European and American intercity train planning takes it as a given that every train must have a car dedicated to cafeteria service. This is not the only way to run trains – the Shinkansen doesn’t have cafe cars. Cafe cars waste capacity that could instead be carrying paying passengers. This is the most important on lines with capacity limitations, like the Northeast Corridor, the West Coast Main Line, the LGV Sud-Est, and the ICE spine from the Rhine-Ruhr up to Frankfurt and Mannheim. Future high-speed train procurement should go the Shinkansen route and fill all cars with seats, to maximize passenger space.
How much space do cafe cars take?
Typically, one car in eight is a cafe. The standard European high-speed train is 200 meters long, and then two can couple to form a 400-meter train, with two cafes since the two 200-meter units are separate and passengers can’t walk between them. In France, the cars are shorter than 25 meters, but a TGV has two locomotives and eight coaches in between, so again one eighth of the train’s potential passenger space does not carry passengers but rather a support service. Occasionally, the formula is changed: the ICE4 in Germany is a single 12-car, 300-meter unit, so 1/12 of the train is a cafe, and in the other direction, the Acela has six coaches one of which is a cafe.
A 16-car Shinkansen carries 1,323 passengers; standard class has 5-abreast seating, but even with 4-abreast seating, it would be 1,098. The same length of a bilevel TGV is 1,016, and a single-level TGV is 754. The reasons include the Shinkansen’s EMU configuration compared with the TGV’s use of locomotives, the lack of a cafe car in Japan, somewhat greater efficiency measured in seat rows per car for a fixed train pitch, and a smaller share of the cars used for first class. An intermediate form is the Velaro, which is an EMU but has a cafe and three first-class cars in eight rather than the Shinkansen’s three in 16; the Eurostar version has 902 seats over 16 cars, and the domestic version 920.
The importance of the first- vs. second-class split is that removing the cafe from a European high-speed train means increasing seated capacity by more than just one seventh. The bistro car is an intermediate car rather than an end car with streamlining and a driver’s cab, and if it had seats they’d be second- and not first-class. A German Velaro with the bistro replaced by a second-class car would have around 1,050 seats in 16 cars, almost even with a 4-abreast Shinkansen even with four end cars rather than two and with twice as many first-class cars.
How valuable are cafes to passengers?
The tradeoff is that passengers prefer having a food option on the train. But this preference is not absolute. It’s hard to find a real-world example. The only comparison I am aware of is on Amtrak between the Regional (which has a cafe) and the Keystone (which doesn’t), and Regional fares are higher on the shared New York-Philadelphia segment but those are priced to conserve scarce capacity for profitable New York-Washington passengers, and at any rate the shared segment is about 1:25, and perhaps this matters more on longer trips.
Thankfully, the Gröna Tåget project in Sweden studied passenger preferences in more detail in order to decide how Sweden’s train of the future should look. It recommends using more modern seats to improve comfort, making the seats thinner as airlines do in order to achieve the same legroom even with reduced pitch, and a number of other changes. The question of cafes in the study is presented as unclear, on PDF-p. 32:
|Food and Refreshments||Willingness to Pay|
|Coffee machine (relative to no service at all)||3-6%|
|Free coffee and tea in each car||6%|
|Food and drink trolley||11%|
|Restaurant with hot food||17%|
Put another way, the extra passenger willingness to pay for a cafeteria compared with nothing, 14%, is approximately equal to the increase in capacity on a Velaro coming from getting rid of the bistro and replacing it with a second-class car. The extra over a Shinkansen-style trolley is 3%. Of course, demand curves slope down, so the gain in revenue from increasing passenger capacity by 14% is less than 14%, but fares are usually held down to a maximum regulatory level and where lines are near capacity the increase in revenue is linear.
Instead of a bistro car, railroads should provide passengers with food options at train stations. In Japan this is the ekiben, but analogs exist at major train stations in Europe and the United States. Penn Station has a lot of decent food options, and even if I have to shell out $10 for a pastrami sandwich, I don’t think it’s more expensive than a Tokyo ekiben, and at any rate Amtrak already shorts me $90 to travel to Boston. The same is true if I travel out of Paris or Berlin.
Even better, if the station is well-designed and placed in a central area of the city, then passengers can get from the street to the platform very quickly. At Gare de l’Est, it takes maybe two minutes, including time taken to print the ticket. This means that there is an even broader array of possible food options by buying on the street, as I would when traveling out of Paris. In that case, prices and quality approach what one gets on an ordinary street corner, without the premium charged to travelers when they are a captive market. The options are then far better than what any bistro car could produce, without taking any capacity away from the train at all.
A curious pattern can be found in subway construction costs around the world, based on GDP per capita. On the one hand, poor countries that have severe cultural cringe, such as former colonies, have high construction costs, and often the worst projects are the ones that most try to imitate richer countries, outsourcing design to Japan or perhaps China. On the other hand, poor-rich countries, by which I mean countries on the periphery of the developed world, have similar cultural cringe and self-hate for their institutions, and yet their imitation of richer countries has been a success; for example, Spain copied a lot of rail development ideas from Germany and France. This can be explained using the development economic theory of isomorphic mimicry; the rub here is that a poor country like India or Ethiopia is profoundly different from the richer countries it tries to imitate, whereas a poor-rich country like Spain is actually pretty similar to Germany by global standards.
What is isomorphic mimicry?
In the economic development literature, the expression isomorphic mimicry refers to when a poor country sets up institutions that aim to imitate those of richer countries in hope that through such institutions the country will become rich too, but the imitation is too shallow to be useful. A common set of examples is well-meaning regulations on safety, labor, environmental protection, and anti-corruption that are not enforced due to insufficient state capacity. Here is a review of the concept by Andrews, Pritchett, and Woolcock, with examples from Mozambique, Uganda, and India, as well as some history from the American private sector. More examples using the theory can be found in Turczynowicz, Gautam, Rénique, Yeap, and Sagues concerning Peru’s one laptop per child program, in Evans’ interpretation of Bangladesh’s domestic violence laws, and in Rajagopalan and Tabarrok on India’s poor state of public services.
While the theory regarding institutions is new, analogs of it for tangible goods are older. Postwar developmental states engaged in extensive isomorphic mimicry, building dams, steel plants, and coal plants hoping that it would transform them into wealthy states like the United States, Western Europe, and Japan; for the most part, they had lower economic growth than did the developed world until the 1980s. The shift within international development away from tangible infrastructure and toward trying to fix institutions came about because big projects like the Aswan Dam failed to create enduring economic growth and often had ill side effects on agriculture, the environment, or human rights.
How does isomorphic mimicry affect public transportation?
The best example of isomorphic mimicry leading to bad transit that I know of is the Addis Ababa light rail system. This is funded by China, whose ideas of global development are similar to those of the postwar first and second worlds, that is providing tangible physical things, like railroads. Unfortunately, usage is low, because of problems that do not exist in middle-income or rich countries but are endemic to Ethiopia. Christina Goldbaum, the New York Times’ transit reporter, who lived in East Africa and reported from Addis Ababa, mentioned four problems:
- Electricity is unreliable, so the trains sometimes do not work. In early-20th century America, electric railroads and streetcar companies built their own power supply and were sometimes integrated concerns providing both streetcar and power service; but in more modern countries, there is reliable power for urban rail to tap.
- Not many people work in city center rather than in the neighborhood they live in. This, again, has historical analogs – there were turn-of-the-century Brooklynites who never visited Manhattan. Thus, a downtown-centric light rail system won’t get as much ridership as in a more developed city.
- The train is expensive relative to local incomes, so many people stick with buses or ride without paying.
- The railroad cuts through streets at-grade, to save money, and blocks off pedestrian paths that people use.
The Addis Ababa light rail system at least had reasonable costs. A more typical case for countries that poor is to build urban rail at premium cost, and the poorer the country, the higher the cost. The reason is most likely that such countries tend to build with Chinese or Japanese technical assistance, depending on geopolitics, and therefore import expensive capital for which they pay with weak currencies.
In India, the most functional and richest of the countries in question, there is much internal and external criticism that its economic growth is not labor-intensive, that is the most productive firms are not the ones employing the most people, and this stymies social development and urban growth. I suspect that this also means there is reluctance to use labor-intensive construction methods, that is cut-and-cover with headcounts that would be typical in New York, Paris, and Berlin in the early 20th century, or perhaps mid-20th century Milan and Tokyo. International consultancies are centered on the rich world and recommend capital-intensive methods to avoid hiring too many sandhogs at a fully laden employment cost of perhaps 8,000€ a month; in India, that is the PPP-adjusted gross salary of an experienced construction worker per year, and if capital is imported then multiply its cost by 3 to account for the rupee’s exchange rate value.
Poor-rich countries are those on the margin of the developed world, such as the countries of Eastern and Southern Europe, Turkey, Israel, to a lesser extent South Korea, and the richer countries of Latin America such as Chile. These are clearly poorer than the United States or Germany. Their residents, everywhere I’ve asked, believe that they are poorer and institutionally inferior; convincing a Spaniard or an Italian that their country can do engineering better than Germany is a difficult task. Thus, these countries tend to engage in mimicry of those countries that they consider the economic center, which could be Germany in Southern Europe, Japan in South Korea, or the US or Spain in Spanish America.
However, being a poor-rich country is not the same as being a poor country. Italy is, by American or German standards, poor. Wages there are noticeably lower and living standards are visibly poorer, and not just in the South either. But those wages remain in the same sphere as American and German wages. The labor-capital cost ratios in Southern Europe are sufficiently similar to those of Northern Europe that it’s not difficult to imitate. Spain even mixed and matched, using French TGV technology for early high-speed rail but preferring the more advanced German intercity rail signaling system, LZB, to the French one.
Such imitation leads to learning. Spain imported German and French engineering ideas but not French tolerance for casual rioting or German litigiousness, and therefore can build infrastructure with less NIMBYism. Turkey invited Italian consultants to help design the early lines of the Istanbul Metro, but subsequently refined their ideas domestically in order to build more efficiently, for example shrinking station footprint and tunnel diameter to reduce costs. Seoul has a subway system that looks like Tokyo’s in many ways, but has a cleaner network shape, with far fewer missed connections between lines. As a result, all three countries – Spain, Turkey, Korea – now have innovative domestic programs of rail construction and can even export their expertise elsewhere, as Spain is in Ecuador.
Openness to novelty
Andrews-Pritchett-Woolcock stress the importance of openness to novelty in the public sector, and cite examples of failure in which bureaucrats at various levels refused to implement any change, even one that was proven to be positive, because their goal was not to rock the boat.
Cultural cringe is in a way a check on that. Isomorphic mimicry is an attempt to combine agenda conformity and closeness to novelty with a desire to have what the richest countries have. But in poor-rich countries, isomorphic mimicry is real imitation – there is ample state penetration in a country like Spain or Turkey rather than outsourcing of state capacity to traditional heads of remote villages, and education levels are high enough that many people know how Germany works and interact with Germany regularly. A worker who earns 2,000€ a month net and a worker who earns 3,000€ a month can exchange tips about how to apply for jobs, how to prepare food, what brands of consumer goods to buy, and where to go on vacation. They cannot have this conversation with a worker who earns 10,000€ a month net.
Within the rich world, what matters then is the realization that something is wrong and the solution is to look abroad. It doesn’t matter if it’s a generally poor-rich region like Southern Europe or a region with a poor-rich public sector like the United States – there’s enough private knowledge about how successful places work, but what’s needed is a public acknowledgement and social organization encouraging imitation and lifting voices that are most expert in implementing it.
And for all the jokes about how the United States or Britain is like a third-world country, they really aren’t. Their public-sector dysfunctions are real, but are still firmly within the poor-rich basket; remember, for example, that despite its antediluvian signaling capacity, the New York City Subway manages to run 24 trains per hour per track at the peak, which is better than Shanghai’s 21. Health and education outcomes in the United States are generally better than those of middle-income and poor countries on every measure. This is a public sector that compares poorly with innovation centers in Continental Europe and democratic East Asia, but it still compares; to try to do the same comparison in a country like Nigeria would be nonsensical.
The upshot then is that implementing best practices in developed countries that happen to be bad at one thing, in this case public transportation in the United States, can work smoothly, much like Southern Europe’s successful assimilation of and improvements on Northern European engineering, and unlike the failures in former colonies in Africa and Asia. But people need to understand that they need to do it – that the centers of innovation are abroad and are in particular in countries that speak English non-natively.
There’s a study by Eno looking at urban rail construction costs, comparing the US to Europe. When it came out last month I was asked to post about it, and after some Patreon polling in which other posts ranked ahead, here it goes. In short: the study has some interesting analysis of the American cost premium, but suffers from some shortcomings, particularly with the comprehensiveness of the non-American data. Moreover, while most of the analysis in the body of the study is solid, the executive summary-level analysis is incorrect. Streetsblog got a quote from Eno saying there is no US premium, and on a panel at Tri-State a week ago T4A’s Beth Osborne cited the same study to say that the US isn’t so bad by European standards, which is false, and does not follow from the analysis. The reality is that the American cost premium is real and large – larger than Eno thinks, and in particular much larger than the senior managers at Eno who have been feeding these false quotes to the press think.
What’s the study?
Like our research group at Marron, Eno is comparing American urban rail construction costs per kilometer with other projects around the world. Three key differences are notable:
- Eno looks at light rail and not just rapid transit. We have included a smattering of projects that are called light rail but are predominantly rapid transit, such as Stadtbahns, the Green Line Extension in Boston, and surface portions of some regional rail lines (e.g. in Turkey), but the vast majority of our database is full rapid transit, mostly underground and not elevated. This means that Eno has a mostly complete database for American urban rail, which is by construction length mostly light rail and not subways, whereas we have gaps in the United States.
- Eno only compares the United States with other Western countries, on the grounds that they are the most similar. There is a fair amount of Canada in their database, one Australian line, and a lot of Europe, but no high-income Asia at all. Nor do they look at developing countries, or even upper-middle-income ones like Turkey.
- Eno’s database in Europe is incomplete. In particular, it looks by country, including lines in Britain, Spain, Italy, Germany, Austria, the Netherlands, and France, but even there it has coverage gaps, and there is no Switzerland, little Scandinavia (in particular, no ongoing Stockholm subway expansion), and no Eastern Europe.
The analysis is similar to ours, i.e. they look at average costs per km controlling for how much of the line is underground. They include one additional unit of analysis that we don’t, which is station spacing; ex ante one expects closer station spacing to correlate with higher costs, since stations are a significant chunk of the cost and this is especially notable for very expensive projects.
The main finding in the Eno study is that the US has a significant cost premium over Europe and Canada. The key here is figure 5 on takeaway 4. All costs are in millions of PPP dollars per kilometer.
|Tunnel proportion||Median US cost||Median non-US cost|
However, the study lowballs the US premium in two distinct ways: poor regression use, and upward bias of non-US data.
Regression and costs
The quotes saying the US has no cost premium over Europe come from takeaways 2 and 3. Those are regression analyses comparing cost per km to the tunnel proportion (takeaway 3) or at-grade proportion (takeaway 2). There are two separate regression lines for each of the two takeaways, one looking at US projects and one at non-US ones. In both cases, the American regression line is well over the European-and-Canadian line for tunneled projects but the lines intersect roughly when the line goes to 0% underground. This leads to the conclusion that the US has no premium over Europe for light rail projects. Moreover, because the US has outliers in New York, the study concludes that there is no US premium outside New York. Unfortunately, these conclusions are both false.
The reason the regression lines intersect is that regression is a linear technique. The best fit line for the US construction cost per km relative to tunnel proportion has a y-intercept that is similar to the best fit line for Europe. However, visual inspection of the scattergram in takeaway 3 shows that at 0% underground, most US projects are somewhat more expensive than most European projects; this is confirmed in takeaway 4. All this means that the US has an unusually large premium for tunneled projects, driven by the fact that the highest-cost part of the US, New York, builds fully-underground subways and not els or light rail. If instead of Second Avenue Subway and the 7 extension New York had built high-cost els, for example the plans for a PATH extension to Newark Airport, then a regression line would show a large US premium for elevated projects but not so much for tunnels.
I tag this post “good/interesting studies” and not just “shoddy studies” because the inclusion of takeaway 4 makes this clear: there is a US premium for light rail, it’s just smaller than for subways, and then regression analysis can falsely make this premium disappear. This is an error, but an interesting one, and I urge people who use statistics and data science to study the difference between takeaways 2 and 3 and takeaway 4 carefully, to avoid making the same error in their own work.
Eno has a link to its dataset, from which one can see which projects are included. It’s notable that Eno is comprehensive within the United States, but not in Europe. Unfortunately, this introduces a bias into the data, because it’s easier to find information about expensive projects than about cheap ones. Big projects are covered in the media, especially if there are cost overruns to report. There is also a big-city premium because it’s more complicated to build line 14 of a metro system than to build line 1, and this likewise biases incomplete data because it’s easier to find what goes on in Paris than to find what goes on in a sleepy provincial town like Besançon. Yonah Freemark thankfully has good coverage of France and includes low-cost Besançon, but Eno does not – its French light rail database is heavy on Paris and has big gaps in the provinces. French Wikipedia in fact has a list, and all of the listed systems, which are provincial, have lower costs than Paris.
There is also no coverage of German tramways; we don’t have such coverage either, since there are many small projects and they’re in small cities like Bielefeld, but my understanding is that they are not very expensive. Traditionally German rail advocates held the cost of a tramway to be €10 million/km, which is clearly too low for the 2010s, but it should lower the median cost compared to the Paris-heavy, Britain-heavy Eno database.
The answer to the question is the public sector, always. It’s okay to have private-sector involvement in construction, but the risk must be borne by the public sector, or else the private sector will just want more money to compensate for the extra risk.
The biggest piece of evidence for this is emerging out of our construction costs project, so it will appear in the report and not in a blog post. But for now, I’d like to point out examples from media, the academic literature, and one interview of particular interest.
PPP, Gangnam style
A transportation planner in Korea named Abdirashid Dahir has been giving Eric and me a lot of detailed information about Korean construction costs. We were already aware that Line 9 in Seoul had been built as a PPP, but what we learned was more complicated.
Line 9 is a partnership – the last P in PPP. This means, part of the construction is done by the private sector, and part by the public sector, namely the Seoul Metropolitan Government. The private consortium, led by Hyundai, was responsible for the design and for the construction of the systems, including the tracks, signaling, and rolling stock. SMG was responsible for the civil infrastructure. The total cost of the first phase was 1,167.7 billion won for 25.5 km, split as 492.2 billion in municipal construction and 675.8 billion in private investment.
The importance of this split is that civil infrastructure is the least certain part of underground construction. There are always geotechnical surprises, most small, a few potentially leading to large cost and schedule overruns. These are especially likely during station construction – the tunnels in between tend to be simpler with modern TBMs. Systems, in contrast, are relatively straightforward. Installing rail tracks is the same task regardless of whether it’s in solid rock in an exurban area that has no significant archeology, or through sand that had to be frozen, partly underwater, in the oldest parts of Berlin.
The upshot here is that while low-cost countries do use PPPs, this project keeps the riskiest aspects of construction public and not private. Privatization is fine for less risky, more commoditized situations.
How private bidders respond to risk
Two examples come to mind, both from the United States.
First, in New York, Brian Rosenthal’s seminal New York Times article cited Denise Richardson of the General Contractors’ Association saying that the contractors are barely making any profit and are bidding high because of risks imposed on them by the public sector. I don’t think this is a very high-quality source – it’s extremely biased, for one – but in context, it makes some sense.
Second, we do have more quantifiable data on this, thanks to the work of the Stanford Graduate School of Business economist Shosh Vasserman and Hoover Institute economist Valentin Bolotnyy. They look at highway maintenance contracts in Massachusetts and compare scaling auctions, in which the contracts are itemized, with lump sum auctions, in which they are not. Based on actual differences in price and estimates of contractor risk-aversion, they estimate that itemizing saves 10% of the cost through lower risk.
Supporting structures for public-sector risk assumption
There’s always the problem of moral hazard. Of note, even with this problem, costs are lower with itemized contracts in Massachusetts than with lump-sum contracts. But this does suggest a number of ways to reduce costs through better risk management:
- Itemized contracts, in enough detail that changes do not need litigation.
- Fixed profit rates – Spanish contracts are done with a fixed profit rate over the items named in the bid.
- Public oversight – there needs to be tighter supervision of risky things, which most likely means no PPPs for civil infrastructure.
It is unfortunate that American trends in the last 20 years have been away from those principles and toward greater privatization of the state, and equally unfortunate that American (and British) soft power has led to similar reforms in the wrong direction in the rest of the Anglosphere. But it’s possible to do better and imitate Korean practices to get Korean costs.
Ever since reading Brooks-Liscow on the growth in American road construction costs since the 1960s, I’ve been interested in the surplus extraction theory of costs. The authors call their main theory citizen voice, in which local groups can use litigation to extract the social surplus generated by infrastructure construction. I’d like to go more deeply into what this theory is and what it implies.
What is surplus?
Normally, a competitive market has no surplus. The owner of a restaurant, the developer of a building in an unconstrained area like suburban Texas, the seller of cloth masks on Etsy, the freelance web developer – none of them is making a killing. People enter the market until profits are driven down to levels low enough to essentially be the owner-manager’s wage. Companies can only make a large profit if they operate at enormous scale, which takes a long time to develop – the profit margins on a single Walmart or Carrefour or Lidl are small, but the profit margins on 10,000 stores add up to a couple billion dollars a year.
Infrastructure is not a competitive market, for a number of different reasons:
- The construction of transportation infrastructure has strong positive externalities, through enabling agglomeration. In a country with cars, the construction of public transportation also helps mitigate the negative externalities of cars.
- Infrastructure is not meaningfully competitive. The largest city in the world, Tokyo, has around two competing rail operators per suburban region. In Tokyo, it’s a natural duopoly; in just about every smaller city, it’s a natural monopoly.
- The barriers to entry are so steep that some kind of price regulation is obligatory. The result is extensive consumer surplus for riders who are not poor.
- Government involvement means that regulations that make it easier or harder to build infrastructure have large impact, which can create or destroy social surplus.
The upshot is that at non-New York costs, infrastructure construction in New York generates enormous social surplus. I could break this down by component, but for brevity I won’t, and just cite what looks like the upper limit of what the publics in the United States and Europe are willing to pay for urban and regional rail: around $50,000 per projected weekday trip. Lines teetering on the edge of cancellation, like M18 in Paris, Second Avenue Subway Phase 2 in New York, and Crossrail 2 in London, all cluster around this figure.
If we take $50,000/rider as the lowest possible benefit-cost ratio that gets a project built, around 1.2-1.3 in countries that conduct such analyses, then Second Avenue Subway Phase 2, currently projected around $60,000/rider, is 1. But at the median global cost, which exists in France and Germany, it would cost $700 million, or $7,000/rider, for a benefit-cost ratio of 8.5. At costs that exist in Southern Europe, Scandinavia, Switzerland, and Korea, make it $400 million, or $4,000/rider, for a benefit-cost ratio of 15. That’s a big net profit for New York City Transit (or, it would be if its operating costs were not abnormally high too), and a huge net social surplus for New York. Every group that wants a piece of that surplus then has an incentive to make noise and raise costs.
How can surplus be extracted?
People who wish to seize public resources have a variety of methods with which to do so. Some are net transfers of surplus from society to one special interest, but most are net destruction of value in the sense that the loss of social surplus exceeds the gain to the special interest, usually by a large margin.
The technique for surplus extraction is usually the threat of a lawsuit, but in some cases it can be direct political lobbying. The actual lawsuit is almost never important – in the US and Germany, at least, the state usually wins these suits, and the impact of litigation is to delay and to deny political capital.
However, surplus can also vanish into the ether through poor planning. Consultants who are not under pressure to save money may well propose oversize infrastructure just because that’s what they are used to, or to avoid sharing right-of-way across railroads; this has led to unusual cost premiums in the United States for everything that touches mainline rail, whereas the subway and light rail premiums are, outside New York, bad but less onerous.
The demands made by special interests that extract surplus vary. They include any of the following:
- Gratuitous tunneling instead of above-ground construction. This is usually a demand made of high-speed rail, but there are some gratuitous tunnels in suburban rail as well, for example Crossrail 2. The surplus here is that NIMBYs do not like to see trains from their houses; the emotional value of their views is naturally a fraction of that of the cost of tunneling.
- Compromise alignments that either increase costs or reduce benefits. This is usually about avoiding specific places; Brooks-Liscow give an example of a Detroit highway swerving around a Jewish community center. But sometimes it can be the opposite – in fact, early US freeway builders expected that communities would lobby for highways near them, not far from them. Los Angeles County’s advocacy for a high-speed rail detour through Palmdale is one such example.
- Extortion of community benefits to activists, for example demands for larger stations to act as neighborhood centers. A large degree of the cost explosion of the Green Line Extension in Boston came from the policy of accommodating local demands, leading to oversize stations. But such overbuilding can also occur absent extortion – the surplus can vanish into poor practices, representing incompetence rather than malice, as in the oversize viaducts of California High-Speed Rail.
- Contracts to favored companies. This led to cost explosion in Italy in the 1970s and 80s, especially in Rome but also Milan; unlike the other items on this list, this is generally illegal, and costs in Italy came down after crackdowns on corruption in the 1990s. However, legal versions exist – sometimes the government is just used to doing business with a company with a poor track record, for example the “the devil we know” attitude in California toward Tutor Perini. The surplus in the latter case vanishes not quite into someone’s pockets but more into the state’s unwillingness to oversee contractors more tightly.
- Labor demands. If the demands are purely about wages then the surplus is distributed without being destroyed. However, these demands are in all cases I know of also about other things. For example, the sandhogs in New York opposed the use of more efficient tunnel boring instead of more dangerous but more labor-intensive dynamite. Protectionism also leads to inferior equipment in addition to higher costs.
Who can extract surplus?
Surplus extraction works through informal mechanisms. The purpose of the nuisance lawsuit is not to win, but to extract a settlement. The threat is delay and loss of political favor for the project rather than outright cancellation. The NIMBY lawsuit in Silicon Valley against California High-Speed Rail was right on the technical merit – the Pacheco Pass route, which would pass through the richest suburbs was technically inferior to the Altamont Pass route, which wouldn’t – still lost; Pacheco was favored due to another kind of surplus extraction, namely Rod Diridon’s desire for shorter Los Angeles-San Jose trip times.
Because surplus extraction works through politics and not clear rules, it benefits those with the most political power. In this way, the rise in NIMBYism in the 1960s and 70s, for example the freeway revolts, contrasts with the contemporary free speech movement, which used formal lawsuits with the intent of winning to expand the boundaries of free speech in America.
The free speech movement celebrated protections for communist Berkeley professors and for pornographers; people with normative professions and normative political views were already protected. In contrast, NIMBYism was most powerful in already rich areas, like Jane Jacobs’ Greenwich Village, or Boston’s South End. Baltimore’s racially integrated freeway revolt was exceptional. New York built freeways through working-class neighborhoods easily, and only encountered political obstacles in the Village, which was by the 1950s gentrified (Jacobs was a journalist with some college education, married to an architect, and her father was a doctor), a new development that hadn’t happened in urban history before and thus the city elites had missed it. Moreover, Jacobs’ remedy of creating and empowering community boards has ensured that only powerful people and powerful communities could change city decisions.
Even more recent attempts to create equity have failed. Slowing down the state and empowering community is always bad for equity, because the community is where inegalitarian traditions live. Black leaders now can derail transit plans just as white leaders can; non-leaders have no voice in neighborhood politics, and it’s those non-leaders who work outside the neighborhood who rely on public transit.
Surplus extraction remains the domain of people with political and cultural cachet. One can fight redevelopment in San Francisco on behalf of a mural to Cesar Chavez; fighting it on behalf of pornographers is harder. Similarly, the unions that have been the best at extracting surplus are traditional ones, doing jobs that existed 100 years ago, at productivity levels that remain stuck in that era, mainly the trades.
Conclusion: saying no
Surplus extraction theory does not say it is impossible to reduce costs. Italy’s sharp fall in costs in the 1990s and Turkey’s gentle fall in the 2010s both suggest that cost reduction is possible. What it does say is that the role of the state is to safeguard surplus and keep it socialized, against demands from many special interests, which should be disempowered through legal changes making lawsuits harder and reducing the ability of consultants and unions to drive up costs.
In that sense, the role of the planner is to say no – and moreover, to say no to charismatic groups representing much-romanticized people. No, dear mother with children, we will not build you a noise wall just because you think 140 km/h electric trains will reduce your quality of life. No, dear tradesman much-profiled as a non-college white voter, we will not hire you for $110/hour when there exist people who will do your job better than you can at $35/hour. No, dear third-generation business owner, we will not listen to what you think about traffic as we replace parking spots with bus lanes. No, dear anti-gentrification activist, we will not pay you as an equity consultant, we will just build the subway in the city. No, dear white flight homeowner, we will not build you a tunnel just to avoid taking a few houses through eminent domain. No, dear deindustrialized city leader, we will not require companies to set up factories in your city at high cost when we can get cheaper imports. It’s never going to be no, dear criminal, or no, dear Nazi, because criminals and Nazis are not used to making such requests and having people listen.
It’s optimistic in a sense, because much cost control comes just from knowing that it’s possible and having the nerve to say no to people who are used to hearing yes. The engineering factors that lead to low costs are important, but first of all, it’s necessary to believe that they are feasible, over local objections.
A few months ago, there appeared an article comparing construction costs for subways in the US and Europe. It has a little table, not PPP adjusted, with cases from elsewhere, but the bulk of the reporting covers differences between the US and Europe. It’s interesting and I urge everyone to read it – but read it critically. It has a long list of bullet points naming various differences, some already covered here, some new but still within reason.
One aspect that seems especially apt is this:
The construction cost [in the US] represents slightly more than 50% of the overall program cost, while soft costs and stakeholders’ commitments at 45% are significantly higher in comparison with other types of major projects or similar projects in other global regions.
Labor cost and construction schedule are the most important factors affecting the construction cost. Labor cost is often driven by labor union rules which vary significantly among states and cities. One of the highest labor costs of tunnel construction workers is the Sandhogs in New York which can be as high as $110/hr and on an overtime basis, it can reach over two to three times this value. Their rates are higher than other tunnel workers in the country and significantly higher than European or Asian workers rates. Also, the number of workers assigned in the tunnel in New York is significantly more than other parts of the country and as much as 4 times more than tunnel workers assigned to comparable projects in Europe. Tunneling being linear structures, the opportunities to accelerate the construction schedule in order to reduce overall labor cost are limited.
That said, I’d like to caution about fully accepting everything the article says. The key issue is that the authors’ experience is as consultants – they work for AECOM. This means that to at least some extent, their expertise is informed by their work as outside consultants, which means that they are the most familiar with projects that at some point invite consultants in.
This is important, because this may be an important difference between low- and medium-cost countries. I am not sure – I’m trying to investigate those differences more carefully, but this involves listening to German complaints about NIMBYism and trying to figure out how relevant it is that NIMBYs are far less empowered in Southern Europe, counting Turkey as part of that region since it acts much like a peripheral European country in construction. I don’t think that low-cost countries in Southern Europe use international consultants – Milan and Madrid at least don’t, and Istanbul used Italian consultants at one point but nowadays seems mostly to design things itself.
What’s more, AECOM’s experience is not just in countries that use AECOM’s advice regularly, but also in specific projects that bought its services. This is relevant to the claim that,
European owners spend less time and money on planning, studies, conceptual developments, and detailed design. Most projects are implemented using the Design-Build model with the detailed design provided by the contractor during construction to suit his means and methods; this results in efficiency and eliminates repeating of design work.
There’s the rub: design-build does exist in Continental Europe. Turkey uses it, and France is glancing in that direction. But it’s uncommon – Italy and Spain do not use this method, and France largely does not either and I think neither do Germany or the Nordic countries. Moreover, design-build in Turkey means there is extensive in-house oversight, much more so than in American or British design-build projects.
French design-build is even more tightly overseen, because its purpose is not to forgo public planning. Rather, France traditionally maintains the separation of public planning, private design, and private construction, in order to fight corruption and guarantee fair procurement. This separation leads to problems when projects require redesign in case they are very complex, and as a result, Grand Paris Express exists as a large public-sector planning agency to facilitate coordination between the design and construction teams. Technically this can be called design-build, but it has approximately nothing to do with American design-build projects that pay Skanska or Dragados a large sum of money to dig a subway and have extensive public regulations and red tape but little public engineering. The role of the public sector in American, British, and increasingly rest-of-Anglosphere eyes is to make sure companies follow capricious rules but not to actively build infrastructure or, perhaps, change the rules to be more favorable to swift action.
Regrettably, in the coda the authors buy into this mentality that the public sector cannot change the rules. They list various action items that can be undertaken to reduce costs, all of which are very good – those items include streamlining regulations, improving risk sharing mechanisms, and offloading some peripheral costs, among others, rather than expanding design-build. They’re missing a few things that we’re learning from the low-cost world – for example, Istanbul makes an effort to site stations in parks in order to be able to build them more easily and reduce their costs, which I believe is also true of Milan. But for the most part, the list of things that the US needs to do to have what France and Germany have cannot be too dissimilar to that produced by the authors.
But then the authors throw it all away and say it’s unlikely that the US could match European costs. They give a bare-bones explanation that boils down to saying “these recommendations won’t really be implemented.” I agree to some extent – it’s plausible, though not yet certain, that New York will need to union-bust the sandhogs and probably also the other trades, and these are politically powerful unions that know very well that they earn several times what their labor is worth and fight to preserve this. But, first of all, not every recommendation is that fraught; questions of risk sharing, public planning, and procurement do not lend themselves to political populism and remain unreformed mostly because the Northeastern US has timid, reactive governance.
And second, the authors say it’s unlikely the US could match European costs even if their recommendations are followed. They don’t explain why – there are few intangibles in the article, and they mostly seem peripheral to the main question, for example the fact that the US is an auto-oriented society. I can’t tell if it’s just uncertainty, which does not appear in the body of the piece, or if there’s more to it. It could just be a writing artifact and what they meant to say was that their recommendations could help New York match Parisian costs but they’re skeptical their recommendations are politically palatable to New York.
I emphasize the criticism, even though it’s generally a good overview, because all of the experts we talk to have biases. These could be consultant biases, or political biases (Turkey is far more polarized than any mature democracy), or engineering biases, or language biases. Even reading my blog is to some extent a bias – people who read me and think well of my analysis might well look for reasons in their own domain why design-build is bad, which means that to be certain I am correct in my prescription against it, we need to cleanroom this, for example by interviewing people who do not know me directly (or at all) and asking how engineering is done where they are.
Ada Palmer posts rarely, but when she does, it’s always worth reading. She alternates between writing about her science fiction and writing about academic history; her most recent post is the latter, covering the historiography of the Renaissance. She notes that the idea of a three-age system, in which great Ancient knowledge was lost in the Middle Ages and rediscovered in the Renaissance, was first promoted in the Renaissance itself, even if the word renaissance was only used starting in the 19th century, and traces why this idea was accepted then and why it’s remained popular since. In short: it provided political legitimacy to the coterie of thugs (“aristocracy”) who launched coups and counter-coups in the Italian states, who could hire historians to portray them as harbingers of a new era of revival of ancient glory.
This is a paragraph-long summary of a 13,000-word post that summarizes an in-progress book, so I’m glossing over a lot of detail and I recommend that people read the post if they want to talk about Renaissance historiography. I bring this up because this is relevant to transportation, and to some extent urbanism in general, in a number of ways.
The three-age schema
Ada notes that medieval Europeans divided the world into two ages: before and after Jesus. The Renaissance began a trend of a three-age system: Antiquity, a medieval dark age, and the Renaissance or modernity. She further traces the intellectual history of this not just in the Italian Renaissance but also in more recent times, going over the use of the language of renaissance in Johan Burkhardt’s work to argue for a new modernity replacing medieval superstition.
Stepping away from professional historians, I do not know to what extent the average educated Westerner thinks in terms of three ages. The answer is clearly “a great deal,” but I do not know to what extent it is universal. I was taught this schema uncritically in primary and middle school, but what I see in the online discourse is less consistent – for example, Paul Krugman’s writings on Malthusianism back a two-age model, before and after the beginning of the Industrial Revolution. But even with the caveat that economic historians don’t view things this way, the Nike swoosh model of Roman greatness, medieval decline, and modern resurgence still exercises enormous cultural influence.
The relevance of this is that people who propose a change to something often default to the three-age model, transplanted into a specific context. The emergent view of most American and European advocates for rail transport is that rail had a golden age from its invention until the middle of the 20th century, declined subsequently, and is supposed to enter a renaissance now. This is usually connected with urbanism, with a model of the growth of traditional cities, decline through suburban sprawl, and renaissance; variants depend on politics, but Strong Towns, myriads of consultants telling cities how to attract talent, most YIMBYs, and most of the left agree on this picture.
Revival of ancient learning
Renaissance Italy had a MIGA obsession. In an era of the Avignon Papacy and intensifying warfare between different factions and city-states, the appeal of Roman unity and peace is not hard to understand; it’s not as if 14th- and 15th-century Italians had better models. Here’s Ada again:
The solution Petrarch proposed to what he saw as the fallen state of “my Italy” was to reconstruct the education of the ancient Romans. If the next generation of Florentine and, more broadly, Italian leaders grew up reading Cicero and Caesar, the Roman blood within them might become noble again, and they too might be more loyal to the people than to their families, love Truth more than power, and in short love their cities as the Romans loved Rome. Such men would, he hoped, be brave and loyal in strengthening and defending their homelands. Rome started as one city, and did not make itself master of the world without citizens willing to die for it.
“Petrarch says we can become as great as the ancients by studying their ways! Let’s do it!” Petrarch’s call went out and, with amazing speed, Italy listened. Desperate, war-torn city states like Florence who hungered for stability poured money into assembling the libraries which might make the next generation more reliable. Wealthy families who wanted their sons to be princely and charismatic like Caesar had them read what Caesar read. Italy’s numerous tyrants and newly-risen, not-at-all-legitimate dukes and counts filled their courts and houses and public self-presentation with Roman objects and images, to equate themselves with the authority, stability, competence and legitimacy of the Emperors. No one took this plan more to heart than Petrarch’s beloved Florentine republic, and, within it, the Medici, who crammed their palaces with classical and neoclassical art, and with the education of Lorenzo succeeded in producing a classically-educated scion who was more princely than princes.
This provided the template for every Western narrative of decline that I’m familiar with, and a good number of non-Western ones: we were great, we’ve gone into decline, we will reverse the decline by restoring our ancient values. It’s unavoidable in every narrative of American decline; it’s there in the Brexit conception of British nationalism; it’s there in cross-national narratives of the decline of the left since the 1970s. In non-Western countries, it was there in a lot of early colonial rebellions (the Indian Rebellion of 1857 tried to restore the Mughal Empire). Even Japan went through a restorationist phase in the wake of its forced opening, though it famously went in a very different direction once the Meiji restoration happened.
This schema is used at a subnational level extensively. Regions that view themselves as declining, like the American Rust Belt, Northern England, or East Germany, cling fiercely to distinctive local institutions. This includes extensive study of local history and local affairs. It’s unavoidable in, say, Belt Publishing. Sometimes, this history is studied critically; in the broad public, it usually isn’t. The number of times I’ve heard New Yorkers contrast how the First Subway was built in four years (and not, say, 40) with how long subways take today is beyond mortals’ ability to count.
With rail transport specifically, advocacy is usually bundled into railfan interests. This, as per the usual paradigm, dovetails into very deep, usually uncritical, study of the history of the technology back when it was supposedly great. Go on Railroad.net and you will see people talk about the minutiae of historical steam and diesel engines and also brush off every piece of knowledge that was not generated in American mainline railroading. Interest in rail technology as a solution for the future gets bundled into romanticism for steam locomotives and for the particulars of how private railroads chose to operate service in the early 20th century.
The Renaissance Man as the innovator
Finally, Ada’s insight about why the idea of the Renaissance was accepted so quickly matters when looking at modern technology. Here, the three-age model is less relevant. The same emphasis on the innovator bringing the company/city/nation/world into a golden age is produced by other models. The accelerating growth model of the technological singularity produces the same effect even without the need to learn history, and is therefore widely popular among rationalists.
In transportation, the best recent example of this is the idea of the Hyperloop. What it is, underlyingly, is a new technology for running rail service, like maglev but capable of running at higher speed. All aspects of rail service planning with the exception of propulsion remain mostly the same (mostly, because the higher speeds do have special implications, though I don’t think they’re any different from what one can extrapolate from existing high-speed rail). This means that what it takes to build Hyperloop is similar to what it takes to build ordinary rail plus more money. I think Hyperloop One and Virgin understand that, but Elon Musk does not.
The importance of history as legitimacy cannot be discounted here. Court historians were hired to write hagiographies, just as artists were hired to paint and sculpt the likenesses of the biggest thugs (“royalty”). This does not usually apply to modern academic history – historians have political biases but there are layers insulating high-prestige academic historians from donors. But it does apply to a lot of popular writing, especially business journalism. I forget where I’ve read – I think it was in the context of New York real estate – that 2010s journalism is alive and well in trade media, but writing critical investigative pieces about powerful players is not always expected or rewarded in publications that make money as internal trade papers.
The upshot is that analyzing history, whether general or specific, as an abrupt positive change serves to empower people who can claim that they are the new world, and that any and all criticism is just the old way of thinking. It’s a form of epistemic narrowing that blocks off knowledge those people don’t have or can’t easily control.
New York is the capital of the coronavirus pandemic, with around 110,000 confirmed cases and 10,000 confirmed deaths citywide, and perhaps the same number across its suburbs. There must be many reasons why this is so; one possibility that people have raised is infection from crowded subways, so far without much evidence. Two days ago, MIT economist Jeffrey Harris wrote a paper claiming that the subways did in fact seed the Covid-19 epidemic in New York, but the paper cites no evidence. Sadly, some people have been citing the paper as a serious argument, which it isn’t; the purpose of this post is to explain what is wrong with the paper.
New York and other subways
In multiple other countries, one cannot see the transit cities in the virus infection rates. In Germany the rates in the largest cities are collectively the same as in the rest of the country. In South Korea, the infection is centered on Daegu; Seoul’s density and high transit usage are compatible with an infection rate of about 700 in a city of 9.5 million, about 1.5 orders of magnitude less per capita than in most Western countries and 2.5 orders of magnitude less than in New York. In Taipei, the MRT remains crowded, with weekday ridership in February and March down by 15-16%. In Italy, car usage is high outside a handful of very large cities like Milan, and Milan’s infection rate isn’t high by the standards of the rest of Lombardy.
However, rest-of-world evidence does not mean that the New York City Subway is safe. The Taipei MRT has mandatory mask usage and very frequent cleaning. German U- and S-Bahn networks are a lot dirtier than anything I’ve seen in Asia, but much cleaner than anything I’ve seen in New York, and also have much less peak crowding than New York. New York uniquely has turnstiles requiring pushing with one’s hands or bodies, and the only other city I know of with such fare barriers is Paris, whose infection rates are far below New York’s but still high by French standards.
So the question is not whether rapid transit systems are inherently unsafe for riders, which they are not. It’s whether New York, with all of its repeated failings killing tens of workers from exposure to the virus, has an unsafe rapid transit system. Nonetheless, the answer appears to be negative: no evidence exists that the subway is leading to higher infection rates, and the paper does not introduce any.
What’s in the paper?
A lot of rhetoric and a lot of lampshade hanging about the lack of natural experiments.
But when it comes to hard evidence, the paper makes two quantitative claims. The first is in figure 3: Manhattan had both the least increase in infections in the 3/13-4/7 period, equivalent to a doubling period of 20 days whereas the other boroughs ranged between 9.5 and 14, and also the largest decrease in subway entries in the 3/2-16 period, 65% whereas the other boroughs ranged between 33% and 56%.
The second is a series of maps showing per capita infection levels by zip code, similar to the one here. The paper also overlays a partial subway map and asserts that the map shows that there is correlation of infection rates along specific subway routes, for example the 7, as people spread the disease along the line.
I will address the second claim first, regarding line-level analysis, and then the first, regarding the borough-level difference-in-differences analysis; neither is even remotely correct.
Can you see the subway on an infection map?
Here is a static version of the infection map by zip code:
This is cases for 1,000 people – note that my post about Germany looks at rates per 10,000 people, so the range in New York is consistently about an order of magnitude worse than in Germany. The map shows high rates in Eastern Queens, the North Bronx, and Staten Island, hardly places with high public transportation ridership. The rates in Manhattan and the inner parts of Brooklyn are on the low side.
There are no ribbons of red matching any subway line – there are clumps and clusters, as in Southern Brooklyn in Orthodox Jewish neighborhoods, and in Central Queens around Corona and East Elmhurst. There is imperfect but noticeable correlation with income – working-class areas have higher infection rates, perhaps because they have higher rates at which people are required to still show up to work, where they can be infected. East Asian neighborhoods have lower rates, like Flushing and environs, or to some extent Sunset Park; Asians are infected at noticeably lower rates than others in New York and perhaps in the rest of the Western world, perhaps because they took news in China more seriously, began practicing social distancing earlier, and wear masks at higher rates. There are many correlates, none of which looks like it has anything to do with using the public transportation network.
What’s more, the paper is not making any quantitative argument why the graph shows correlation with subway usage. It shows the graph with some lines depicted, often misnamed, for example the Queens Boulevard Line is called Sixth Avenue Local, leading to a discussion about higher infection rates on local trains than on express trains where in fact the F runs express in Queens. But it does not engage in any analysis of rates of subway usage or changes therein, or in infection rates. The reader is supposed to eyeball the graph and immediately agree with the author’s conclusion, where there is no reason to do so.
The claim about Manhattan is the only real quantitative claim in the paper. Unlike the zip code analysis, the borough analysis does make some statistical argument: Manhattan had larger reduction in subway usage than the rest of the city and also a slower infection rate. However, this argument relies on an N of 2. Among the other boroughs, there is no such correlation. The argument is then purely about Manhattan vs. the rest of the city. This is incorrect for so many reasons:
- Manhattan is the highest-income borough, with many people who can work from home. If they’re not getting infected, it could be from not commuting as much, but just as well from not getting the virus at work as much.
- The Manhattan subway stops are often job centers, so the decline in ridership there reflects a citywide decline. A Manhattanite who stops taking the subway is seen as two fewer turnstile entries in Manhattan, whereas a New Yorker from the rest of the city who does the same is likely to be seen as one fewer Outer Borough entry and one fewer Manhattan entry.
- Many Manhattanites left the city to shelter elsewhere, as seen in trash collection data.
- Manhattan’s per capita subway usage is probably higher than that of the rest of the city counting discretionary trips, so 65% off the usual ridership in Manhattan may still be higher per capita than 56% off in Brooklyn or 47% in Queens. (But this is false on the level of commuting, where Manhattan, the Bronx, and Brooklyn all have 60% mode share.)
Does the paper have any value?
I have heard people on Twitter claim that correlation is not causation. This argument is too generous to the paper, which has not shown any correlation at all, since the only quantitative point it makes has an N of 2 and plenty of confounders.
For comparison, my analysis of metro construction costs has an effective N of about 40, since different subway projects in the same country tend to have similar costs with few exceptions (such as New York’s extreme-even-for-America costs), and I consider 40 to be low enough that Eric Goldwyn and I must use qualitative methods and delve deep into several case studies before we can confidently draw conclusions. The paper instead draws strong conclusions, even including detailed ones like the point the paper tries to make about local trains being more dangerous than express trains, from an N of 2; it’s irresponsible.
But what about the workers?
A large and growing number of New York City Transit workers have succumbed to the virus. The current count is close to the citywide death toll, but transportation workers are by definition all healthy enough to be working, whereas citywide (and worldwide) the dead are disproportionately old or have comorbidities like heart disease. Echoing the union’s demands for better protection, Andy Byford had unkind words to say about Governor Andrew Cuomo’s appointees in charge of the system, MTA chair Pat Foye and acting NYCT chair Sarah Feinberg.
However, this is not the same as infection among passengers. The dead include workers who are in close proximity to passengers on crowded vehicles, such as bus drivers, but also ones who are not, such as train operators, maintenance workers, and cleaners. Train cleaners have to remove contaminated trash from the platforms and vehicles without any protective equipment; NYCT not only didn’t supply workers with protective equipment, but also prohibited them from wearing masks on the job even if they’d procured them privately. Contamination at work is not the same as contamination during travel.
So, should people avoid public transportation in New York?
If the best attempt to provide evidence that riding the subway is a health hazard in a pandemic is this paper, then that by itself is evidence that there is no health hazard. This is true even given New York City Transit’s current level of dirt, though perhaps not given its pre-crisis peak crowding level. Social distancing is reducing overall travel and this is good, not necessarily because travel is hazardous, but mostly because the destination is often a crowded place with plenty of opportunity for person-to-person infection.
In preparation for going back to normal, the current level of cleanliness is not acceptable. The state should make sure people have access to masks, even if they’re ordinary ones rather than N95 ones, and mandate their usage in crowded places including the subway once they are available. It should invest far more in cleaning public spaces, including the subway, to the highest standards seen in the rich countries of Asia. It should certainly do much more to protect the workers, who face more serious hazards than the riders. But it should not discourage people who are traveling from doing so by train.
In the last year, Massachusetts has been studying something called the Rail Vision, listing several alternatives for commuter rail modernization. This has been independent of the North-South Rail Link study, and one of the options that the Rail Vision considered was full electrification. Unfortunately, the report released yesterday severely sandbags electrification, positing absurdly high costs. The state may well understand how bad its report is – at least as of the time of this writing, it’s been scrubbed from the public Internet, forcing me to rely on screencaps.
In short: the alternative that recommends full system electrification was sandbagged so as to cost $23 billion. This is for electrification, systems, and new equipment; the NSRL tunnel is not included. All itemized costs cost a large multiple of their international cost. The Americans in my feed are even starting to make concessions to extremely expensive projects like the Caltrain electrification, since the proposed MBTA electrification is even costlier than that.
But the telltale sign is not the cost of the wires, but rolling stock. The report asserts that running electrified service requires 1,450 cars’ worth of electric multiple units (“EMUs”), to be procured at a cost of $10 billion. More reasonable figures are 800 and $2 billion respectively.
Why 1,450 cars?
The all-electric option assumes that every line in the system will get a train every 15 minutes, peak and off-peak. What counts as a line is not clear, since some of the MBTA’s commuter lines have branches – for example, the Providence and Stoughton Lines share a trunk for 24 km, up to Canton Junction. However, we can make reasonable assumptions about which branches are far enough out; overall rolling stock needs are not too sensitive to these assumptions, as most lines are more straightforward.
The MBTA is capable of turning trains in 10 minutes today. In making schedules, I’ve mostly stuck to this assumption rather than trying to go for 5-minute turnarounds, which happen in Germany all the time (and on some non-mainline American subways); occasionally trains steal 1-2 minutes’ worth of turnaround time, if there’s a longer turn at the other end. Thus, if the one-way trip time is up to 50 minutes, then 8 trainsets provide 15-minute service.
To me, high-frequency regional rail for Boston means the following peak frequencies:
Providence/Stoughton: a train every 15 minutes on each branch. Service south of Providence is spun off to a Rhode Island state service, making more stops and running shorter trains as demand is weaker than commuter volumes to Boston. With this assumption, the Providence Line requires 7-8 trainsets. The Stoughton Line, with the South Coast Rail expansion to New Bedford and Fall River, each served every half hour, requires around 9-10. Say 18 sets total.
Worcester: the big question is whether to exploit the fast acceleration of EMUs to run all-local service or mix local and express trains on tracks in Newton that will never be quadrupled unless cars are banned. The all-local option has trains doing Boston-Worcester in just under an hour, so 9-10 trainsets are required. The mixed option, with a train every 15 minutes in each pattern, and local trains only going as far as Framingham, requires 14 sets, 8 express and 6 local.
Franklin/Fairmount: a train every 15 minutes on the Franklin Line, entering city center via the Fairmount Line, would do the trip in around 50 minutes. It may be prudent to run another train every 15 minutes on the Fairmount Line to Readville, a roughly 17-minute trip by EMU (current scheduled time with diesel locomotives: 30 minutes). Overall this is around 12 trainsets.
Old Colony Lines: there are three lines, serving very low-density suburbs. The only destinations that are interesting for more than tidal commuter rail are Plymouth, Brockton, Bridgewater State, and maybe an extension to Cape Cod. Each branch should get a train every 30 minutes, interlining to a train every 10 from Quincy Center to the north. About 10-12 trainsets are needed (2 more if there’s an hourly train out to Cape Cod); this is inefficient because with three branches, it’s not possible to have all of them depart South Station at :05 and :35 and arrive :25 and :55, so even if there’s a train every 15 minutes per branch, the requirement doesn’t double.
Fitchburg Line: a local train to Wachusett every 15 minutes would require around 12 sets (75 minutes one-way). The number may change a little if there’s an overlay providing service every 7.5 minutes to Brandeis, or if trains beyond South Acton only run every half hour.
Lowell Line: an EMU to Lowell would take about 27 minutes, depending on the stop pattern; 5 trainsets provide 15-minute frequency.
Haverhill Line: an EMU to Haverhill running the current route (not via the Wildcat Branch) would take about 40 minutes, so 7 trainsets provide a train every 15 minutes.
Eastern Lines: like the Old Colony Lines, this system has very low-density outer branches, with only one semi-reasonable outer anchor in Newburyport. Trains should run to Beverly every 10 minutes, and then one third should turn, one third should go to Rockport, and one third should go to Newburyport. With the same inherent inefficiency in running this service on a symmetric schedule as the Old Colony, around 10-12 sets are needed.
This is about 90 sets total. At eight cars per set, and with a spare ratio of 11%, the actual requirement is 800 cars, and not 1,450. The difference with the state’s assumption is likely that I’m assuming trains can run at the acceleration rates of modern EMUs; perhaps the state thinks that EMUs are as slow and unreliable as diesel locomotives, so a larger fleet is necessary to provide the same service.
Rolling stock costs
Reducing the cost of infrastructure is complicated, because it depends on local factors. But reducing the cost of industrial equipment is easy, since there are international vendors that make modular products. Factories all over Europe, Japan, and South Korea make this kind of equipment, and the European factories barely require any modifications to produce for the American market under current federal regulations.
It is not hard to go to Railway Gazette and search for recent orders for EMUs; names of trainsets include Talent, FLIRT, Mireo (cost information here) and Coradia. The linked Coradia order is for €96,500 per meter of train length, the other three orders are for about €70,000. A US-length (that is, 25 meters) car would cost around $2.5 million at this rate. 800 cars times $2.5 million equals $2 billion, not the $10 billion the MBTA claims.
Railway Gazette also discusses a maintenance contract: “Vy has awarded Stadler a contract worth nearly SFr100m for the maintenance in 2020-24 of more than 100 five-car Flirt EMUs.” These trains are 105 meters long; scaled to US car length, this means the annual maintenance cost of an EMU car is around $50,000, or $40 million for the entire fleet necessary for electrified service.
The actual net cost is even lower, since the MBTA needs to replace its rolling stock very soon anyway. If the choice is between 800 EMUs and a larger diesel fleet, the EMUs are cheaper; in effect, the rolling stock cost of electrification is then negative.
Why are they like this?
I struggle to find a problem with Boston’s transportation network that would not be alleviated if Massachusetts’ secretary of transportation Stephanie Pollack and her coterie of hacks, apparatchiks, and political appointees were all simultaneously fired.
There is a chain of command in the executive branch of the Massachusetts state government. Governor Charlie Baker decides that he does not want to embark on any big project, such as NSRL or rail electrification, perhaps because he is too incompetent to manage it successfully. He then intimates that such a project is unaffordable. Secretary Pollack responds by looking for reasons why the project is indeed unaffordable. Under pressure to deliver the required results, the planners make up outrageously high figures: they include fleet replacement in the electrified alternative but not in the unelectrified one (“incremental cost”), and then they lie about the costs by a factor of five.
Good transit activists can pressure the state, but the state has no interest in building good transit. The do-nothing governor enjoys no-build options and multi-billion dollar tweaks – anything that isn’t transformative is good to him. The do-nothing state legislature enjoys this situation, since it is no more capable of managing such a project, and having a governor who says no to everything enables it to avoid taking responsibility.
In the last few years, ever more serious and powerful actors have begun investigating the fact of high American infrastructure construction costs. First it was Brian Rosenthal’s excellent New York Times exposé, and then it was the Regional Plan Association’s flop of a study. At the same time, I was aware that the congressional Government Accountability Office, or GAO, was investigating the same question, planning to talk to sources in the academic world as well as industry in order to make recommendations.
The GAO report is out now, and unfortunately it is a total miss, for essentially the same reason the RPA’s report was a miss: it did not go outside the American (and to some extent rest-of-Anglosphere) comfort zone. Its literature review is if anything weaker than the RPA’s. Its interviews with experts are telling: out of nine mentioned on PDF-p. 47, eight live in English-speaking countries. Even when more detailed information about non-English-speaking countries is readily available, even in English, the GAO report makes little use of it. It is a lazy study, and people who ideologically believe the American federal government does not work should feel confident citing this as an example.
Brian himself already notes one of the reasons the report is so weak: Congress mandated a comparative study, but the report made no international comparisons at all. Instead, the report offered this excuse (PDF-p. 27):
The complexity of rail transit construction projects and data limitations, among other things, limits the ability to compare the costs of these projects, according to the stakeholders we interviewed. As highlighted above, each project has a unique collection of specific factors that drive its costs. According to FTA officials, each proposed transit project has its own unique characteristics, physical operating environment, and challenges. Some stakeholders said that the wide disparity in the relative effect of different cost factors renders cost comparisons between projects difficult. For example, representatives of an international transit organization said that because of the large number of elements that can affect a project’s costs and the differences in what costs are included in different projects’ data, projects should be compared only at a very granular level and that aggregate cost comparisons, such as between the costs per mile or costs per kilometer of different projects, are likely flawed. Some stakeholders also said that project costs should not be compared without considering the projects’ contexts, such as their complexity. For example, one academic expert contended that project costs cannot be compared without considering the context of each project, and that analysis of projects should focus on leading practices and lessons learned instead.
There is a big problem with the above statement: disaggregated costs for many aspects of urban rail construction do exist. The Manhattan Institute’s Connor Harris has done a lot of legwork comparing tunnel boring machine staffing levels and wages in New York and in Germany, and found that New York pays much higher wages but also has much higher staffing levels, 25-26 workers compared with 12. I have done some work looking at station costs specifically, and at the cost of installing elevators for wheelchair accessibility.
There is a lot of detailed comparative research about the costs of high-speed rail; the report even references one such meta-study undertaken within Europe, but omits the study’s analysis of causes of cost differences and instead asserts that it shows that comparing different projects is hard. In the interim, California contracted Deutsche Bahn to do a post-mortem of its elevated high-speed rail costs, which found that California needlessly built larger structures than necessary, explaining its cost premium over Germany.
Instead of probing these disaggregated estimates, the GAO preferred to say that they are too hard and move on.
Even without disaggregation, there are some good sanity checks one can make about construction costs. The most important is that big projects – major subway expansions, regional rail tunnels, high-speed rail – cost an appreciable amount of the government’s budget. The budget for the 200-kilometer Grand Paris Express project is €35 billion, plus another €3 billion in contributions for related suburban rail extensions such as that of the RER E. There may be future cost overruns, but they will be reported in the media, just as the current overrun has been; it is extremely difficult to hide cost overruns measured in tens of billions in a Paris-size city, and even in a China-size country it may not be easy.
Is it plausible that GPX is inherently easier to build than New York’s $1+ billion/km subway tunnels? Yes. It’s equally plausible that it is inherently harder. Second Avenue Subway runs under a wide, straight throughfare, a situation that simplifies construction. In Israel, the ministry of transportation has long mentioned the ease of tunneling under wide, straight boulevards in connection with plans to extend the second line of the Tel Aviv subway to North Tel Aviv under Ibn Gabirol, and admitted this even when it opposed the extension on land use grounds.
The most important sanity check is that in a world with several dozens of cities with a wide variety of wealth levels, land use patterns, geologies, and topographies, no city has managed to match or even come close to New York’s construction costs. New York is not special enough to be an edge case in all or even most relevant geographic variables – it is dense but no denser than Seoul or Paris, it is wealthy but no wealthier than London or Paris or Munich and barely wealthier than Stockholm, it has hard rock but less hard than Stockholm (and in Stockholm the gneiss is cited as a cost saver – bored tunnels do not require concrete lining), etc.
Moreover, the cities that have the highest construction costs outside New York are almost without exception in the same set of countries: the US, Canada, Britain, Singapore, Australia. What’s likelier – that there is some special geographic feature common to the entire Anglosphere (including Quebec) but absent from all other developed countries, or that there is a shared set of legal and political traditions that developed in the last 50 years that impede cost-effective construction? Instead of probing this pattern, the GAO preferred to wash its hands and refuse to compare projects across countries.
In lieu of making international comparisons, the GAO has engaged in extensive internal comparison. It cites aspects that have raised the costs of Second Avenue Subway above other American subway projects, such as overdesign for stations. Apparently, it’s completely legit to compare two different cities’ construction if they’re in the same country.
Over and over again, it references its own domestic standards. The GAO has 12 design standards, e.g. on PDF-pp. 51-52 and 56-60; the report mentions that existing cost estimation methodologies by the Federal Transit Administration, or FTA, meet 7 of them; thus, it exhorts transit agencies to meet the other 5 standards.
The only problem is that there is no evidence supplied that those design standards are really useful. After all, the United States has very high costs, so why should anyone trust its standards? Even domestically, the report makes no effort to bring up successful examples of low overall costs coming from following prescribed standards. Seattle recently opened a light rail tunnel built for around $400 million per kilometer, a cost that would get most European project managers fired but that is still the lowest for an American urban rail tunnel built in this century. But the report never brings up Seattle at all, never mind that New York would salivate over the prospect of tunneling at Seattle’s cost.
The real internal comparisons then are not between different cities in the United States. Rather, they’re between different stages of cost estimation for the same project. There is published literature on cost overruns, most famously by Bent Flyvbjerg and his research group. The report cites Flyvbjerg. Moreover, one of the nine academic experts it consulted is Don Pickrell, who published a seminal paper on American cost overruns and ridership shortfalls in 1990. Pickrell was influential enough that a 2009 review found that not only had cost and ridership projections improved greatly in the intervening two decades, but also there was an improvement in ridership estimate quality attributable to Pickrell’s paper.
The GAO report is not the best source on cost overruns, but it is not completely useless there. Unfortunately, it remains useless when it comes to discussing absolute costs, a different topic from relative increases. Flyvbjerg’s original paper found that the US did not have higher cost overruns than Europe; but absolute costs in the US are several times as high. Flyvbjerg’s paper found that urban rail has higher cost overruns than road projects; but when a rail tunnel and a road tunnel are built in the same city, the road tunnel is more expensive by a factor of 1.5-2.5, at least in the four-city pilot I reported in 2017, owing to the need to build bigger bores with ventilation to carry heavy car traffic.
Lazy analysis, lazy synthesis
Americans who think of themselves as reformers like to point out real problems to solve, but then propose solutions that they made up without any connection with their analysis. The RPA study is one such example: even though one of its sources (namely, former Madrid Metro CEO Manuel Melis Maynar’s writeup about low Spanish costs) explicitly calls for separation of design and construction, its recommendations include a greater reliance on design-build. The same design-build recommendation appeared in a 2008 report in Toronto comparing the costs of the Sheppard subway, opened in 2002, with those of subways in Madrid; construction costs in Toronto have since tripled, while those of Madrid have barely risen.
To the GAO report’s credit, it does not recommend design-build. It even mentions the biggest drawback of design-build: it shifts cost risk to the private contractor, who compensates by demanding more public money up front. Nonetheless, it does not follow through and does not make the correct recommendation on this subject – namely, that cities and states should cease using this approach. It buries a recommendation for in-house expertise alongside a fad for peer review of projects.
Instead of lazily proposing design-build, the GAO lazily proposes two barely relevant tweaks (PDF-p. 43):
- The FTA administrator should ensure that FTA’s cost estimating information for project sponsors is consistent with all 12 steps found in GAO’s Cost Estimating and Assessment Guide and needed for developing reliable cost estimates.
- The FTA Administrator should provide a central, easily accessible source with all of FTA’s cost estimating information to help project sponsors improve the reliability of their cost estimates.
In other words, the report makes no recommendation about how to reduce costs, only about how to tell the public in advance that costs will be unaffordably high.
Why are these reports so bad?
This is not the first time a serious group releases an incurious study of American construction costs. What gives?
I suspect the answer has to be a combination of the following problems:
- Reform factions often have a lot of internal ideas about how to improve things based on what they already know. They will cite new information if they feel like they must do so to save face, but they will not let new evidence change their conclusions. A little knowledge can be dangerous.
- Finding information from outside the US, especially outside the English-speaking world, puts Americans (and Canadians) at a disadvantage. They know few to no foreigners, have little experience with cities abroad except as tourists, and do not speak foreign languages. Even when machine translation is decently accurate, which it is in the engineering literature in European languages, they are intimidated by the idea of dealing with non-English material. The process of learning is humbling, and some people prefer to remain proud and ignorant.
- Open-ended analysis does not always lend itself to easy explanations or easy solutions. Even when solutions do present themselves, they may not flatter the people in power. Ten years ago I did not think senior management at American transit organs should be fired; today I think mass layoffs of the top brass, especially the political appointees, are somewhere between very useful and essential.
All three problems interact. For example, senior management is even less likely to be multilingual than junior staffers, who may be second-generation immigrant heritage speakers of a foreign language; thus, anything relying on foreign material disempowers the high-ups in favor of up-and-comers. The quick-and-easy-and-wrong solutions reformists seize upon if they find a little bit of knowledge let outfits like the GAO feel more powerful without actually challenging any obstructive politician or interest group, and if those solutions fail, they can always keep churning reports about implementation.
Last year, I did not know whether the GAO was capable of providing a blueprint for improving American infrastructure at lower cost. I assumed good faith because I had no reason not to. With this report, it is clear to me as well as to other observers of American public transit that the GAO is not so capable. Instead of doing what was in the country’s best interest, the people who commissioned and wrote the report delivered the minimal product that would get them kudos from superiors who do not know any better. They could have learned, or made a serious effort to learn, but that might challenge their assumptions or those of the high political echelons, and thus they preferred to say nothing and propose to do nothing.