Fantastic example of the failure of central planning

Chinese airports built to accommodate what central planners thought would be hot tourist spots are not meeting expectations.

This is not how things were supposed to be when the $57-million airport opened in late 2007. Local officials were so confident that tourists would flock to this beautiful, mountainous county in southwestern China that they made the terminal big enough to accommodate 220,000 passengers annually, and built a runway capable of handling a 140-seat Boeing 737.

But only a few charters and budget carriers have established service here. A grand total of 151 people flew in and out of Libo last year.

At a time when anxiety is growing over the United States’ aging infrastructure, China is pouring billions of dollars into improving its transportation network to catch up with the developed world.

China has added about 40 airports in the last decade alone, bringing its total to 166. The U.S., by comparison, has 503 airports that serve at least 2,500 passengers a year, according to the Federal Aviation Administration.

But in the mad dash to expand China’s civil aviation system, many new airports are lacking one important thing: passengers.

Spurred by federal infrastructure money, easy bank loans and the cachet of having planes land in their backyard, many small cities jumped at the opportunity to lay down runways and open terminals.

“An airport is like a business card for the city. It can boost tourism and the economy,” said Xu Hongjun, a professor at the Civil Aviation University of China. “But a lot of small airports are not doing well. They need a lot of subsidies from the central government. They were too optimistic.”

With lessons like this all around us, why do we continue to do it?

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About Paul Stagg

Husband, lifter, MBA in Baltimore, MD. Will post about Powerlifting, politics, Classical Liberalism, Economics, building wealth, self improvement, productivity, heavy music, wine, food, beer, and almost anything else. View all posts by Paul Stagg

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