That mindset seems to have changed. I wonder if the companies are different (greedier?) now, governments and non-profits are more efficient or is this purely a perception shift.
Contrast this with today's digital services: if Uber gets rich providing hailing intermediation, all that wealth goes straight to the headquarter, with the local economy getting nothing besides the drivers' share which Uber will inevitably push down to subsistence level. Local inefficiency on the other hand would at least keep the money circulating locally.
No, its just that -- with the 1980s and beyond push for privatizing governments services -- we now have experience as well as pro-corporate astract theory. And while experience has sometimes shown some benefits, its shown a lot of problems with privatization, as well. (Including that it often promotes a particularly intense, single-beneficiary variation on regulatory capture.)
Unions and pensions and oversight are good things that help ensure people are treated fairly (or at least, better than they otherwise would be). I want my tax dollars spent giving locals a decent retirement, and not going into some California VC's portfolio.
And "no easy allocation of resources" strikes me as a good thing as well. This is public infrastructure. People depend on this for their daily lives. The last thing we want is for it to be easily unallocated.
So for example, if the demographics of the community change such that transportation needs change, or technology changes (automation of many kinds) meaning fewer employees needed or different kinds of employees are needed, it becomes hard to reflect those needs in the workforce because of the union agreements.
No. Stuff like UK rail privatization or US electricity deregulation happened.
It's just that today, even in die-hard free market countries, people have come to realize that infrastructure and private/for-profit don't mix well most of the time.
A necessary part of a free market is that consumers have choice. In the franchised UK rail system, there are very few routes on which one can choose between different suppliers. The franchise system also imposes huge barriers to new entrants to the market. Therefore, there is little incentive for companies, having won the franchise, to improve the service more than the minimum necessary.
The core infrastructure of the UK rail network is still owned and run by Network Rail, which is publicly owned, so the core inefficiencies remain.
The private operators compete for the contract to run a franchise for a couple of years. The "choice" is not for the passenger, the choice is for the government to decide which private company to give the franchise, to give access to the infrastructure, and to provide subsidies. The competition basically happens at the bidding level.
NYC is a great example. In exchange for access, two companies signed contracts with the city that limited prices to $0.05. They built a large portion of the existing lines and made a good chunk of change.
But the City wanted to own them, and inflation stepped into the picture decades later. Turns out, a nickel wasn't worth the same anymore and couldn't cover costs. Rather than allow prices to rise, the City bought up the two companies while building a third system (the IND). It also doubled fares after unifying. Hmm....
Then it put out an elected board to vote on fare increases. Guess what the winning stance was? No increase. Eventually the system decayed as the subsidies didn't cover maintenance and deferred maintenance eventually became a major issue. The system today still has 1930s and 50s technology.
If anything, the US public transit systems (which had similar stories in other cities) are evidence against American governments running infrastructure.
We are underfunding other important pieces of infrastructure from roads to bridges to sewers, so the next few decades should be fun as cheaply built suburbs deal with infrastructure costs rising.
In any case, the two private systems are badly designed relative to one another: bad transfers, redundancies. The IND built by the public is overall much better designed.
The fact that both the private and public where able to build giant subway systems in the 10s-40s but it all fell apart after, should give some idea that it wasn't anything inherent to being public or private that allowed building it and made it difficult later, but other factors.
Oh, and fares have increased many many times. Many people always complain when it does.
And NYC is still building new subway lines. Construction is underway right now on a new east side line.
It's too bad. Because singapore, which arguably has the world's best (or maybe second best, after Seoul) public transit system, is basically an entirely privatized system.
The public Land Transport Authority built and still owns most of the assets, and enacts strong regulation for the duopoly of service providers (SBS and SMRT) - not only on service levels, but also on operational processes. Even so, there's awkward UX quirks on the boundaries between lines run by the different companies.
If anything, the Singapore MRT runs closer in spirit to a US taxicab system - that is, surprisingly regulated on a global scale.
Comfortdelgro is certainly widely owned - but they're into busses and taxi mainly, not infra heavy stuff like subways.
For various reasons, Governments will make state owned companies publically traded. That doesn't mean they're not going to toe the government line in decisions if it has majority stake.
I wasn't aware that SMRT was bought out by the government recently (the last time I rode the MRT, last year, it was still private). It doesn't seem that the buyout was orchestrated as some sort of bailout, especially given that the systems seem to be solvent enough to support at least one for-profit. It, then, remains to be seen if refolding SMRT will result in a net degradation or net improvement in services... This will be an interesting 'control' experiment.
The UK STILL has not solved its problem of wrong tracks and seemingly never will, trains are still absurdly expensive compared to cars and the government still ploughs billions of pounds into what is supposed to be a "privatised" system. Its fucked.
Our only future transport hope in this country is automated cars.
That is often true, but the efficiency comes from competition in a free market, not the ownership of the service provider.
The government usually has a monopoly, so there is little pressure to be efficient other than the personal motivation of some government employees to improve life in their city.
If there are instead 5 service providers who compete for customers, then they are forced to be efficient or lose their business.
But if there is just one commercial company with an effective monopoly - due to mergers between all providers in an area, poorly structured contracts, or plain old corruption - then there is no pressure to be efficient either.
I dunno. State schools are only sometimes and somewhat cheaper than private counterparts, USPS is sometimes better in terms of price + speed, but many times it loses to UPS and FedEx, and anyone extolling the virtue of government-run service should get an option to change their medical provider to a VA hospital and report back in a few years.
The uber thing is a good choice for Innisfil. They wouldn't have the money to roll their own ride share, and they can't afford the infrastructure to create a bus system.
But the interesting thing is that absolutely no one is proposing that; what's being proposed is Medicare-for-all, where you get your choice of providers (pretty much any existing provider), and you pay the government for low-overhead insurance through your taxes.
It's kind of a really obvious rhetorical bait and switch, but it seems to resonate with people.
Organizations like NASA or the entire US military apparatus are also government-run, but you never hear free-market conservatives argue that US military sucks or is inefficient.
On the other hand, there are plenty of private organizations that are universally hated, like Comcast, American Airlines, or Bank of America, which are also huge, bloated, and have tons of waste internally.
NASA just gave up on making rockets and arguably going private is going well for them.
US military is quite famous for inefficiency. F35, B2, the 100 million dollar gas station in Iraq etc. Given the mess in the middle east, effectiveness is questionable as well.
US military is pretty effective in its primary function, but may not work as well when required to adjust to something like policing the population, sure. But that's a separate discussion.
But yeah, those were just a couple of examples. There are plenty others.
- University of California system, along with many other state universities.
- Various three-letter spy agencies
- Your local fire department etc..
I'd say that it doesn't matter whether any given organization is private or public. What matters is enough funding and semi-competent management.
Those are private industry contracts.
Are there any policies that were built this way?
However, you can never really control for differences between the states, which means weak predictive value, and it's easy to argue about results. And given that the policies we're talking about are inherently political, facts and evidence don't necessarily contribute to policymaking.
[0]: https://en.wikipedia.org/wiki/Laboratories_of_democracy
A good government option shouldn't require ANY funding at all. It should pay for itself.
The government may wish to
- provide a service that pays for itself only indirectly in the long run like investing in its citizenry and their well being.
- price a service below cost to enable the citizens who most need the service to actually benefit from it
- serve the entire citizenry not just those profitable to serve
What these have in common is that they represent a transfer of value from those who have more to society as a whole. This is pretty much how every decent functional society in existence works at scale.
Virtually nothing the government does "pays for itself" because economic systems while useful are so bizarrely insufficient by themselves that I'm not sure I have words to express it. They suffer from insufficient information, outright corruption and outright failure to encode most of what is most worthwhile in dollars, cents, and incentives.
Those who believe in capitalism alone seem to be appealing to some bizarre pure state of nature that has never existed will never exist. Meanwhile ignoring the fact that everything about capitalism as practiced anywhere on Earth is a wholly artificial mashup of perverse incentives, short time thinking, rules, regulations, and customs based in part of what can be exploited, in part on what people think is right, and in part on what people think is useful.
Given that capitalism is as artificial construct as opposed to some ideal state its easy to argue that we the people ought to use our political power transfer wealth from the haves to increase the health and well being of society as a whole.
Because of this government options will often be aligned with what society as a whole can afford and will benefit from in the long run as opposed to what those directly benefiting right now can support out of pocket.
It has since been proved time and time again that replacing government workers with private entities provides a worse service, which is more expensive.
You literally cannot make something more profitable than the government. More efficient, yes, but since it has no profitability goal, it's effectively perfect in that regard. Improve your services, don't privatize them.
Cthulhu may swim slowly. But he only swims left.
Please post any suggested name's!!
I think you underestimate economies of scale and the value Uber can provide, and also underestimate the cost of DIYing it and upkeep.
edit: like, especially if the town is really small and the app gets low utilization, isn't it better to pay a fixed % on top of each ride (say 50%) to uber than to have to pay someone a full time salary for a year to maintain things.
You mean CAN do?
Piggy-backing off the extremely polished apps forged in the heat of open-market competition seems like a good call to me.
Hmm, I feel like my experience on US websites has ranged from "decent but not great" (https://www.irs.gov) to "basically terrible" (trying to sign up for a healthcare plan a while ago).
I do get the sense our government used to be much more competent overall, and I think it's an interesting question how we can get that back.
For instance, if you outsource mechanical maintenance for your firetrucks, is that wrong also since a company can profit from it?
Simply: Tax money is wasted. Already rich investors end up enriching themselves further, tax money ends up in the taxes of the rich instead of improving the life of the poor.
Sometimes it makes sense (see economies of scale), but often it does not, because the private contractor has to design one system that works everywhere, and has to deal with a lot more complexity due to that than a local system. Often expenses also occur elsewhere that wouldn’t in a local system.
And paying out to investors is also a common example of additional expenses. Especially if the state has to provide a guarantee the company will be a specific amount of money in profit from the riders of the project.
That’s also why in Germany right now there’s lots of protest against privatizing the Autobahn.
While I don't know the particulars of the Autobahn privatization controversy, I do know about toll booth and parking meter privatization in the United States, and yes, they tend to be bad deals for the tax payers, because the government wants a quick hit of money, in exchange for multiple times that money over the long term. Take for instance, Chicago's parking meter privatization, where the city got $1.15 billion in exchange for all the revenue from parking meters over the next 75 years In 2015, the meters brought in $156 million, so we're talking at least 7x.[0]
[0] http://chicago.suntimes.com/news/parking-meters-garages-took...
But a government has the task to always use the least costly bid. And that can also be "build it from scratch". In this example, that’d be cheaper.
But now you're saying they should buy vehicles, hire drivers, hire an iOS dev, an Android dev, a back-end coder, an ops team to watch the servers 24/7, a coder to handle payment back-end, a general manager to run the whole thing, pay AWS or GCP or a bare metal hoster for the servers, hire customer support to handle issues, pay Google (or Bing) maps commercial license fee, cover gas, maintenance, tires for all of the aforementioned vehicles and still have a lot of money left over from that fat $610,000 check to justify this project?
I think people suggesting "build it from scratch" mean build a local Uber-like service from scratch, which like Uber would not own vehicles itself or pay for gas or maintenance. That gets rid of the buying vehicles, and covering gas, maintenance, and tires.
Dispatching drivers could be done with pairs of text messages to the driver, of the form "pick up <NAME> at <ADDRESS>" and "drop off <NAME> at <ADDRESS>". The driver can tap on the addresses in those text messages to open them in the driver's smartphone's map application. That gets rid of the need for a commercial map license.
I don't see any need for a payment back end. The town can require drivers to accept payments directly using one or more specified methods (such as Square).
It probably doesn't need native iOS and Android apps. A web-based application should be sufficient.
They already have a website. They should be able to add the back end stuff to that, so no new costs for ops or hosting. (That is assuming that they have access to the code for their site and can make changes. Their site is run by Pathfive.ca, which seems to be a company that specializes in building and hosting websites for educational institutions and local governments. It may be that the town only supplies content to fill in templates).
Why hasn't anybody executed on that strategy (in practice)?
Forget the government affiliation, someone could be minting money either by competing with Uber on cost or just strategically choosing smaller markets that are not yet covered by Uber.
Why aren't they?
For comparison, in an average German town, a bus costs annually $80'000, including maintenance and driver. From scratch or rented from a company offering bus services.
a typical California city must contribute quite a significant sum so that the bus driver can retire at, say, 70% of their highest salary level. (e.g. over the past year, about 20% of Los Angeles's budget went to paying for the retirement of past employees.)
how does Germany do it?
The rest is handled by the employee.
Pensions are paid by the employees pension insurance, and the federal pension insurance, not by the employer.
There was a distant time where some bus drivers were also appointed Beamte but that practice was done away decades ago, so there are only very few such drivers left.
So what are the most successful examples of non flashy websites running on cheap hosting you'd recommend?
Things working the way they do, the government could not build a system that even approaches a service like Uber.
Although, I really don't know how to make the rules better.
Anyway, from personal, anecdotal experience, I have hired building contractors, first time around I took the cheapest offer, then two years later I needed the same work done for another room and then didn't take the cheapest offer (the one I took was about 25% more). The result could not have been more different. The cheap room has cost me more than 2x the original price, because I've had to redo most of it during the last 7 years and the second room shows no signs of needing any more work anytime soon.
So, taking the longer term view, sometimes it's better to pay more upfront to get more quality. Except that quality in this sense is really hard to quantify and put into rules.
I'm no particular fan of Uber. But the idea that some small city government could create a more economical mobile taxi app seems unlikely to me.
Now maybe this should be some shared local government infrastructure app but those sort of things aren't that common. I know I use checks to make various payments to my town because the online service actually costs me an incremental fee.
lolno
A government has the task to provide the best service for its citizens with its budget. We've seen what least costly bid leads to: degradation in quality of all public services impacted.
That is similar to saying that you're wasting money by paying a plumber to fix your pipes, instead of buying all the tools and fixing it yourself.
If the government doesn't have the capital, expertise, or budget for investment in infrastructure, it makes perfect sense to outsource it.
Why would a county pay a bus driver, mechanics, and invest in a fleet of buses when it's less expensive to outsource it?
That’s a good argument. Especially once economics of scale come into play.
But that’s not the case in this example. The government is outsourcing something that would be massively cheaper if purpose-built for their town.
Uber has a lot of expenses and complexity to handle corner cases that will never occur in this town – outsourcing is wasteful. That’s like building a heating system into a house in Phoenix.
I don't understand. Software has ultimate economies of scale. Also, they're not paying Uber a fixed cost, they're strictly subsidizing the ride. They can opt out at any time, if I'm reading the article correctly.
> Uber has a lot of expenses and complexity to handle corner cases that will never occur in this town – outsourcing is wasteful. That’s like building a heating system into a house in Phoenix.
One of us is misunderstanding the point of software. Just because you're not using certain capabilities doesn't mean you're charged extra for them. To your point, did you waste money by buying your IDE if you don't use each and every feature, because outsourcing your dev environment is "wasteful"?
But you are.
Such a system for a small town doesn’t need native apps, it doesn’t need to look beautiful.
You can use a single PhoneGap app for all OSes, also the same on the web.
You can avoid the entire payment infrastructure, and have riders pay the drivers directly. Alternatively, use Square, and you won’t have to make your own payment system either way.
A lot of uber’s costs only appear at huge scale.
This town doesn’t need uber, it needs a simple ride sharing service like every town in the second or third world has – and those even work without any app.
Explain that last bit. Economies of scale work very well for software. Whenever there's a new security patch or a feature that Uber implements, you get it for free if you use Uber as a platform, in that you don't pay any additional cost. Also, you don't need to pay money for maintenance/servers.
At this point I'm not quite sure if you're trolling or not. That'd be like advocating that a town's government use a home-coded text editor instead of Microsoft Word, because you don't need any of that fancy stuff that you get for no incremental cost.
If anyone of you is a city and wants that: Email me under the address in my profile.
That's not a valid point. You're subsidizing a good. That's like me saying that since I'm willing to buy my friend a beer, then beer is free.
Development time is most definitely not free, and neither is software update, ops, or support. Things that Uber gives for free.
Just a lot smaller in scope. See Mercedes' ridesharing offering in the EU, it's exactly that.
Only a few dozen devs, yet cheaper than Uber, with similar features.
Uber has already built an app. The city is subsidizing people for transportation. There is no more software development that needs to be done.
You comparing cheaper services to Uber is like comparing a large industrial farm to a local farm. Sure, the industrial farm costs more, but you're not paying for it. You're just paying for food stamps.
Why would you duplicate effort that already exists?
I don't see any way this discussion can continue in a useful way like that.
That said, you're not the only one - although it might also be due to the SV mindset.
> Why would you duplicate effort that already exists?
Because it's cheaper.
I have single-time costs to pay for developing such a system, and afterwards minor maintenance costs.
Or I can pay every year for Uber, and create high profits for their investors for them to build golden castles. If an investor makes profit from taxes, something's already gone wrong.
You're still suggesting an economy based on leasing, but that's not affordable in the long term.
Then they could build in all the business logic to store driver and rider information securely as well as securely charge and pay them.
Then operate the business by marketing it and attracting drivers to the platform.
Subsidize Uber vs. All of That? On a 600K MAX budget for a town too small to seriously consider >2 buses, using an existing Lyft or Uber-esque service is a no brainer.
[1] I mean what google does is a lot more comkplicated than what Uber does. That said, google is alleging that large swathes of the Uber AI program are literally"exactly the same" as Waymo...
So why isn't it as widespread as Uber is?
uber does many things with their business practices that help them stay the largest provider.
GNU Ride anyone?
As exemplified by any random California town crushed by pension obligations to prison guards, police, firefigthers, teachers or just a public employee pension system.