The paradox still applies when we consider the Tokyo rail network. There's lots of rail in Tokyo - it transports most of the commuters. Major lines are quite literally packed during rush hour. [0] Adding more rail will make the system even more popular, so the problem won't get better.
OTOH consider congestion charges. When interviewed[1], individuals do not believe they were significantly affected by the introduction of a charge, even though overall traffic levels go down substantially, by one fifth in the example used of Stockholm.
What we are changing when we change capacities is not speed or comfort, but a preference for what kind of congestion we get and how cheaply it will be filled. If our only goal is congestion reduction we should not be looking at the roads at all.
The San Francisco area has plenty of car traffic, but more recently, within the past decade or so, the public transit has become extremely popular. This is not because the transit has gotten substantially better by quality or speed metrics. It is because the population is making more trips and longer ones, and the public transit systems were the last resort for capacity. Demand for new trips is in turn caused by available housing being located distantly from workplaces. If newcomers were able to live where they worked, congestion would drop significantly.
[0] https://www.youtube.com/watch?v=pRBLnth4oSg [1] https://www.youtube.com/watch?v=wC33HAq--x8