Trouble is brewing on tracks up north

Last week the Fuji TV variety show “Real Scope” covered Japanese railroads. Most of the celebrities in the studio were densha otaku (train geeks), so it was one big love-in for railways and the people who operate them. However, the entire two-hour program focused on only two systems: the super express Shinkansen and Tokyo’s subways.

There are many private rail companies in Japan, so why only those two? Money, apparently. JR Tokai, usually referred to as Central Japan Railway in English, which runs the main Tokaido Shinkansen, boasts the highest profits of all rail transportation companies in Japan, and Tokyo Metro, one of the two subway systems in the capital, is fourth on the list.

Profitability in this case has less to do with Japan’s famously efficient service and vanguard technology than with circumstance: Both systems are in Tokyo. The subways, of course, run through the whole city. JR Tokai serves the region between Tokyo and Osaka, but doesn’t make money on its regular train lines. It makes money on the Tokaido Shinkansen, which connects Western Japan to Tokyo. It makes so much money from this line, in fact, that it is using the profits to build the futuristic magnetic-levitation (maglev) shinkansen, which will shorten the journey between Tokyo and Nagoya from 100 minutes to 40.

As with all things train-related, the media is also in love with the maglev project since it is seen to represent Japan’s technological edge and disciplined management style. It is the perfect advertisement for Japan’s superiority in the realm of public transportation — the better to sell the technology abroad — even if its sex appeal distracts from its questionable practicality.

The maglev is an impressive piece of engineering and the perfect manifestation of JR Tokai’s hubris. It is the most successful railway company in Japan and wants everybody to know it. It also wants everyone to know it’s doing this without any help from the public sector, but while tax money is not being spent on the maglev, the central government is helping out. It passed a law, mainly for JR Tokai’s benefit, that stipulated tunnels built more than 40 meters underground do not need to compensate land owners. And the company doesn’t have to pay for any of the stations along the maglev line, since that is the responsibility of the municipalities where the stations are located.

But JR Tokai is the exception. As recent problems in Hokkaido have shown, most railroads not connected to Tokyo don’t do as well. On Sept. 19, a cargo train on the Hakodate Line derailed. Though there were no injuries, operations on that stretch of track were suspended, disrupting several passenger lines. An investigation revealed that the rails were too far apart, with further inspections showing similar flaws at 267 spots on other lines belonging to JR Hokkaido (JRH), which, aside from Sapporo’s subway system, is the only railway company in Japan’s largest prefecture. In May 2011, a super express from Kushiro bound for Sapporo derailed in a tunnel and caught fire, injuring 79 passengers.

The distance between rails should be fixed and uniform, but safety standards allow for a maximum of an extra 19 mm before the rails have to be reset or repaired. The excess at the derailment point was 37 mm, almost twice as much. Last October, the press eventually learned, the extra gap was 20 mm, which increased to 25 mm in June, but nothing was done.

In fact, many of the flaws have been extant since the time when the system was operated by Japan National Railways (JNR), which in 1987 split into private companies. And it isn’t only infrastructure: Much of JRH’s rolling stock is just as old. According to Tokyo Shimbun, there has been at least one incident every month this year involving engines catching fire or leaking fuel. On July 6, one forced the evacuation of a passenger train, again on the Hakodate Line.

The reason is simple: JRH doesn’t make money and never has. The Asahi Shimbun reports that with resources so scarce, financial rationalization such as personnel and salary cuts takes precedent over maintenance. When JRH was privatized there were 13,000 employees. Now there are 7,100. After 28 years of being a private company, only 18 percent of JRH’s locomotives are electric.

JRH reported an operating loss of ¥23.7 billion last year. When JNR went private, the government gave each new company “management stabilization funds,” a kind of dowry that they invested. Basically, JRH survives off whatever capital gains it earns, which have steadily decreased in recent years. In 2012, the return on investment amounted to only ¥4 billion. Former Prime Minister Yoshiro Mori recently told an audience in Sapporo (only half-facetiously) that if JRH has no money to carry out normal maintenance, “it should ask JR Tokai, which has a lot of money, to purchase it.”

As many media pundits have pointed out, while the central government is no longer in the train business it still has a responsibility to ensure that JR Hokkaido lines are safe. This relationship between government and private companies, such as Tepco, that offer essential public services will always be a problem as long as the market is considered the arbiter of all economic matters. Unquestionably, Japan has the best public transportation system in the world, but that service depends on fiscal health. JR Hokkaido isn’t the only railroad with serious financial problems that affect users. In a pure market economy these companies would already be out of business.

Pride can be blinding. Last week, TV Asahi’s news show “Morning Bird” reported on the JRH problem. Reporters and guests blamed it on feuding unions and a top-down corporate culture that discouraged “real communication.” They wanted to believe that the greatness of Japanese railroads was a function of their true spirit of service, which had somehow been lost at JRH. They didn’t want to acknowledge the obvious: It really comes down to money.