Comment by samatman | Hacker News Reader

Comment by samatman | Hacker News Reader

Parent Full thread

People who treat profit as a dirty word are responsible for enormous amounts of suffering.

The only valid reason to subsidize some piece of infrastructure is if the provisioned public good leads to more overall wealth. I consider the word "wealth" broad enough to cover things like reducing carbon emissions, these things can be (and should be) estimated in monetary terms, but that will always be an approximation.

My point is that subsidizing unprofitable transportation which doesn't itself provide value in excess of the subsidy is wrong. That's not public service, it's a boondoggle.

The US, like any country, does subsidize infrastructure extensively. This includes the public highway system as well as our remarkable freight rail infrastructure. The reason this works is because the public goods so provisioned pay off extensively in wealth. While this includes the profits of the freighting and trucking companies, who after all won't transport goods if they don't make a profit, it also includes the entire country's population, who benefit from available and cheap goods. There are libertarians who argue that this would work just as well if the roads themselves generate profit, and I think they're wrong about that.

Profit is not a dirty word. I don't think that's an argument anyone is making. Profit is not _sufficient_ motivation to make a lot of infrastructure happen, and until that's recognized we'll be building too little, too late. I think most actually would agree with the rest of your points--I certainly do.

If it isn't profitable overall, it shouldn't be built. Whether or not it should be profitable at the point-of-sale is a different question. But public goods which don't contribute to the common wealth are parasitic makework enriching the few at the expense of the many.

You're baking in a lot of assumptions in the statement "profitable overall". I take it that you mean "benefits society in a way that more than makes up for its cost" but a private company doesn't care, they naturally want immediate or (relatively) short-term profits. A country's first trans-national railway is naturally almost always a net benefit, to take an example, but it's too expensive for the private sector to build alone and almost certainly wouldn't be properly profitable for decades until the infrastructure grows around it.

Some infrastructure or public service building also facilitates something else indirectly, or over a long enough time that it wouldn't feature into any direct calculus. The same goes for services. And how does one quantify this "profitable overall" requirement? This is why big projects are often ultimately a political choice, lambasted by businesses and economists, which often (but not always) are greatly appreciated in hindsight. That shouldn't be carte blanche for people to go out and spend tax money, but it illustrates a certain dilemma.

That's contrary to the reality. I live in a country sometimes described as the most successful communist country in the world, and our people's revolutionary train system is miles ahead anyone else's. "Communist" description is mere irony by the way.

I think allowing market principle to self-regulate cost performance of infrastructure investment has its own merits, but large scale infrastructure like train systems is not something that a commercial entity such as a train operators to just passively and inevitably move towards greater societal goals by nearsighted means of quarterly paperclipping, it's something that totaritalian subsidy and control could yield great results.

So what you're saying is that subsidizing the train infrastructure in your country contributes enough wealth to offset the expense of the subsidy? Weird, that's what I'm saying too.

Reply on news.ycombinator.com