The railways can't compete when trucks are receiving so many subsidies.
This one of the most dangerously misleading peices of rhetoric because of the vagueness of the term "subsidies", which could mean almost anything the listener wants it to mean. However, those who make this statement generally mean one or more of the following:
1. Taxpayers and ratepayers are subsidising all road users. This is the exact opposite of the truth. Various aspects of this are discussed elsewhere on the Rhetoric page and Toll Roads page.
2. Trucks are not paying their full share of roading costs. Generally, studies that support this argument use Marginal Utility Theory with absolutely no consideration of the costs or benefits attributable to various classes of road users. There is a very simple reason why you should be sceptical of any study which claims to identify the precise amount of money that trucks should be paying. Roading engineers have not yet been able to precisely determine how much of the damage to roads and bridges can be blamed on heavy traffic and natural causes because they don't know precisely how much these two factors ineract. Natural causes include structures simply growing old, temperature extremes, oxidation of metals and tarseal, irregular compaction of soils under the weight of the road base, ultra-violet degradation of paint and tarseal, and irregular dynamic bridge loadings from flood debris and earthquakes. Mostly we only think of earthquake damage when severe earthquakes crack or destroy roads and bridges. But each minor or moderate earthquake has the same effect as large numbers of trucks and as a great many of these seemingly harmless earthquakes happen each week in this country they can substantially reduce the serviceable life of roads and bridges. These uncertainties result in the best Cost Allocation Modelling being able to estimate heavy vehicle costs only to within 50 million dollars. The scale of Road User Charges sensibly aims for the middle of this range, so trucks may be paying 25 million too much or 25 million too little.
3. Trucks are being subsidised by sharing the roads and highways with cars. This is perfectly true. This is actually a good example of economies of scale and because it applies mainly to the fixed annual costs it is equally true that cars are being subsidised by trucks. Each year road users contribute approximately $m250 from registration and license fees for road safety and $m400 from RUCs and petrol tax to repair environmental damage. Until the end of the last millenium this straight split of costs between cars and trucks also applied to public transport subsidies and capital investments but it is no longer clear how those costs are split. In the year 2000 RUCs included approximately $18 for these shared costs on the basis that this was what an average petrol car was paying in petrol taxes. On top of this is a weight fee ranging from approximately 30 cents for 2-ton pick-up to over $300 for a 44 tonne 8-axle truck and trailer unit.
4. Trucks need much stronger roads and bridges than cars do but cars end up paying for this extra cost. If our bridges were built to post-Kobe earthquake standards they would comfortably exceed the strength needed to carry heavy vehicles. Railway bridges generally perform better than road bridges in earthquakes because they are built to resist the enormous dynamic loads that occur with 18 ton axle loadings. However, this extra strength actually adds surprisingly little to the cost of building roads and bridges. On average almost 90% of the cost of a bridge is needed just to make the bridge strong enough to support its own weight, which leaves only a small additional cost directly caused by the need to accomodate the extra loads imposed by trucks. Similarly, land purchases and earthworks account for most of the cost of new roads. The actual cost of the load bearing pavement and roadbase is generally less than $100,000 per kilometre for a two-lane State Highway. Generally this type of subsidy does not occur on local roads because the minimum thickness of seal and roadbase needed to survive in the environment for several decades provides enough strength to easily withstand moderate amounts of heavy traffic. The only real exception to this rule is buses on residential streets or new industries in rural areas and even these would not be a problem if all of the RUCs were paid to the local authorities on whose roads the kilometres are travelled rather than only 43% - 50% in cities and 50% -70% in most districts.
In fact there are three very simple reasons why trains can't compete financially with trucks:
Trucks are descended from drays, carts and wagons. Modern roads and highways are an evolution of the simple bridal tracks and dray roads built in the 1800s. The development of these roads has occured progressively over a great many decades with money being spent only when both the demand and revenue occur. The railways required a substantial investment of borrowed money to build a completely new infrastructure from scratch. Because it was a revolution in land transport rather than an evolution it has generally been difficult or impossible to build or improve railways from cash flow. This became a major problem after the second world war when the railways had to compete for public works loans with state housing and huge hydro-electric schemes. However, his problem was hidden between 1934 and 1954 by the simple expedient of spending half the petrol tax on railways capital works. Between 1954 and 1973 all of the petrol tax was paid into the National Road Fund and the government resorted to borrowing from the World Bank to upgrade railways rolling stock..
| 
