Comment by georgewsinger | Hacker News Reader

Comment by georgewsinger | Hacker News Reader

An underrated fact is that the Japanese train & metro system is largely privatized: https://www.bloomberg.com/news/articles/2011-10-31/why-tokyo...

> Japan followed a similar path as the West before World War II, but afterwards diverged. As in the West, railroading started out very laissez-faire in the 19th century, but came under state control in the beginning of the 20th. But after World War II, while nearly all railways and intracity buses in Europe and North America were nationalized, Japan stayed its pre-war course, with the railway industry retaining its sizable minority of private firms.

They became further privatized in the 80s, and now there are multiple competing rail companies in Japan. It's my understanding that their business model is to build rails, run near breakeven on the actual trains, and then capitalize on the businesses that spring up around the lines (by purchasing nearby real estate and opening up shopping centers & restaurants).

They are privately operated since the 80s, but the vast majority of their initial development was government funded.

As far as I understand the privatized companies are monopolies-- these companies were formed from the JNR by geographic area served (hence "JR East", "JR West" etc.)

The bloomberg story is really light on details for why and how the privatization occurred; for a much more in-depth view, see S.Y. Lee's Substack, for example this post: https://seungylee14.substack.com/p/the-death-and-privatizati...

(An interesting fact is that most of JNR's debt at the time was retained by the government while the assets and revenue were privatized)

In major cities like Tokyo and Osaka, J(N)R is far from the only player in town, there are numerous "really" private railways like Keikyu, Odakyu, Keio, Tokyu etc. And they all followed the same very profitable playbook of snapping up rural land, building a train line to it, and then building/selling off rights to build apartments, shopping malls etc on the now much more valuable land.

They are not monopolies at all. In major cities you have tons of companies competing on different lines

> , but the vast majority of their initial development was government funded

Source?? Most countries developed railroads with private investments first.

The link in my comment is a long read but links to lots of original sources.

That article didn't touch on what happened before JGR/JNR. Prior to railway nationalization around 1906-1910, most lines beyond Tokyo-Osaka were built and owned by private companies. This includes Sanyo Main Line (previously built and owned by Sanyo Railway, not to be confused with today Sanyo Electric Railway), and Tohoku Main Line (previously built and owned by Nippon Railway).

Exactly. In the US the railroads were first developed by private entrepreneurs as well.

People seem to think nowadays that all the infrastructure we have has sprung out of thin air by pure goverment will or something.

The original lines may be from the private era but JNR also built a lot.

The Saikyo, Keiyo, and Musashino Lines in Tokyo were all built by JNR. So was all the Shinkansen. And all the main lines around Tokyo were quadrupled or sextupled by JNR at great cost. And let’s not forget the feats of the Kanmon tunnel to Kyushu, the Seikan tunnel to Hokkaido, and the Great Seto Bridge to Shikoku.

Tokyo Metro and Toei are also state-owned, and private operators directly benefit from the through operations into the Yamanote loop.

So it depends on what you mean by majority.

If you were to talk in terms of asset value, then yes, the government did fund most of it; but that was because the Shinkansen were enormously expensive compared to the old, narrow curvy mainline network. In fact, the large Shinkansen debts are why JNR had to be privatized; the government restructured the private groups so that all the debt was confined to a ‘bad bank’ paid for by the government.

My understanding is that this is also the economic play for Brightline, which has an operating passenger line in Florida and is planning to start on a new high speed line from LA to Las Vegas.

They are owned by Fortress Investment Group and are buying real estate along the lines, which is likely to make more profit than the operations of the rail lines themselves.

I don't have a super strong opinion on public vs private ownership for public transit systems, but I do think the idea that the owner/operator of the rail line also owns and develops property around the stations is a good idea. It's a positive feedback loop where good service creates demand for development, and development provides more customers for the transit service. I feel like in the US at least we have a tendency to handicap public services from making choices that would let them generate profit (ie investing in real estate and developing train stations into shopping malls) while also complaining that the public service doesn't generate a profit.

Reminds me of the transit station built in China in the middle of nowhere that attracted some international attention, Caojiawan Station.

This CNN article shows some good pictures in 2017; https://edition.cnn.com/travel/article/chongqing-china-metro... . It's just a concrete nub nestling in some undergrowth.

“Caojiawan Station may not be in the most popular area for now,” one worker told Chinese media company Manner Video, a Chinese digital video production company. “But with the development of the rail route, it’s possible that it’ll attract more people to the area and help hasten urban development along the line.”

Well, somebody sure decided to build right next to it: https://en.rattibha.com/thread/1647469687335428097

The fact that Texas had a thing like this being built only for it to get mothballed by angry GOP members mad at the _concept_ of a train is so depressing.

And its a massive success.

Reply on news.ycombinator.com