Yes, public transit is subsidised. But it isn't subsidised in such a way that it is expected to eventually become self sustaining - tax-payer funding is expected to continue in perpetuity.
That's not the case with Uber and Lyft. VCs are subsiding their rides on the expectation that eventually the company will dominate the market enough to not require subsidy any more.
I mentioned this elsewhere, but I wonder if maybe cities should run light rail and buses along the most used routes then subsidize private companies (like Lyft and Uber) to service people outside of those routes. I used to ride #43 Taylor's Ferry in Portland twice a day and I was sometimes on the bus by myself or with three or four other people. I bet it would have been far cheaper for the city to put us in a cab (this was before Uber) than to pay a driver to operate a giant, empty bus. I bet the bus was way worse from an emissions point of view as well.
I'd argue that there's no reason transport agencies couldn't do this kind of intelligent routing/hailing themselves. The problem is usually that government is actively punished when they don't go for the cheapest possible alterative, so rather than hire a team of skilled, innovative developers, they out source to a lowest cost bidder. As a result it looks like private enterprise is the only place where innovation happens. It's a shame.
EDIT: Reading some of the other replies, I suppose making rides on these routes on-demand instead of fixed timetable services may change the economics of less popular routes.
Every dollar we subsidize public transit, is far more than a dollar saved on road repair & upgrades.
Just think of buses. Two to three axles. If all the riders took cars instead, that's one hundred axles. Road wear is a function of weight, for which axles is a proxy, and obviously one hundred axles is a lot more traffic demanding road upgrades as well.
My current city, Miami, the city is looking at reducing mass transit service [0]. After already approving a 1-cent tax to expand service MDTA reneged and used the increase to pay for existing issues (fair enough, it needed fixing). Now, we're all paying slight more for a still terrible system.
At this point I think the solution just may have to come from the open market, obviously the govt run entity is unable/unwilling to do the job.
[0] http://www.miamiherald.com/news/local/community/miami-dade/a...
This is a key misunderstanding: the systems are performing as designed but the normal maintenance was skimped on for years and now we're seeing the consequences of years of fiscal “conservatism” punting the problem down the road for future generations to deal with.
If we were to use that logic to say we should stop doing things, we'd also be shutting down most roads, bridges, water systems, schools, etc. because those have the same problems due to the large number of people who don't want to pay for the things they use. Every year, https://www.infrastructurereportcard.org will have a low rating for most U.S. infrastructure and every year a key part of the political system will shrug, say “starve the beast”, and plan on being dead / elsewhere before things break down too much more.
Privatization often makes this problem worse because all of those costs remain unmodified and there's a need to generate profits which requires either increasing prices or reducing service. That can be acceptable for many businesses but cutting infrastructure tends to have significant economic ripple effects since it affects your ability to participate in the economy.