Would we build another Opera House?

The other 'Melbourne Opera House' - Powlett St East Melbourne

An argument I see frequently in relation to massive infrastructure projects like High Speed Rail (HSR) is that we should simply get on and build them because they’re ‘visionary’ and ‘nation building’. For example, a commenter recently likened investment in HSR to the decision to build the Sydney Opera House. If cost-benefit analysis had been done on the Opera House, he argued, it would’ve been still-born. Thus we would’ve been denied the enormous tourism revenue and the boost to national pride provided by this magnificent building.

I expect he’s right. Formal cost-benefit analysis would probably be hard-pressed finding that the benefits of any opera house exceed the costs, either then or now. There’s therefore always a chance if you look too hard at the costs and the risks you could end up missing out on some whopping future benefits. However the problem with this sort of argument is that it’s based on hindsight. We know for a fact from the perspective of 2011 that the Opera House is a grand success. But cost-benefit analysis isn’t retrospective, it’s prospective – it helps us to evaluate projects before we commit to building them.

Here’s a “thought experiment”. Consider a contemporary proposal to spend a fantastic sum of money on (say) The Melbourne Opera House (insert your city of choice). Imagine an architect of Frank Gehry’s stature (but please not Frank himself!) was asked to ignore the cost and come up with a design that would create an “international icon”. The promise is the building would “put Melbourne on the map” and more than repay the preposterous cost over the years in tourism revenue and civic pride. Of course while it would nominally function as an opera house, what we’d really be building is a piece of architecture so powerful, distinctive and attractive, that it would be as iconic as……well, the Sydney Opera House.

The trouble is the probability of achieving this vision is close to zero. No one knows what the recipe for international icons is. We can look back and more or less pick out the vital decisions and factors that made the Sydney Opera House the symbol it is today, but doing it prospectively is close to impossible. We’d almost certainly end up with a Melbourne Opera House that was functionally compromised and cost billions more than it needed to, but which nobody outside Victoria gave a second glance.

Actually even if the Sydney Opera House planners knew with certainty in the late 1950s what we know now, I’m not sure building it would’ve been the “right” decision to take at the time. The Sydney Opera House didn’t instantly become an international symbol so most of the tourism and “icon” benefits, which probably didn’t kick in seriously until at least the 1980s, would’ve been heavily discounted back to the time the decision was taken to proceed. The net present value of the benefits might not have exceeded the cost of construction which, let’s not forget, was very high.

It might be a bit like proposing to Victorians today that they spend $10 billion to build a Melbourne Opera House that is guaranteed to make the city world famous and drag in billions in tourism revenue, but the catch is these benefits won’t materialise for at least 20-30 years. Maybe it could be sweetened by funding it from a new class of poker machines! Would we buy it? Or would we prefer to spend the money now rather than on future generations? If we spent it instead on a vastly better transit system, we’d be better off and future generations would still get a lot of benefit.

Returning to the debate on HSR, the point is nobody can guarantee the benefits and nobody has tomorrow’s information. On the face of it, with today’s information, HSR looks like a poor investment. Unless the first stage of the Federal Government’s study of HSR, due next month, puts some positive new information on the table, being “visionary” about HSR would be too much like gambling.


9 Comments on “Would we build another Opera House?”

  1. Paul Grgurich says:

    Alan
    I very much agree with your comment that HSR could not be called visionary. Comparing it to an architectural icon is ridiculous – what is visionary about technology that was introduced into Japan in 1964. Most European countries have a high speed system – even Poland is building one – its not visionary – its just a practical solution – for Europe.
    I am not a cost benefit purist, however in this case I am afraid that unfortunately, unlike Europe, the HSR concept is doomed to failure in Australia, the metrics don’t stack up.
    From an urban development perspective, central Europe is characterised by a series of major cities typically 200km to 500km apart. These cities are interlinked by a web of (originally) pre-war railways and later post war freeways. The high speed limits on the freeways (160km in Italy, unlimited in Germany, together with the rapid modernisation of the rail system has ensured that the regional aviation market has never developed. The psyche of the European is to travel on the ground!
    Australia, with only 3 major cities spread over 2000km just does not have the population to sustain a HSR system – or even a viable freeway system for that matter. Instead we have developed the most efficient intercity air service on the planet. With Sydney-Melbourne being the 3rd most trafficked city pair and Sydney-Brisbane coming in at number 5 we see discount tickets at $150 every day. Even if the $10B construction cost was written off it could not compete. It would take 4hrs to commute between Melbourne and Sydney (when you took into account stops and lower speed inner city rail). This is too long for business. Frequency would also be a problem, as you can fly on Qantas every 30 mins – this could never happen on rail. Despite the ACCC, you can bet that predatory pricing would occur and the airlines would slash fares until the rail operator was finished.
    Interestingly there is another little publicised problem that the rail operator will face. Large corporate customers negotiate air ticket prices well below the internet price – it is usually 20-40% below the list price – i.e. it costs about $200 to fly Sydney-Melbourne on a fully flexible ticket! HSR has no hope!
    We are better off spending $2B on an improved goods line service – that’s where rail beats all-comers – in the heavy haulage category – nowhere else – not in this country!
    Cheers

  2. brisurban says:

    I caught a plane recently. It goes just about as fast or faster, difficult or environmentally sensitive terrain it has no issue with at all, no need to maintain thousands and thousands of km of asset that can get washed away in floods or fires, zero chance of hitting kangaroos, no need to dig anything, no overhead wires, and so on and so on.

    Some of the towns en route are tiny. Are these people really going to take HSR to Melbourne or Sydney often?

    There are many good things the billions of dollars could be spent on- like fixing up the existing urban and interurban train and bus systems of Perth (BRT or LRT), Brisbane (Cross River Rail, track duplications to remove bottlenecks), Adelaide (major overhaul), Sydney (self-explanatory), Melbourne (Metro tunnel), Canberra (busways or higher speed urban rail), Hobart (ANY sort of functional public transport would there be a godsend!) and Darwin

  3. brisurban says:

    And one other thing I have never understood about the Australian psyche– we seem to think we should be the Europe of the Pacific and turn places like Sydney and Melbourne in to Paris and London.

    Maybe someone can shed some light on this.

  4. poneke says:

    The Sydney Harbour Bridge is similarly an icon of Australia. I think Sydney is amazingly lucky to have that and the Opera House — both by the harbour which is one of the most magnificent in the world.

    Melbourne really has nothing to match, except its accidental icons — the trams, which are by far the most distinctive feature of the city, a city with very few distinctive features given its flatness and rectangularness.

    Probably the most distinctive building in New Zealand is the Beehive — the cabinet building — next to Parliament House in Wellington. It is also an accidental icon. Its plan was drawn on the back of a napkin by architect Sir Basil Spence in the 1960s. That is not an urban myth, I have seen the napkin in the NZ Archives.

    http://en.wikipedia.org/wiki/The_Beehive

    Like Utzon, Spence was disappointed in the outcome of his design, but both the Opera House and the Beehive are remarkable buildings.

  5. Daniel says:

    A far more viable solution would a less advanced (slower) form of HSR between the cities and airports, that were integrated at the airport. So you could check your luggage in and get a boarding pass at Southern Cross, then just go through security at the airports. Although having said that, airport rail links have also proven unviable, and the cost of the rail ticket at each end would likely be more than the flights.

    HSR is great in theory, but in practice the economics don’t stack up in Australia, especially when our flights have been adapted to the market so well. Over time technology may reduce the need for business flights, and make our planes more efficient.

  6. Alexander says:

    Sydney would always have had the Opera House even if it weren’t the Opera House; think of the Harbour Bridge, which fulfils the same role in roughly the same place. Any building at that location which wasn’t a box would’ve done the trick.

    Melbourne’s a different place. Different climate, different geography, different self-conception. Melbourne gets by on more cultural icons: like trams, but also graffiti and the Melbourne International Comedy Festival. So if the Opera House had’ve been built in Melbourne, it would just have been the Arts Centre Spire.

    There’s also a difference in their position in the world’s eye. Sydney is used as an icon of Australia; Melbourne (despite being almost the same size) is just a city in Australia. (Many of my European friends describe it as “the best” or “the most European”, but I’ve never found anyone who thinks its iconic of Australia.)

    As for a high speed train line between Melbourne and Sydney, it would be a complete waste of money. I hate to commute by car and live overseas partially so that I don’t have to, but I hope we don’t put in high speed rail like that. Long rail lines only work in Europe because they link lots of places. Maybe if we could promote almost unheard of regional growth we could justify, say, a Sydney-Canberra HSR line and a Melbourne-Albury one, and then just fill in the missing link.

  7. rohan says:

    Visionary Landmark ? That’s partly what Federation Sq was supposed to be. Like the opera house, it was a controversial decision chosen by competition, it went way over budget, the design changed as it went along, and was even altered by a change of govt.

    But while people use it a lot, it doesnt lend itself to postcard images, nor is the design universally liked, so still no “opera house” for Melbourne ! Probably best that way. Prefer the trams as an icon really.

  8. […] iconic as the Opera House, Bilbao or the Guggenheim, but the odds on that are astronomical. No one really understands why a handful of buildings become international symbols, but the fact is millions […]


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s