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4.1 London, England In 1996, Britain privatized its railways, contracting private companies to

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4.1 London, England
In 1996, Britain privatized its railways, contracting private companies to operate trains and maintain the rail lines. The argument for privatizing public transportation is that private companies pursue cost-minimizing strategies, which means that public transportation can benefit from the more efficient outcomes. This has proven to be the case in London, where the central government’s spending on the railway is mainly payments to franchised train-operating companies and Network Rail, which is a semi-public body. Overall, costs for the railways have been lowered in London “reducing operating costs by about 10 per cent” (White, 2009).

Private companies tend to shift the main focus of public transportation from service …show more content…

4.2 Chicago, United States
In the past, United States’ infrastructure were mainly developed and maintained by the private sector, this included major parts of transportation like railroads, roads, bridges, etc. This contributed to a significant proportion of the nation’s GDP (Wright & Murphy, 2009). Due to various financial crises, the United States government took over most of the nation’s infrastructure. This theoretically can be perceived as the right action as government ownership can help in keeping the firms afloat.

In the United States however, the government ownership of infrastructure that were previously from the private sector created many problems. The government’s agency limitations and regulatory constraints created problems like insufficient revenue, which could have been easily managed if it were run by the private sector. “The federal gasoline tax, which is the primary source of highway user fee revenues, has not been raised since 1993 and Congress has recently been forced to add general funds to the Highway Trust Fund to close what would otherwise be a deficit” and “Aviation Trust Fund has been running annual deficits of $3 billion--$5 billion that have been covered by general taxpayer funds... forced to cut back operations, which significantly increased flight delays, when the government

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