Yesterday’s MBTA collapse, which shut down our economy, cost us tens of millions of dollars, and created cautionary headlines for anyone trying to draw students, businesses, or Olympic athletes to Boston — let alone get to and from work and school! — is just a dramatic reminder of what T users have known for decades: our public transportation system, once the envy of the world, is inadequate and deterioriating. It will require perhaps $13 billion in investment to pay down its staggering debt and restore it to a world standard.
It doesn’t have to be this way. The essential problem of the T is its current organizational structure, which insulates it from market accountability while simultaneously exposing it to harebrained schemes like Charlie Baker’s 2000 plan to lumber it with $3 billion in debt, $1.7 billion for the unrelated Big Dig road project, and his current proposal to cut its funding further — because current performance is apparently adequate from a financial perspective. (The spectacle of Baker fulminating about “unacceptable” service while having played a large role in creating the disaster, and simultaneously trying to cut the T’s budget, is entertaining in its incoherence, but I digress).
Hong Kong has a much better structure, and a much better mass transit system. The Mass Transit Railway there is controlled by the government, which is its largest shareholder, but is a public company listed on the stock exchange. It has total assets of about $257 billion, annual revenue of about $4 billion, and made about $2 billion in profits last year. The company owns and operates the mass transit system in Hong Kong, and has additional operations in the United Kingdom, Australia, China, and Sweden. It makes most of its profits by developing real estate around the transportation hubs it builds, creating a virtuous circle between transportation and community development. Critically, although it is controlled by the government, which is appropriate for a key infrastructure monopoly, it is organized as a business, which allows it to access global capital markets to raise investment funds, attract and retain skilled staff, and explore new revenue areas in an entrepreneurial manner. It was established in 1975, when Hong Kong started to build its subway system (it is now far larger than the T). That is the kind of venture that can attract the kind of capital the T needs, and provide sustained performance. And it can happen in our lifetimes.
Fundamental changes are required at the T. The chance that the organization as presently constituted can raise anywhere near $13 billion, from the legislature or anywhere else, is slim to zero. But even if it did, the same problems that have reduced the system from a model to a tragedy would still apply. There is a better way. We should embrace it.