this post was submitted on 11 Oct 2023
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https://www.eurasiantimes.com/a-whopping-900b-debt-chinas-once-profitable-high-speed-railways/?amp
It'd be good to have high speed rail but not at any cost.
Queue tankies going crazy to defend the absurd cost...
Less than 9x the cost of California HSR or the UK's HS2. With that money, California HSR aims to build 840km and HS2 aims to build 230km. China, with 42000km, built 50x the rail of California HSR and 180x the rail of HS2 and is delivering economic and social mobility benefits today.
Either way, infrastructure doesn't need to be profitable at a first-order level to be profitable to the country as a whole. The increase in economic mobility, social mobility, consumer spending, travel, and logistical efficiencies typically have returns that far exceed that of fares: in typical North American transit systems, although they operate at a loss on paper, it's estimated that each dollar put into transit returns $4-$5 in economic returns.
These high speed rail lines are NOT providing social mobility. These trains are quite expensive to ride, and they're out of reach for a lot of Chinese citizens. Many poor people opt for the conventional slow trains, which tend to be cheaper. So your average HSR line will run mostly empty outside a select few lines between two very major cities, while your average conventional rail will be crowded with passengers.
Also, China's infrastructure project aren't not paying dividends like they're supposed, especially their HSR. The idea is that if the government invest money into a logical rail system, that system will be pay for itself indirectly even if it operates on a loss. However, in China's case the system isn't built logically. China in the 2000s and 2010s wanted to maintain their high GDP growth at all costs, and the CCP thought this was the way to do it. Initially they were right as stimulus on infrastructure projects are generally a smart investment because they create jobs, gives the country the needed infrastructure, and boosts growth... but they just didn't stop. They built all the logical feasible lines, then they built some less logical and feasible lines, and they kept building more and more until the new lines made no sense whatsoever. This type of building isn't smart, it's reckless, and they're paying the price for it right now.
I don't think you comprehend just how insanely large $900 billion is. That's the equivalent of the entire annual GDP of the world's 20th largest economy, Switzerland, in 2023. All this debt is just on a rail system that's pretty damn new. To put things in perspective, let's compare it to Germany's system. For Germany's ENTIRE rail system, which includes slow trains, high speed trains, and freight trains their rail system is only $20 billion in debt. If Germany were to have a rail system as long as China's (150,000 km vs 40,625 for Germany), the debt it would have for its rail system would be about $74 billion. China has $900 billion in debt on its high speed rail alone. That is nuts, this is a rail system that will never pay itself back directly or indirectly. This amount of debt is so huge for a HSR system that it's actually unsustainable.
Going to guess the workers in CA are paid slightly better...
yeah but how does their cost of living stack up against that paycheck?
It is higher but they are still doing better even with the higher COL.
Then let's talk about Spanish HVT (AVE), shall we?
No. Lets not do whataboutism.
Jesus fucking Christ, that is an abusrd amount. $900 billion is worth the same as the GDP of the entire country of Switzerland in 2023. Switzerland has, the 20th largest economy in the world. What's nuts about this is that this debt is expected to ACCLERATE with time.