China Turns to $503B Rail Expansion to Boost Growth
bloomberg.com
bloomberg.com
https://www.thelocal.de/20161229/german-rail-giant-steps-up-...
But Russia cut _all_ gas supply, stopping gas flow to Germany and other customers.
There is another line is spinning up too - through Caspian Sea, Turkey, etc.
>It seems people forgot that Russia is always threatening with cutting the gas supply.
Russia is an opportunistic bully. The key thing to success here is to know whom you can bully around and whom you can't. Germany is of the latter :)
[0] https://www.google.de/amp/s/amp.welt.de/amp/wirtschaft/artic...
Seattle is spending 54 billion dollars over the next 25 years for a mere 62 miles of light rail.
http://www.newsproject.org/node/181/
All the consolidation meant that banks gained a lot of money, and the US government bought debt $1 for $1. Instead of TARP, the US government could have done something for...the people you know? The attorney general could have pushed prosecuting all the people who committed fraud (forging income documents for home loans was rampant, lying to people about home loans, etc.) from the top to the bottom. Banks should have been forced to sell loans back to consumers for quarters on the dollar (you know, what the homes were actually worth now).
We saved some retirement accounts, and everyone above 50 at the time was very thankful for that, but young people lost their homes, tons of money and the banks didn't take a hit at all. They just got stronger and swallowed other banks.
I don't think it can truly be said that TARP turned profit[...]
And it is impossible to know profitability of securities without
knowing their Sharpe ratio,
your statement is good, but only in hindsight. we didnt have that forethought before the crash. its a useless statement.
Sorry to go meta and off-topic, but I'm curious about this sort of sentence because I seem to be seeing it more and more. It seems like you're making a statement, but then it is finished with a question mark. Are you asking whether the statement is true? I don't think so. My interpretation, which I think is based on similar things in colloquial speech, is that you're implying a question like, "you know that the Iraq war cost around 1 to 2 trillion dollars, right?". Is that how this is meant? Is there a name for this sort of statement-question?
> But Iraq war cost around 1 to 2 trillion dollars, right?
That question mark is not really necessary.
I recall when an economist said, as the war was ramping up, that the cost will be in the trillions. The wise guys in the Bush administration and the military said he was yapping out of the back of his neck. They put the final cost at a few hundred billion.
Turns out the guy was right.
His math included the cost of taking care the vets. That part of the cost will keep going up until all the vets are all dead.
Meanwhile, we're back in Iraq in some fashion.
They actually put the cost at $50-60 billion.[1]
I recall members of the Bush admin telling requesting Congress to fund the war to the tune of $50 billion, that the cost to America wasn't going to be more than that and that because Iraq has oil, the rest of the cost will come from Iraqi oil revenue.
Not too long after that, if I recall correctly, they came back for another $75 billion (?) or so. And that was not the last time.
You hear that number trillion dollars so often that you become numb to it, but the annual tax revenue for u.s. was somewhere around 2.8 trillion.
Just imagine that. 90 million working Americans, from poor to filthy rich, working entire year, some paying quarter or third of their earnings, some companies paying billions in tax. And still amount amount to less than $3 trillion.
It's quite fascinating how fast growth in the world is in general. It reminds me of a talk about the speed of the "seemingly small" 7% per year growth.
I would be shocked if this doesn't improve the lives of the average Chinese citizen, and I think it likely that a long-term move towards public transportation will help China meet its carbon emissions goals.
- Make "friends."
- Countries now owe China money over 30+ years.
- Makes it easier for China to ship products into these countries helping China's economy.
Interstate highways barrelled their way though the hearts of cities, destroying poor/low-income neighbourhoods. If at any time US policy makers decide to push for rail, we could see dramatic turnarounds over the course of the next two decades.
Seattle is building ST3 and California is building its high speed network. It's a start, and we're still ahead of Australia when it comes to inter-city rail, but no where near close for urban/light rail (which every Australian state capitol has except Darwin and Hobart).
By comparison, Russia is less densely populated, yet they have a both better high speed rail and last-leg commuter rail between/in major cities and they are actively expanding their high speed systems.
Self driving cars are realistically a decade away and they cannot solve the capacity problem:
http://penguindreams.org/blog/self-driving-cars-will-not-sol...
..and they can only solve the last leg problem if we have better inter-city rail infrastructure.
https://www.fra.dot.gov/Page/P0362
The US has one of the best freight rail systems in the world. As a country we ship freight not people. Its not tragic, its damn amazing. I'm sorry they didn't specialize it for the use case you want.
High speed rail is the solution, not a pipe dream, the issue in the USA from what I've observed is that we don't fund it at the federal level.
There still seem to be deep misgivings within his cabinet about the spending, but Trump seems to tend to get what he wants, and is quick to fire people who aren't making it happen, so...
You're saying that it existed before and that it opposed infrastructure spending doubtfully out of heartfelt principle. Now that the Republican Party candidate has been elected, does this wing still exist? If it exists then surely it can be depended on to resist any large government infrastructure spending that a populist candidate would propose.
Surely this is the case.
There were clearly vast distances between the Pre-Trump Republican establishment, and the Republican electorate, and so it would make sense for the post-Trump Republican establishment to move in Trump's direction. That process is currently nascent, and the differences have, if reports are anything to go on, yet to have shaken out.
Because of the way Trump operates, and because of the populist shift of the Republican electorate, I'd expect Trump to win most of the internal battles on spending. The winds are at his back. He will probably also flip many Republicans who previously positioned themselves as staunch fiscal hawks.
If Colin Powell and Condoleezza Rice do something, that's OK. If Hillary does the same thing, it's treasonous. Got it?
it can only take you 90% of the way there. You still need other transit options.
Seriously, is a 2 day sleeper HSR from SF to new York with damn good internet really less productive meams of emloyee transport than trains? You spread out the pain of time zone shifts, avoid all the bullshit at airports, an and work much more effectively.
I think I rather take a train for any trip short of being intercontinental, and would be a more productive worker because of it.
Trump has an infrastructure plan, maybe he'll see that China and Europe has better trains and that would spur him to propose HSR (being cynical, but he can power it by coal since he wants to bring back coal to the US :) )
“IEEFA forecasts that China will install an additional:
* 22GW of wind
* 18GW of solar
* 16GW of new hydro
* 6GW of nuclear.
Seems sustainable.
China doesn't operate as some charity receiver for the west.
In fact it's the opposite, the west uses china for its hard labor and manufacturing tasks, and gets back products at a cheaper rate than itself can produce.
There's no "world's willingless to fund it" involved, there's that the world pays China $20 and gets back goods it packages and resells to its people (e.g. from Apple to Lacoste) as $50 and $100 goods.
That's how much of China's GDP is dependent on exports to the US.
A significant paycut as it were, but hardly fatal.
(If they were to stop exporting to us, it would hardly be a fatal blow to us either. There is just not as much there in terms of percentage of GDP as everyone seems to think.)
Basically, china cuti off trade with the USA would be a North Korea style action.
What you're suggesting is essentially reverse-sanctions, and that would be a foolish move.
The economic "essentials" based on innate human needs are water, food, shelter (housing and clothes), and - in today's world - energy. The US has plenty of resources, space, and people to produce all four of those at home.
If China decided to shut down all manufacturing such that we would stop receiving all of our consumptive goods, electronics, etc... The US would take a hard look at what it really needs as a people and then decide to load balance its needs across both itself and other countries.
What would need rebuilt is all the infrastructure for automating supply chains, and such an aggressive economic move would be highly likely to unite the American people in a singular cause against their new economic foe.
Eventually. Not immediately. Factories and supply chains and aren't built over night.
The US would take a hard look at what it really needs as a people
Or, much more likely, its people would flood the streets in anger and demand a return to normalcy.
In the mean time, black markets and therefore crime would explode.
Huge swaths of the economy, depending on Chinese imports in their supply chain, would cease to function. Unemployment would surge, throwing even more angry bodies onto the streets and even more desperate bellies into the Jail cells.
Fringe political movements would capitalize and the US would face an existential threat to its democratic heritage.
Skilled workers and those with large amounts of capital would quietly leave for greener pastures in the EU and stable parts of South America and Asia, making recovery that much more difficult.
At least, that's what typically happens when trade wars create extreme shortages of key goods and services (we have a lot of data points on this). Perhaps the USA is exceptional, but I wouldn't count on it...
ABCD in Japan prior to ww2.
Chile prior to Pinochet. Chile is agriculturally rich but suffered food shortages none the less.
Neither is exactly this scenario but there are enough similarities to suggest likely outcomes. People don't typically "toughen up and deal with" severe and abrupt changes to availability of common household items, and even countries with the potential for self sufficiency often have painful transitional periods.
So ya, we do toughen up, and no, china doesn't have much leverage over the west at all, even less than the Middle East.
The US also has multiple trade partners around the world. China does not hold a monopoly on US imports. If anything, it's more of a final assembly point for many things, and the US could do more business with southeast Asia.
On top of that, the usual workings of supply and demand would make it quite profitable to divert $STUFF from another economy to the US. Heck, if China still traded any goods the rest of the world at all, firms in the rest of the world could just sell us back many of the exact same goods, with a competitive markup for the indirection, unless and until China puts a complete stranglehold on all its trading partners' deals with the US.
It'd be bad, but at worst it'd be more like 2008 bad than 1930s bad. People did "flood the streets" a little back then, of course (our friends at Occupy Wall Street). It was pretty easy to ignore, though.
Now, if we want to talk of the disruptions associated with an outright war, that's another matter, but we'll also have to worry about the war, which will likely be far worse.
I'm reading A World at Arms (https://www.amazon.com/World-Arms-Global-History-War/dp/0521...) at the moment, and what has struck me most so far is what a mistake the Axis made underestimating American manufacturing mobilization.
Today, I'm not sure if we could ramp up actual production as quickly.
i want to argue the opposing side of this a little. i would argue that present-day America is actually extremely difficult to unite.
i don't believe the imagined "aggressive economic move" would unite the American people. "the American people" is just a diverse bunch of competing economic actors and political interest groups operating inside US geographical boundaries.
WWII is the last thing that really united "the American people" to the extent that you describe, and that was characterized by direct acts of war resulting in human fatalities (e.g. u-boats sinking ships in the Atlantic, Pearl Harbor, bombing raids on our British ally, etc).
a purely economic move like that is a lot less likely to unite the American people than an actual military attack. what's more, today, even real American human fatalities don't unite America. when the San Bernardino attacks happened, half the country was arguing for more gun control laws and the other half was screaming "Islamic fundamentalism." going to a larger event, did even 9/11 unite "the American people" in a way comparable to WWII? if it did, it didn't last long.
when i try to understand why, say, Apple, does its manufacturing in China, i read from various sources that it's not just cheaper labor, but also the availability of a very large number of engineers on short notice and the ability to build factories way, way faster -- no bureaucratic red tape and far fewer environmental reviews and roadblocks. i don't see a way to match that in the US system. a lot of people really love environmental protection laws.
i don't see where something as low-intensity and undramatic as "an aggressive economic move" by China would be enough to unite the people in an effort to repeal environmental laws and motivate sociology and psychology majors switch to EE and CS.
There are always options if the country is rich enough. The USA could redevelop manufacturing relatively quickly or even lean more heavily on Bangladesh, India, and Vietnam. All china would get out of it are newly developed competitors.
Meanwhile, within months, the US would have all its cheap shit imported from Thailand, Vietnam, Mexico--even Japan and Korea. We have enough retail reserves that aside from slight price increases on some inessential goods for a few months, likely nothing else would happen.
China, OTOH, would likely never recover from having all of its revenue generating export goods evaporate to other countries in SE Asia and elsewhere.
http://www.tradingeconomics.com/country-list/government-debt...
The question of which country loses more if the US and China stop trading probably doesn't need to be answered; both countries would lose so much that it won't happen abruptly.
It's no different with China. The world can't afford to let their economy collapse, and so they won't. This isn't Russia we're talking about here, who for all intents and purposes is completely isolated outside of providing arms to the world, space launching (although that reliance is quickly going away), and cheap natural gas to Europe. If/when their economy collapses again, it will have almost no effect on the western world. If China collapses, we're all in trouble.
My memory is that other parts of the world had their own economic problems at the same time as the US housing crisis and were paying the US government for the privilege of owning US treasury bonds (rates were 0 ish for quite a while).
On the other side of it, shrugging does seem to have been the standard external response to the currency crisis in Zimbabwe.
*ruined is a bit strong, but it had a serious impact
Yes, the other developed economies which have largely given up on developing and embraced stagnation instead. It's not the greatest situation, especially if you're unfortunate enough to be young.
If China is done being the world's manufacturing state then inflation is going to go crazy and we'll experience something a bit like what we did with the 1973 oil crisis, except with manufactured goods. It would be a good time to set up a repairs shop.
If China is just done being "America's manufacturing state" then we'll see inflation but probably not as extreme - goods could still be shipped to "neutral" states and then shipped on.
In all likelihood if such a breakdown does occur it will form part of a tit-for-tat including shipping blockades, sanctions and proxy wars.
However, they already have 12,000 miles (20,000 km) of hsr that carries over 1 billion passengers a year. Most of this was built in a little over a decade. So, it's not a stretch for them to continue at this pace. According to the WSJ, they've spent $120 billion in 2015 and 2016 on hsr. That means that spending is about the same until 2020.
http://blogs.wsj.com/chinarealtime/2016/07/20/chinas-busiest...
The 1.5 miles first stage of the 2nd Avenue Subway opens tomorrow. That took 9 years and $4 billion. My bet is that China will have 10,000 more miles of hsr before the rest of the 8.5 mile 2nd Ave Subway is finished
Actually people (especially those in the west) have been saying China is going to crash for a couple of _decades_
>The 1.5 miles first stage of the 2nd Avenue Subway opens tomorrow. That took 9 years and $4 billion. My bet is that China will have 10,000 more miles of hsr before the rest of the 8.5 mile 2nd Ave Subway is finished
And this is exactly why it won't!
To put it simply, the US worker gets a salary and buys a car, while the Chinese worker makes a deposit in a bank for a construction firm to borrow and build a railroad. Both cases describe transportation services, but they look very different in national accounts.
As for the exchange rate, it's not that relevant for local investments since China's going to pay in yuans anyway.
So yes, you are talking about China's biggest problem (inability to consume what they produce) that even the Chinese leadership has acknowledged is a huge problem.
Whether china can afford this or not is less relevant than "bang for the buck", china has already built out lots of HSR, some of it very lightly utilized (my own trip from Beijing to a city in south Hunan, the train was mostly empty most of the time). China builds mostly as a stimulus program, because if consumers aren't consuming its one of the only tools they have, but also focuses on flashy projects that they can brag about in articles like this. However, much of this infrastructure is going to be underutilized for decades, while really needed infrastructure, like adequate flooding drainage, doesn't provide enough "face" to be considered instead. So every year, we see pictures of flooded out cities...but at least you can get to them quickly on empty trains!
http://www.railjournal.com/index.php/high-speed/chinese-high...
>In 2013, Chinese high-speed traffic reached 214 billion passenger-km, slightly more traffic than the rest of the world's high-speed networks combined
>the CRC network is already one of the most densely used in the world, with robust growth between 2009 and 2013. Overall passenger traffic grew by 5.5% per year during this period reaching 2.1 billion passengers or 1060 billion passenger-km in 2013. Railfreight grew by 6% per year to 3.6 billion tonnes, or 2633 billion tonne-km in 2013. These are large volumes compared with the size of the network (103,100km in 2013).
> Although the railway authority has said that the Beijing- Shanghai high-speed railway was the only profitable high-speed rail in China in the past five years, some believe that other lines in densely-populated and developed regions will likely become profitable soon.
Only Beijing to Shanghai is making a profit ATM (flying is still cheaper on that route, but airport delays are way too bad).
They're still saving and those savings keep a lid on Chinese inflation which makes projects like this affordable.
>China desperately needs for its consumers to actually consume to move away from an export oriented economy, which is especially sensitive to trade friction.
There's a lot of talk in the CCP about shifting China's economy to becoming more consumer driven but there isn't a lot of appetite to actually do the things which would make that happen - namely some sort of social security/nationalized health insurance system.
The Chinese will thus continue to be terrified of getting old and sick and will and save accordingly, and those savings will no doubt continue to get recycled into projects like this as well as subsidizing state run SMEs with cheap loans.
2017 will be very interesting. Can't wait to see what happens in Tuesday.
They sure do and you only have to look at Australia, US, and Canada where it ends up. The Chinese keep most of their money in either cash or real estate. They don't trust banks.
Have you been to Beijing recently? I can assure you the Chinese worker is also buying a car. China has the highest automative sales of anywhere on the planet.
Here is some data:
https://www.bloomberg.com/news/articles/2016-12-08/china-wra...
http://www.chinadaily.com.cn/business/motoring/2016-01/26/co...
http://www.accessmagazine.org/articles/fall-2012/will-chinas...
Yes, and if you talk to most people, they can't dream of affording a car, let alone in Beijing. It's insanely expensive, not even including the permit[1]. Maybe if you're in Beijing talking to rich people or just looking at the traffic in abject horror, it looks like everyone is buying cars.
China, per capita, has like one fifth or one sixth as many cars as the US. There's like one car per 10 people.
[1] and by permit I don't mean the actual cost of getting a Beijing plate through normal channels (which has like a <0.2% chance of actually working due to the lottery). I mean if you actually want to guarantee that you get a car, be prepared to grease the wheels with lots of money. Shit idk how that even works with Xi Jinpings rampage against corruption, I don't think they've gotten that low of a level yet (still going after higher-ups).
If you want to get a permit in Beijing and have money, buy a Tesla. The quota for elctric vehicles is higher than for gas, so you see a lot of rich people in Teslas these days, something unthinkable only a couple of years ago.
Yes, it would be this :)
Another top official in the Railways Ministry, Zhang Shuguang, was
also sacked for corruption. Zhang was estimated to have misappropriated
to his personal overseas accounts the equivalent of $2.8 billion.
For example I can save 50% of my income but if i lend to a 90 year old who uses it to fund an elaborate funeral my savings means little.
Other metrics in China suggest that a lot of investment in China since 2008 hasn't been productive. This pattern isn't limited to China but is common in every country who has gone through rapid debt expansion including the US. Finding productive investments takes work and talent and economies have natural limits on investment opportunities that aren't purely monetary.
My relative worked at Crane Pumps for years; every order was a fix-on-failure emergency order. For pumps designs that went back 50 years - they were commonly pulling plans on paper out of drawers in storage rooms to match exactly the specs for some ancient pump in Pocatella or Poughkeepsie.
When Obama had that shovel-ready infrastructure effort, they expected a big upswing in business. But nope; nothing. Probably because water systems are underground and invisible. They wanted splashey visible activity like road-building. Which IMHO accomplished exactly the opposite of what was intended - they built MORE infrastructure to support.
That is awesome. Thank you for the info.
When a company like Crane Pumps goes out of business because cheaper imports take over its market, all that information (the paper plans from past pump designs) probably gets lost forever. Once the company folds, these small cities all over the country cannot replace their old pumps and instead have to upgrade the system to make it compatible with a new pump model.
I wonder if global trade economists account for that additional cost to the customers when the old domestic supplier goes away.
Drainage in the USA is also a magnitude better than in china. I'm sure hey could use upgrades, and I'm sure there is a bias to showy projects, but it is nothing compared to what happens in the guo.
in reality the bank will force you into bankruptcy, seize all your assets because they're at the top of the payback list, and blacklist you from ever running a business or borrowing money again.
in other words, you lose.
You'd be surprised. People have recovered from such "bankcrupcies" time and again, including the current POTUS.
It's not a cliche. It's reality. If you loan someone an insane amount of capital and are dependent on a return on that capital to keep your bank solvent, you are now dependent on them (e.g. "To Big to Fail") for your own business to not collapse. Interestingly enough, you can only extend credit to someone if you consider them an equal, at least at first. Removing this equality is how you can turn a person into property.
Debt and guilt are the same word in many languages (such as German) and debt has a large moral social construct attached to it (which is why people are hesitant to walk away from debt, even when the value of a house exceed what they'd pay on a load).
I highly recommend reading the book Debt the First 5,000 Years. It's the most comprehensive book I've read on the history of money, debt and slavery. They are all very closely related, and it will change the way you look at states, money and markets.
[citation needed]
China won't be able to afford this;
"The Chinese government will invite private investment to participate in funding
intercity and regional rail lines"
"Earlier this year, China turned to a private company for first time to operate an
inter-city rail service on the mainland"Otherwise, it may be able to take advantage of anti-immigrant sentiment in the developed world. That's what intrigued me about your point. China has started to invest in African infrastructure, so why not leverage that to supplement its population when the aging curse kicks in?
Perhaps because the entity is not "China", a state, but China, a culture and a specific population with a shared history etc? So arbitrarily supplementing the population as a means to keep it going doesn't make sense?
Edit: Anyway, it's besides the point: we were clearly talking about China the state (the same one that built those empty cities).
I'm only recognizing that there is a Chinese culture that has been shaped by various forces (including population migration, trade, and even war and invasion) over long historical periods (keyword: long).
Which doesn't translate to some "Since we had e.g. the Mongols in the 13th century, and they are now part of Chinese culture, it's no biggie to just get some hundreds of millions of people that don't share our culture to replace our aging population" -- any more than "Since we were subjects to the Queen before 1776 it's no biggie to subject ourselves to being a UK colony again".
>Maybe I've heard wrong, and there are in fact no substantial differences between Beijing, Shanghai, and Hong Kong
That only matters if they are also more substantial than those between "Beijing, Shanghai, and Hong Kong" to Berlin, Phoenix, Santiago, Accra or London.
Otherwise, all, or almost all, countries have regional differences within the country's culture. Beijing and Shanghai are not more different than, say, New York and Savannah or New Orleans and the Quad Cities. As for Hong Kong that has been, for over a century, shaped from being a UK colony.
I'd also submit that constructing buildings which never get occupied (or don't get occupied until they begin falling into a state of disrepair) is totally senseless regardless of scale.
You can read the Wikipedia page on these for the actual reasons they happen[1]. It's all about Chinese local governments selling property to speculators to raise revenue and the speculators having to build to hold them rather than just sitting on the lots like regular capitalist speculators can. This does represent an inefficient use of resources but not a huge one, past ghost towns have all been filled eventually. Rapid growth covers a multitude of sins. Goodness knows what'll happen when the growth slows, as it must, but there's no particular reason to think that'll happen soon.
This is yet another way that China looks like early 19th century US. Not only are they copying industrial designs a la Samuel Slater and industrializing rapidly, they're financing local government via land speculation the way we did in the US back then. Hopefully when they have their equivalent of the panic of 1839 they'll make similar reforms.
[1]https://en.wikipedia.org/wiki/List_of_under-occupied_develop...
At first glance your comment sounds great, yeah China is just anticipating demand, but it seems much more likely it was a wonton spending spree to help the economy continue on. With that spending spree coming to a halt, now China has millions of steelworkers, miners, construction works, etc... out of work.
Nobody is going to want to live in those cities because they want to live in established cities. Ask yourself, if the goal was to anticipate demand, why wouldn't you do all of this construction alongside established cities? Why would you often times do it in the middle of nowhere?
And the new plan going forward is to 'urbanize' already-existing places, which means building an urban center around an existing town. So it can expand outward, starting with a core of city services and administration.
You can see the same thing happening in central London, Vancouver and New York on a smaller scale. Plenty of housing in upscale neighborhoods bought as an investment and left empty.
http://www.cnn.com/2012/01/20/world/asia/china-florcruz-urba...
We have 50 MSAs with 1 million+:
https://en.wikipedia.org/wiki/List_of_Metropolitan_Statistic...
I think they aren't the right comparison either but quite a few cities are at the center of a larger built up area.
http://www.businessinsider.com/these-chinese-cities-are-ghos...
http://www.forbes.com/sites/wadeshepard/2016/04/23/chinas-la...
Sounds like they build them first then move in the people. Probably cheaper and faster that way? They do have 1.3 billion people.
This is just what fascists do.
http://thehill.com/policy/transportation/263782-obama-high-s...
"His stimulus offer was rebuffed by Republican governors in states including Ohio, Wisconsin and Florida, who rejected the money."
FTA:
"At the end of 2015, China had 121,000 kilometers of railway lines,
including 19,000 kilometers of high-speed tracks, according to a
transportation white paper issued Thursday. The U.S. had 228,218 kilometers
of rail lines as of 2014, according to latest available data from the World
Bank."I was addressing "against anything involving steel tracks."
https://en.wikipedia.org/wiki/Amtrak
I think the US officially has 26 miles of HSR. China transports 1.1 billion people a year on HSR. Amtrak carries about 30 million people a year. Why don't more people take Amtrak? It's faster to drive.
Steel tracks are doing just fine in the US, thank you very much, with minimal governmental involvement. Our rail system is the envy of the world, and has been getting new investment to the tune of $25 billion a year of late. This is why Berkshire Hathaway bought BNSF, so they could have a place to reinvest billions of dollars of profit and earn a return.
All freight rail, of course.
Mind you, regulatory creep threatens this. The FRA has been pushing for "safety" rules which are basically handouts to labor unions (requiring extra headcount per train), and Positive Train Control's top-down bureaucracy-driven technology-solutioning has been a comedy of errors, but the real threat they're facing is the potential of a mandate to make all freight trains make way for passenger trains. which no one will use.
If anything, the Trump administration will be much better for steel rails than the past eight years. Still freight rails, of course. But unlike theoretical passenger rail proposals, these ones are already popular and profitable and reducing carbon emissions.
https://www.amtrak.com/national-facts
Amtrak then overpays for this use which amounts to a government subsidy.
http://www.eenews.net/stories/1060015115
We subsidize rail (freight+passenger) just as we subsidize airlines. Let's just be honest about it.
BTW, your notion of the FRA over-regulating for unions is similarly malarkey. And envy of the world? Dunno if you've been to Europe (which is heavily regulated).
I live in Europe right now, thank you.
European (freight) rail falls apart the moment you cross any internal border: differences in train control systems, electrification standards, signalling systems, loading gauges, and the like. France, Spain, and Germany alone have four different electrification systems among them.
> We subsidize rail (freight+passenger) just as we subsidize airlines. Let's just be honest about it.
Sure. Is this actually a point of contention? It'd be great if we could stop, anyway, and let various forms of transportation compete on true merit rather than on which one the politicians prefer. Especially for freight. There are various barriers to this happening, naturally. It'd be great if they could be reduced and any externalities mitigated.
And the subsidies don't nearly approach the ~$25B/yr new investment.
> BTW, your notion of the FRA over-regulating for unions is similarly malarkey.
I refer you to 81 FR 13917, in which the agency itself admits in the filing, "FRA has no empirical evidence to suggest" that two-person crews are safer, admitting that "in fact, it is possible that one-person crews have contributed to the improving safety record".
That's just a tiny piece of what they get to deal with, anyway.
Then I don't know if you've lived in the US. I've lived and worked both places.
As for 81 FR 13917, you're mis-summarizing your source.
https://www.federalregister.gov/documents/2016/03/15/2016-05...
Indeed, the previous sentence was:
Finally, railroads have achieved an improving safety record
during a period in which the industry largely employed
two-person train crews.
Basically, you sound anti-labor and anti-regulation. Just say it.
BTW, outside of Spain's Iberian gauge, I'm not aware of any inter-country freight problems.
Loading gauge, not track gauge. Here in Britain, Network Rail's standard W6a gauge is too small for standard shipping containers on standard cars. You need to get up to W8 for that, and W10 for High-Cube. They have that on certain corridors only. You can use special low-deck cars to get around it, of course, though those are heavier and more expensive to own and operate.
Meanwhile in the US, all that investment cash has made double-stacked container transport the norm rather than the exception. Do not expect to see it in Europe in either of our lifetimes.
Amtrak then overpays for this use which amounts to a government
subsidy.
http://www.eenews.net/stories/1060015115
FTA: Amtrak wasn't formally reviewing invoices, some of the alleged over-payments lack supporting documentation, and in general, it sounds like there's STILL disagreement over contract language.
If anything, the taxpayers subsidized management negligence.
The USA isn't the envy of the world for anything these days. Only Americans think that. Nobody envies you for anything, not even Silicon Valley, with the housing crisis and poverty surrounding it.
http://business.time.com/2012/07/09/us-freight-railroads/ - "US Freight Railroads are the Envy of the World"
But if you don't trust the Americans let's ask the Brits.
http://www.economist.com/node/16636101 (The Economist) - "America’s system of rail freight is the world’s best" and "They are universally recognized in the industry as the best in the world."
It's a fact generally acknowledged. I'd find you more variety but it's harder to get detailed Asian and European perspectives in English, you know?
That said, I sure hope no one envies Silicon Valley. An individual facet of it like the jobs or the climate, maybe...
As for the best of the best, I just kinda think Deutsche Bahn has us beat. And Japan. And Switzerland ...