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"If you ignore the externalize that the privatization of freight killed passenger rail. If that had not happened, the US would be filled with high-speed rail lines that the French, Japanese and Chinese would be jealous of. Everybody knows that the US can do anything faster and bigger if it sets its mind to it."

A. I'm not sure what you mean by freight "privatization" Freight rail has been private in this country (except for a brief period during WW1) since the mid 19th c (when there was heavy public involvement in financing, but not in operation).
B. Passenger rail was not "killed" It has been in operation continually - though arguably not at the optimal level
C, its not clear how nationalizing the freight RRs would have been good for passenger, unless you mean that Freight RR profits should have paid for the investment in HSR. I think that would have been very bad for freight rail - HSR should be paid for by the general public, and if by any particular part of the private sector, by airport and road users, since its congestion and neg externalities in their modes that would be addressed by it.
D. In any case, my point was that freight rail has succeeded while being private. A point which stands. What you are speaking of is not an externality, but a source of financing. You might as well say that having a private trucking sector has an "externality" of not having well developed bike infrastructure, since we could have confiscated the profits of that sector to pay for bike infrastructure.

by AWalkerInTheCity on Jun 22, 2012 11:46 am • link • report