From: pshuang@athena.mit.edu (Ping-Shun Huang)
Subject: Re: Drinking and the MBTA was Re: Sunday Liquor Sales
Organization: Massachusetts Institute of Technology
	<1992Dec17.175334.15005@linus.mitre.org>
	<1992Dec21.155847.7913@m5.harvard.edu>
Date: Tue, 22 Dec 1992 01:21:48 GMT

In article <1992Dec21.155847.7913@m5.harvard.edu> borden@head-cfa.harvard.edu (Dave Borden) writes:

 > be at a severe competitive disadvantage, because of the high subsidies which
 > the MBTA receives (I heard about 85 percent - is that true?), but people

While this might be true, I do not believe it unless someone can confirm
this using real financial figures and not "Well, I heard it was true."
(I seem to recall the last fare raise in San Francisco, to 85 cents from
75 cents, brought the MUNI bus operation there back to the break-even
point again.) Yes, I suppose *I* could try to uncover those figures, but
the burden of proof should be on the person who uses the fact to bolster
their argument and not on people who disagree with him. :)

 > I would be pretty upset if government restricted the private shipping
 > companies in such a way that good quality shipping became unavailable
 > or more expensive than it is now.

I agree that the quality and speed of the US Postal Service sometimes
leaves a bit to be desired (fancy, litotes from a MIT student... :).
However, if private industry continue to successfully assume the most
profitable parts of the shipping business, such that USPS is forced to
charge more and more and eventually there is a revolt, and Congress
revoke their charter and lets the private shippers battle it out in a
laissez faire marketplace... you wouldn't be able to mail things to many
places.  Remember, the Postal Service will deliver anywhere, but many of
the shipping companies will not. Likewise with bus service.

Another important issue is what kind of costs are there to put up basic
infrastructure for the industry -- this differs greatly between mail
delivery and electricity/water/gas delivery, I suspect public
transportation falls somewhere in between. USPS doesn't have to share
facilities with FedEx, but if two companies were allowed to compete in
the Northeast to provide electrical power, it seems ridiculous to have
to have two sets of power lines throughout the several states here, and
clearly if one company focused on just supplying power to urban areas,
they would have to invest much less in physical infrastructure.

	--------

Anyway, I think you are quite right in that a private company may indeed
be able to provide some subset of the MBTA's services at much lower
cost. However, the start-up capitalization would certainly be
non-trivial. I mentioned this casually in my earlier posting, but what
*IS* the MBTA charter, and *DOES* it expressly forbid any private
service which could be construed as competition? If it does not, then I
think that, in accordance with your admiration of the private sector in
China's economy, that clearly free-enterprise has spoken and disagreed
with you. :) It takes a full business plan and not just speculation on
the Usenet to create economic reality, after all....

--
Ping Huang (INTERNET: pshuang@athena.mit.edu), probably speaking for himself

Newsgroups: ne.general