Not all infrastructure investment is good

ScreenHunter_06 Jun. 06 09.33

By Leith van Onselen

Recently, I have been running the line that the Government should borrow to build productive infrastructure in order to: 1) support growth and jobs as the mining investment boom fades; and 2) expand Australia’s productive base and improve living standards.

A key element that will determine the success of any plan to boost infrastructure investment is to set-up a framework that ensures any such investment is well-targeted and based on rigorous cost-benefit analysis, rather than being politically expedient. Jessica Irvine recently raised the idea of setting-up an independent agency, on par with the RBA, with the power to decide infrastructure priorities:

Labor, to its credit, invented Infrastructure Australia. But it is hamstrung in important ways. It can only provide a cost-benefit analysis of projects submitted by governments. It can’t make recommendations on other projects, such as a second Sydney airport for example.

It consists of 12 board members, chaired by Sir Rod Eddington and including the Treasury Secretary, Martin Parkinson, but its support agency, the Office of the Infrastructure Co-ordinator, is run on a shoestring…

Such an agency could, like any other business, have the ability to borrow to fund important work. Investors could purchase longer term (20-year or 30-year) bonds to fund its work.

It could conduct rigorous cost-benefit analysis of all potential infrastructure projects.

Its board could meet monthly and produce statements of infrastructure priorities like the Reserve Bank.

It could better coordinate interest from private sector investors, like super funds, and lower the cost for bidding for projects that is currently a major deterrent to private sector investment.

An independent infrastructure agency could remove from politicians the honey pot of infrastructure spending. It could put an end to election year vote buying and the politics of state federal relations.

It could lead a sorely needed national debate about the nation’s infrastructure backlog and future needs.

Again, what Australia must try to avoid is building expensive ‘white elephants’ that are based on political motivations, do little to improve Australia’s productive capacity or living standards, and benefit only tiny segment of the population at the expense of the majority.

A classic example of such poorly targeted infrastructure investment was on display yesterday in Canberra, with the Government announcing an initial $18.7 million investment to develop light rail between Gungahlin in the north and Civic. From the Canberra Times:

Canberra’s long promised Capital Metro project is one step closer to becoming a reality, with $18.7 million in funding allocated for preliminary design work and a co-ordinating agency included in Tuesday’s budget.

Announcing a total infrastructure spend of $775.5 million in 2013-14 and $272 million in new capital works, Treasurer Andrew Barr said the Capital Metro agency would be established at a cost of $12.3 million.

A project director and board president will be recruited and an additional $5 million for design work on the Light Rail Transit corridor between Gungahlin and the city, with the route via Flemington Road and Northbourne Avenue.

Mr Barr said the project and the $800,000 in spending to remake Parkes Way were critical to the creation of thousands of construction jobs while attracting overseas and domestic investment.

The feasibility of a Canberra-wide light rail network will also be assessed in a $1.4 million master plan process.

Anyone who has spent a large amount of time in Canberra (I lived there for three years) would recognise that it is totally unsuitable for a dedicated (and costly) light rail service. Canberra is the most decentralised city in Australia, with the population spread-out around five primary employment centres: Civic (the tiny CBD), the Parliamentary Triangle, Belconnen, Woden, and Tuggeranong. Gungahlin in the far north is also emerging as the city’s sixth node.

Canberra’s housing and employment lacks density. It is also serviced by the nation’s best road system. Accordingly, the overwhelming majority of Canberrans drive their cars to/from work. Yet, for those that require it, Canberra’s bus system (Action) operates well given the capital’s geography and demography.

In short, Canberra lacks the population base or density to make such a light rail project viable from either an economic or social perspective.

If policy makers in Canberra are truly interested in improving public transport access to Canberrans, they should look to expand bus services across the entire city, rather than focussing on one costly project that benefits only a tiny minority of the population (those located in the narrow northern corridor between Gungahlin and Civic), and is likely to be grossly underutilised.

These are the types of vanity infrastructure projects that Australia doesn’t need.

[email protected]

www.twitter.com/Leithvo

Unconventional Economist

Comments

  1. Absolutely needed. Problem is infrastructure is a pork barrel albeit slower one for politicians. Can you really see them relinquishing control of this?

  2. I strongly recommend the books and papers of Prof. Bent Flyvbjerg.

    His latest paper is entitled: “Quality Control and Due Diligence in Project
    Management: Getting Decisions Right by Taking the Outside View”.

    Commuter Rail projects are the main example he uses in his critiques.

    Here are some excerpts:

    “…errors of judgment are often systematic and predictable rather than
    random, manifesting bias rather than confusion, and that any corrective
    prescription should reflect this….Due diligence is a method for systematically and reliably assessing how large biases are; and for de-biasing business cases
    and other forecasts…

    “….Using such distributional information from other ventures similar to that being forecasted is taking an outside view and it is the cure to the
    planning fallacy……

    “….The contrast between inside and outside views has been confirmed by
    systematic research…(which) shows that
    when people are asked simple questions requiring them to take an outside view, their forecasts become significantly more accurate….

    “…While understandable, planners’ preference for the inside view over the
    outside view is unfortunate. When both forecasting methods are applied with
    equal skill, the outside view is much more likely to produce a realistic
    estimate…That is because the outside view bypasses cognitive and political
    biases such as optimism bias and strategic misrepresentation and cuts
    directly to outcomes….

    “..where optimism bias is the main cause of inaccuracy, we may assume that
    managers and forecasters are making genuine mistakes and have an interest in
    improving accuracy….

    “…In the second type of situation – where strategic misrepresentation is
    the main cause of inaccuracy – differences between estimated and actual
    costs and benefits are best explained by political and organizational pressures. Here managers and forecasters would still need the outside view if accuracy were to be improved, but managers and forecasters may not be interested in this because the inaccuracy is deliberate. Biased forecasts serve strategic purposes that dominate the commitment to accuracy and truth.

    Consider, for example, the case of urban rail. Here, the assumption of innocence regarding estimates typically cannot be upheld. Cities compete fiercely for approval and for scarce national funds for such projects, and pressures are strong to present business cases as favorably as possible, that is, with low costs and high benefits, in order to beat the competition.

    There is no incentive for the individual city to debias its forecasts, but quite the opposite. Unless all other cities also debias, the individual city would lose out in the competition for funds. Managers are on record confirming that this is a common situation (Flyvbjerg and Cowi 2004:36-58).

    The result is the same as in the case of optimism: managers promote ventures
    that are unlikely to perform as promised. But the causes are different as are possible cures.

    Under these circumstances the potential for using the outside view is
    low – the demand for accuracy is simply not present – and barriers are high.
    In order to lower barriers, and thus create room for the outside view,
    incentives must be aligned to reward accurate forecasts and punish
    inaccurate ones, for instance by allocating forecasting risk directly to
    investors so they will carefully scrutinize the accuracy of forecasts before deciding to invest in a project. Below, we will see an example of how this
    works, in the case study of the A-Train. Furthermore, to curb strategic forecasts, governments and other funders may have to make the outside view mandatory and make funding contingent on the application of this particular methodology, as has been done in the UK and Denmark. However, better methods alone will not solve the problem, because any method can be gamed (Winch and Maytorena 2011:354). Better methods need to go hand in hand with better incentives.

    Finally, promoters’ forecasts should be made subject to quality control and due diligence by other parties, including banks and independent bodies such as national auditors or independent analysts. Such bodies would need the
    outside view or similar methodology to do their work. Projects that were shown to have inflated benefit-cost ratios would not receive funding or would be placed on hold. The higher the stakes, and the higher the level of political and organizational pressures, the more pronounced will be the need for measures like these…”

    “….Step four in the method for due diligence followed here consists in checking the forecaster’s track record from other, similar, forecasts.
    Forecasters typically attempt to lend credibility to their bid to do a forecast for a specific project by listing forecasting experience from other similar projects. But rarely do forecasters provide ex post data on actual accuracy of forecasts made in the past. If asked to provide such evidence of actual track record, forecasters typically reply that the evidence is confidential and cannot be released (a common explanation for private projects) or that the evidence is not available, because they have done no
    systematic follow-up studies of accuracy, and neither have others (a common explanation for public projects). Either way, evidence of documented track record of accuracy of past predictions is typically not available from
    forecasters….”

    “….Management research has recently developed strong theory to help identify
    the “fools” and “liars” Taleb talks about. Being academic, the theories
    use more polite and opaque language, needless to say, describing Taleb’s fools as people who are subject to “optimism bias” and the “planning fallacy” and liars as those practicing “strategic misrepresentation”, “agency,” and the “conspiracy of optimism” (Flyvbjerg, Garbuio, and Lovallo 2009; Gardener and Moffat 2008; Hirt 1994; Weston et al. 2007). This research has demonstrated that fools and liars constitute the majority of forecasters and that forecasts are used as sinister tools of fraud more often than we would like to think. Wachs (1990:146, 1986:28) found “nearly universal abuse” of forecasting in this manner, and it is common in all sectors of the economy where forecasting routinely plays an important role in policy debates, according to Wachs. Forecasts are used to “cloak advocacy in the guise of scientific or technical rationality”, in Wachs’ (1989, 477) classic formulation, and there is no evidence that things have improved since Wachs did his pioneering studies (Flyvbjerg 2007a).

    However, recent research has also developed the concepts, tools, and
    incentives that may help curb delusional and deceptive forecasts. The outside view and due diligence, presented above, was developed with this purpose in mind. So was reference class forecasting (Flyvbjerg, Holm, and Buhl 2005; Flyvbjerg 2006), which has been officially endorsed by the American Planning Association (2005) and made mandatory by government in the UK, Denmark, and Switzerland (UK Department for Transport 2006, Danish Ministry for Transport 2008, Swiss Association of Road and Transportation Experts 2006). Finally, the incentive structures designed by Flyvbjerg, Bruzelius, and Rothengatter (2003) and Flyvbjerg (2007a) are a means to curb both optimism bias and strategic misrepresentation in forecasting. Given the knowledge and tools we have today for making better forecasts, there is little excuse for accepting forecasts like that for the A-Train, which is incompetent at best (made by fools) and fraudulent at worst (made by liars). We have the knowledge and tools to disclose the incompetence and fraud and should clearly do so, given the
    large financial, economic, social, and environmental risks that are at stake
    in this type of multibillion-dollar investments. Luckily, government and
    business are beginning to see this…..”

  3. We drove down to Canberra from Sydney last Friday and stayed over to visit War memorial etc.
    we stayed on Northbourne ave, drove and parked at War Memorial and wifey caught free link bus to art gallery etc. if I was to complain it would be that as it was a very wet Saturday it would have been nice if the bus stops all had shelters ..
    I agree that they have a good road system so upgrading the bus service would be the better thing as when I visited the Irish club in Weston and we inquired about public transport we got a lot of negative response to Canberra’s bus service.
    Btw I had a great day at the War memorial.

  4. arescarti42MEMBER

    You’re wrong on a number of points about the Canberra Metro Leith.

    The Civic-Gungahlin corridor runs along Northbourne Avenue and Flemington Road, both of which are lined with high density housing. The corridor also serves the major employment, retail and activity centres of Dickson, Northbourne Avenue, Mitchel, Exhibition Park and Gungahlin.

    The bus service which currently runs along the route is typically packed due to lack of capacity during peak times, and considerably delayed due to congestion on Northbourne Avenue, which is the only route in to the city from North Canberra and Gungahlin and lacks dedicated bus lanes.

    Gungahlin is the fastest growing region in the City, and is identified as likely to exceed both Woden and Belconnen to become the city’s second largest town centre. Considerable investment in transport infrastructure is going to be needed either way.

    Canberra is also probably the most centralised city in Australia, with almost all the jobs confined to a handful of central employment areas.

    Improving public transport along that corridor not only benefits the ~100 people along the route, but everyone else in the city who accesses the area through reduced road congestion.

    Perhaps a rail system isn’t what’s needed, but some sort of dedicated public transport system with right of way definitely is.

    • “…..Perhaps a rail system isn’t what’s needed, but some sort of dedicated public transport system with right of way definitely is….”

      But a rail system is what the bureaucrats and politicians will pursue to the death regardless of the benefit-cost of the various options.

      Any public transit system (except in rare exceptions like Hong Kong) based 100% on buses and vans will be a lighter load on the region’s taxpayers for the level of service it offers, than a system with some rail and the rest buses by necessity.

      The rights of way can also be opened to unsubsidised Jitney and Vanpool operators, for very high benefit-cost. And opening them to private vehicles paying a high fee enables maximum utilisation and maximum cost-effectiveness. It is just pointless politics of envy to call this “Lexus infrastructure” and not do this.

      • “Any public transit system (except in rare exceptions like Hong Kong) based 100% on buses and vans will be a lighter load on the region’s taxpayers for the level of service it offers, than a system with some rail and the rest buses by necessity.”
        Huh?
        Van – 1 driver can serve ~12 passengers
        Bus – 1 driver can serve ~60 passengers
        Light rail – 1 driver can serve ~ 250 passengers
        Heavy rail – 1 driver can serve 1 to 2 THOUSAND passengers.
        The increased capital costs of rail are accompanied by increased hikes in land value, so pre-bought land can be sold or developed to pay for the rail. A company could profit from this… Wait a minute, I thought trains were for commies… Oh, well. The MTR Corporation already follows this model with subways, can smaller cities do it with light rail or surface heavy rail?

    • “The bus service which currently runs along the route is typically packed due to lack of capacity during peak times, and considerably delayed due to congestion on Northbourne Avenue, which is the only route in to the city from North Canberra and Gungahlin and lacks dedicated bus lanes.”

      So narrow the massive median strip and add a car lane on both sides, benefiting both car drivers and buses. Much cheaper and more convenient than a dedicated light rail system. It ain’t rocket science.

      “Canberra is also probably the most centralised city in Australia, with almost all the jobs confined to a handful of central employment areas.”

      How many capitals have five seperate (spread-out) employment centres (six if you include Gungahlin)?

      “Improving public transport along that corridor not only benefits the ~100 people along the route, but everyone else in the city who accesses the area through reduced road congestion.”

      Add an extra lane, add more buses, and let people decide how they want to travel.

      • “How many capitals have five seperate (spread-out) employment centres (six if you include Gungahlin)?”
        Yes, but that is an ADVANTAGE for Canberra light rail. The five separate centres all lie in one line. A light rail line could easily connect five centres. Such a line would be highly efficient – instead of running full into the city and empty out, it would have a constantly high but not standing-room load, and over the course of a trip one seat could carry four people going from one centre to the next, rather than just one going to the city. As a result, the farebox recovery ratio would be higher, possibly above 100%, and profitable.
        “let people decide how they want to travel.”
        That is the point of adding a light rail option.

  5. Alex Heyworth

    IIRC, the light rail was part of the bribe they offered to the Greens in return for their continued support to form a government.

    The Greens have never been noted for their concern about how much of our money they spend pursuing their agendas. Cost-benefit analysis in their world view is not conducted in dollars.

    • +100

      The Greens are more governed by the number of “Hail-Gaias” we can be forced to say.

    • DrBob127MEMBER

      “Cost-benefit analysis in their world view is not conducted in dollars.”

      is that maybe because both costs and benefits sometimes cannot be solely expressed in terms of dollars.

      e.g.

      what is the cost of a beach covered in oil?

      what is the benefit of having clean water?

      • Alex Heyworth

        I agree with what I think you are trying to say, that is, that there may be externalities that need to be taken account of when assessing public policy, and one of these is environmental impact.

        However, in most cases this can in fact be given a $ value. For example, in the cases you mention the cost of a beach covered in oil is, at minimum, the cost of cleaning up the oil. The benefit of having clean water is at least the cost that would be incurred treating the diseases that resulted from unclean water. There may be additional costs or benefits, but this is a good starting point.

        My point about the Greens is that they don’t bother to do the sums, they simply assume that something that benefits the environment is an unalloyed good and the cost involved in producing that benefit is irrelevant.

      • drsmithyMEMBER

        My point about the Greens is that they don’t bother to do the sums, they simply assume that something that benefits the environment is an unalloyed good and the cost involved in producing that benefit is irrelevant.
        Or perhaps they do the sums and simply attach a higher value to things like clean water and air ?

      • Alex Heyworth

        If they do the sums, it is not in evidence afaik. Show me the calculations.

      • @Lorax i have similar view to NBN – intangibles cant be calculated using traditional cost/benefit analysis…

        One of the things the makes Straya – but NZ moreso IMO – very rich is its natural environment.

        I was very disappointed to hear the Key govt in NZ cut DOC (dept of conservation) to the bone in its latest budget cuts…very short sighted, and I hope the Abbott government doesnt do something similarly stupid in its “necessary” budget cuts.

        @bullionbaron. I went with an image instead of a gif, because I got a complaint they’re too big.

        My reaction:

      • “…very short sighted, and I hope the Abbott government doesnt do something similarly stupid in its “necessary” budget cuts.”

        If there’s an absolute certainty of one thing it will do, it’s this.

      • Chris, the argument about saving the environment does not even wash at all for public transport systems that actually use more fossil fuels and emit more CO2 per passenger km than an average car with only the driver on board. And this is a surprisingly higher proportion of all public transport systems than people realise.

        It is certainly the case for all off-peak public transport services, and we don’t here environmentalists arguing that these should be cut to save the planet. A typical mostly-empty commuter train in the middle of the day is less efficient than taking the few riders on a Hummer stretch Limo instead. A Toyota Hiace Van would piss all over the “efficiency” of the train.

        If each rider ran their own small Asian hatchback car it would be more efficient than the train off peak and possibly AS efficient as the train ON peak.

        Of course it matters how the electricity for a train is generated – but where is the evidence that CO2 friendly new capacity is the norm? And of course cars can be electric too.

        I was impressed by Lorax’s impassioned argument in favour of technological progress above; I am not sure he was fair to GSM; but I am certainly with Lorax on technology being the answer; in fact I thought I was a stronger believer in that than he is. Teslas are indeed far more of an “answer” than a great leap backwards to a 19th century transport mode whose Kondratieff cycle peaked in about 1950.

      • drsmithyMEMBER

        If each rider ran their own small Asian hatchback car it would be more efficient than the train off peak and possibly AS efficient as the train ON peak.
        These tens of thousands of extra cars you advocate – what are they going to drive on and where are they going to be parked ?

        How are people who can’t drive going to get around ?

      • @PhilBest
        “A typical mostly-empty commuter train in the middle of the day”
        Trains in Perth are standing-room only, or at the very least have few seats available, during daylight hours, and sometimes quite far into the evening.
        Other Australian cities tend to have similar experiences.
        Or should I use the proper defintion of ‘commuter rail’, a lumbering North American giant of a train, that takes city workers to work in the morning, home in the evening, and isn’t much use for anything else? Yeah, they’re inefficient beyond saving, but also not found in Australia (although Sydney approaches this with the size of its trains and ridiculous staffing levels, such as a guy whose job it is to wave a flag and blow a whistle when the train leaves, just like 1889, called a ‘guard’).

  6. I wholeheartedly agree with the proposition that infrastructure should be costed and prioritised very vigorously.

    However, one of the shortcomings of economic analysis is of things that can’t be costed accurately. Thus, an economic analysis may value something at X, but the public values it at Y. So, is it the economic analysis (rigorous as it can be) correct? Or the public who are paying for it?

    I suggest that what is vitally important is for the public to be clearly informed about the economics of a proposal, and are crystal clear as to how much they will pay. However, the final decision as in any where I want something, and am prepared to pay, it is my decision, and not that of some central planning committee.

    So, more economic information, yes absolutely, any economic dictation, no way.

    The light rail issue is a little clouded in that in Australia light rail is way over-engineered and over-priced compared to world’s best practice, probably by about fifty percent if experience in Adelaide and the Gold Coast is concerned and prospectively in Sydney and Canberra. Even so, it probably would not be economic (but that is a guess and take it with a truck load of salt). However, since it was approved by the political process, the Canberra taxpayers have said they want it, and who am I to say that having decided that they want it, I am to tell them, no they cannot have it. The real nub of the matter is whether or not they have been told the real cost, and whether it can be afforded at this economic period.

    We all have ‘vanity projects’ in our lives, from cars, to cosmetic surgery, and to the latest iPhoney thingy, so as long as it is decided democratically is there really any difference if we want a vanity tramway?

    • Where is “world’s best practice” light rail? Is there any light rail system in the world that is a stand-out fiscal performer, and do we know why and how it is so different to the norm for light rail?

      One of the things the public really should know is that most light rail systems cost more per passenger km and emit more CO2, than an average car with one person on board, let alone a small car or a car with two or more persons on board.

      In fact most public transport is reaching the point of efficiency decline where it is now “crossing over” with private motor vehicles on the graph of cost and efficiency. There are public transport systems all over the USA in particular that are several times less efficient on cost and emissions, than the average car with one person on board – yet the politicians continue to pour money down a pointless black hole expecting “ridership to come” this year….. perhaps next year …. perhaps the year after that ……

      • drsmithyMEMBER

        One of the things the public really should know is that most light rail systems cost more per passenger km and emit more CO2, than an average car with one person on board, let alone a small car or a car with two or more persons on board.
        Where are the numbers for this ?

      • Where are the numbers on this indeed?
        Your claims might apply to a couple of poorly run outliers, but ‘most’ is a very big exaggeration. Also, consider the opportunity cost of a driver’s time and labour, where that has been paid out in the case of light rail.

      • Rumplestatskin

        Hong Kong metro is profitable, but only because of it’s real-estate dealings
        http://www.chinadaily.com.cn/opinion/2012-10/22/content_15835155.htm

        Developing station sites for residential and commercial uses is a terrific way for the system to capture some of the rents generated by the investment. Henry George would be proud.

        It wouldn’t be technically difficult for governments to implement similar systems when investing in urban transport infrastructure (though maybe politically difficult).

      • “I am surprised anyone disputed my assertion that most public transport systems in the USA are less efficient per passenger km, in dollars, energy, and emissions, than the average for cars. This is common knowledge among specialists.”

        Er one of the links you point to actually shows the exact opposite with regards to regards to MJ per passenger km (energy) and emissions.

        Namely pg 11 and 12 respectively of the following (which you provided as a source saying cars are more efficient):

        http://www.cybercars.org/docs/Energy%20report1.pdf

        More to the point you seem to miss the point that those figures are averages. An incremental passenger on a train will cause a negligible increase in energy use thereby reducing the average. By comparison an incremental car will come at the same energy use as the ones before it.

    • Phil, I was talking about the capital costs, perhaps I should have been clearer about that, in terms of the rather outlandish prices we pay.

      • FWIW, I am not aware of any metropolitan public transport systems that make money. If anyone knows I would be interested in finding out.

      • drsmithyMEMBER

        FWIW, I am not aware of any metropolitan public transport systems that make money. If anyone knows I would be interested in finding out.
        The point of public transport isn’t to make money, it’s to provide transport.

      • “….The point of public transport isn’t to make money, it’s to provide transport….”

        It’s a bit like public telephone boxes “providing communication”, these days. Because it is nearly irrelevant now, the cost of keeping the system going is really little more than “the world’s most expensive historical re-enactment society”, in the words of the late Owen McShane.

        It would now actually be cheaper to just give anyone needing transport, a car; compared to the marginal cost of “investment” in new ridership.

        In fact seeing the benefits of public transport subsidies are now mostly captured in convenient lifestyle choices for higher income workers, it is time to start targeting needy people’s needs rather than a pouring money down a black hole and hoping some of it does some good.

        I have even seen a study somewhere that showed that lower income earners rate of use of cars was slightly higher than average anyway. Generally they are “priced out” of the housing locations for which public transport is relevant, and generally do not work in jobs for which public transport is relevant; a doubly compounding killer.

        It is also false that private car travel is so “subsidised” that public transport needs “subsidies” to “level the playing field”. Nobody pays for car drivers capital costs and running costs. The “subsidies and unpriced externalities” come to perhaps 15% to 25% of the total cost of automobility; the other 75% to 85% is borne by the driver.

        If public transport fares covered 75% to 85% of the actual costs of the system (without even considering negative externalities) no-one would use it.

      • drsmithyMEMBER

        Nobody pays for car drivers capital costs and running costs.
        Novated leases ?

        The “subsidies and unpriced externalities” come to perhaps 15% to 25% of the total cost of automobility; the other 75% to 85% is borne by the driver.
        I’d guesstimate the typical driver pays somewhere in the ballpark of $3000/yr in taxes. I struggle to believe that pays for even the roads, let alone the other costs involved in vehicle infrastructure.

      • “It would now actually be cheaper to just give anyone needing transport, a car; compared to the marginal cost of “investment” in new ridership.”
        How much would the roads cost? Fuel? Lost useful time?
        “In fact seeing the benefits of public transport subsidies are now mostly captured in convenient lifestyle choices for higher income workers, it is time to start targeting needy people’s needs rather than a pouring money down a black hole and hoping some of it does some good.”
        That’s why high density needs to be permitted around public transport, to bring the sale price of housing near train stations (and other public transport) to a level that everyone can afford.
        “I have even seen a study somewhere that showed that lower income earners rate of use of cars was slightly higher than average anyway. ”
        Showing that cars are the choice of the desperate, and the lack of density in desirable locations has pushed the poor out to the fringes, where they must use cars, which are more expensive. Economic inequality is reinforced.
        “If public transport fares covered 75% to 85% of the actual costs of the system (without even considering negative externalities) no-one would use it.”
        The most-used PT systems in the world are also the most profitable eg. Hong Kong MTR, Tokyo Metro.
        And also, consider POSITIVE externalities, such as delivering more transport capacity in a less obtrusive manner compared to roads.

  7. I think you’re forgetting the key issues, like is there a chance the track could bend? And what about the braindead slobs? Perhaps most importantly, the ring came off my pudding can.

  8. Spain’s regional gvts got the country in a mess by absurd infrastructure spends – airports and art galleries. Good to see Canberra adopting similar practices. Canberra would be improved if bull-dozed and begun again.

    • I think the Spanish also had one or two light rail systems that they could not afford to run. Which is where Adelaide and Sydney got or are getting some cars. (Adelaide by paying almost twice the going rate for six almost brand new cars ex Madrid. How can anyone economically model such negotiating genius?).

      The comparison is getting interesting.

      • Indeed…!

        Even in Portland, the light rail system has been a disaster fiscally and even for “public transport” as more-fiscally-viable bus services have had to be abolished as the light rail has swallowed up all the funding.

  9. The thread up there is getting a bit skinny. So here is my response to the request for information on public transport versus private cars.

    I am surprised anyone disputed my assertion that most public transport systems in the USA are less efficient per passenger km, in dollars, energy, and emissions, than the average for cars. This is common knowledge among specialists.

    Here are a number of useful sources.

    Lowson: Energy Use and Sustainability of Transport Systems

    http://www.cybercars.org/docs/Energy%20report1.pdf

    Particularly from page 11 onward

    Sorenson: Assessing Current Vehicle Performance…..

    http://energy.ruc.dk/ZaragozaVehicle.pdf

    Note the graph at the top of page 9, and note that the scale is logarithmic……!

    The Annual Transportation Energy Data Book:

    http://cta.ornl.gov/data/index.shtml

    Requires a lot of digging and calculations – I know Thomas Rubin has done this. So has this guy:

    http://www.debunkingportland.com/top10bus.html

    http://www.debunkingportland.com/transit/busvscartedb.htm

    http://www.debunkingportland.com/carenergy.html

    I am also bearing in mind the rule of thumb that comparative dollar costs in complex systems are a prima facie measurement of resource use. It is not just a matter of measuring energy consumption of a vehicle underway.
    Comparing the dollar cost per passenger mile on a commuter rail system with the dollar cost per mile over the life of a car is a fair prima facie approach in the absence of thorough life-cycle, whole-system studies.

    http://www.debunkingportland.com/transit/cost-cars-transit%282005%29b.htm

    Most comparisons just use “averages”. This is unfair both to the most efficient commuter rail systems (such as NYC’s subway system) AND the most efficient cars.

    The average for the former is dragged down by the many grossly under-utilised commuter rail systems, and the latter is dragged down by all the large SUV’s, luxury cars and high performance cars.

    • “public transport systems in the USA are less efficient per passenger km”
      The key word being USA. American transit is highly inefficient, due to low patronage and ridiculous staffing levels and safety laws.
      Lowson: Energy Use and Sustainability of Transport Systems
      According to the results of Davis 2001 shown in the above link, rail is more efficient than cars, only buses consume more energy. Only buses consume more energy because they are the form of public transport used to provide basic service to low density areas. The carbon benefit graph also shows that rail is the most environmentally friendly form of transport, as well as UK buses. As for resource usage, this is calculated by empty weight per seat installed, when all the seats of a car are rarely used, while rail can often have more passengers than seats(standees).

      Sorenson: Assessing Current Vehicle Performance…..
      “note that the scale is logarithmic”
      Which bodes well for rail being ‘slightly’ above cars when it comes to efficiency, as well as the long upwards tail on cars, doesn’t it?

      “The Annual Transportation Energy Data Book”
      …shows that the energy use of rail is much lower than cars. The average energy use of light rail is only shown in a bar graph, so its hard to compare, but doesn’t look much higher than cars.

      As for the Debunking Portland site…
      http://www.debunkingportland.com/transit/table2.11.html
      Says that buses were more efficient than cars in 1970, and the got worse, reversing… but doesn’t make anything of it. This reversal in efficiency was caused by the concentration of technological development on cars, rather than buses. By 1970, car culture was in full swing, so it is to be expected that research and technological innovation would be focused on cars rather than transit. If transit is adopted to a large extent, than research into its fuel efficiency should then increase, and fuel efficiency gains would follow, with buses once again becoming more efficient. Since the main mechanical components are only required once in a bus, rather than in many cars, buses have higher inherent efficiency due to less weight.
      And in terms of costs – have you been listening to me about useful time? Time translates into potential working income.