Friday, September 17, 2021

Failure caused the failure of the New York government subway

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Private cars cannot make money, nor can they provide good services. Only the government can drive the train. Give it more dollars.

This is the traffic bible of New York political/media elites, the squishy stuff that dates back to the early 20th century. They oppose any private subway components. Their descendants have been funding expensive city and state transportation agencies.

The Metropolitan Transportation Authority (MTA) is a national agency responsible for operating subways, buses, and trains in the area. State and city officials agreed that the train was a mess.

New York State Comptroller Thomas DiNapoli’s 2018 report “Metropolitan Transportation Authority 8-2019 Financial Outlook” (pdf) found that New York’s state-owned transportation services were “deteriorating.” DiNapoli wrote that the MTA “is facing its biggest challenge in decades. …Passengers are abandoning the system in exchange for other modes of transportation.”

Therefore, the country will provide more of the same content. It recently approved the largest capital plan in the institution’s history. Approximately US$54.8 billion was allocated in the “MTA 2020-2024 Capital Plan”. The Biden administration recently invested billions of dollars in the system.

Nonetheless, DiNapoli’s analysis for 2020 “Metropolitan Transportation Authority Financial Outlook, 5-2021” (pdf) is bleak.

“MTA predicts that the budget deficit will reach 6.3 billion U.S. dollars in 2021, 3.8 billion U.S. dollars in 2022, 2.8 billion U.S. dollars in 2023, and 3.1 billion U.S. dollars in 2024,” DiNapoli wrote. “The budget gap after 2021 as a percentage of revenue is comparable to the budget gap during the Great Recession, and depends on returning to 2019 passenger levels by 2023.”

DiNapoli wrote that a new plan to save the subway consists of three elements: increased federal aid; integrated administrative functions; and higher fares and tolls.

DiNapoli said: “Even if the MTA successfully implements its plan to fill the gap, it still predicts a budget deficit of 5.1 billion U.S. dollars in 2021, 3.5 billion U.S. dollars in 2022, 1.8 billion U.S. dollars in 2023, and nearly 2 billion U.S. dollars in 2024.”

“By 2024, debt repayment is expected to reach US$4 billion, an increase of 55% over 2019,” DiNapoli wrote.

Goo-goos said that the government subway will be a huge transaction for passengers and taxpayers, because the government does not seek profit, but only to operate the system as a public service at a cost.

However, for more than 80 years, the government subway has never been close to break even. Many riders hate them. The Comptroller of New York City, Scott Stringer (Scott Stringer) said that poor service is hurting the region’s economy. According to his 2017 report “The Economic Cost of Metro Delays”, the annual losses ranged from US$170 million to US$389 million.

He said that the problem is that the government spends too little, which has been approved by many New York lawmakers.

Stringer said in a report in October 2017: “There is no doubt that our subway is in crisis after decades of underinvestment and inaction.” Stringer’s solution, More taxpayers’ money is happening again.

His “underinvestment” complaint ignored the disastrous government spending since the takeover in 1940.

Since then, elected officials have transferred responsibility for subway operations to various authorities. They took on debts, financed new routes that never happened, or were just a small part of the planned routes.

After the government took over, it promised to build the Second Avenue subway. The production line received three funding through bond issuance.

It’s not nearly done yet. Three sites were operated out of the predicted 16 sites. This is beyond the budget. Nevertheless, about five years ago, New York State Governor Andrew Cuomo said when the Second Avenue subway opened, New Yorkers should be proud of the subway.

A historian disagreed.

“Spending $4.6 billion to build a 1.5-mile subway line is not necessarily worth celebrating,” Philip Mark Plotch wrote in “The Last Subway: New York City’s Long Wait for the Next Train” .

“The final figure obscured other costs,” Nicole Gelinas of the Manhattan Institute wrote when commenting on his book. “In order to complete these three sites by 2016, the MTA had to postpone the maintenance and repairs of its existing systems, which resulted in increased delays from 2015, and subsequent repairs would cost more.”

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She warned that the MTA “is now saddled with $44 billion in debt, and even in a mild recession, there is little flexibility, not to mention the historical epidemic of indefinitely reducing the number of passengers.”

Epoch Times Photos
On March 28, 1939, a new streamlined luxury BMT limousine with air conditioning and green mohair cushions made its debut in New York. (AP Photo)

What about the dedicated line?

Political and media leaders immediately rejected it, believing that it would never provide good service and make money. Gelinas said the subway never makes money because it rejects private alternatives.

Although the subway was never privately owned, in the first 36 years of the subway, private transportation companies operated under city concession contracts. The best private transportation company Interborough Rapid Transit Company (IRT) generated profits in the first 20 years or so; from the first batch of IRT trains in 1904 to the 1920s.

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In IRT’s 1917 annual report, the company reported net income of $23.2 million. This is an increase of approximately $1.4 million from 1916. IRT received a dividend of approximately US$7 million.

IRT later ran into financial problems because it had never raised fares in its history. However, after the government took over in the 1940s, fares often rose. Last year, DiNapoli’s report stated that the state increased fares faster than the rate of inflation.

IRT cannot cope with inflation. A reporter wrote in the sale in 1940 that due to price controls, some once successful companies closed down, and the reason for the sale to the city was the same as that of the city. He said that the city is looking for a back door to socialism.

“New York City has set a model for the nationalization of the country’s railroads: a regulator with the power to set rates and force unprofitable operations, squeezing companies to bankruptcy, so that owners are very willing to sell their railroads. The taxpayer’s property and bureaucracy have improved its status,” Frank Chodorov wrote in the book The Rise and Fall of Society.

Despite the recent disasters in the subway, they were actually once considered “engineering miracles.” New Yorkers used to be “very proud” of their subway, Robert Carlo wrote in “The Power Broker.”

Caro writes: “The previous design and maintenance of the system were so good…that it took years for this systematic oversight to cause damage.”

Most political and media elites agree to “fees.” No state or city government or commissioned state or city agency solved the poor service, contract system, and increasing red ink problems that persisted after 1940.

The historian Brian Cudahy wrote in “Under the Sidewalk in New York”, “If there is something that has become an eternal and universal feature of the New York subway, it is the endless exploration of future salvation. It has not yet been achieved to solve its difficulties and cure its ailments.” Cudahy is a former federal transportation official and opposes any privatization.

Therefore, New York officials who rarely take the subway usually share two beliefs: they oppose any privatization; they take no responsibility for poor service, and they have established a power system that exempts them from responsibility.

The economist Alexander Gray saw the same problem in his “Socialist Tradition: From Moses to Lenin” in 1946. He wrote of the London Underground: “[The] The state is increasingly’interfering’ or’controlling’… the less it shows the tendency to assume ultimate and direct responsibility for what it does. “

The views expressed in this article are those of the author and do not necessarily reflect the views of The Epoch Times.

Gregory Bresig

Gregory Bresig

Freelance journalist

Gregory Bresiger writes articles about business and personal finance.He is a former New York Post business reporter

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This News Originally From – The Epoch Times

Failure caused the failure of the New York government subway
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