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In some cases, it appears that comparing the "cost recovery" for rail and highway systems is like comparing apples and oranges. The reason is that many of the hidden "benefits" of a road system cannot easily be calculated. For example, a local road system serves a variety of users that do not benefit very much from a railroad (school bus and emergency vehicle access, for example).

Having said all that, it would seem that there are only two ways to get railroads and highways on a "level playing field" -- either have the government take over all the railroads in the U.S., or privatize every road in the country. I'm not sure I want to see either one of these things happen, so this kind of debate will go on for a long time.

BTW, New Jersey Transit held their public hearings for their proposed fare hikes the other day. While I can understand their need for a fare hike and view NJT as a top-notch agency, the last few months have exposed some major flaws in public transit as it operates today:

1. The methods of funding public transit in the U.S. are absolutely idiotic. Federal Transit Administration funds can be used for capital projects, but not for operating expenses. This is like providing incentives for people to purchase an $800,000 home even though they can't afford to buy any furniture. The natural result is that transit agencies (NJT is particularly bad this way) build major projects that they can't possibly operate, due to limitations in operating funds or capacity constraints. September 11th has given NJT an excuse for all those trains jamming into Penn Station (NY) packed to the roof with passengers, but the truth is that those trains were packed to the roof before September 11th. The fact that NJT was able to open their Midtown Direct service and build the Secaucus Transfer despite the common understanding that the Northeast Corridor Line cannot accommodate the projected passenger load is an absolute disgrace.

2. The major flaw with any rail system is that a train only operates with one degree of freedom (i.e., forward and backward). If there is a problem somewhere on the system, then there is no way to divert trains somewhere else and still get people to their destinations. If a major highway is shut down for hours at a time, at least people have an opportunity to find their way to an alternate route. Can you possibly put a value on that kind of flexibility when you compare railroads to highways?

Using property taxes to fund local roads does not seem like a big deal to me, for a substantial portion of a property's value is directly tied to its access to public infrastructure. A suburban residential lot that sells for $100,000 would be worth only a fraction of that value if it only abutted on a river or railroad right-of-way. In fact, there's no way in hell this land would ever support a residential land use under the latter circumstances.

A well stated reply and I like this part the most.

But I would also mention that governments have always subsidized the construction of roads and bridges to facilitate both trade and military mobility. The resulting expanded trade has generally paid the freight every time although additional revenue was usually supplemented, in both ancient and modern times, with toll booths.