Construction Costs in the Arab World

The construction costs of rail infrastructure in the Arab world are globally atypical. We looked at the entire region, because of the common use of the literary Arab language; nearly all of this work is due to a New School student named Anan Maalouf, who’s doing long-term work on urban planning as relevant to Nazareth. Here is a presentation he gave at NYU on the subject last monthUpdate 7/22: here is an updated version of the presentation.

There are identifiable clusters in the Arab world, which is not surprising – it’s similar to how there is a common Nordic cost (which is low), a common cost to the English-speaking world (which is high), and so on. Of course, these clusters are not perfectly predictable ex ante; in light of the most important global pattern with the coronavirus crisis, I keep stressing that there is no distinct Europe vs. East Asia cluster when it comes to costs, and instead both regions have similar averages and huge internal variations. The Arab world does not form an entire cluster itself, but its clusters are at least somewhat understandable based on internal divisions.

One cluster is the six states of the Gulf Cooperation Council: Kuwait, Saudi Arabia, Qatar, Bahrain, the UAE, and Oman. All are distinguished by high incomes, comparable to those of the developed world, but coming almost exclusively from oil extraction. All also have atypically large numbers of immigrants, who form large majorities of the populations of the UAE and Qatar, and who have few rights and earn very low wages by local standards. One might expect that in such an environment, construction costs should be low, since there is ample cheap labor but also money for imported capital. Instead, these states all have high costs; for example, the Doha metro project costs around $700 million per kilometer, and is not even 100% underground but only 90%.

The explanation, per Anan and an Israeli-British planner named Omer Raz, is that there is no interest in cost control in the Gulf region. The GCC states have money. They are buying prestige and the trappings of modernity; for all of their crowing about the superiority of their traditional values and Islamic law, they crave Western acceptance, in similar vein to Singapore. So they invite first-world consultancies to build their infrastructure to build what Aaron Renn would call “world-class in Doha” (or Dubai, or Riyadh, etc.), as opposed to “world-class Doha,” i.e. domestic production that is good enough that other people are attracted to it. On top of it all, Omer gave an example in which Saudi Arabia was not a reliable partner for these foreign consultancies; Anan, too, notes a plethora of postponements and cancellations of rail lines, sometimes because of changing economic conditions, sometimes because these lines are international and relationships between Saudi Arabia and Qatar deteriorated recently, etc.

Another cluster consists of Egypt and Iraq. Both have high costs, in line with other third-world ex-colonies, like India, Vietnam, Indonesia, and Nigeria. The Cairo Metro extensions are $600-700 million per km; the Baghdad Metro is, in PPP terms, $330 million per km for an all-elevated project. This is not surprising – these countries use first-world consultancies with background in high-wage, strong-currency, cheap-capital economies. Unlike in the other datasets, like mine or Yinan Yao’s, Anan included a crucial piece of information: who the lead contractor or consultant was. It’s often a foreign firm, from a much richer country – in Iraq’s case, it’s Alstom. On the other hand, Egypt is using a domestic contractor, Orascom, and costs there remain high.

Finally and most interestingly, there is the Maghreb. One would expect that Tunisia, Algeria, and Morocco should have high costs, just like the other ex-colonies. However, they do not. Anan pointed out that the Arab world inverts my theory about how ex-colonies have higher costs than never-colonized countries like Iran, Turkey, and China. He adds that these countries have much closer ties with France than other ex-colonies do, whether they used to be French outside Africa (i.e. Vietnam) or other European empires’ (e.g. India, Indonesia, Nigeria). Alstom has had continuous presence in the area for 20 years.

In a sense, France didn’t fully decolonize in the Maghreb and the Sahel. It still views these regions as its near abroad, with a forever war in Mali, currency pegs, and deep economic ties with the higher-functioning countries. One can even see the French way of building urban rail in the Maghreb, for example on the Sfax tramway. This isn’t quite every urban subway – the Algiers Metro is pretty expensive. But the Oran Metro has normal costs, and light rail systems like those of Sfax and Casablanca have reasonable costs, as does the TGV system running as Morocco’s high-speed rail system.

So perhaps the issue is that the French planners in the Maghreb are there for long enough that they know the local conditions, and build in accordance with them. In contrast, systems have higher costs if they try to imitate first-world methods either due to first-world consultants’ unfamiliarity with the local situation or due to local cultural cringe.


  1. michaelrjames

    If we are to accept the published data, Morocco’s Al-Boraq HSR was built remarkably cheaply: total cost (incl. trains): 20 billion dirhams (MAD) = US$2.073bn for 323 km ≈$6.4m/km. No doubt aided by using existing ROW and no land acquisition costs or much route infrastructure (ie. assuming it was already a very straight route). But perhaps, as you implied, aided by Alstom’s long-term presence and established French practice there.

      • michaelrjames

        I really have no idea of whether it makes any sense to apply PPP to such a project. I find it suspect. After all, if they are paying the French (for the trains and other imported manufactured items) they are paying with currency that ignores PPP, ie. nominal. Alstom doesn’t adjust their quoted prices or costs according to some scribblings on a theoretical PPP by an economist at the IMF or World Bank . Or perhaps they do, but then it is already in the price (and cited as USD).

        If you are adjusting using this magical factor for your world comparisons, I wonder how much reality is being messed with. I see that Morocco is only 16% different to the US on the Big Mac Index which is wildly different to the almost 300% claimed by the PPP versus nominal GDP.

        • Eric2

          You are right that PPP should not apply to imported goods like trains. But it should apply to local expenses like labor and land acquisition.

          Big Mac Index is not very exact because Big Macs play different roles in different cultures. In the US, McDonalds is considered cheap unhealthy fast food for the lower classes. In some other countries, McDonalds is considered an exotic foreign restaurant and priced accordingly.

          • michaelrjames

            I don’t get it. I mean the labour is what it costs. The reason why these costs are sometimes higher in the developing world is that such projects have to import first-world people for much of the work (since so little is unskilled these days) and they end costing more than in first-world countries due to “hardship” wage rates and higher costs of housing, healthcare etc. which has to be first-world in a developing-world context (ie more expensive). But I doubt much of this applies to a project in Morocco and anyway the cost is what it costs and must be in that cited price. Likewise, land acquisition is a very simple cost and should not be adjusted by some magic PPP number. Think about it this way: if Morocco sought full funding from someone like the IMF or World Bank, or Bill Gates, the cost would be the actual US$2.07bn, and under no circumstance does it magically get multiplied by 3x due to anything, least of all PPP. I can see that one might deploy PPP adjustment when someone is prospectively estimating the likely cost of such a project in another country (in an extremely lazy exercise, not bothering finding real costs), however retrospectively adjusting actual costs after a project has been completed at a stated cost makes zero sense to me. Indeed it is perfectly nonsensical.

            Yes, I understand the problems with the Big Mac index but actually at least it is totally transparent and a better comparator than a lot of the big items that influence PPP calcuations. On what basis is it (PPP) determined to be almost a factor of 3x (300%) for Morocco? Is it like those ridiculous Deloitte or KPMG or whatever cost-of-living estimates in cities around the world that assume a quarter-acre block, two-car lock-up-garage (and two Mercedes to fill them), private schooling, private healthcare (insurance), a daily diet of champagne & caviar (or sirloin steak & salmon), eating out at 4-star restaurants four times a week, exclusive golf/country club fees etc etc. and makes some places eye-watering expensive even when almost no one, including those executives, live like that in those cities. BTW, we’ve had this discussion here before, and it doesn’t even work for rents where simple-minded assumptions are made, like if someone in Woodlands Tx lives in 100m2 per person then it is calculated what that would cost in Paris. Or even 50m2 pp in Manhattan. But it doesn’t work like that because people adjust demands and expectations, and likewise there is another false assumption that that involves a loss of quality of life, also not true (within bounds). And so on, so forth.

            FWIW, I assume (but never been to Mahgreb) that in Morocco the McDonalds are probably like in France and a superior experience compared to the US and most places; every few years I deliberately try them to see if they are as bad as I remember and yes they are terrible wherever I have tried them (except can’t remember in Paris; actually I think it is more than a decade since I went to a Maccas anywhere in the world). In France there is a unique history for McDonalds as the master US company actually sold (not licensed or sub-franchised) the franchise to a local French company because they didn’t have any confidence it would succeed or be profitable there. But the French company made a success of it (at least partly improving on the US awful formula and providing wine & beer etc) and McDonalds took them to court to recover the franchise, eventually succeeding after relentless court battles, and I assume settling with the French owners. Those owners retained the stores & locations which underwent an overnight name brand change to Quick which you see to this day. If McDonalds had their way they would probably be as bad as elsewhere in the world. I don’t mean to inadvertently give good PR to Maccas in Paris: I curse every dumb tourist (or yes, Parisian) who comes to Paris and then gives their patronage to the toxic chain (ditto Starbucks, FFS!)–is this really what they came to Paris for?

        • Alon Levy

          The project is done with local labor.

          And the Big Mac index suffers from problems like “in developing countries, McDonald’s is a middle-class food by people with cultural cringe about their cuisine.” (Hell, not just developing countries – this was true in 1990s’ Israel, though it went into decline later as Israeli cultural cringe eventually adopted the Western middle class’s hostility to fast food.)

          • michaelrjames

            The project is done with local labor.

            As I imputed.
            And so that makes it even more inappropriate to adjust by the PPP factor! It just means that things (needed to build HSR) are actually cheaper in Morocco, or of course management is much better in managing costs. And seemingly with no difference in quality of outcome.

      • michaelrjames

        While searching for something else I found this contribution on the subject, which is obviously much more authoritative than my own gropings but does seem to confirm those fumblings:
        2019/05/06 – 16:55 Michael Thomas
        I wish to clarify something about purchasing power parity or PPP. The correct use of PPP is to compare the cost of consurmption of a basket of goods from one country to another while scaling the cost to reflect exchange rate differences between those two countries. Some things you can do with PPP is compare the cost of a haircut, or a head of lettuce or a gallon of gas. or a metro ticket or even monthly rents. When you use PPP to compare the cost of something like a skyscraper or a subway project, it is utterly devoid of meaning because those things are not part of anyone’s basket of goods or services. The only way to compare capital expenditure at that scale is just to compare it in strictly nominal terms.
        2019/05/07 – 12:39 Michael Thomas
        Capital expenditures like metro systems are wholly non-tradable. One cannot pick up and sell a local metro system in another town or country. If a good is wholly non-tradable, then the PPP value is the nominal value. Conversely, the nominal value is the PPP value. This is a standard point when calculating PPP.

        • Eric2

          How is paying local rent different from building a skyscraper?

          Don’t the two comments contradict each other, because local rent is non-tradeable?

  2. Roger Senserrich

    How much did the Saudi HSR cost? It was largely built by Spanish contractors, so it would be interesting to see if the exported the low cost or made bank.

        • Mikel

          Some possibly interesting info inside this article by members of Ineco, the state-owned engineering consultant firm (particularly in section 8). I don’t know if the measures mere unusual or if there were simply many kilometers that needed said measures.

          P.S: Alon, does the $80 million/km figure include the rolling stock? That would be 35 Talgos* for €1600 million, which applying a ~1.2 EUR-USD rate and ~1.8 PPP rate yields ~$7.4 million/km, a minor but nonzero chunk of the total.

          *with only 12-year maintenance included, much shorter than the 30-year contracts Renfe uses on its domestic purchases.

          • Alon Levy

            I try to exclude rolling stock whenever possible, but I’m not sure in this case, the information I’ve seen in English doesn’t explicitly say. We’ll check. Either way, $72.6m/km would still be well into “lol” territory.

    • Mikel

      It’s interesting that this post comes out just as the rampant corruption around the former (Spanish) king’s dealings in Saudi Arabia is making the news. He definitely made bank…

      … however they did have technical problems with desert sand and large temperature fluctuations, so perhaps that accounts for part of the high cost? It could be a factor in other above-ground metros in the Gulf, too.

      • Alon Levy

        Is desert sand inherently a problem to build trains through, or is the real problem that the consultants don’t know how to handle it because we don’t have it here in Euro-land?

        • Mikel

          Both. If I’m not mistaken this was the first HSR built on a sand desert, and it seems that the designers initially underestimated the issue of sand, which creates several separate problems:
          ·It’s brutal for any moving parts. Therefore the rolling stock is not an off-the-shelf Talgo 350, but a specially adapted design with larger wheels and extensive weather-proofing (and also extra AC).
          ·Wherever the terrain is made of sand, it’s unstable, which means you can’t simply pour concrete and ballast and call it a day.
          ·In the coastal section, the sea wind blows perpendicular to the railway. Since dunes can move several metres per year, extensive works were needed to fix them in place. They also developed a shiny drone-based monitoring system to detect sand invading the tracks.

          In any case, I doubt the factor of ~4 increase from typical Spanish costs is due entirely to technical difficulties, so I’d say self-dealing by consultants and contractors is probably another factor? Also, the stations seem to be somewhat overbuilt –the ridership projections seem pretty optimistic to me, but I don’t know much about the country so perhaps they’re just future-proofing.

          • Tonami Playman

            Maybe they should have just built the line on viaducts instead of at grade to avoid the ongoing sand encroachment issues and the custom trains with sand cleaning capabilities from the rails. With all the measures being taken, this line seems like it’s going to be very very expensive to maintain.

          • df1982

            I’m extremely dubious about the technology in general, but Saudi Arabia is the one place in the world where, theoretically at least, a hyperloop-style system might have actually made sense. It fulfilled all the conditions for a non-steel wheel-on-steel rail solution: the distances involved are at the threshold where standard HSR starts to struggle to compete with flying (Riyadh to Medina and Mecca is around 850km), there is no legacy rail system of note to make use of for station approaches, the government has more money than they know what to do with, and in light of the desert conditions an elevated vacuum tube across the desert might have actually proved to be not that much more expensive in the long run than a standard HSR line.

            But the technology isn’t mature (and probably never will be ) and they’ve already gone with HSR for Medina-Mecca, so they should just expand on that system.

          • michaelrjames

            What you’re really saying is that the Saudis should have gone with the TransRapid MagLev. It copes with those issues, not only being always elevated but the mechanism is intrinsically resistant to weather and things like sand. It could traverse the 850km (Ryadh to Mecca) in under 2 hours.
            At Alon’s stated cost, it would be about half the price. Well, using the cited cost in 2006, so would need to do some inflation adjustment. Still, at 453km the Mecca–Medina HSR apparently cost >US$36 billion! I found something that has the inflation adjusted cost (only to 2007 …) of Paris to Lyon’s 425km LGV at €3.5 billion. Morocco’s Al-Boraq HSR is roughly comparable to that cost while Saudi Arabia’s is approx. ten fold more expensive.
            Did the French submit a bid on the SA project?

            Having said that, I’m not sure the conditions are so unique. Or even that different from Morocco’s, not to mention Australia’s Adelaide to Darwin 3,000 km line that traverses some of the harshest landscapes in the world with some of the most extreme diurnal temperature variation (it’s not HSR but is a modern seamless welded-track route). Or China’s line to Turpan, Urumqi on the northern Gobi desert (and part of the East Wind new silk route freight trains to Europe), or its Qinghai–Tibet railway that passes thru the southern edges of the Gobi etc.

          • Alon Levy

            The GCC states like flashy tech, to the point that the UAE is looking into a Hyperloop system to connect Dubai and Abu Dhabi, which are located at the wrong distance for this mode.

          • df1982

            Exactly. Dubai-Abu Dhabi doesn’t even really need HSR, a 200km/h line could do the distance in well under an hour. Although if they ever want to expand into a pan-Arabian network HSR might be better.

            The Alice Springs-Darwin line was a pretty good example of cost containment, since it was built for under $1million per km, opening in 2004. Yes, it was a single track, unelectrified, frieght-primary line (there is a luxury passenger train to Darwin running every few days) passing through unpopulated desert, but that is still an extraordinarily low figure, in a country that has similar issues to the UK and the US with construction inflation.

          • Alon Levy

            For what it’s worth, I’m not so sure Australia had a construction cost problem in the 1990s. There were no subways so I can’t tell, but during that period Canada and Singapore were building subways at below-average costs.

          • df1982

            The Airport line in Sydney was an extension of the suburban network, but it was almost all underground, so had a construction profile similar to subways. 9km of tunnel, 5 new stations, and two grade-separated junctions with existing lines for $900m, completed in 1999. At the time it went horrendously over budget, partly due to a botched PPP that had a private company pay for the stations in exchange for a 30 year station access fee (it still costs nearly $20 to travel the 8 or so kilometres from Central to the Airport), but today we would kill for those kind of construction costs (even inflation adjusted).

            Another subway-like line was the Chatswood-Epping link: 13km of tunnel with 5 stations (3 new, 2 re-built with extra platforms), completed in 2008 for $2.3b. Again it went way over budget, and was truncated from the original plans which called for the line to go to Parramatta. It wasn’t a PPP, but a lot of the excess costs had to do with how the project was financed, rather than on-the-ground expenses. But again it seems pretty cheap by today’s standards. A currently planned metro line between Parramatta and the CBD is spoken of as being in the $15-20b bracket (for a 25km line, and scandalously few stations).

            The gold star, however, goes to the Mandurah line in Perth: a 70km above-ground line built through suburbia (mostly in a highway median, but with an underground station in the CBD), completed in 2007 for $1.5b. It baffles me that nobody in the rest of the country has tried to learn how the WA government got the project right (they basically implemented a lot of the same procurement strategies as Madrid did in its metro construction).

            These figures are AU$, which has fluctuated a lot against the US$ (between $0.50 and $1.10 in the last couple of decades), so it’s hard to make a direct international comparison.

          • michaelrjames

            The Perth Mandurah line does get discussed in transit sectors but not by east-coast politicians who are just proxies for the big contractors. (I don’t know if it is the same companies in Perth but obviously they have no interest in west coast frugality spreading east.) The weird thing is that one might expect it to be the other way around in that Perth is supposed to be the most isolated big city on the planet (closest neighbour is Singapore, ≈5h flying) so one wouldn’t be surprised by high costs in everything, especially being subject to the Miners Curse. But it really is like another country and they do many things differently.

            Another example is gas (natural gas). WA’s Northwest Shelf is one of the world’s biggest gas resources though there is also plenty in the east such that Australia recently surpassed Qatar as world’s biggest exporter. However on the east coast there is a domestic crisis because the multinationals want all the gas for their ridiculously over-capitalised (>$80bn) LNG plants to feed the global market (pre-covid). The conservative government ferociously resists calls for gas reservation for the domestic market, yet WA have had such a policy for ages (about 15% is reserved) introduced by conservatives and today uncontested bipartisan policy. Worse, while Qatar makes about $26bn per year on its similar scale gas exports, Australian tax income on more gas exports nets to …. zero, due to all the tax credits on the capital costs of building those LNG plants that stretch into infinity. In addition, big price increases have cost domestic users (including industry) an extra $10-$12bn per year and it is driving industrial users to close down manufacturing (even more). We pay international prices even though it is not LNG for the domestic market and thus the companies earn a margin of about $2.80 a gigajoule from domestic sales compared to 15¢ on exports! There is even talk of re-importing LNG from Japan (! seriously) due to the companies over-commiting themselves on international contracts.
            The reasons are simple: industry capture of both political parties at federal and state levels. Ian Macfarlane, former conservative federal minister of resources is the boss of the industry’s Queensland Resources Council. The current chair of APPEA – (Australian Petroleum Production & Exploration Association Ltd), the industry peak body, is former Labor federal resources minister Martin Ferguson, and the CEO of APPEA is Matthew Roberts who was chief of staff of then minister MacFarlane. Another former Labor resources minister Gary Gray went on the Woodside payroll (the company that dominates the NW Shelf gasfields).

            Here’s some highlights on discussion of Mandurah and how Perth gets it right:

            The great disconnect
            Clay Lucas, November 2, 2010.

            Bowen is president of the Public Transport Users Association. He says the station is emblematic of Melbourne’s wider public transport malaise and part of the reason his politically unaligned group is calling for major changes, including the establishment of a public transport authority. Coincidentally, the Greens last week proposed the same thing. (The Brumby [Victorian] government says such a body is not needed and the opposition will not comment.)

            ….. many others point to Western Australia’s TransPerth public transport authority. Established in 2003, it is now recognised by planners as ”best practice” in Australia. It acts like a North American or European transit agency, taking responsibility for planning and procuring services and ticketing. Most importantly, it presents the system to the public as a single system – unlike in Victoria, where the government allows pressure to be taken off it by having a range of separate transport providers as frontmen.

            TransPerth has ”about 80 people, right down to the guy responsible for letting contracts to build bus stops”, spokesman David Hynes says. It is a much leaner body than Melbourne’s: when Perth decided to buy a new smartcard ticket system, six people were put in charge of buying and overseeing the $35 million project, Hynes says. In Victoria, the Transport Ticketing Authority is in charge of the $1.35 billion myki project* and its most recent organisational chart showed it had 161 staff.

            In 2007 TransPerth opened the 71-kilometre, $1.3 billion Mandurah rail line; its route changed several times following community feedback. Contrast this with Melbourne’s $4.3 billion, 47-kilometre Regional Rail Link.

            [*the myki project, and Sydney’s equivalent, was a clusterfk of epic proportions.]

            So, it is as I have been saying on this blog for years, it comes down to almost no meaningful oversight from within government. We have taken the British route of dissolving most relevant public service capacity and knowhow for these things, including oversight of itself, and outsourcing it all to private contractors. That’s how a 13km tramway in Sydney has blown out to $4bn, about three times the cost of building that 3,000km Adelaide-to-Darwin rail. As the above author says, there needs to be a named official public servant who signs off on every aspect of these big project contracts so that when something goes wrong someone specific is held accountable. Today no one is held accountable, and the voters are too stupid, uninformed etc. (by the Murdoch media monopoly) to exercise their vote responsibly. By virtue of its isolation and its self-admitted insular nature, West Australia didn’t get the memo and fell thru the neoliberal cracks!

          • Eric2

            Is it really that simple for a random city to choose one day to imitate Madrid, and thus get low construction costs?

          • df1982

            I don’t know, but Perth showed that it was possible within the context of an Anglo-Saxon political culture and legal framework, and at a time of high labour costs and a property boom.

          • Eric2

            How did they do it? Time for some investigative reporting and interviews I think!

          • df1982

            It’s funny because Western Australia was once a by-word for cronyism and corruption (the so-called “WA Inc.” scandal). It also came close to shutting down the entire suburban railway system in the 1980s, so there was evidently quite a turnaround. A lot of credit goes to the transport minister at the time, Alannah McTiernan, who clearly did have a personal investment in keeping construction costs to a minimum.

          • Richard Mlynarik

            For what it’s worth, I’m not so sure Australia had a construction cost problem in the 1990s. There were no subways so I can’t tell, but during that period …

            When looking at Australia in the last many decades, what you are seeing on the public transportation front is what wasn’t built. Dozens of shelved and botched rail extensions and capacity improvements in Sydney and Melbourne. Hey, Sydney-Melbourne HSR! Change of state goverment, cancel the prior plan. A few dribs and drabs happened, and of course the usual stupid airport rail lines, but mostly it was study-cancel-shelve.

            What do you see was incredible amounts of freeway building (basically all the motorways of the entire country post-date 1980) and, as the 1990s and 2000s wore on, explosive cost blowouts and quite literally criminal PPP scams with endless public bailouts. (Sydney airport rail really is an example of one of these urban road tollway PPP scams; the tracks and trains part is pretty superficial.)

            Somehow in some of this and a little under the radar Brisbane and Perth electrified, and Transperth got away with far more than might be expected, but overwhelmingly there were terrible “public” civil works construction cost problems in Australia in the 1990s (and continuing to this day) — it’s just that most of the rail projects that might have gone in your spreadsheets were instead drowned in a bathtub.

            Bonus fun fact: I had a couple of people from Transperth and consulting for Transperth contact me back in the early 2000s saying they were interested in what they’d heard about Caltrain and they happened to be coming to Los Angeles and they’d be interested in talking to Caltrain people about their experiences with Perth rail modernization — pretty much exactly what Caltrain needed and still needs and will probably never see. I put them in contact, they came up to San Francisco and … Caltrain agency staffers blew them off, cancelled the meetings. Niiiiiiiiice.

  3. Max Wyss

    Could it also be that Alstom (and other French consultants) are not as much considered to be “foreigners”, because they may have employees originating from the Maghreb working on the projects.

  4. Gok (@Gok)

    PPP adjustment is always pretty suspect but it’s extra problematic here given how much is imported. Consumer goods are more expensive in Copenhagen than Riyadh but that in no way implies that trains should be cheaper in Saudi Arabia. We wouldn’t expect SAS to pay twice as much for airplanes as Saudia. Cheap local labor doesn’t follow PPP either; the expensive parts of construction are things like TBMs with foreign owner/operators and palatial stations with foreign celebrity architects.

  5. Richard Mlynarik

    The explanation, per Anan and an Israeli-British planner named Omer Raz, is that there is no interest in cost control in the Gulf region. The GCC states have money. They are buying prestige and the trappings of modernity; for all of their crowing about the superiority of their XXX and YYY”

    This pretty much explains most public transportation public works and procurement in the USA and much of the Anglosphere, also. Same situation, same cast of transnational characters, same outcomes.

    Substitute some sort of greenwashing about “Paris of the West Coast” or “vibrant urbanity” or “sustainability” for “traditional values and Islamic law” or whatever and you have it.

    This is why any investigation of the number of union tunnel boring machine operators, or the cost per cubic metre of concrete is irrelevant and doomed: once it is explicitly telegraphed that cost is no object in pretty much the richest parts of the world that have ever existed in human history, the worst types of human are going to ensure that costs are, indeed, uncontrolled.

    • Eric2

      No politician is indifferent to costs. They would all like to open two subway lines rather than one, for a given amount of available funding.

      The problem is lack of technical expertise at various levels of the government and public, which does not allow for an intelligent acceptance of reasonable prices and rejection of unreasonable ones. So some politicians end up rejecting all transit projects, while others end up accepting them pretty much any cost.

      • Richard Mlynarik

        No politician is indifferent to costs. They would all like to open two subway lines rather than one, for a given amount of available funding.

        Nope. They really truly are not only indifferent to costs, but actively promote higher costs. “Jobs”!

        You’re under the misapprehension that “one subway line” is what is being delivered, and that “two subway lines” is more.

        Not so! What’s being delivered is earmarked and greenwashed public cash, not any particular rail line or whatever.

        “One subway” suffices. Why do twice as much work for the same payback?

        • Eric2

          The vast majority of what politicians say about transit projects is not about jobs.

          Politicians work extremely hard to get and stay in office. A lot of that effort is spent on things like campaigning of no intrinsic value, and some of that effort is unethical, but it’s all still effort. If a politician sees a way to put in a little more effort and get results which voters will appreciate (like another subway line), they absolutely will put in that effort.

          • Alon Levy

            The majority, yes, but I don’t know how vast a majority. In rolling stock especially, politicians demand local jobs, forcing vendors to establish a new factory in-state at high costs. The Los Angeles LRV disaster was celebrated by TAP, which talked up the broken process that drove the cost up from $80-100,000 per linear meter to $140,000 just so that unions could brag about a handful of $20/hour jobs in Palmdale (link).

          • Reedman Bassoon

            RM is essentially correct. The example I would use is AC Transit (Oakland) buying VanHool buses for about 10 years. The $1 million in trips to Paris, London, and Belgium that managers took were just a cost of doing business. The money laundering required to buy Belgian buses in defiance of “Buy American” was just part of the paperwork. Having to pay for an AC Transit bus inspector in Antwerp for five years was not considered unusual. The fact that there is a bus manufacturer in Alameda County (Gillig) was “salt in the wounds” — Gillig buses are not considered as visually attractive as the VanHools, and AC Transit wanted to give its riders a European flavor.

          • Mikel

            To be fair, most American buses are kinda ugly compared to e.g. these, which can be seen all across Europe nowadays. Couldn’t they just… ask that local manufacturer to make a prettier-looking bus?

          • Richard Mlynarik

            Everything Mr Bassoon writes here is totally incorrect. It’s just amazing how a crowd of incensed and largely geriatric bus fans and union dudes and local rent-seeking parasite companies have maintained their white-hot hatred of “Van Hell” buses — of BUSES!! — for a couple decades.

            The fact is that I know the people who pushed for this procurement, and knew and interacted with them a great deal at the time. They could take and pay for their own holidays in Europe without the attraction of spending quality time in a factory in a shit industrial area of Koningshooikt. The fact that they weren’t small-minded public-hating US transit industry lifers and had some cosmopolitan experience of the world and what was possible wasn’t because of “$1 million in trips to Paris, London, and Belgium” (“one MILLION dollars!”) — it was because they gave a fuck about their constituents and taxpayers and about improving the world.

            What they wanted was to provide modern and efficient and attractive transportation services to the riders (and not-yet-riders to improved service) of Alameda and Contra Costa Counties. Low-floor buses — basically not available in the US — with many wide doors, all-door boarding, proof of payment, transit priority traffic signals and strategic transit priority lanes were a way to get there. Faster, more comfortable, more efficient service at lower cost using superior and cheaper vehicles.

            What they got was total Empire Strikes Back from the operating unions and agency staff. Running shit service at huge cost using shit equipment procured at high cost that breaks down constantly and is maintained using shit practices is just how they like things. The shit local builder of shit buses was of course happy to contribute cash and bodies to the “spontaneous” upwelling of scandal that satanic buses from Belgium (notorious land of pedophialia, you know!) were threatening a decades-long, and continuing pattern of stagnation, decline, jobs for the boys, pay for doing nothing, hopeless inefficiency in staffing, hopeless inefficiency in equipment utilization, etc. AC Transit still doesn’t have all-door boarding, 25 years or so later.

            This happens all the time. Look — or rather don’t look — at the Philadephia S-Bahn.

            The key thing to understand is that delivering service is never the point of US public transportation procurement — and if somebody makes that mistake, they’re underminded and expelled by the powerful immune response system of the system. It’s all about scoring earmarked cash and then funnelling it into the right pockets. That and that alone. I’ve seen it happen over and over and over, and it has not improved. (SF Muni’s Jeff Tumlin will be crushed soon enough.)

          • Richard Mlynarik

            The vast majority of what politicians say about transit projects is not about jobs.

            Nope. Most of it is about “secured a $600 million of federal funding for XXX” or “successfully passed a regressive sales tax to fund YYY” or “created 17 new jobs in a new railcar assembly facility in ZZZ”. That’s jobs-talk — they public is allowed and encouraged to have the idea that, say, a hundred million expended on civil engineering “soft costs” somehow has something to do with lots of “jobs.”

            It’s never “improved bus speed by 13%”. It’s never “procured twice as many trains for the same budget, and had them delivered three yeers sooner.” It’s never “undertook operational study that identified $200 million in project capital cost savings while increasing throughput by 38%”. It’s never “doubled ridership while increasing operating costs by only 19%”

            If a politician sees a way to put in a little more effort and get results which voters will appreciate (like another subway line), they absolutely will put in that effort.

            Interesting theory. Very much less than zero evidence for the theory this part of the world. (And yes, topic drift. We’re commenting below the line on an article an construction costs in the Arab World.)

          • Eric2

            Only one of your three examples is about jobs, thus confirming what I said that most transit talk is not about jobs. The other two examples are about fundraising, which is a necessary part of any project, even an efficient one with no overhead.

            Politicians do talk about metrics like shortening commute times Yes it would be nice if we could get them to focus on more sophisticated measures, like perhaps people-minutes saved per dollar spent. The way to do that is by engaging with them and with the public in an attempt to raise the level of discourse, not by whining about how they are irredeemably evil and therefore not worth talking to, as you seem to prefer.

          • Richard Mlynarik

            Believe whatever bullshit you wish. In the USA, a “transit” project is always advertised primarily in terms of the number of millions of earmarked dollars it will consume. In the USA, this is a proxy for “good jobs at good wages in our district”. It really means “pile cash in a hole and set it on fire”, but that message doesn’t sell as well. You can believe “fundraising”, all by itself, makes voters happy, and the only reason they elect politicians is because they wants funds raised with no purpose in mind, and good luck with that. Enjoy arguing with yourself.

            Sure then “talk about shortening commute times”. They talk about highway widenings “ending congestion”, too. They talk about “enabling vibrant communities” and “decreasing greenhouse gas emissions”. Some people listen to this bullshit — it never hurts to cover your bases. (It’s bullshit, because the criminally expensive projects they “fundraise” are nearly the worst possible routes to such ostensible greenwashing goals.) But once the project is a go and the “environmental studies” and “alternatives analysis” have done their part and strangled any cheaper or more effective alternatives, it’s all about the earmarks, and all about “$800 million dollar project to XXX” and pictures of bunch of dudes in hard hats flanked by rebar. Once the cash is spent, the projects goals and motivations — never remotely approached, since they were always fraudulent means to a fundraising end — are forgotten and we move on to the next “$1.8 billion dollar project will add one new station and extend into the vibrant/underserved/up-and-coming/knowledge hub/.. community”.

            The dollars are up front, here, always. The worse the project, the bigger the earmarks, and the more they love it.

  6. Pingback: Week 34: 17-23 August 2020
  7. Pingback: Transit Costs Website | Pedestrian Observations
  8. Pingback: High-Speed Rail Costs and Presentation | Pedestrian Observations

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.