Defining Success – The Case against Rail Transit

by Randal O’Toole, Cato Institute, Policy Analysis No. 663, March 24, 2010

COST Comments: This is one of the finest summary papers regarding the merits of rail transit. The executive summary is below and the full Policy Analysis can be found at CATO.


Over the past four decades, American cities have spent close to $100 billion constructing rail
transit systems, and many billions more operating those systems. The agencies that spend taxpayer
dollars building these lines almost invariably call them successful even when they go an average of
40 percent over budget and, in many cases, carry an insignificant number of riders. The people who
rarely or never ride these lines but still have to pay for them should ask, “How do you define success?”
This Policy Analysis uses the latest government data on scores of rail transit systems to evaluate
the systems’ value and usefulness to the public using six different tests:

• Profitability: Do rail fares cover operating costs?
• Ridership: Do new rail lines significantly increase transit ridership?
• Cost-Effectiveness: Are new rail lines less expensive to operate than buses providing
service at similar frequencies and speeds?
• The “Cable Car” Test: Do rail lines perform as well as or better than cable cars, the oldest
and most expensive form of mechanized land-based transportation?
•The Economic Development Test: Do new rail lines truly stimulate economic development?
• The Transportation Network Test: Do rail lines add to or place stresses upon existing
transportation networks?

No system passes all of these tests, and in fact few of them pass any of the tests at all.
Defining Success

How Successful Are Recent U.S. Rail Transit Projects?
comments by Robert Poole, Reason Foundation

The most comprehensive report I’ve encountered on the rail transit systems implemented in U.S. metro areas over the past 40 years has been published by the Cato Institute. “Defining Success: The Case Against Rail Transit,” provides very sobering tables on the ridership, capital costs, operating costs, farebox recovery, commute mode share, and other data on rail systems in 30 metro areas—commuter rail, light rail, heavy rail, and people-movers. You may not like author Randal O’Toole’s conclusions, but his data raise serious questions about what kind of bang for the buck taxpayers have received for the close to $100 billion spent on building these systems.

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