclusions (attempted privatization stopped just before IPO, so now it's lot of different state-owned private organizations with degraded infrastructure). But the stations are actually fairly straight forward: the platforms and the means to get there are still publicly owned, but 80% of the station buildings have been sold off to private operators. The bigger ones are glorified malls that are exempt from laws about shopping hours, the smaller ones mostly just decay
Plus the Scottish Govt have removed the peak/off-peak ticket split, everything is now priced at off-peak - i.e. cheaper - rates.
Doesn't necessarily impact season ticket holders but it's been a pretty good move for the most part, and a well received change.
It's a mystery to me how Germany, known for its high efficiency in many industries, cannot get the trains to run on time. It's almost as bad as Italy.
This is great to hear.
The problem with this assement is that it misunderstands the role of the private sector.
Yes, those crashes happened, and they were disasters, but they were only partially down to rail track being privatised. They were a result of systemic under investment both pre and post privatisation.
THe _other_ key thing that needs to be remembered is that rail is highly regulated. To the point that both price, timetables profit and pay are controlled by the deparment of transport.
The bigger issue is that actually the department of transport doesn't have the specialists needed to run the railways, they are hired in as consultants.
If you compare that to TFL, which operates both private (DLR and some of the overground) and public (most of the tubes, not sure about elizabeth line) and buseses (which are entirely private)
The railways are in the state they are because of poor governance from central government. and poor investment, also from government.
IF they had been publicly owned, we'd be in the same state, because the UK government is not currently able to run services effectively. Unless and until the political classes are willing to pay civl servants competitive rates of pay and trust data, then we will continue to be in a mess.
Yes, privatization is bad, but the lack of effective governance is the hidden crisis here.
I'm just not convinced that privatisation of natural monopolies is ever sensible. Especially when failure isn't option, you can't just stop the trains running because some operator spent all of their budget on executive bonuses. It's privatised profits and public liability.
You can see that it is highly effective even within the UK. Ofgem publish components of the energy price, of the average annual cost of £1300 I recall that profit was £40. Government subsidies are now £200-300 and are growing (I believe I read a story the other day that said that if the wholesale cost of energy fell to zero over the next few years, the cost of energy would not fall...that is how expensive the government's corporate subsidies to high-cost suppliers is...for some reason, no-one talks about this).
If you compare to the 70s when the government was throwing cash at these industries (largely because of the political incentives), it is unbelievable how low costs are. The problem is that the political intervention has been very bad, the public liability comes from bad regulation (which was just as true in the 70s).
For example, in energy the regulator has encouraged operators, like Tomato Energy the most recent failure, who are very clearly not operating in a financially sustainable way. If you look at who works for regulators (and look at what they get up to outside of regulation, in other parts of government), I am not sure how you can conclude that it could ever be any other way. We are paying for people who are largely unemployable outside of government to attempt to govern companies that are responsible for powering the whole of the country. Why does anyone think is wise?
Another example mentioned in the OP is retaining much in public ownership and then privatizing ROSCOs...it isn't just this is a bad idea, it is so clearly a bad idea that it is unclear who could have thought this is a bad idea. Again, this happened because of very ineffective regulation/political leadership.
Finally, what profits? One of the issues with most regulated industries is that the profits are very low because of the politics (for some reason, people think that public ownership will fix this...rather than make it much worse...we don't need to imagine, the UK has tried this several times, it has failed every time but the politics mean that there is no option but to keep trying it). The result has led companies to do things that are not wise because, otherwise, investors will pull capital. If you read any article about this is any paper in the UK, you would assume that the profits on offer in these industries are wild...they are not, share prices are collapsing, the reason why the government is taking over rail operating companies is because they are going bust, there is massive demand destruction in almost all of these areas because prices are sky-high, profits are non-existent, demand is being destroyed, and no-one wants to deal with the lack of supply because it would require admitting that the world isn't divided into Monopoly Man and a Victorian urchin.
There are countries that have made it work but the UK will never be one of them because of the political environment (significantly more raucous than the European style of managed democracy).
England's water companies are a classic example of why you don't want a natural monopoly to be privatised.
For some reason, people also tend to ignore the many other cases where this is also true: telecoms, energy, water, etc.
The problem is that there is massive political gain to both sides so we will likely keep rotating through the same options. In either case, the exact same people are in control, and no-one will ever ask whether the issue might be the people.
I also think that people fundamentally misunderstand why they were privatized: the public cost was massive, it was ever growing, and there was no capacity to fix this. Any discussion around money was completely impossible. Can you think of any part of the government where this is true? Actually, can you think of any part of the government where this isn't true? The government struggles to do bin collections, they struggle to police effectively, nothing works...and people assume that the problems will magically be fixed if they are given more control.
I think the lack of investment is a side-effect btw. There is a massive issue in the UK with management, it stretches across government, the larger public sector, and the private sector. It is true that in regulated industries, regulators have created bad incentives for the private sector, this is true generally of the incentives that government creates for the private sector...but even outside of those areas, it is generally quite bad. One of the sources of this problem is the complete and total obsession with politics outside of the outcomes that it creates i.e. the purpose of politics is politics, not running things effectively.
There is no real way to fix this (and we have done almost everything possible to make it worse).
> lack of effective governance is the hidden crisis here
but privatization makes that worse, by adding profit-seeking (which tends to minimize investments) to the lack of effective governance
the solution is improving governance and public investments, not privatization
(not to mention the problem with infrastructure paid for by the public over decades being sold off on the cheap to private companies who can reap the benefits thereof)
As always this is grossly oversimplifying. As well as the misleading safety stats, as graemep has noted, it ignores that journeys just absolutely exploded under privatisation [https://en.wikipedia.org/wiki/Privatisation_of_British_Rail]
Graham Dennis (author of the article) absolutely does not ignore this. He regularly points out that Irish rail ridership exploded almost in lockstep with GB rail network growth despite remaining entirely publicly run. Even right at the top of this article he points out that the growth had begun long before privatisation. He goes into a lot more detail in his book.
Possible complicating factor is that at about the same time Irish Rail started experimenting with radical new concepts like having trains that were not from the early 1960s, and having more than one commuter line in the entire country. So possibly hard to read too much into it; there’s an argument that Irish journeys just went up because the system was becoming rapidly less terrible.
(I remember being amazed as a kid in the 90s on encountering a mainline train that had automatic doors. Irish Rail was pretty behind the times for a long time.)
The growth didn't happen long before privatization in the UK though. It turned around almost exactly when the privatization process started (which wasn't an immediate overnight event).
I'd argue that the upswing had started in the 1980s and took a hit along with the economy between black monday (87) and ERM2 crash/black wednesday (92)
https://en.wikipedia.org/wiki/Impact_of_the_privatisation_of...
The privatization took years however, it wasn't an overnight thing. A lot of the process was just writing down and professionalising a lot of aspects that were previously ad-hoc, so the benefits started before the precise date drawn on the graph. The law was passed in 1993 but preparations began before that, it was clear this was going to happen even in 1991.
That certainly happened, but at the same time the ticket prices have consistently gone up above inflation, so what we're missing is the causal link - why did journeys go up so much? Was it in fact other transport policy to get commuters out of cars?
Ticket prices going up is actually good for mass adoption. If they are too low, you will see people riding the train who are only using the train because they are too poor to afford a car. That makes middle class people want to avoid the train.
Also higher revenue often means better service, which for most people is more important than the price.
I don’t think these points are accurate at all for people in the UK. There isn’t really a class divide, you ride trains in particular because it’s theoretically the most time efficient way to travel within metro areas and potentially across the country. Increased prices have not resulted in better service, and it’s purely a method to price gouge those who have no feasible travel alternatives.
Thats irrelevant to the safety statistics.
The worst UK accidents happened immediately after the initial push to privatize which resulted (in part) in the hybrid situation that exists today.
Does Britain have any privatisation success stories? Or any public-private partnership (PPP) success stories?
Does any country have any success stories?
I can’t think of any.
You can't privatize what can't make money in itself. By that I mean, rail is beneficial to the entire economy of a country. This profit is not something a rail company can benefit from but a country can. Serving low traffic areas are a loss business but vital for a country to grow.
Same for fiber infrastructure, running fiber into a desolate town may not be profitable but giving the chance for some kid in that town to build the next unicorn from his home benefits the entire nation. Not all talent is in the cities.
In the Japanese model the rail company also owns land around the station, so they capture more of the value of rail transport. Rail in the UK does not capture all the value it delivers, so subsidies would be a pragmatic solution.
Why should I, a taxpayer, subsidize rails?
It's sarcasm, many drivers don't realize that the public subsidizes them too, but have such silly arguments.
No, it's actually a good question. If the rails are private, why should the public subsidize them?
For clarity's sake, I think railways should be public, and paid for with a combination of taxes and fares.
I think rails should be public, like skies and roads, and train companies should pay for their usage.
That sounds like an excellent idea. However I think rail transport depends more heavily on quality infrastructure. If a state doesn’t maintain its roads well and allow potholes to develop, it is probably rare for that to cause a fatal accident (I’ve heard of potholes causing damage to cars but not deaths). But improperly maintained rails lead to derailments and deaths.
Potholes do regularly result in cyclists' deaths.
That's how it was in wild west US as well. The rail lines got massive land grants.
https://en.wikipedia.org/wiki/Pacific_Railway_Act_of_1862
This is one of the ways the US funded rail infrastructure in the 1800s.
So they're basically a real estate company with a rail transport component?
Italy has seen tremendous success with privatizing High Speed rail.
I think the difference is that the infrastructure (tracks and stations) is still owned by the state and leased out competitively to private train operators.
It’s kind of like the airline model.
They've been doing that here in Norway as well for regular trains.
The result is that the train operators get f'ed in the a by poor track maintenance and old trains. It has been so bad that when the trains run people joke it's "train for bus".
Also us customers can no longer buy one ticket that gets us from A to B but often have to contend with 2-3 different operators.
Italy has not exactly privatized high speed rail. The public rail operator Trenitalia is by far the largest high speed rail operator in the country. And it’s great.
What Italy has done is open the rails to access by private companies in addition to the public one, most notably high speed operator NTV/Italo.
Arguably this competition has helped spur on the public operator to greater heights. But it’s not the same at all as what Britain did (privatizing the public operator itself).
> Italy has seen tremendous success with privatizing High Speed rail.
I think whether privatization helps or hurts depends a lot on how corrupt or inept the government is, ie. the more corrupt or inept, the more privatization can probably help.
> the infrastructure (tracks and stations) is still owned by the state
...so, a bit like Network Rail, then?
In many European countries trains do make money.
The model should be that rails are public and are leased to private operators.
The private companies pay for the maintenance and such, and then are free to do what they prefer.
That is the UK. The big issue has been:
* Government is unable (for various reasons, the primary one being massive levels of corruption) to invest in expanding capacity. Demand on certain routes is multiples of the capacity that exists. * The trains are owned by private companies, this was a bad idea. * Operating companies have had to put prices up because of all the things outside of their control. Government has been happy to let them take the blame, it has allowed things to be moved into public ownership, more power, more control. * No-one is making any money because the idea is for no-one to make any money. Making money is dirty so operating companies make no profit, and prices are sky-high.
Railway privatization is resolved in East Asia where they are also major real estate developers that plop luxury malls and apartments ontop stations. See the HK MTR as an example, which is far better than the average European subsidized metros.
The real problem, as always is NIMBYism and the western aversion to luxury malls and mass consumerism, which ends of in a self-reinforcing cycle of increasingly miserable public sphere as nobody wants to engage with it or make it better.
Japan's rail system has some of the best farebox ratio's across their system (many of their lines actually make money, which if you compare to other countries, is pretty much unheard of in North America). [1]
And they actually continue to expand their service.
[1] https://en.wikipedia.org/wiki/Farebox_recovery_ratio
In the US, one of the highest farebox recovery ratio transit systems has historically been BART, which is 2019 was 72%, and even today is around 50%.
Unfortunately, having a very high ratio also makes systems much more vulnerable to collapse during periods of economic downturn, which is exactly what BART has been dealing with since ridership collapsed during Covid.
I'm no expert in this topic (in other words, I just asked Claude this), but AFAICT part of the reason Japanese rail systems did better appears to be that they are owned by diversified companies that own numerous other assets, like hotels, restaurants, and office complexes.
Every major station I went to in Japan had a huge mall with restaurants connected to it owned by the rail company. Inside stations were rail company owned gift shops, convince stores, etc.
I think that connecting outlying areas (especially ones you the railroad build yourself) to department stores is what got Japanese rail companies going, but it's probably less important now than it was initially. Farebox revenue covers profitable operation of the railroad. It even appears to cover upgrades; browse around on the satellite view of Tokyo and you can see many private companies moving their above-ground infrastructure to (expensive!) subways because ... trains hitting cars interferes with their ability to earn money. It is honestly something that I have trouble wrapping my head around. The business is so good you can afford to make it better, but the business is a commuter train? Weird!
I think Japan is successful because of a less pervasive car culture than the US. People expect to walk 30 minutes to the train in the morning, that's just something you do. It would be unheard of in the US (and also dangerous in many suburbs, because they are designed to move as many giant SUVs as possible per hour, not to let pedestrians and cyclists get to the train station).
Also, a big caveat is ... all of this is Tokyo and Osaka, very large, rich, and dense cities. When you go out into the middle of nowhere in Japan (even an hour out of Tokyo, think the Hachikō line, etc.), rail service kind of sucks and is subsidized heavily.
I disagree and am working on an article arguing that Japan rail privatization represents a failure, as does its much lauded pedestrian friendliness.
The premise is basically that Tokyo is the busiest city on planet earth and so should therefore have the best public transit and pedestrian infrastructure by a huge margin, when in fact it still gives unbelievable space to cars (Shibuya crossing should have been permanently closed to cars 20 years ago).
As for trains, during rush hour trains can be so full you might be squashed against the door unable to move - incredibly unsafe, leads to daily injuries, and some argue have something to do with the heinous levels of sexual assault on trains. Not to mention even in Shinjuku station most platforms don't have guardrails to prevent accidental or purposeful death by trains, another outsized problem in Tokyo.
But the most glaring issue is around the very design of the system. Privatization results in requiring riders to sometimes exit a station of one company, go all the way up to ground level, walk a block or to two another different company station, and then ride another train. A government managed system wouldn't have this issue, it would simply combine the stations at design time.
>The premise is basically that Tokyo is the busiest city on planet earth and so should therefore have the best public transit and pedestrian infrastructure by a huge margin, when in fact it still gives unbelievable space to cars (Shibuya crossing should have been permanently closed to cars 20 years ago).
Tokyo has the top 3 busiest train stations in the world. 8 of the top 15, 9 if you count Yokohama. To argue that they're somehow failing to provide a service, and that privatization is the problem, just sounds insane. [1]
It's 'don't let perfect be the enemy of good' taken to the very extreme. I'm really not sure how to have a productive conversation with this premise.
>Privatization results in requiring riders to sometimes exit a station of one company, go all the way up to ground level, walk a block or to two another different company station, and then ride another train
Heavy emphasis on sometimes since they're often connected at a station if it's busy enough (yes you have to 'exit' a gate then enter another. There's plenty examples of lines in city subways not having tunnels between them as well, and having to walk outside.
[1] https://en.wikipedia.org/wiki/List_of_busiest_railway_statio...
There are problems with rail privatization but I don't think this is one.
> Privatization results in requiring riders to sometimes exit a station of one company, go all the way up to ground level, walk a block or to two another different company station, and then ride another train.
I believe this is the result of different private companies operating physically separate lines, rather than some privatization activities? For example, Shinjuku has stations of JR East (result of JNR privatization), Keio (private), Odakyu (private), Toei (public), Tokyo Metro ("private" but owned by Japan gov and tokyo metro gov). Sure, JNR privatization is controversial but without that, Shinjuku is still a mess of different operators.
Are you suggesting the government turn back time and banned private companies owning rail or they should buy out and nationalize all rails companies?
> A government managed system wouldn't have this issue
Well, if it's 2 different government levels and 2 entities, the issue still exists. For example, to transfer between Tokyo Metro and Toei Subway, you might need to tap or a transfer ticket https://www.tokyometro.jp/lang_en/ticket/types/connection/in...
It's also possible for public and private companies to cooperate. Keikyu main line (private) does through running on Toei Asakusa line that allows the subway to have connections to both airports through private rails.
Nowadays, with IC cards, transferring between systems is a breeze. For the walking distance, nothing much you can do besides moving the track itself (done sometimes) or station redesign with better walkways and tunnels (done often).
> As for trains, during rush hour trains can be so full you might be squashed against the door unable to move
I don't know why this never occurred to me before, but: is there a reason they can't run more trains or higher-passenger-capacity trains? The demand is obviously there, so the question is: do they like it super-crowded?
There's a hard limit on how frequently you can run trains, because you need to maintain safe separation distances. Try to pack too many trains into the timetable and the whole line is just one tiny error away from grinding to a complete halt, or worse. There are some tricks to pack in slightly more trains, but they generally require expensive and disruptive signalling upgrades. For commuter lines with lots of closely-spaced stations, the most effective way of increasing train throughput is to reduce dwell time at stations and ensure punctual departure, hence the often rather brisk attitudes at Japanese stations during rush hour.
There are several limits on the length of trains, but the primary one is platform length. It's no use running a 7 car train if all of your platforms are 6 cars long - anything you might gain in capacity per train is wiped out by increased dwell time. You can extend platforms, but it's expensive, disruptive and only works if you have sufficient space at all (or practically all) of the stations on the route.
Japan can't really justify major rail investment, because passenger demand has been steadily declining for decades. Peak-time trains get progressively less busy every year, simply because there are fewer commuters every year.
> higher-passenger-capacity trains
Length is limited by platform length and width is limited by tunnel loading gauge and platform sizes. To increase the platform length, you have to do it at most if not all stations. Crowded stations are usually in desirable areas which make it harder to dig or acquire land.
> run more trains
For lines at capacity, I believe it's usually limited by trains dwell time. Longer and bigger trains take longer for people to safely board. To improve this on the train side, you can have more doors and bigger doors. Station platforms also need to be bigger, have more stairs, bigger walkways, etc. Longer trains also make it tougher for train drivers and station staff to open and close the doors safely.
Tough but not impossible problems but many solutions contain trade offs. Only surefire way is to build another line but that costs tons of money.
I believe it's run absolutely maxed out during rush hour, like 12+ cars per train with 2-3 minute headway
Often you are limited by dwell time + track separation.
It's just humans being humans. NYC has the same thing during rush hour for certain stations. A train might be 3mins away but people crush themselves into a subway car while I just wait for the next train which is pretty empty.
I’m not sure why you’re being downvoted when those are legitimate problems.
I disagree that this is a failure of privatization (other than the last point) and I also disagree that Japan’s success is a vindication of privatization (although it does show that above average systems are possible through privatization) but those are reasonable discussions to have
I believe the public transit systems in most countries are so bad and underfunded that Japan's seems holy in comparison. And don't get me wrong, it's one of the best.
For transit nerds like me though, it's frustrating when all the evidence points to the same conclusion: more trains, more pedestrian throughput, no cars, and yet no city has gone this route full throated.
I was genuinely shocked on at the amount of space given to cars on my first trip to Copenhagen last month. I was promised bicyclist utopia, instead I was presented with massive lanes for cars, confusing intersections, and in a construction area being forced onto a narrow sidewalk full of pedestrians.
Frankly I don't know any city on earth getting it right. I've heard maybe Shanghai but from videos I've seen of car culture in the PRC, I doubt it.
The bar is just very low in this world right now.
> when in fact it still gives unbelievable space to cars
That's not the fault of the railways but govenrment policy in the 60-80s. Everybody drunk the US coolaid.
Japan has a culture of running trains on time though. There is no MBA figuring out that they can pay themselves a bigger bonus by firing the backup train drivers needed to ensure on-time service.
And even if there was they couldn't thanks to unions and some of the strongest worker protections in the developed world. That doesn't even touch on the loss of face for proposing such a thing.
Is it really their recipe for greatness? We have very strong unions and worker protections in France, and our trains are unreliable as fuck. I'd be more inclined to think that their highly developed feelings of pride and shame are bigger drivers.
Spoken to a few ojiisans here over the years and they'll always mention the value placed in making sure everything's well maintained. If you go out past midnight in Tokyo you'll frequently see gangs of workers on the lines doing inspections and installing new equipment. Can't comment on other countries but if you're not doing enough upkeep things will turn to shit fast.
It's hard to measure this.
British Telecom lost its monopoly around the same time it was privatised. Is today's (very competitive) telecommunications market more a result of privatisation or of the loss of BT's monopoly?
Another way to look at it would be, are BT's customers better off now, than when it was a government company?
BT was deep into preparations for a nationwide fiber rollout at the time of privatisation in the early 80s. The project was cancelled, the fledgling factories equipment and expertise were instead exported to South Korea, enabling their widespread fiber penetrance.
That delayed fiber rollout in the UK by decades.
Was that a success? Could be they were too early to justify the cost? But without someone pushing ahead, who develops the technology?
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 is idiotic to anyone who remembers the state of the internet at that time. Most servers were not connected to the internet via fiber.
Unwittingly a brilliant demonstration of how short-term capitalistic behaviour hamstrings society. Japan, Korea and Hong Kong are way ahead of the UK and much of Europe precisely because of the lack of insight and vision reflected in your post.
Ahead in what sense? More successful internet startups or tech economy? I don't think so, but that's how such buildouts were pitched as justified.
The private market made the exact same choice in the 90s, but instead of just being something that cost maybe more tax money than it should, it was hyped up and full of lies and marketing and bullshit and burned tons of cash for really stupid projects and caused a serious recession.
So..... not really a point for privatization here.
The 90s were dominated by modems and around the turn of the millennium DSL connections. Fiber internet (to the home) didn't start until much later. The backbone was getting fiber deployed before then, but there was never some kind of unusual bandwidth crunch in the UK. The private sector managed the rollout just fine.
Do you have some source on this, sounds interesting.
It could of course also have just been a failure if tried to early. So we should just assume this would have worked out perfectly.
https://www.techradar.com/news/world-of-tech/how-the-uk-lost...
It's hard to tell with counterfactuals like that. One factor to bear in mind is that BT was close to rolling out nationwide fibre in the early 90's [0]. Would it have made more sense to decouple infrastructure and service, or would that have led to a nightmare like we have with the trains?
[0] https://www.techradar.com/news/world-of-tech/how-the-uk-lost...
I would say BT got worse immediately after privatisation and now have got better - largely I suspect due to competition.
Post-privatisation, Bonfield-era BT really was an abusive monopoly.
I do not think the problems have gone away; dealing with OpenReach is very often as kafkaesque as it would have been.
Oh yeah - OpenReach is a bit of nightmare, but less of a nightmare than some energy suppliers I can mention...
The New Economic Policy in Soviet Russia (1921) and Deng Xiaoping's reform and opening up in China (1980s) both saw privatizations and significant economic improvement. But those were corrections of rare cases of having way too much (ie, near-absolute) state control, where even stuff like private barbers had been illegal. That said, in the case of Russia of course, wider privatization in the 1990s was disastrous in many ways
> in the case of Russia of course, wider privatization in the 1990s was disastrous in many ways
When you effectively hand over state property to high-ranking communists for less than five percent of its real value, that is not a privatization.
In the UK the airline and telecom privatisations were largely successful (BA, Rolls Royce, BT, etc). BP did okay too.
For some reason things that happen in the air seem to privatise much better than things that happen on the ground.
MG might be the exception, but it’s a bit of a weird situation in that it went from being owned by a loss making British state owned enterprise (Leyland) to being owned by a loss making Chinese state owned enterprise (SAIC). Still makes popular, cheap and not very reliable cars though.
The key is competition. BP compete on the global oil market. BA compete freely with other air companies. RR with other turbine manufacturers (not many of those globally!).
The semi-successful ones are the "shell company" ones: telecoms, power, and railways. The user gets a choice of who to get customer service on, which feels nicer than a government bureaucracy, but the infrastructure is a natural monopoly so the actual hardware delivering the service is mostly the same.
Electricity markets work pretty well as a market and has miraculously managed a lot of carbon transition, but is now horrendously expensive (like trains) in a way that's becoming politically important. The public are going to demand that something be done. AI power use is not helping here.
The less successful ones are the actual big capital asset ownership ones: RailTrack PLC, OpenReach, water companies, the nuclear industry.
BT was only successful if you take a very narrow view of success. They dragged their heels on rolling out ADSL to maximise short-term profits from ISDN which has had a hugely negative effect on the country.
Government spent decades figuring out how to regulate it and even today OpenReach is far than ideal.
For some reason things that happen in the air seem to privatise much better than things that happen on the ground.
I know that there are some nuances to this, but this makes sense right? If you think you can compete on say London-Amsterdam, your airline can in principle decide to compete there (yes, they need slots, etc.).
If you want to compete with rail between Amsterdam and Berlin, you are either going to pay an insane amount for extra infrastructure (too expensive) or you have to let companies bid on exploiting a line. But you can never have two companies competing at exactly the same times.
Yeah there’s probably a way in which railways and water are natural monopolies, so are more difficult to privatise.
Yes, it's the tracks. Planes don't need tracks.
> Planes don't need tracks.
But let's all take a moment to acknowledge that it would be awesome if they had them. Can you imagine the shenanigans you could get up to designing a nationwide 40,000-foot-high rollercoaster system?
I think that's a factor to explain why air travel can be cheaper than rail.
Air travel lends itself better to competition and it needs much, much less infrastructure than rail.
These entities are not really the same kind of thing. BA and RR were successful private companies that ran into difficulty for one reason or another and took on the UKG as an investor of last resort. BT was an offshoot of the Post Office, a service that is run by the government even in the USA. BP was government controlled for...geopolitical reasons.
BA was originally stated as a state owned airline, but I agree about RR.
https://en.wikipedia.org/wiki/British_Airways
There are some nuances to it. British Airways (not the original British Airways Ltd [0], who merged to form BOAC) was established to manage several existing airlines that had already been nationalised (BOAC, BEA) and two regional carriers (Cambrian Airways and Northeast Airlines).
Of course BOAC and BEA had been made my consolidations of many smaller airlines which gets messy quickly when tracing the lineage. Even Cambrian and Northeast had formed British Air Services prior to this which was 70% owned by BEA.
So it is technically true that is was started as a state owned airline, but one made from companies that were originally created as private with a mixed history of state ownership.
[0] https://en.wikipedia.org/wiki/British_Airways_Ltd
Very fair question. Let's also consider the inverse. Are there any modern government run success stories in Britain?
The privatisation of the water industry in the UK certainly wasn’t and is considered a failure due to rising bills, poor infrastructure, and severe pollution from sewage overflows.
In the US, some have failed, some have worked. In my home state of Maryland, the PPP (P3) for redeveloping the Travel Plazas along I-95 is often cited as a success story and they are indeed widely considered top notch rest stops. It's a small-ish thing, but it did work.
https://mdta.maryland.gov/Partnerships/tp3Overview.html
I don't know enough to say if Seagirt is considered a success but I do know Baltimore's port does very well. The Purple Line is/was a failure.
All things where you can't have genuine competition are a disaster.
I'm not against taking these things away from government but it might be better to have a non-profit that isn't as directly controlled by the whims of politicians. Independent similarly like the Bank of England with very clear metrics/goals on how to run the company.
Japan’s rail privatization was extremely successful and it’s considered one of the best rail networks in the world now.
Hong Kong is considered to have the best subway system in the world and it is private and for-profit. Though the largest shareholder of its stock is the Hong Kong government.
> Does any country have any success stories?
Apparently South Korea is doing pretty well with its healthcare: financing is public, service delivery is private (but heavily regulated).
That's the same model we have in Canada here mainly. Provinces pay for the service, but family doctors and most other practitioners are private businesses that then bill the government based on a set fee schedule.
The exception I guess is hospitals which are kind of a mixed structure of some kind and doctors in them are salaried employees not businesses of their own.
The problem with this approach is it intrinsically creates conflict between the doctors and the gov't about how fees are structured, and the patient gets stuck in the middle. That and inconsistent standards, structure, and quality. Couple that with conservative governments that sometimes have ideological antipathy to socialized medicine generally, and there's a recipe for difficulties.
I'm given to understand that the NHS in the UK is not like this, and most doctors are salaried?
I could be getting some details wrong.
CDPQ has been good at making transit in Canada, but they are working on behalf of the Quebec Pension Plan so it's kind of a weird situation. I largely agree with you.
telecoms, wired broadband is competitive and has variety of different levels of service at different price points
water/electricity/gas have been abject failures
railways have been a mixed bag
some things are better (quality of service is much better), some things are worse (subsidy and cost)
but a good chunk of that is under direct government control, and has been for a very long time
the only private bit is/was the TOC, "train operating company" (and roscos... which are another subject)
TOCs essentially just put a driver in the cab, and collect the fares and send them to the government
they don't maintain the track, they don't set the fares, they don't set driver pay, they don't control the service pattern
if your train service sucked during the last few years: it's probably the government's fault
It depends on what you count as a success.
The privatisation of BT meant that there was no specific monopoly on ISPs during the Internet boom. While the privatised BT had a monopoly on the wires - customers could choose from hundreds of different dial-up and, later, ADSL ISPs.
Similarly, the privatisation of the mobile phone networks means that the UK had some of the cheapest airtime contracts in the EU. Yes, there are still gaps in network coverage, but there were at the peak 5 different MNOs for customers to choose from each competing and driving down prices / increasing coverage.
Energy has been mixed. Companies like Octopus have provided things like real-time electricity APIs. I can't imagine an organisation like British Gas launching something like that. Similarly, if your power supplier has crap customer service, you can move. And people do! In that sense, it has been a success.
Pickfords was also privatised. People forget that house-moving companies were nationalised during WW2. The liberalisation of that market has been a success.
You can argue about things like Rolls Royce, BP, British Airways etc. But I don't think they offset the utter failures of privatising water, trains, etc.
LOL. Yes, Scottish Water was never privatised, and that's been a great story of success... even if it's only because it's not any of the failed English water companies.
Yeah I was going to say. Every one of these privatizations was a success from the point of view of the people who made them happen. They weakened worker power and increased the amount of money available to be extracted by the wealthy. If they happened to also make these important systems worse, well, that's our problem.
British Airways?
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 on how it's told - it lets you get the school you need after all (even if it's wasting money vs doing it the normal way). And it's making the participating companies great profits, just don't mention whose pockets it comes out of.
PFI has been an absolute disaster in Scotland: not only incredibly expensive, but there were some substandard construction issues that became very public when a wall in a school simply fell over (fortunately outside hours so no injuries!)
https://www.bbc.co.uk/news/uk-scotland-edinburgh-east-fife-3...
That has happened in Britain. it was how Gordon Brown claimed a balanced budget while running up what would be classified as off balance sheet debt if anyone other than the government did it. A lot of things like hospitals were financed this way.
I would say the motive here was mostly to avoid increasing the government debt numbers. it would not work if the government did not exempt itself form the rules applied to everyone else.
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.
Depends, do you travel through any of the airports in Europe, use many of the train services in Europe, get power from spain, portugal or (non-nuclear) France? Fly on a Airbus, or a Boeing with RR engines?
There are legit reasons to be skeptical of privatization, but yes. It works well when it works.
Dogmatic responses (free market == everything, only government and unions can provide service) are not helpful.
Airbus is by all intents and purposes a (multi-)State controlled company with privatized profits. You don’t get to have hefty defense contracts in countries like Afghanistan or Saudi Arabia if you’re de facto a private company, which they aren’t.
>You don’t get to have hefty defense contracts in countries like Afghanistan or Saudi Arabia if you’re de facto a private company, which they aren’t.
This is false. Saudi Arabi buys equipment from private companies. Most US Defense contractors are private companies, of course countries all around the world buy from private companies.
The defense contracts of Airbus have nothing to do with them being partially state owned.
>Does any country have any success stories?
Both Airbus and Volkswagen were set up by Governments. T-Mobile is arguably quite successful.
Some communist era enterprises failed (or would have failed) on open market and entirely deserved this.
Extreme absurdities included hunting whales to fulfil production quota, then dumping carcasses into sea as they were not needed for anything. Some species were hunted into extinction this way, for no benefit whatsoever.
I'd argue that privatising telecomms has been a win. I think because it's quite open to competition (even if there has been a good deal of consolidation).
The challenge with so many UK privatisations is that the idea of real alternatives/competition ranges from laughable to extremely laughable.
No. Because privatising natural monopolies always creates unwelcome outcomes for everyone except the new shareholders.
One could argue the rails were a success. The article argues deaths went up after privatization, but that's only because the miles being ridden went up significantly as well. Actual deaths per mile are down. Further the drop in ridership in 2021 was due to covid, and the financial strain was caused largely by the rail industry re-investing heavily before covid.
There have been lots of privatizations all over the Western world and most are not well known, its the negative examples that are very much talked about. And many or most are somewhere between fully private and fully public anyway, so the picture is much more muddy. I think to say its all a failure would be very reductive.
I think many of the telephone operator privatization worked pretty well in most places and buildup of user business for those companies and more competition, mostly from formerly public operators competing in other markets. But it also depends on the country.
Some of the airline privatization seems to me also sensible.
In my country (Switzerland) government owned some banks or partly old them and sold some stock in them, witch seems sensible to me.
Some water infrastructure was privatized and regulated in many countries and for the most part this has worked fine, maybe not in Britain.
Denmark seems to have done quite a lot of privatization and it was mostly considered pretty well done.
I was really surprised how much of this was done all over Europe, often by 'left' governments. Once you start researching you find more and more.
Would be the work for an economists thesis or something to try to do a full accounting of this across all European nations.
Surely it depends on how you measure success. I'm sure a lot of politicians got very rich, so that's a success from their point of view.
But but but... Someone got rich! Thus it has to work. (And if privatization doesn't work, we'll just repeat that it works over and over until people believe that it works.)
I'm the wrong person to try to steelman this, but lets have a go anyway with a couple I know well:
1. Internet Service Provision
Britain chose to separate the intrinsically geographic monopoly of Last Mile Copper Loops from its existing non-intrinsic monopoly telephony provision. British Telecom, which had once been publicly owned, was obliged to distinguish "BT Openreach", the part of their company which inherits the local loop monopoly and which also offers (non-monopoly) long distance network transit and other useful stuff - from the consumer facing BT, which is a fairly ordinary PLC. I know a BT employee, the regulators really care that they can't collude with Openreach.
This means that the tiny company providing my Internet access (Andrews & Arnold) doesn't need to own a large brick building down the street, or even a cabinet in that building, or negotiate a deal with a monopoly behemoth who can set their own terms unfairly. Instead, they pay Openreach to move packets from my home to a nearby city, and then they can choose to pay Openreach or its competitors to move those packets from the city to their routers. BT Openeach is a monopoly, but it's an ordinary public company just with a lot of regulations to ensure it behaves equally for A&A as it does for its owners BT. BT isn't a monopoly but it does have lots of customers, I think its services are crap or alternatively that they're too expensive (A&A is more expensive but much, much better, if BT were much cheaper than they are maybe that's a good deal for somebody)
This arrangement means most UK residents have dozens of potential reasonable ISP options, with a range of pricing and terms, including lots of "All you can eat" type packages, even if they don't live in a big city. People like me who do live in a big city get slightly more options (a Cable TV company, a local fibre startup), which can go cheaper and higher bandwidth, but only a few people are stuck with a single practical option as is common in the US - basically only people in very rural areas, and usually their option is community owned, so it may not be cheap but it's at least owned by actual people who might care.
2. Energy
Britain separately privatised the gas and electricity supply. Now on the surface this is lunacy because of course that's a geographic monopoly. But they're not complete idiots, so what was actually privatised was mostly the customer service/ end user billing part of the problem. My gas and electricity come from the same place as my neighbour, inevitably because they're the same pipes and wires, but my bills and my customer service are from my choice which happens to be Octopus.
Does this achieve anything useful? Eh, maybe. I don't think a local energy monopoly would be anywhere close to as good at either customer service or billing. Octopus seem to have some idea what they're actually doing. On the downside these firms have ended up costing tax payers a bunch of money because of course when one goes bust the gas and electricity are still working but the government is on the hook to ensure somebody else handles billing them for it and that's complicated. This happens far too often when there is stress on the financials of these firms e.g. the Ukraine situation fluctuated energy bills with little notice.
Edited: fix s/citizen/resident/ what matters isn't your passport but where you live
> Does any country have any success stories?
Yes, but it depends on how/why things are done. You don't hear about the successes because it's not a story worth telling.
Charter schools are a good example. They have mixed success when deployed. In many places they're deployed by right-wing politicians primarily to weaken public schools (and their unions). This can be done via a variety of ways, such as letting the charter schools charge extra (thereby essentially subsidizing private schools), allowing the schools to "expel" problem children, thereby dumping the public system with them, etc. The result is usually a framework that isn't designed to actually make education better.
In some places (Sweden is a good example), charter schools were implemented by a centre-left government because all attempts at school reform failed due to a variety of reasons. The result was by most measures successful as the charter schools couldn't pick and choose kids, were still held accountable, and it resulted in the public schools having to stop fighting reform in order to sort of compete.
The Canada line in Vancouver (metro link to the airport) was build on time and on budget and is still run by a P3 company, as is the new REM line in Montreal. The incentives here were ONE company was given a contract with clearly laid out incentives and minimal political meddling after that (as opposed to other P3s where the government is highly involved and subcontracts, etc get doled out to connected firms, etc).
The UK car industry was mostly privatized, but judgement on its post-privatization failure mostly goes down political lines (eg should a government continue to subsidize poorly made cars in the name of employment). Same with most of the rest of industrial Britain, which under public ownership was uncompetitive in most cases. That being said, most would consider Rolls-Royce to be successful and was privatized in the 1980s.
BP's privitization was mostly a success, even with all its issues.
Canada privatized CN rail and it is now one of the most efficient freight railroads in North America.
Telecom privatization in the EU has mostly been a success (though one could argue that the EU has pushed for too much competition, which has meant that while mobile prices are generally very low, it has made it harder for companies to invest).
Many airlines outside of the USA were also publicly owned pseudo-monopolies. Flying is cheaper than it's ever been, even if no longer glamourous.
The TL;DR is of course it's a mixed bag and depends on so many factors. Many UK industrial firms were so poorly run under private ownership that they were so far behind they couldn't catch up and compete once privatization did happen.
Depends. According to BBC & Friends, or according to reality?
No. The UK refuses to accept reality, which is a poverty rate 12% higher than the US, and families with three or more children poverty rate of 47%. The cost of benefits and other costly boondoggles compete with these failed public works ventures. The largest water utility has £20 billion debt and will probably need to be un-privatized. They probably breathe a sigh of relief knowing that France is twice as bad financially, so that feeds the denial mass delusion. And the economy doesn't have the fantasy growth that was expected, so automatic additional borrowing. And it's budget season. Yay!
Yay Brexit!
> The UK refuses to accept reality, which is a poverty rate 12% higher than the US,
I'm sorry but any US figure you use to support this allegation is probably nonsense. US figures about joblessness and poverty are a joke, and typically in international comparisons they still use things like "access to air conditioning" as an indicator of poverty even though they are meaningless.
I was going to say just that. The whole statement is ridiculous.
The only rail privatization success story, that being the rail system in Japan, for some reason is not replicated much elsewhere. You make money on development, not running trains. You will never make money on public transportation, nor should you—it's a public service.
> You will never make money on public transportation, nor should you—it's a public service.
My understanding is that in the US Amtak runs a net-positive operating income in the Northeast Corridor (Boston-NYC-Philly-DC) but it all goes toward subsidizing unprofitable routes throughout the rest of the country. To the tune of the entire system running a $2 billion loss every year.
So in theory you could get some private rail to run trains up and down the northeast seaboard, upstate NY, Long Island, and possibly come out with a net profit.
Agreed. Transportation is a public service and economic engine. Subsidizing travel to help supply travel to demand is the easiest and likely most affordable thing we can do to ensure economic volume.
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 40% discount right?)
How would you quantify the money lost by roads?
I miss being able to spontaneously buy a ticket and travel off to see a friend in another town or city. I did quite a lot as a young man with the help of my 'young person's railcard'. The cost would be prohibitive nowadays because only tickets bought well in advance are cheap.
A lot of people in the UK seem to think the trains in Europe are so much better, but that's not the case, at least in my experience. We took an interrail trip a couple of years ago and spent half the time sat on the floor and waiting for delayed trains. If anything, the overall experience was much worse than trains in the UK, especially if you factored in the difficulty in procuring the correct tickets.
Talking about "trains in Europe" as one thing doesn't really capture the complexity of the system – it varies a lot between different countries and operators. For example Swiss trains (SBB) are extremely reliable but Deutsche Bahn is famously unreliable.
Apparently if a light-bulb blows at a station, two different contractors need to be called - one company has a contract for replacing consumables while another has a contract for repairing faults.
https://youtu.be/bNEEJX0VM6k?si=1hGCnYx826ffGOPj
I remember that the UK was forced to privatise Rail in the way that it did because of EU competition rules. I was commuting by Rail at the time and the manner in which it was privatised was considered to be barmy by both myself and fellow passengers.
This is just another “bendy bananas”-tier myth. The UK was never forced to privatise because of EU competition rules, see, for example, France, an EU member state that retained publicly owned railways during the same period.
There are EU competition rules that require separating operations from infrastructure, but it is and always has been fine to do this as separate divisions under the same publicly owned umbrella.
Not true. The EU is taking Netherlands to court for not allowing private companies (not state owned) to bid on the main passenger routes: https://ec.europa.eu/commission/presscorner/detail/en/ip_25_...
De facto it is required, and you see that in Germany - many routes are not operated by DB anymore.
I don't understand how is this "forced privatisation"? There's nothing preventing a state owned rail company from operating, no? All this says is that private companies must be allowed competitive access. Am I missing something?
No nothing preventing it but you cannot just have a state operator bid for it. The contract in question is basically the entire Netherlands passenger operations, with some small exceptions.
The key problem the EU has is the size of the contract. The contract cannot be for the entire country (more or less), it needs to be split into smaller ones (eg: one contract for intercity, one contract for local services near Amsterdam, etc). Netherlands defense is that the passenger rail system cannot be split up like this as it would cause operational problems and thus should not be franchised. I'm simplifying this from memory but it's roughly correct I think.
There is no doubt in my mind were it to be split up like the EU is requiring, that de facto some of it would be privatized. It has/is happening in every European state that has complied with the EU rules.
To me that is very close to forced privatisation. The current (Labour) UK model (government owned franchises with no bidding) would 100% not be allowed.
> abject failure
Other than a huge explosion in the number of people using trains? literally Chernobyl-on-wheels
> so that decisions about the railways we use are made closer to us
I believe this is a mistranslation of "so that decisions about the railways we use are made by me" or more precisely "so that decisions about the railways we use are made by the sort of people that like attending committee meetings and working their way up the inside of political parties"
The privatisation was very likely botched, however, it was not as if it was done in a secret - the "fire sale" only happened at "rock bottom prices" with hindsight. The nationalisation itself was fairly botched and it is hardly as if the decimation of Britain's railways implemented following the Breeching Report (completed on a nationalised rail system) was particularly effective.
Similar problem with "Deutsche Bahn" in Germany. Probably also the reason why this German political NGO is writing this article. Are there any other countries with similar problems or history in their public transportation-systems?
Privatization in Germany and Briain are completely different ...
How does the govt pick executives or companies for owning the railways?
I am thinking of the three credit bureaus in the US. These companies suck, and offer 0 innovations, but we are stuck them for the foreseeable long term.
It's really an open question - UK's railways were in a poor state & lacking investment when they were handed over. Rail journeys and infrastructure investment did increase in the intervening period.
It's not at all clear that railways will have consistent, adequate funding in the public realm, not least because the government is leery of capital expenditure and is always interested in ways to make debt levels look smaller.
Depends - some got wealthier. :)
Although, even with this in mind, it seems as if the UK really has a notoriously bad railway system. Most countries in the EU of a comparable size have a better railway system as such, even though they also have their own problems. One of the best in Europe is in Switzerland - the swiss really are clever. And also not in the EU.
This just isn't true on any measure (apart from affordability and true high speed penetration in some countries).
Affordability is really driven by how much the operators are subsidized by the govt. It's hard to calculate this on a like for like basis as some subsidy goes to the track operator and some to the train operator, and in eg Germany you have a hugely complex set of subsidies and fare zones in operation from various levels of government.
I don't expect the other European systems to be any cheaper - it's just hidden in the tax system instead.
Where the UK shines imo is two things. 1 is the frequency of many services. It's rare to have less than 2 trains per hour on an intercity route, and often far more.
This compares to France (outside TGV) which is atrocious. Non regular timetable with often 2-3 hour gaps on trains.
Spain (even on the high speed lines) is even worse. Some _high speed lines_ can't even manage an hourly service. This has got far better recently on high speed lines with private competition, but outside of that the timetabling is terrible.
The other is some of the ticketing options. Firstly, there is a no questions asked delay repay feature which means you get a substantial portion of the ticket refunded if there is any delay for any reason, starting at a 15minute delay. Obviously no delays are better than a refunded one, but I've had some atrocious delays in mainland europe and no option to apply for a refund.
The other is no composlary reservations (though I'm not sure how long this will last). If you have a valid ticket, you can get on. In many EU countries if a train is out of seats you don't even have the option to buy a ticket and stand. Combine this with poor timetables on many routes and it can cause huge problems if you are travelling at short notice.
Netherlands and Switzerland good for sure - better than the UK I would say. But Germany/France/Italy/Spain have a lot of issues.
I'd argue that subsidizing the railway system from the taxes is inherently a better way to pay for it. In the UK, the trains are ridiculously expensive out of pocket. They are vastly more expensive than in Switzerland (a really high CoL country), which as you say is a much better run system at the same time.
The total costs might be the same, but if paid out of the taxes, the cost is distributed progressively. People who earn more will pay more to keep the trains running. In the UK, the cost is regressive by definition, because the portfolio manager who earns 1 million pounds a year will pay the same expensive ticket fare that the nurse who earns 40k a year, but for the PM it's a trivial expense. And the portfolio manager can work from home, or just drive in to work if they fancy, the nurse cannot. The nurse is forced to use an aging, unreliable and at the same time really expensive train.
And the service itself is positively atrocious even in London when it comes to any non-mainline route. It's a complete tossup whether the trains will have severe outages due to strikes, engineering works or the frequent signal failures.
I don't disagree fwiw, but the issue with it is you have no way to limit demand.
Imagine if the season tickets were 50% cheaper overnight going into London, coming out of government funds.
You'd induce (I suspect) double the demand at rush hour, as people could move further from eg London and not be bothered about the price.
I definitely don't think the current ticketing system is right but if you moved to this model you'd have even greater overcrowding problems.
All privatizations of public infrastructur and services are failures, simply due to the discrepancy between the interests:
The public wants: Cheap, reliable, quality services.
A corporation wants: Maximized Revenue.
The two inevitably clash. No matter what business, no matter what country. Don't believe me? Go and find a single instance of a service that used to be provided completely by the government, that got BETTER FOR USERS (that is: The Public, not investors) after being privatized. I'll wait.
Public utilitis HAVE TO be run by the public, meaning the government. In pretty much every instance where this isn't the case, the provided service is more expensive, and/or less effective for the people.
And that's why I am sick and tired of the old trope "bUt pRivAtE sEcToR mOrE effIciEnt!" Sure. That would be the same private sector that caused almost every non-war related major economic crisis, is it not? I think the "efficiency argument" is already a moot point.
Why would public ownership deliver those benefits? Walmart is delivering cheap, quality and reliable service in retail. Soviet stores we not better than American ones.
Let's see: Is Walmart a utility provider, or a retailer?
https://en.wikipedia.org/wiki/Walmart
> Walmart Inc.[a] is an American multinational retail corporation
This is only "true" because anything run efficiently by the private sector is so demonstrably better than any communist-fantasy alternative that no one bothers arguing any more.
Should Tesco be run by the government? I use Tesco more than I take trains.
May be of note also that the best train in London (the Elizabeth line) is run by a tendering process
>Don't believe me? Go and find a single instance of a service that used to be provided completely by the government, that got BETTER FOR USERS (that is: The Public, not investors) after being privatized. I'll wait.
You won't have to wait long: flying. Shocked? You shouldn't be. In the 70s, you'd have to pay thousands of dollars to fly across the country. Now you can get a flight between NYC and London for $200.
Time to retract your entire little rant.
Air travel wasn't provided by the government before deregulation. The airlines have always been private companies. They were heavily regulated and run as public utility. Deregulation increased competition but nothing was privatized, the CAB was eliminated.
Air travel is also not privatized these days. The airports are nearly all owned by government entities.
> Time to retract your entire little rant.
https://techrights.org/n/2025/08/22/Enshittification_of_Airp...
You were saying?
Did you read the source you posted?
It basically provides a bunch of graphs that confirms that flying is safer than ever, even as more people than ever fly at cheaper fares than ever. Embedded within the actual data is an unsubstantiated rant about enshittification and the danger of flying (despite the evidence they chose indicating the opposite), and a tangent about github.
Public transportation needs to be a public cost, paid for and funded by tax payers and not for profit. When transportation is subsidized but privately owned, then you will see maintenance neglected in an effort to raise shareholder value.
Public transit in the way we are used to it also cannot be run "for profit".
There is no public transit system where fares cover all the costs, never mind generating a profit. Riders would refuse to pay a fare high enough to do this.
Airlines barely make a profit. I'm not sure about intercity rail globally but in the USA, Amtrak relies on government subsidies to operate. All the private railroads gave up passenger service decades ago because it was unprofitable in the face of new competition (i.e. cars and air).
Local bus and light rail service will never be profitable as a private enterprise. We'll see what happens once drivers can be eliminated, but I'm still doubtful. Plus the public will still want some sort of authority figure on the bus or train. It's one thing to feel safe in a Waymo where you're not sharing the vehicle with 20 strangers but a bus or subway is different. So trade driver for security/customer service person and you're not really saving on payroll.
This all hinges on people utterly ignoring the expense of maintaining the road system.
If you factor in the spending on highways and road systems that can support high speed private vehicles at no direct cost to the end user, other forms of transport get incredibly competitive. Highway spending alone accounts for a quarter of a trillion per year. That doesn't account for spending at lower levels of government for streets and other car infrastructure.
>Plus the public will still want some sort of authority figure on the bus or train.
There are plenty of driverless transit systems. It is a very solved problem.
I'm saying that even with the current approach to taxpayer-funded roads, operating a local bus service cannot be done at a profit to the operator if they rely on fares alone. All public transit systems require substantial funding beyond what they receive in fares. And rail lines cost even more than roads do.
Privatizing such services and maintaining affordable fares is a complete non-starter. It cannot be done.
> in an effort
OK? Capitalism works because of the evil businessmen not in spite of them.
I'm sure Gregg's could put rats in the sausage rolls if they wanted to but suspect it wouldn't do much good for their footfall
Privatization in Europe, otoh, is going okay-ish.
Seriously can't tell if sarcastic or not.
As opposed to the privatization of water utilities, which was such a resounding success?
Both can be a laughable failure at once!
In the 1980s the nationalised railway was considering closing London Marylebone.
Today
The number of passengers on the railway is far ahead of the number in the 80s and 90s.
There is a persistent belief in the UK that privitisation of the railway was bad, yet it led to great things -- the constant Chiltern line investment, massive competition on the west coast mainline (you can walk up to the station and get a train from Manchester to London for £50 return taking about 3h30 -- it cost more than that and took the same time 30 years ago), Marylebone serving 16 million passengers a year pre-covid
There's been bad things too -- companies have failed and the government has chosen to bail the shareholders out rather than letting them fail and simply taking over, standard privatise the profits socialise the losses. Cross Country routes are screwed as it's a series of local services masquerading as a long distance one. Nationalisation doesn't help there.
But when we compare with German and French systems we see just how good the UK system is, despite the insanely cheap commuting (15, even 10p/mile) being subsidised by occasional long distance travellers.
Couple of decades late with this news…
I'm undecided if privatisation was a failure. I don't know the counterfactual scenario well enough. The article paints a picture that British Rail was doing just fine, making all capital investments necessary, and at low taxpayer cost. I'm somewhat skeptical that it would continue like that for 30 years. Any better analysis?
Me and a friend decided to dig into who makes the money here and in the end the big earners are the private equity companies that own the rolling stock and leases it out to the rail companies. The actual rail companies have slim margins. The leasing companies had much bigger profit margins.
If only someone could have predicted this.
The German even more. When it was already clear that the British privatization completely failed.
And we saw what the others did in the meantime. Swiss, Austrian, China, all huge success stories. Without privatization
The only issue I have with British rail is the expense. Otherwise, seems rather well done. Much better overall experience than I had with DB at least.
The privatisation of the commons will endure as our generations' greatest folly. I look at the Australian NBN as a great example of a project that is not economical for a private business to entertain - it requires "The Government" to build. How do we reason with this in the capitalist system?
> The privatisation of the commons will endure as our generations' greatest folly
Things really went downhill after 1773 (first Inclosure Act)
so.. whats the future for the infamouss HS2 project?
I hear these stories about UK private rail system being terrible for more than a decade now. But, truth is, I go there frequently and the times I had to use it it was quite fine. Lots of trains and they arrived on time (and they were fairly clean).
It was much, much better - by any account of imagination - than the public railway we have here in Portugal. And I’m guessing they cost the taxpayers a lot less too (but that part I didn’t check).
I think there's a couple of things about typical foreign experiences of UK public transport to note (some of this may not apply to you in particular, of course):
(1) Most tourists visit largely London and its near surroundings. Public transport in (and to) London is generally much better than other parts of the country.
(2) A lot of the downsides don't manifest if you're a relatively infrequent user and you're largely travelling at off-peak times. As a UK resident who doesn't commute on the railway, this also includes me -- my experience of trains is generally good because I travel at quieter times and I don't travel so often that unreliability is a regular experience.
(3) If you ignore the costs (by not being a taxpayer or because you're less price sensitive for infrequent travel and especially for holiday travel), then you're ignoring the large part of the argument which is "this privatization had massive inefficiencies and costs".
FWIW, the UK government pays about half of the 25 billion/year cost of the "operational rail industry" (source: https://dataportal.orr.gov.uk/statistics/finance/rail-indust...). I couldn't find the equivalent stats for Portugal with a quick search, so I don't know how that compares.
London is particularly notable because it escaped forced privatisation of e.g. bus services. In London all the buses are red and work the same. You do not care whether your bus is a "Big Corp" bus or a "Tiny New Outfit" bus, they're both red, they both take Oyster, or credit cards or whatever, they're the same, the bus service is controlled by Transpot for London which responds to an elected Mayor. In most UK cities by contrast there are multiple, privately owned bus companies. The local government can try to persuade them to run services it wants but they don't have to, and indeed if the local government won't do what they want they can just fold up the service and go home, too bad, the government have to contract with a for-profit business and if nobody wants to do it then too bad no buses.
Until relatively recently (things have improved in Scotland especially and now increasingly in English cities) it would have been illegal to do what London does anywhere else. My city really wanted a single card that works on a bus or a train anywhere in the city, they couldn't persuade anybody involved to actually do that and the cards went away without ever being actually useful.
> You do not care whether your bus is a "Big Corp" bus or a "Tiny New Outfit" bus, they're both red, they both take Oyster, or credit cards or whatever, they're the same, the bus service is controlled by Transpot for London
Irish urban buses are like this in principle; they're branded TFI and operated by either Bus Eireann (state-owned) for non-Dublin stuff or Dublin Bus (state-owned) or GoAhead (private) for Dublin stuff. Only way to tell these days is a small notice on the door. However, you do care whether your route is Dublin Bus or GoAhead; if it's Dublin Bus it will probably merely be late, whereas if it's GoAhead it will probably be _very_ late or just cancelled. Is this not the case in London; ie are the operators all about the same in terms of level of service?
The government funding is interesting. It excludes HS2 for one thing.
The funding for oeprating companies varies a lot, according to the chart on page 6, 3p per passenger kilometer for Thames link, 30p for Scotrail, -1.1p for west coast.
Mmm, presumably big infrastructure projects like HS2 don't count as "operational" expenses. (Personally I put the huge costs of HS2 down to our complete inability to build anything in a reasonable timeframe and budget, rather than to privatisation in particular. The usual ludicrously long and extended consultation/legal objection/appeal process plus political meddling in the specification plus other stuff all factor in here.)
Yes, and a lot of money has been going into infrastructure, but its dominated by HS2.
Yes, its not anything like a uniquely British problem, its widespread. Bigger projects are a lot more difficult to run, and governments are drawn to big projects.
I think a lot of people in the UK would agree with this. It's not perfect but the rail system on the whole is pretty great for getting around the country. There's some annoying things like having to go to a hub to go back the way you came sometimes. But without a sprawling expensive network that's somewhat unavoidable. And obviously some lines are worse than others re delays and cancellations.
Most complaints in the UK are about cost of tickets. They are very valid complaints imo, the cost of getting a train in this country can be absurd. There would be a really positive attitude towards train travel in the UK and our rail system if it wasn't trying to bankrupt you every time you use it.
> I think a lot of people in the UK would agree with this. It's not perfect but the rail system on the whole is pretty great for getting around the country
In the South East, or if you're employer is paying for 1st class, definitely agree.
I prefer rail but public transport is very limited where I live, in Cheshire, and it is very expensive. It is fast for long distances, but it is a lot more expensive than driving, especially if you have more than one person in the car.
Mostly repeating what others have said but...
Trains get delayed and cancelled very frequently. They leave you stranded in the middle of nowhere because there's a technical issue fairly regularly: it's not a daily occurrence, but it's frequent enough that people will just go "ahhh classic british rail".
Trains are often packed, with literally nowhere to sit for hours-long journeys.
And this poor quality of service is very expensive. I know adults in their late 20s - early 30s with a fulltime job that choose to take the coach even though it's twice as long, because it's much cheaper. An ex-colleague was living outside of london, and spending £16k a year on train for commuting (you'd expect a big bill, but £16k is insane).
I'm sure there's plenty of countries that do worse, and as an infrequent traveller you'd probably be fine, but it's just... not great
I also go there rather frequently (much more before covid, though), and agreed, compared to the rail I'm using in the US (NYC, Boston, Amtrak), it is pretty good, but I've had some VERY bad experiences on it.
As a whole though, at least out of major cities London, Edinburgh, Glasgow, and Manchester, the rail system is great.
British trains are _terribly_ expensive, and get cancelled a lot, has been my general impression (from next door in Ireland, another country with a notoriously bad rail system, though it is at least cheapish).
As someone else mentioned, London (and really urban commuter services in general) are essentially separate; the problems are _primarily_ around the regional/intercity stuff.
One specific consequence of the privatisation. Earlier this year I visited Manchester. The airport to city route is operated by _two_ rail operators, on the same line. You buy a ticket for one service or other. I bought a ticket for operator A because their train was next. A few minutes later that train was cancelled, so I had to watch as a couple of operator B trains passed and wait for an operator A train.
I mean, no-one can tell me that’s a sensible way to run a railway.
(Mind you, this still beats Dublin airport, which currently has no rail at all, and under current plans will have _two_ separate rail lines around 2040-2050, and maybe a tram. Though, if that happens, at least the same ticket will work for both…)
It's too confusing but you can always buy an any operator ticket. On that route you have these options for anytime travel.
Anytime Day Single: Any permitted - £6.70 Anytime Day Single: TPE only - £6.50 Anytime Day Single: Transport for Wales only - £5.40
Unfortunately many apps don't make this clear enough. I suspect you bought a TPE only ticket when any permitted would only be 20p more. Many apps will show you the cheapest ticket even if it results in massive downgrade in flexibility.
While it seems ridiculous (and tbh it is) on these kind of routes, it is useful on some routes, which the slower operator (eg Birmingham to London) is 1/3rd of the price of the fast one.
Many operators do an "operator-specific, 10/20p cheaper" ticket because it means they receive 100% of the revenue, rather than just a portion of it. That's exactly what TPE are doing in this instance.
That practice should have been abolished long ago - it's totally anti-passenger.
GBR will likely solve this with removing the cheaper ticket, instead of making the cheaper ticket a generic ticket, of course :-)
Let's see. I don't know how far they will go with this - are they going to have LNWR the same price as "Avanti" for example, despite one being twice as fast?
> Earlier this year I visited Manchester. The airport to city route is operated by _two_ rail operators, on the same line. You buy a ticket for one service or other. I bought a ticket for operator A because their train was next. A few minutes later that train was cancelled, so I had to watch as a couple of operator B trains passed and wait for an operator A train.
As of June 2025, there is automatic ticket acceptance rules between those operators now in the case of cancellations and disruption, as both Northern and TPE are owned by the DfT.
Great British Railways will continue these kind of sensible changes (though not cheaper tickets, that's for sure!)
Huh, this was in August, and there were signs warning _not_ to do that. May’ve been old signs, I suppose.
Oh, yeah, such changes take months or years. I'm sure even today barely half the staff know about the change. Give it another 6 months...
The railways in England and Wales are very adversarial. You have to do a lot of research and fight for your rights. It's about maximal revenue-extraction, not a customer-friendly experience.
(Nearly?) all of the the "private" rail operators in the UK are actually the national operators of other countries - Germany, France, Italy and I think Netherlands. The national rail operators mostly know how to run a decent service, but in the UK passengers pay multiples of what those operators charge in their home country and the service is definitely not as good.
You are aware National Express (UK company) operates a lot of train routes in NRW in Germany, too? Equally Ariva (UK company, was owned by DB, now UK) in the Netherlands?
The EU basically mandates privatisation of railways.
They require track and trains to be run by different operators (DB InfraGO in Germany, ProRail in NL, etc) to the train operators.
They then require (nearly?) all passenger rail operations be available to private companies to bid on. The EU is taking the Netherlands to the ECJ over the fact the Netherlands won't allow it: https://ec.europa.eu/commission/presscorner/detail/en/ip_25_...
Also the EU requires open access operators access to said separate tracks. That's why you're seeing all the competition in high speed routes (especially) in the EU. They have to pay a track access fee but are free to request to run whatever route it is.
The last point (well, all are really) is a big problem for many national operators as they make a lot of revenue from 'premium' intercity operations that cross subsidies the local trains. A lot of that "margin" is going to be eroded by the competition.
Technically Arriva is now American owned.
Which part of the UK out of curiosity?
Around Manchester.
the service is often plagued by strikes, but the real problem is the cost. In what universe does it make sense for the train to be more expensive than a single person driving?
Rail travel is one of the few things that's cheaper now I live in Denmark compared to the UK.
A ticket for the next direct train (16:42, peak time) from Copenhagen to Århus is 449kr, £53. That's 300km in 3 hours.
London to Manchester is the same distance, 2¼ hours, and £193.
This is partly because of the UK's ticketing system, which (like airline prices) heavily discounts for people who can book ahead and travel at off-peak hours. If you're able to do that, then for instance, right now you can get a ticket from Euston to Manchester on Weds 10th December mid-morning for 35 quid. If you're really price sensitive you can get there for just 14 quid (you have to change at Crewe and take an extra hour and a half of journey time).
The downside of this pricing system is (a) everybody complains about its complexity (b) if you really do need to travel at peak time or at very short notice you're going to pay a lot (c) it's really easy to make it look like it's a terrible rip-off by quoting the anytime walkup fare for an intercity journey :-)
Denmark also does this — Copenhagen to Århus on 10 December at 10:52 is £16 if purchased now.
My example wasn't especially ridiculous. Try something like Stansted Airport to Birmingham — 200km, 45 minutes slower than driving, and £97 — or £67 off peak.
The other ridiculous feature of British train tickets is when some return tickets cost just £1 more than a single ticket.
Hum, there are a lot of trains from London to Manchester today for between 42-47£. Those do take 3h45m.
But there are also trains for £80 that take 2h11m.
https://www.nationalrail.co.uk/journey-planner/?type=single&...
> Hum, there are a lot of trains from London to Manchester today for between 42-47£. Those do take 3h45m.
Those are indirect train services. That can also be the return price, which is very very good value. You do have to be careful with travelling the right route and company
Yes. I didn't see the slow trains, it looks like they were hidden from my search.
(Also bear in mind the median income after tax is 50% higher in Denmark.)
> it looks like they were hidden from my search
I don't blame you. They do make it VERY hard to find and buy that particular cheaper ticket
Ticket websites generally assume you have unlimited funds and want the fastest route, always.
Without commenting on the sense thing, the user is being asked to pay for upgrading the infrastructure of the railways.
I live in a city in the UK and use the train to commute daily. Return travel on a peak train costs me £8.40 (arriving at work before 9am), and £6.50 if I go in after peak (arriving at work after 9am).
Every year without fail this goes up by a noticable amount, but the service is still unreliable. Looking back at my travel history, the train has either been late to arrive or late to get to my destination around 30% of the time. That delays can vary a lot as well between about 10mins (this morning for example) to 30 minutes on average.
But that's the average picture, the winters get so much worse for my route. There's a tunnel just before our station which frequently has water pouring through when it rains heavily which means no trains can run until it stops. Several times I've left my house with all the trains listed as running on-time and arrived at the station to be told by the (very nice) guard that he doesn't expect there to be any trains through until mid day.
They also get very crowded, at least on my route. They're meant to send a 3 carriage train but will frequently end up with only 2 carriages because they had a problem with one of them. This usually delays people boarding which means the resulting journey is around £8.40 for no seat and a 10-15 minute delay.
The UK rail sure isn't the worst in the world by any stretch. When a journey goes well it's seemless and I'm a big fan. But a lot of the time it feels like you're being bent over, especially when after several weeks of reduced services due to strikes you're suddenly met with a price hike of 5% with no improvement in the services reliability. All of that is just when you're talking about commuting as well. Any time I'm forced to head to London it's a miserable emptying of my wallet.
All of this is just my daily experience, but I'm so sick of this failed experiment. Each year it costs more, the service is just as unreliable, and the profits all leave the UK.
Maybe my expectations aren't reasonable, but it's something I'm effectively forced to use daily because of house prices.
When I'm looking for politically unbiased news, I make sure to visit the fine internet presence of the Rosa Luxemburg Stiftung.
The central claim of the article makes sense. Tickets are too expensive and that's all i care about as a consumer. I don't agree with many of the authors arguments and his proposed solutions.
> the case against fragmented and privatized operations focuses on three key arguments. The first is that railways are complex systems where commercial boundaries at engineering interfaces are a threat to safety and efficiency. The second is that railway operations are geographic monopolies where market conditions are — at best — contrived. The third is that railways are a public service that cannot fail — hence, introducing private interests into the railways is merely a way to sequester income into private hands while the state shoulders the financial risk. In other words, private interests’ role is simply to extract profit that could otherwise be reinvested into the system.
That is true of most infrastructure. The closest parallel i can think of is the airline industry. It may never be perfect but these problems are solveable.
Next the claim that moving decisions away from Westminster will make things better. That is highly debatable.
Finally the main point. The nationalised railway worked well in the 90s so it would work well today. That is such an obviously flawed argument i won't even bother discussing it. I think the local government in London has far more direct control of local transport and it is horribly inefficient and expensive. Finally look at the ongoing, slow motion train wreck which is the hs2 rail project. At this stage it's just a government employment program for labourers. It's way, way too expensive and they should have pulled the plug on it years ago or drastically deregulated idk. As it is we have the worst of both worlds.
However, it is interesting that Thatcher didn't want to privatise the rails. Does anyone know what her opinion on it was?
Well it didn't work great in the 90s. There's a great documentary about this: https://www.youtube.com/watch?v=WJfaKKVS5Hc from 1990. The problems will seem very similar.
Where I think privatisation went wrong (the core concept of having private operators bid on franchises is ~right imo) is the state lost a lot of 'management' knowledge that was in British Rail. This has really killed us because we don't know how to build complex civil engineering projects anymore, and _the management_ of them gets outsourced to large contractors like Arup at eye watering costs.
They also have a terrible conflict of interest as if they manage it well, they often get paid much less than managing a slow moving disaster of a project.
I think this needs to be solved first, not getting the state to operate train fleets.
Germany failed to privatize its Railways (it is still 100% owned by the state and directly financed through taxes) and it has an abysmal, totally dysfunctional railway system.
This is an article by a communist rag and NGO, which is also paid for by the German tax payer. Why would anyone care what they have to say?
For context: The website is called Rosa-Luxemburg-Stiftung. Rosa Luxemburg was a Polish and naturalised-German Marxist theorist and revolutionary. A very biased source
Tot have a certain political angle does not imply a bias by definition
Everyone is biased by definition. Knowing in which direction someone drifts and how strong they move supports your media literacy.
I think the thing that bothers me in the comment is "very biased". If everything is biased, there is not a lot of point in pointing that out.
Absolutely, I flagged this post for this very reason. Far left or right websites are no place to get a reliable account of things.
It's so insane that communism always gets a pass. I feel for the victims of that insane ideology.
https://en.wikipedia.org/wiki/Mass_killings_under_communist_...
> Estimates of individuals killed range from a low of 10–20 million to as high as 148 million.
Post a right-wing source, get flagged in minutes. Post literal Communist rhetoric, get to the front page with lots of excuses in between.
Politically colored ≠ biased
Bias - an inclination of temperament or outlook [1]
Politically colored = an inclination of outlook
[1] https://www.merriam-webster.com/dictionary/bias
Two legacies from the 1980s and 1990s that haunt us to this day are:
1. The idea of trickle down economics; and
2. That public-private partnerships ("PPPs" were a stalwart of Thatcher and Blair) do anything other than simply transfer wealth from the public sector to the private sector. Put another way, PPPs socialize the risk and privatize the profits.
For anyone who pays attention and can think critically, this is the least suprising thing that can possibly happen and was evident decades ago.
For the railways in particular, railroads (technically, train operating companies or TOCs) in the UK have zero incentive to invest in rolling stock, track, signalling systems or stations because they own none of it. So all they do is engage in cutting costs and gaming politics to raise prices to increase profits. That's all that happens.
You can say that British Rail needed reform and funding but PPPs were simply not the answer.