Canada Needs to Nationalize Its Transit System

May, 19, 2021

The demise of Greyhound Canada underscores the market’s inability to meet the transit needs of Canadians. It’s past time for a national, publicly owned rail and bus service, operated in the public interest.

In the early 1930s, a young graduate of McGill University sat down for an interview with Sir Edward Beatty, then the president of Canadian Pacific railways, as part of his application for a scholarship at Oxford. Beatty, as the story goes, asked the young applicant: “What would be your first step if you were elected Prime Minister?” to which he replied “I’d nationalize the Canadian Pacific.”

The applicant in question was the young socialist organizer David Lewis who, perhaps on the strength of his chutzpah alone, was duly awarded his scholarship and soon after began his studies at Oxford. As leader of the NDP some forty years later, Lewis would campaign to turn his retort into national policy during the 1972 federal election — the privatization mania that would sweep much of the world in the following decades having not yet arrived to stigmatize the concept of public ownership and render it the anachronism it’s often assumed to be today.

The intervening years have, to say the least, offered a mountain of evidence to strengthen the classical socialist case for nationalization of sectors like transit — the market failing, again and again, to provide decent service or meet basic standards of efficiency. The privatization of British Rail, to take an obvious and famous example, has been an unmitigated disaster: the business of getting around the United Kingdom by train today being both complicated and expensive (the cost of a single ticket from London to Manchester more than tripled between 1995 and 2013).

Thanks to New Zealand’s 1980s experiments in privatization, Auckland’s transit system is a morass of competing companies contracted by local government to provide bus, rail, and ferry services. Tickets are similarly expensive, transfers between sections owned by different firms is impossible, and bus routes are circuitous. As the expat Canadian economist Jim Stanford put it in 2010: “The top priority becomes ensuring that a private company reaches profit targets, not picking up people who need a ride.”

As Canada’s own experience shows, however, the failure of privatized transit can sometimes take other forms: most recently, outright failure. Last week, Greyhound Canada announced the permanent closure of every bus route in the country, eliminating one of the only options for affordable intercity transit across the world’s second-largest national landmass. While the immediate catalyst was undeniably the months-long suspension of service due to COVID-19, the company has struggled for years and its collapse hardly comes as a surprise. In 2018, it ceased operations in Western Canada which had once covered some eleven thousand kilometers and serviced around two million trips per year. As writer Alexis Zhou remarked at the time:

Canada now has a patchy network of intercity bus services composed of individual, separate bus lines. Those systems often don’t interconnect with each other, rendering transfer almost impossible. Moreover, bus schedules are usually far between, not keeping up with the growth in population. As a result the current intercity bus service fails to reach many Canadians or serve them adequately.

With Greyhound’s final demise, this situation has gone from bad to worse — with people in already under-serviced northern and remote communities in particular soon to find it near impossible to travel significant distances with convenience or ease. Very likely, governments will opt to respond by offering up market solutions. The Province of Ontario, for example, has already proposed to start deregulating the inter-community bus industry in the next few months — a move almost certain to result in higher ticket prices, less consistent service, and many of the inefficiencies visible in privatized transit boondoggles elsewhere.

The Amalgamated Transit Union has proposed a much better way in the form of a nationalized, public, intercity bus service. That idea could be taken still further by expanding it to rail and even, potentially, discounted air travel. By crude market metrics, a nationalized transit service would probably be an abysmal failure: Canada is, after all, a huge place and it’s difficult to imagine how even the most dynamic public sector alternative could possibly be profitable while also being affordable and available to those who need it. The point is that it shouldn’t have to.

Canadians, regardless of background, income, or postal code, should be able to get around their country with ease on bus routes and railways owned and operated in the public good.

[Top photo: Greyhound Canada has announced the permanent closure of every bus route in the country. (Can Pac Swire / Flickr)]