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Showing posts with label predation. Show all posts
Showing posts with label predation. Show all posts

Very cheap, energy efficient transportation, and the government wants to kill it

Personally, I don't care about "energy efficient" transportation per se.  I figure that the market will figure out the most efficient way to transport people and energy costs are no more important than other costs.  Yet, it seems more than a little hypocritical for the government to try making this type of transportation so difficult and costly.

Let's say you wanted to get from New York to DC this evening. You could take the government-supported train system - which would cost you $153 or more - or you could take a bus, which gets no government subsidies, for... $19. . . .
[These buses] are now, as CATO transportation expert Randal O'Toole puts it, "the nation's fastest growing transportation mode." He adds:
"They do so with almost no subsidies... Intercity buses are safe and environmentally friendly, suffering almost 80 percent fewer fatalities per passenger mile than Amtrak and using 60 percent less energy per passenger mile than Amtrak." . . .
I did a quick search and I found that for this coming Monday the average Megabus fare is $14.73.  The average Amtrak fare is $160.



If you want to see more on the efficiency of these buses, this is of some use.
Does the US have a conflict of interest in going after Toyota since it owns GM?

Does the US have a conflict of interest in going after Toyota since it owns GM?

It isn't obvious that the government's behavior is "consistent" with how the government handles similar cases.

The US transportation chief's public rebukes of Toyota's handling of a massive safety recall have raised eyebrows, given the US government's major stake in rivals General Motors and Chrysler.
"The optics are terrible because -- and this is what happens when a government owns a company - the two companies that are going to gain the most out of this are General Motors and Chrysler," said Peter Morici, a professor at the University of Maryland's business school.
"But their behavior is consistent with the general policy of the US government, whether it's dealing with coffeemakers or cars."
Safety officials understand that product design mistakes are inevitable and will work to help companies correct the problem and alert consumers. But they will not tolerate a slow or weak response, Morici told AFP.
Transportation Secretary Ray LaHood sat down with reporters Wednesday to lay out a timeline of how US officials had "pushed Toyota to take corrective actions" on its pedal problems since 2007.
The meeting came a day after he issued a statement accusing the Japanese automaker of dragging its feet on recalling vehicles in danger of sudden, unintended acceleration due to pedals which could get trapped under floor mats or become "sticky." . . .
Amtrak loses $32 per passenger

Amtrak loses $32 per passenger

If Amtrak wasn't operating at such a loss, how many other alternatives would spring up? You would have more buses for one competing along their routes, though there are already a lot that do. These losses are nothing new. If a private firm were to do this, it would be considered predation. From the Associated Press:

U.S. taxpayers spent about $32 subsidizing the cost of the typical Amtrak passenger in 2008, about four times the rail operator's estimate, according to a private study.

Amtrak operates a nationwide rail network, serving more than 500 destinations in 46 states. Forty-one of Amtrak's 44 routes lost money in 2008, said the study by Subsidyscope, an arm of the Pew Charitable Trusts. . . .


While Acela Express made a profit, "The more heavily utilized Northeast Regional lost almost $5 per passenger."
On competition with government companies: The case of the BBC

On competition with government companies: The case of the BBC

James Murdoch, chief executive of News Corporation, Europe and Asia, has some words of warning that are probably relevant to government competition in other sectors.

An out-of-control BBC and addiction to central planning by regulators are damaging democracy and media choice in Britain, James Murdoch said in Edinburgh last night.

Giving the annual MacTaggart lecture to an audience of television executives, Mr Murdoch, 36, the son of Rupert Murdoch, called for a “dramatic reduction of the activities of the State” in broadcasting, arguing that it effectively treated viewers like children.

He contrasted the prevailing political attitude to mainstream broadcasting with the lightly regulated newspaper, film or book industry where consumer choice predominates.

Mr Murdoch, chief executive of the European and Asian operations of News Corporation, parent company of The Times, said: “In the regulated world of public service broadcasting, the customer does not exist: he or she is a passive creature — a viewer in need of protection.

“In other parts of the media world, including pay television and newspapers, the customer is just that: someone whose very freedom to choose makes them important.”

He said that the “chilling” expansionism of the BBC meant that commercial rivals and consumer choice were struggling. In particular the “expansion of state-sponsored journalism” in the form of BBC News online was “a threat to plurality and the independence of news provision, which are so important to our democracy”.

Mr Murdoch criticised Radio 2’s effort to woo younger listeners by hiring presenters such as Jonathan Ross on “salaries no commercial competitor could afford”.

“No doubt the BBC celebrates the fact that it now has well over half of all radio listening. But the consequent impoverishment of the once-successful commercial sector is testament to the corporation’s inability to distinguish between what is good for it and what is good for the country.” . . .
The Economist magazine on Predatory Pricing

The Economist magazine on Predatory Pricing

The Economist magazine points to the skepticism that economists have about predatory pricing. I wish that they would have would have noted that the one place where predatory pricing is most likely to take place is government enterprises.

I couldn't agree more with this quote:

TWO decades before he won the Nobel prize for economics in 1991, Ronald Coase wrote an essay decrying the poor state of research in industrial organisation, the discipline in which he established his reputation. The field, he complained, was devoted to the study of monopoly and antitrust policy. That, he said, made for bad scholarship: an economist faced with a business practice that he cannot fathom, according to Mr Coase, “looks for a monopoly explanation”.


It has always struck me as odd that anything that economists see the first explanation is some type of monopoly power.
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