History
The term Kokuyū Tetsudō "state-owned railway" originally referred to a network of railway lines operated by nationalized companies under the control of the Railway Institute following the nationalization in 1906 and 1907. Later, the Ministry of Railways and the Ministry of Transportation and Communications took over control of the network. The ministries used the name Japanese Government Railways (JGR) to refer their network in English. During World War II, many JGR lines were dismantled to supply steel for the war effort.
In 1949, JGR was reorganized into JNR, a state-owned public corporation by a directive of the U.S. General HQ in Tokyo. JNR enjoyed many successes, including the 1964 inauguration of high-speed Shinkansen service. However, JNR was not a state-run corporation; its accounting was independent from the national budget. Rural sections without enough passengers began to press its management, pulling it further and further into debt.
By 1987, JNR's debt was over ¥27 trillion ($280 billion at 2009 exchange rates) and the company was spending ¥147 for every ¥100 earned. By an act of the Diet of Japan, on April 1, 1987 JNR was privatized and divided into seven (= six passenger and one freight) railroad companies. They have been collectively called the Japan Railways Group (JR Group). Long-term liabilities of JNR were taken over by the JNR Settlement Corporation (disbanded in 1998), and the corporation's remaining debts were transferred to the national budget's general accounting.
See also: History of rail transport in Japan and Japanese Government RailwaysRead more about this topic: Japanese National Railways
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