16 ms·

Why U.S. Infrastructure Costs So Much

145 points by mtviewdave 10y ago

kolapuriya 10y ago
I found Node.js a much simpler platform to use, mainly because there is no worrying about concurrency. Because of the asynchronicity of Node, don't you explicitly have to worry about concurrency issues? I understand that with callbacks you can make things essentially linear from an execution standpoint (per connection), but I guess I'm a little confused by this statement.
- gherkin0 10y ago
  Did you reply to the wrong post?
maxerickson 10y ago
I wonder how much of it goes back to the attitudes of decision makers. A theme of this essay[1] is that decisions makers will outright reject ideas they are uncomfortable with. So say someone believes that businesses in the aggregate will, say, do the right thing rather than mercilessly and rationally responding to maximize their benefit from a contract. It's going to potentially be difficult to convince that person that the structure of bidding and contracts is important. I agree that this is seemingly absurd and terrifying. [1] https://news.ycombinator.com/item?id=11577074 https://news.ycombinator.com/item?id=11577074
Symmetry 10y ago
Generally people buy more of things that cost less per unit and I expect this would apply to track miles just as much as it applies to , e.g., video games.
- saalweachter 10y ago
  It depends heavily on the product. Video games cost a certain amount to produce and then $0.25 to copy. A track requires a certain amount of iron or other raw materials; these raw materials are already being produced at scale. A certain amount of economy-of-scale can be gained on the track-specific overhead (amortize the cost of the track-factory, amortize the management/sales overhead) but there is a certain floor on the minimum cost for a unit of track, and that floor is much higher (relative to its base cost) than the cost of a video game.
  - Symmetry 10y ago
    All the facts you bring up are true but it doesn't make supply and demand less applicable to public works projects. Recently the Green Line Extension near me was partially abandoned because estimated costs to complete it had gone up from $2 billion to $3 billion. If the project had a reasonable (by international standards) price tag there's no way it would have been canceled even if the overrun had been 100%.
toast_coder 10y ago
It's not news, it's bloomberg.
- mancerayder 10y ago
  How is Bloomberg News not news? You don't trust it for some reason? This is HN, not your typical 'Simple unsubstantiated quip, nuff said' type site. How is it not news?
  - toast_coder 10y ago
    Oh Rly? How about this. First Bloomberg news is partially owned, and much run by Micheal Bloomberg a liberal politician. It's 'news' pieces are highly slanted with a liberal bias. It's nice that they have positioned itself as financial news, as opposed to being something like Slate, take a look inside your self, in how you would respond to a news article coming from "Trump News" in another universe and decide if you would be so critical so somebody making a disparaging comment about that. As for this particular article, it's first sentence makes the declaration that if you agree that more should be spent on infrastructure, your part of the "all right-thinking", which of course implies that to not think so is definitely "wrong-thinking". Great, glad we got this bit sorted out early. Then I get to hear the author talk about why he doesn't think unions are the problem. While he has a couple lines relating to why they might be a relationship there, he doesn't really think so because he will use the ending line in the paragraph to explain why that premise is wrong. Ya know, a simple debate tactic where I entertain your silly notion for a minute before leaving the audience hanging on all my reasons why that notion is false. I suppose it was low hanging fruit to simple knock Bloomberg like that, but in the quest to learn about the world you find quite a bit politically loaded junk, that it deserves to be called out, just like this piece. A respectable piece calling for more spending & greater efficiency in infrastructure spending should have spelled out how many hundred of billions of dollars are currently spent, what are the serious infrastructure problems effecting us today are, and what our realistic options are for prioritizing a getting more for our money. This piece is nothing more than a shallow reinforcement for a certain type of thinking regarding spending more government money and how unions are great. //that's how
jbob2000 10y ago
Well that was disappointing. I thought he was on to something regarding projects being difficult to complete because of the common law system. But nope, it's the unions! Please...
- sickbeard 10y ago
  This trend of clickbaity titles with no actual content needs to stop.
- SCAQTony 10y ago
  The author even back-peddled on the unions argument bringing up French unions as example. "...Others have argued that labor laws governing infrastructure projects drive up costs. Gordon and Schleicher are dubious of that as an explanation for why the U.S. has higher costs than other countries, though, because “American laws would have to be tougher than those in Europe, where trade unions are much more powerful. (France, anyone?)” ..."
  - gaius 10y ago
    The local culture makes French and German unions very different from US and UK unions. The former are wise enough not to kill the golden goose, the latter can't see any further than Christmas.
    - deleted 10y ago
      [deleted]
    - pessimizer 10y ago
      I don't know if that's as much culture as that the former are institutionalized and have a say in every step of the process, and the latter are fighting to exist at all.
    - yourapostasy 10y ago
      > ...the latter can't see any further than Christmas. My limited understanding of US unions was that the ones which augured companies into the ground had a toxic, dysfunctional, non-communicative relationship with company management. Even when the company management was sharing and showing them the books and the mathematical certainty of everything shutting down if changes weren't made, the unions thought the company management was pulling the wool over their eyes. So they decided to call what they felt was company management's bluff, and called it wrong. I've never felt comfortable with the narrative that these particular US unions were so short-sighted they would cut their noses off to spite their face; that doesn't fit the prior narrative of the enormous amount of diligent, persistent work it took to organize in the first place. I'm more inclined to believe the narrative that there was such an antagonistic, distrustful, hostile atmosphere in those meetings that union and company management were together as doomed as a Greek tragedy. Any US union history buffs out there care to clarify what the current thoughts are here on what really happened?
bluedino 10y ago
I'm always amazed when there's a story about road construction in the local news, and it costs like 1.5 million dollars to repave 4 blocks of some street..how is that possible? I had a friend have his average-sized driveway re-done with cement and it was like $60,000 which I thought was insane. Remove old cement, grade the dirt, pour new cement, smooth it out...and wait.
- jschwartzi 10y ago
  On a road they typically have an underlayment that has to be packed to withstand trucking. There are usually also new street lights, and sidewalks. In my area they plant trees either in the median or between the sidewalk and the road. When you factor in the cost of those changes, 1.5 million seems reasonable for roughly a mile of road.
- dhd415 10y ago
  Where was your friend located? I've had my 40'x20' driveway re-done (old one torn out and recycled and a new one formed and poured) for 1/10 of that price in Texas.
- hrktb 10y ago
  So from your friend's driveway to 4 blocks of streets it only costs 25 times more ? Taking into account that public roads are not just random cement but usually a special mix for durability, sound properties and water resistance, and then you have all the cables and tubes going under that might need to be taken care of when removing the current layer and putting back the new one. All of this has to be done on public property by qualified staff. Overall a 25x increase in cost seems pretty fair from an external point of view.
  - PantaloonFlames 10y ago
    > All of this has to be done on public property by qualified staff. With safety measures erected for the public, traffic direction, signaling, etc.
    - 10y ago
padobson 10y ago
I find it worrisome that the author starts from a place of advocating borrowing to support building more infrastructure. I was pleased, at least, to see that he seemed to believe that infrastructure funds needed to be invested prudently. I don't have a lot of faith in the levels of governments to choose the right projects. The infrastructure rot we're seeing right now seems to be a result of the fact that economic growth is not what it was when everything was built in the first place. I think it's clear the stuff that was built in the 50s, 60s, and 70s was not sustainable outside of 6% GDP growth, and what we need now is sustainable infrastructure initiatives, rather than trying to bandaid the stuff we can't afford anymore.
- mason240 10y ago
  We have more than enough tax revenue to fund maintenance and development of infrastructure. It's political prioritization issue, not a funding one.
- deleted 10y ago
  [deleted]
- jessriedel 10y ago
  The benefits for the infrastructure accrue to citizens in the future, so its sensible to borrow money (at the very low rates that the government can obtain) and pay for the benefits as they are enjoyed. If the additional cost of the interest makes the project not worthwhile, then this means the project shouldn't be undertaken, not that it should be paid for upfront.
  - padobson 10y ago
    Agreed. I won't discount the benefits of infrastructure now, pay later, so long as the infrastructure being built is economically maintainable later.
- justavoice 10y ago
  I think you bring up a good point: the growth of the 50s-70s was an atypical period, large swaths of Europe and Japan were recovering from the after-affects of WWII. That put the US in position to supply the world, and we did. That is no longer the case, and we need to scale our infrastructure expenditures to match our reduced growth.
PantaloonFlames 10y ago
If only we had more unions, and.... the unions seem to be presenting obstacles to getting projects done. Which is it?
- sageikosa 10y ago
  Neither. Collectivism of labor is a symptom of centralization of budgets. Large companies and large departments need large workforces.
  - randyrand 10y ago
    > Large companies and large departments need large workforces. yet, google, Apple, Facebook etc all have non-unionized employees. A large work force does not necessitate a union. What a silly argument to make.
    - sageikosa 10y ago
      I wasn't making the argument you are denigrating, any more than I'd make the assertion that clouds mean rain.
- deleted 10y ago
  [deleted]
saosebastiao 10y ago
This is a serious issue, and I think the author does a disservice to it by focusing on unions as the problem. At their very worst, they are only a problem for operations costs, which rarely explain why infrastructure doesn't get built. It is true that public service unions do have disproportionate political power, but they are also rarely the ones building the infrastructure, because construction is always up for bid by private contractors. And even if public unions were building these things, labor typically only accounts for 20-30% of construction costs, so they couldn't possibly account for much of the 2-5x increase in costs compared to Spain or France. The real issues at hand are bad planning, extravagant station designs, nominally-environmental NIMBY blockades, and plain old backwards procurement rules that affect all levels of US government. Alon Levy might claim that he doesn't know the answers, but I've been following his blog since he started it and it makes it pretty clear how those things contribute. Hell, the extravagance of the stations alone probably account for 30% of the difference in costs. Nobody seems to blink an eye at massive underground stations with huge art installations and expensive tile facades...yet they end up costing 10-20x more than basic stations that serve their purpose just fine. This is a severe problem for how much we build too. Those on the left like to blame blame conservatives for not wanting to build transit infrastructure, but one of the most conservative regions in the country serves as a counter-example: the Salt Lake Valley. Sure, SLC itself is slightly blue, but step outside the city itself by a mile and you're in some of the reddest land you'll find in the US. And yet those outlying conservative areas have been throwing their votes and money at UTA to build more and more. And if you look at what they're voting on, it starts to make sense. They are building a very low cost, utilitarian, at-grade light rail line. They are optimizing signal priority and grade protection so they can get about 90% of the speed that a subway would give. Their stations are nothing more than simple concrete platforms. Simply put, they are getting a ton of transit for their money. Compare that with Seattle, one of the most liberal cities in the US. We're likely going to see a new transit initiative soon, and it is going to be voted down just like every other transit initiative in Seattle since the 50s. It's gotten so bad than transit activists are worried that they won't even have majority support within Seattle city limits. Gee, maybe the fact that it is going to cost $50B and take 40 years to build has something to do with it. I'm fairly liberal and inclined to vote for transit in general, but I just can't justify paying hugely increased taxes for 40 years so I can finally have a subway stop in my neighborhood once I retire.
JumpCrisscross 10y ago
We just had a novel crane/derrick start-up in New York shut down by the reigning tower-crane union [1]. I also noticed, when I lived on West 49th Street, how street-paving frequency (e.g. paving a road right before putting in a water main then re-paving it right before installing Citi bikes then re-paving right before making a change to the water main...) ticked up in election years. [1] http://www.crainsnewyork.com/article/20160515/REAL_ESTATE/160519910/why-is-this-little-construction-crane-illegal-in-new-york-city http://www.crainsnewyork.com/article/20160515/REAL_ESTATE/16...
- whatok 10y ago
  Crain's story is tragic. Geez.
- stcredzero 10y ago
  how street-paving frequency (e.g. paving a road right before putting in a water main then re-paving it right before installing Citi bikes then re-paving right before making a change to the water main...) ticked up in election years Houston has the same problem. This is a form of corruption.
deleted 10y ago
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deleted 10y ago
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jcoffland 10y ago
> New York’s Metropolitan Transit Authority operates commuter trains that require higher staffing levels -- but as Smith wrote in another 2012 Bloomberg View piece, those higher staffing requirements are the result more of union rules than of necessity. This is also true for construction. Anyone who's seen construction in progress in the US knows that there are usually 5 guys standing around for every one working. Everyone one of them is getting health care, a pension and a decent salary if they are standing around or not. And they are getting the best health care and pensions of just about any group in the US.
- Shivetya 10y ago
  You want a true transit authority horror story go read up on Washington DCs. The unions are not their big issue though they do cost the TA a lot of time and money, its the money games that came about because of years if not decades of mismanagement by government appointees and officials. https://www.washingtonpost.com/local/trafficandcommuting/metro-sank-into-crisis-despite-decades-of-warnings/2016/04/24/1c4db91c-0736-11e6-a12f-ea5aed7958dc_story.html https://www.washingtonpost.com/local/trafficandcommuting/met... and its not just infrastructure. Canada privatized into a non profit entity their air traffic control to good success. We have the TSA running security in airports where if you want timely service it will cost you hours of time and nearly a hundred bucks for membership and even that is not guaranteed. The worst example of how government mismanages everything is sadly still not fixed, the VA There is just too much up front cost in government projects that weighs down the economy but the real danger is all the deferred costs from maintenance to pensions.
MicroBerto 10y ago
In general, we do make the worst deals. I know this place hates Trump, but that statement is not false. The major issue of having a business-driven economy is that the best (or most "tactical") businessmen are running businesses, not the government. As it stands right now, there is very little incentive for US government officials to run things efficiently. Whether they're promoted for incompetence, applauded for employing so many government employees, or getting paid by dirty contractors, it all leads towards the corrupt situation at hand. I don't know the solution, but true campaign finance reform, removing corporate money from politics, would be the best blanket to start with. Good luck with all that, though... Take a look at how Hong Kong's rail system operates, that's the best model I've seen.
- Bartweiss 10y ago
  There's also an argument that a mandate to select the lowest bid massively increases cost overruns, even when everyone in government is sincere and not corrupt. If you're selecting a crappy company that lied about their bid over a competent, accurate higher bidder, you tend to get massive cost overruns that outweigh the promised savings. Everything looks good up front ("we'll build a new railway for only $XXX,000,000!") but in practice it's a disaster.
  - MicroBerto 10y ago
    That falls under the category of "bad deals" too.
    - Bartweiss 10y ago
      It does, I don't disagree, but it seems worth separating "bad deals we actively picked" from "bad deals our laws forced us to make".
      - MicroBerto 10y ago
        Correct, and leads me back to my original point. Our nation's best minds are simply not in politics - they're in business, engineering, finance, or are retired. Anyone even suggesting that we take the lowest bid by default is unfit for office.
bradleyjg 10y ago
I don't have any love for NYC construction unions and their ridiculous work rules, but the fact that France -- France! where strikes shutting down the whole country is a national pastime -- does better means that can't be the number one answer. Similarly we can rule out corruption because even Chicago is a piker compared to Shanghai. I think both unions and corruption play a part but not of the first rank. The first candidate I'd propose for the top slot is diffusion of responsibility stemming from a US obsession with localism. An MTA project might well be paid for by: the federal government, NY state, NYC, and bonds to be paid back by a dedicated tax in 10 downstate counties. There are contracting rules imposed by each of those sources. And it is administered by the MTA board, a monstrosity with appointments from eight different sources. The buck stops nowhere. The second candidate is, paradoxically, the progressive era procurement rules designed to rein in corruption. They leave too little discretion. In a two sided competitive game, if one side is hampered in by slow changing inflexible rules the other side is going to dominate. That's exactly what happens. Government contractors play the system like a fiddle and there's little the government negotiators even when they are supremely competent and diligent can do about it.
- rtpg 10y ago
  I was talking to somebody about how education ends up being so expensive in the US, and I kind of feel like there are similar reasons. Subcontracting out work + massive federalism creates $200 textbooks. Now I know national textbooks are a bit much, but I would be interested in seeing a state completely co-opt the textbook creation process and produce some textbooks and learning material at cost. As for the budget distribution, this pretty much happens in other places too. My French school's expansion was half funded by the ministry of industry, some by the region, some by the national government... I think that's a side effect of how budgeting works.
  - random28345 10y ago
    > Subcontracting out work + massive federalism I think you meant massive anti-federalism. If we had a federal procurement system for math and english textbooks, after being put out for a nationwide bid, the per-unit cost would be about 10% over the cost of paper and printing. (the 10% premium is the bid adjustment for a women or minority owned business) Now $8 textbooks wouldn't save a lot of money compared to the national education budget, but it would be a good start. And do we really need regional variations in math textbooks?
zaroth 10y ago
Perhaps the NYC subway is a special case in the cost-per-kilometer club but how about something more run-of-the-mill like the MA green line extension [0] which is $2-$3B for 4.3 miles of above ground track? [1] They recently had to go back and try to slash the budget since the Fed and State have pledged $1B each and no more. Some of the reasons given for rthe explosion from $2N -> $3B were poor oversight over the bidding process [2]. To cut cost they scaled back the station designs (apparently people were complaining after some stations became little more than a platform without even shelter from the weather), kept some bridges they originally planned to replace, and shortened a walk/bike path. Nowhere in the news do I see anyone talking about labor rates, unions, health insurance / pension, or eminent domain issues causing the cost overruns. I've been on the board of a small condo (27 units) which did a major residing project a few years ago. The process of spec'ing, bidding, overseeing the construction was hugely involved for the huge for us but relatively tiny project. The contractor bids, which were against a very detailed 3rd party specification, had a huge spread. During the project there were significant work items which were outside the spec and ended up being negotiated to control costs. The takeaway for me is that these projects are insanely complicated and cities just don't have the expertise and dedication to tightly manage them and wring out the cost savings. The experts outmaneuver the municipality and we end up paying far too much. What's interesting about the Green Line Extension is the nature of the funding means the first $2B is almost like free funny money but every dollar thereafter is like spilling blood because it comes from the locals. So at least the funding structure is trying to impose some limits. And lo-and-behold if the choice is for a city to cough up the extra cash versus cutting costs, they cut the cost by 1/3rd. I think the biggest problem is cultural. The people overseeing the project are not spending every dollar like it's their own. If the cost isn't "real" to the people running the project, it completely changes how the project is run. Human nature. [0] - http://greenlineextension.eot.state.ma.us/docs_about.html http://greenlineextension.eot.state.ma.us/docs_about.html [1] - https://en.m.wikipedia.org/wiki/Green_Line_Extension https://en.m.wikipedia.org/wiki/Green_Line_Extension [2] - http://www.boston.com/news/local-news/2016/01/15/report-green-line-extension-budget-issues-brewed-long-before-crisis http://www.boston.com/news/local-news/2016/01/15/report-gree...
ChemicalWarfare 10y ago
With things like subway stations it's not easy to compare the cost because more 'extravagant' design will drive the cost up. Apples and apples type comparison would be comparing things like cost of building one mile of the highway. If you look at those figures they are very comparable with US having a slight edge over the EU - $6-10 mil per mile vs. €7-12 mil per km.
gvb 10y ago
We need a corollary to Betteridge's law: newspaper headlines that start with "Why..." do not answer the question.
transfire 10y ago
Trickle-down contracting -- the many guys on top rake in big $$$, while the guy on the bottom who actually builds the thing gets a few cents.
- betaby 10y ago
  This. Costs go x10 because of layers of subcontractors and machinery rentals up to the smallest screwdrivers.
exelius 10y ago
It's simple: there is so much money in our political system (and there always has been) that unless you're donating to a candidate / party machine, your pet projects don't get done. This means a lot of things that matter to average citizens like roads, schools, parks, etc. don't have anyone championing them -- unless there are investors who want to build up the area and want to externalize some of their costs. So they make a small investment in getting some friendly candidates elected to city council or smaller county positions to ensure the access to the various groups they need to lobby to get their projects approved. In return for this investment, they get 100x in public money. What it also means is that unless your project (or collective projects as often the case in gentrifying neighborhoods) promises a big return, it's not gonna get done. What's more is that so much of our infrastructure is so old and in such poor condition that it's often cheaper to just build new stuff in another area than it is to rip out what's already there and replace it. In Philadelphia where I live, large parts of our water and sewer infrastructure date back to the early 1800s.
baron816 10y ago
One thing people don't realize is that Union affiliation is actually still quite high in New York state--25%, and probably higher in the NYC area. New York YIMBY address the topic two years ago: http://newyorkyimby.com/2014/09/the-mta-wants-second-avenue-subway-downpayment-but-cant-tell-us-how-much-itll-cost.html http://newyorkyimby.com/2014/09/the-mta-wants-second-avenue-... In it, they cite union rules that require four times the necessary personnel on underground construction projects. They don't blame it all on unions, but I'm definitely in the camp that unions do much more harm than good.
- mikeyouse 10y ago
  It's hard to blame unions in the US for any substantial part of the cost when areas with much cheaper infrastructure costs have much stronger unions and equivalent salary levels.
  - baron816 10y ago
    My point is that New York HAS strong unions, especially for the MTA. And regardless of their salaries (which are higher than their European and Asian counterparts), they have to employ 4x more people to complete a similar job.
zeveb 10y ago
I think this is similar to the issue that Americans tend to pay relatively high taxes and get relatively little in return, compared to citizens of other countries. I don't know to what extent this is a result of a few folks gaming the system to their own advantage (e.g. by paying very little taxes on a lot), or to the fact that by and large America is responsible for the security and peace of the global (and hence other states need not spend as much on global issues), or to the extent that American civil service appears from the outside to be very much a handout to people who can't get honest employment, or to the extent that government contractors are experts in milking tax dollars, or what. It completely doesn't surprise me that we spend more on less infrastructure.
- ido 10y ago
  by and large America is responsible for the security and peace of the global A task it took on itself mostly unasked for and unappreciated by the rest of that globe.
  - vkou 10y ago
    America is largely responsible for the security and peace of American overseas interests.
    - TeMPOraL 10y ago
      And the big mess that is the Middle East.
      - leonroy 10y ago
        As a Brit I have to chime in to say we deserve at least some of the 'credit'...
        allendoerfer 10y ago
        As a German I have to thank luckily timed elections [0] and a chancellor Schröder, who I imagine could not believe his luck to get served both an upcoming war and an historic flooding [1] while campaigning. He thanked good, put on gumboots and a rainjacket, and won even though Germany was called the sick man of Europe [2] under his chancellorship. 3 years later his party lost so much support that he semi-lawfully dissolved the parliament, campaigned, made a huge comeback and had the balls to tell Merkel on live television on the evening of her victory, that his party will never collate with her and she will not become chancellor - legendary show [3]. Well, 11 years later Merkel is still chancellor, his party back-paddled many of his policies and is nearly dead (<20%). [0]: https://en.wikipedia.org/wiki/German_federal_election,_2002#Issues_and_campaign https://en.wikipedia.org/wiki/German_federal_election,_2002#... [1]: https://en.wikipedia.org/wiki/2002_European_floods#Germany https://en.wikipedia.org/wiki/2002_European_floods#Germany [2]: http://www.economist.com/node/209559 http://www.economist.com/node/209559 [3]: https://www.youtube.com/watch?v=IYs4CjWMkIM https://www.youtube.com/watch?v=IYs4CjWMkIM
JacobJans 10y ago
This article seems quite specific at first – but when you dig down, it is actually rather vague. For example, the author complains that his mother needs a license to bake food. What kind of license? What state? Maybe a food handlers license? These are incredibly common, and very easy to obtain. Maybe a business license? Again – most states are falling over themselves to make it easy to give you a business license. It's hard to tell exactly what is being argued against. Food safety is incredibly important – and food handler's licenses are easy to obtain. States need to collect taxes, that's the basic reason a business needs to get a license. Neither of these things are controversial. That's why I'm guessing the author of this article didn't go into specifics.
- zanny 10y ago
  > Neither of these things are controversial. I'll give plenty of controversy, because your point is fundamental to the runaway problem of licensing and certification in the US and elsewhere. You think it is just one (well, you list two) licenses, but then you find out you also need commercial permits for the building, you need permits for the imports of most of the ingredients, you need certification to serve certain kinds of foods (especially in many states alcohol), and by the end you do not have just two licenses you need to get, you can have dozens of them. And there is no established canonical way to find out which you need, because they vary not only by state but by municipality. And even if you somehow "ask" your regional better business bureau for all the licenses and certifications you need, if they get them wrong, you are still liable and at fault for not knowing. Food safety is incredibly important. If every distributor of food needs a license, the barrier to entry by its nature either must be insanely low or a huge amount of potential productivity lost to the licensing process. If the barrier to entry is low, violating such a license is painless and easy. It is a meme now that restaurants will only clean up the cockroaches the week of food and safety inspections in New York, and that applies everywhere. In the end, the only safeguard against unethical business behavior is an informed consumer. And those do not come from annual state inspections where the inspector is often bought off in the first place. They come from consumers having communication channels to better inform themselves and others about what is or is not trustworthy. We would have significantly higher standards of food safety if instead of state agencies doing it restaurants sought certification from highly respected private firms that do such inspections, because then the reputation of both inspector and restaurant on the line, and consumers can dynamically create or trust any number of inspectors to meet demand. Compare that to how well trusted the state is for just about anything by anyone, and consider which would be better, aside from the lovely side effect of there being no outdated over-saturated government bureaucracy around food inspections.
mschuster91 10y ago
It's not just the US that is expensive and riddled with cost explosions. This seems to be a failure of pretty much every political system - for example, Germany, where construction costs explode (BER, Stuttgart 21, Hamburg Opera House). The most common cause why costs have exploded is that, unlike "old times", where either the state itself has employed all kinds of construction planners and workers or awarded a specific company all construction projects in a given timeframe, now everything has to be available for bidding - usually the lowest bid recieves the contract. This, in turn, creates incentives (often lined with kickbacks for the responsible politicians!) for the construction companies to underestimate the bids and charging the government for each and every change to the contract, to cut corners and generally mismanage the projects. Also, in the EU, projects above a certain threshold have to be advertised in the entire EU - leading to projects with little to no "native" people employed on site, and regular language problems and misunderstandings due to different legal requirements in the EU states (e.g. training of the work force, different specifications - what may very well be an acceptable project under Polish regulations is totally unacceptable by German standards). Furthermore, regulatory oversight has been on a massive decline as competent people leave or don't even enter state service, so that too few people in government employment are available to properly assess and control construction process.
- sageikosa 10y ago
  Well, maybe Europe built itself with government projects, but apart from some dubious transcontinental rail lines, America's "original" heavy and light rail systems were built by combinations of corporate, municipal and state entities. Roads were municipal matters, heavy trucks were seldom seen as that channel grew in symbiosis with the Eisenhower Highway system. Heavy trucks drive the need for durable roads, and they just weren't the norm until the Fed subsidized the crap out of inter-city highways and regulated the rail (most predominantly: the Pennsylvania RR) until if collapsed. Light-rail had its own similar history with roads and busses (and the fight for "right-of-way" at street level).
  - mschuster91 10y ago
    Weren't the beginnings of cross-US rail lines laid back at a time where regulatory frameworks (esp. cross-county/state, and noise emission) weren't that strict as today? Also, back in the time it was customary to create stock companies where people bought shares to actually BUILD something of value? When was the last time that a stock company was founded to build long lasting infrastructure? Stock companies, these days, in my opinion focus WAY too much on creating short-term gains on the back of employees and unsuspecting investors...
excalibur 10y ago
Red tape.
scotty79 10y ago
Usually question "Why X is so expensive in US?" can be answered with "Because such and such for-profit entity wedged itself between buyer and a seller and siphoned so much money that can buy off politicians that in other circumstances would kick it out." I guess case with infrastructure is more complex.
redthrowaway 10y ago
I thought the reason NYC cost so much to build subways in was because it's all granite bedrock, which is expensive to tunnel through, and there's a ton of spottily-documented crap already down there.

145 points by mtviewdave 10y ago

I found Node.js a much simpler platform to use, mainly because there is no worrying about concurrency. Because of the asynchronicity of Node, don't you explicitly have to worry about concurrency issues? I understand that with callbacks you can make things essentially linear from an execution standpoint (per connection), but I guess I'm a little confused by this statement.

gherkin0 10y ago
Did you reply to the wrong post?

maxerickson 10y ago

I wonder how much of it goes back to the attitudes of decision makers. A theme of this essay[1] is that decisions makers will outright reject ideas they are uncomfortable with. So say someone believes that businesses in the aggregate will, say, do the right thing rather than mercilessly and rationally responding to maximize their benefit from a contract. It's going to potentially be difficult to convince that person that the structure of bidding and contracts is important. I agree that this is seemingly absurd and terrifying. [1] https://news.ycombinator.com/item?id=11577074 https://news.ycombinator.com/item?id=11577074

Symmetry 10y ago

Generally people buy more of things that cost less per unit and I expect this would apply to track miles just as much as it applies to , e.g., video games.

saalweachter 10y ago
It depends heavily on the product. Video games cost a certain amount to produce and then $0.25 to copy. A track requires a certain amount of iron or other raw materials; these raw materials are already being produced at scale. A certain amount of economy-of-scale can be gained on the track-specific overhead (amortize the cost of the track-factory, amortize the management/sales overhead) but there is a certain floor on the minimum cost for a unit of track, and that floor is much higher (relative to its base cost) than the cost of a video game.
- Symmetry 10y ago
  All the facts you bring up are true but it doesn't make supply and demand less applicable to public works projects. Recently the Green Line Extension near me was partially abandoned because estimated costs to complete it had gone up from $2 billion to $3 billion. If the project had a reasonable (by international standards) price tag there's no way it would have been canceled even if the overrun had been 100%.

toast_coder 10y ago

It's not news, it's bloomberg.

mancerayder 10y ago
How is Bloomberg News not news? You don't trust it for some reason? This is HN, not your typical 'Simple unsubstantiated quip, nuff said' type site. How is it not news?
- toast_coder 10y ago
  Oh Rly? How about this. First Bloomberg news is partially owned, and much run by Micheal Bloomberg a liberal politician. It's 'news' pieces are highly slanted with a liberal bias. It's nice that they have positioned itself as financial news, as opposed to being something like Slate, take a look inside your self, in how you would respond to a news article coming from "Trump News" in another universe and decide if you would be so critical so somebody making a disparaging comment about that. As for this particular article, it's first sentence makes the declaration that if you agree that more should be spent on infrastructure, your part of the "all right-thinking", which of course implies that to not think so is definitely "wrong-thinking". Great, glad we got this bit sorted out early. Then I get to hear the author talk about why he doesn't think unions are the problem. While he has a couple lines relating to why they might be a relationship there, he doesn't really think so because he will use the ending line in the paragraph to explain why that premise is wrong. Ya know, a simple debate tactic where I entertain your silly notion for a minute before leaving the audience hanging on all my reasons why that notion is false. I suppose it was low hanging fruit to simple knock Bloomberg like that, but in the quest to learn about the world you find quite a bit politically loaded junk, that it deserves to be called out, just like this piece. A respectable piece calling for more spending & greater efficiency in infrastructure spending should have spelled out how many hundred of billions of dollars are currently spent, what are the serious infrastructure problems effecting us today are, and what our realistic options are for prioritizing a getting more for our money. This piece is nothing more than a shallow reinforcement for a certain type of thinking regarding spending more government money and how unions are great. //that's how

jbob2000 10y ago

Well that was disappointing. I thought he was on to something regarding projects being difficult to complete because of the common law system. But nope, it's the unions! Please...

sickbeard 10y ago
This trend of clickbaity titles with no actual content needs to stop.
SCAQTony 10y ago
The author even back-peddled on the unions argument bringing up French unions as example. "...Others have argued that labor laws governing infrastructure projects drive up costs. Gordon and Schleicher are dubious of that as an explanation for why the U.S. has higher costs than other countries, though, because “American laws would have to be tougher than those in Europe, where trade unions are much more powerful. (France, anyone?)” ..."
- gaius 10y ago
  The local culture makes French and German unions very different from US and UK unions. The former are wise enough not to kill the golden goose, the latter can't see any further than Christmas.
  - deleted 10y ago
    [deleted]
  - pessimizer 10y ago
    I don't know if that's as much culture as that the former are institutionalized and have a say in every step of the process, and the latter are fighting to exist at all.
  - yourapostasy 10y ago
    > ...the latter can't see any further than Christmas. My limited understanding of US unions was that the ones which augured companies into the ground had a toxic, dysfunctional, non-communicative relationship with company management. Even when the company management was sharing and showing them the books and the mathematical certainty of everything shutting down if changes weren't made, the unions thought the company management was pulling the wool over their eyes. So they decided to call what they felt was company management's bluff, and called it wrong. I've never felt comfortable with the narrative that these particular US unions were so short-sighted they would cut their noses off to spite their face; that doesn't fit the prior narrative of the enormous amount of diligent, persistent work it took to organize in the first place. I'm more inclined to believe the narrative that there was such an antagonistic, distrustful, hostile atmosphere in those meetings that union and company management were together as doomed as a Greek tragedy. Any US union history buffs out there care to clarify what the current thoughts are here on what really happened?

bluedino 10y ago

I'm always amazed when there's a story about road construction in the local news, and it costs like 1.5 million dollars to repave 4 blocks of some street..how is that possible? I had a friend have his average-sized driveway re-done with cement and it was like $60,000 which I thought was insane. Remove old cement, grade the dirt, pour new cement, smooth it out...and wait.

jschwartzi 10y ago
On a road they typically have an underlayment that has to be packed to withstand trucking. There are usually also new street lights, and sidewalks. In my area they plant trees either in the median or between the sidewalk and the road. When you factor in the cost of those changes, 1.5 million seems reasonable for roughly a mile of road.
dhd415 10y ago
Where was your friend located? I've had my 40'x20' driveway re-done (old one torn out and recycled and a new one formed and poured) for 1/10 of that price in Texas.
hrktb 10y ago
So from your friend's driveway to 4 blocks of streets it only costs 25 times more ? Taking into account that public roads are not just random cement but usually a special mix for durability, sound properties and water resistance, and then you have all the cables and tubes going under that might need to be taken care of when removing the current layer and putting back the new one. All of this has to be done on public property by qualified staff. Overall a 25x increase in cost seems pretty fair from an external point of view.
- PantaloonFlames 10y ago
  > All of this has to be done on public property by qualified staff. With safety measures erected for the public, traffic direction, signaling, etc.
  - 10y ago

padobson 10y ago

I find it worrisome that the author starts from a place of advocating borrowing to support building more infrastructure. I was pleased, at least, to see that he seemed to believe that infrastructure funds needed to be invested prudently. I don't have a lot of faith in the levels of governments to choose the right projects. The infrastructure rot we're seeing right now seems to be a result of the fact that economic growth is not what it was when everything was built in the first place. I think it's clear the stuff that was built in the 50s, 60s, and 70s was not sustainable outside of 6% GDP growth, and what we need now is sustainable infrastructure initiatives, rather than trying to bandaid the stuff we can't afford anymore.

mason240 10y ago
We have more than enough tax revenue to fund maintenance and development of infrastructure. It's political prioritization issue, not a funding one.
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jessriedel 10y ago
The benefits for the infrastructure accrue to citizens in the future, so its sensible to borrow money (at the very low rates that the government can obtain) and pay for the benefits as they are enjoyed. If the additional cost of the interest makes the project not worthwhile, then this means the project shouldn't be undertaken, not that it should be paid for upfront.
- padobson 10y ago
  Agreed. I won't discount the benefits of infrastructure now, pay later, so long as the infrastructure being built is economically maintainable later.
justavoice 10y ago
I think you bring up a good point: the growth of the 50s-70s was an atypical period, large swaths of Europe and Japan were recovering from the after-affects of WWII. That put the US in position to supply the world, and we did. That is no longer the case, and we need to scale our infrastructure expenditures to match our reduced growth.

PantaloonFlames 10y ago

If only we had more unions, and.... the unions seem to be presenting obstacles to getting projects done. Which is it?

sageikosa 10y ago
Neither. Collectivism of labor is a symptom of centralization of budgets. Large companies and large departments need large workforces.
- randyrand 10y ago
  > Large companies and large departments need large workforces. yet, google, Apple, Facebook etc all have non-unionized employees. A large work force does not necessitate a union. What a silly argument to make.
  - sageikosa 10y ago
    I wasn't making the argument you are denigrating, any more than I'd make the assertion that clouds mean rain.
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saosebastiao 10y ago

This is a serious issue, and I think the author does a disservice to it by focusing on unions as the problem. At their very worst, they are only a problem for operations costs, which rarely explain why infrastructure doesn't get built. It is true that public service unions do have disproportionate political power, but they are also rarely the ones building the infrastructure, because construction is always up for bid by private contractors. And even if public unions were building these things, labor typically only accounts for 20-30% of construction costs, so they couldn't possibly account for much of the 2-5x increase in costs compared to Spain or France. The real issues at hand are bad planning, extravagant station designs, nominally-environmental NIMBY blockades, and plain old backwards procurement rules that affect all levels of US government. Alon Levy might claim that he doesn't know the answers, but I've been following his blog since he started it and it makes it pretty clear how those things contribute. Hell, the extravagance of the stations alone probably account for 30% of the difference in costs. Nobody seems to blink an eye at massive underground stations with huge art installations and expensive tile facades...yet they end up costing 10-20x more than basic stations that serve their purpose just fine. This is a severe problem for how much we build too. Those on the left like to blame blame conservatives for not wanting to build transit infrastructure, but one of the most conservative regions in the country serves as a counter-example: the Salt Lake Valley. Sure, SLC itself is slightly blue, but step outside the city itself by a mile and you're in some of the reddest land you'll find in the US. And yet those outlying conservative areas have been throwing their votes and money at UTA to build more and more. And if you look at what they're voting on, it starts to make sense. They are building a very low cost, utilitarian, at-grade light rail line. They are optimizing signal priority and grade protection so they can get about 90% of the speed that a subway would give. Their stations are nothing more than simple concrete platforms. Simply put, they are getting a ton of transit for their money. Compare that with Seattle, one of the most liberal cities in the US. We're likely going to see a new transit initiative soon, and it is going to be voted down just like every other transit initiative in Seattle since the 50s. It's gotten so bad than transit activists are worried that they won't even have majority support within Seattle city limits. Gee, maybe the fact that it is going to cost $50B and take 40 years to build has something to do with it. I'm fairly liberal and inclined to vote for transit in general, but I just can't justify paying hugely increased taxes for 40 years so I can finally have a subway stop in my neighborhood once I retire.

JumpCrisscross 10y ago

We just had a novel crane/derrick start-up in New York shut down by the reigning tower-crane union [1]. I also noticed, when I lived on West 49th Street, how street-paving frequency (e.g. paving a road right before putting in a water main then re-paving it right before installing Citi bikes then re-paving right before making a change to the water main...) ticked up in election years. [1] http://www.crainsnewyork.com/article/20160515/REAL_ESTATE/160519910/why-is-this-little-construction-crane-illegal-in-new-york-city http://www.crainsnewyork.com/article/20160515/REAL_ESTATE/16...

whatok 10y ago
Crain's story is tragic. Geez.
stcredzero 10y ago
how street-paving frequency (e.g. paving a road right before putting in a water main then re-paving it right before installing Citi bikes then re-paving right before making a change to the water main...) ticked up in election years Houston has the same problem. This is a form of corruption.

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jcoffland 10y ago

> New York’s Metropolitan Transit Authority operates commuter trains that require higher staffing levels -- but as Smith wrote in another 2012 Bloomberg View piece, those higher staffing requirements are the result more of union rules than of necessity. This is also true for construction. Anyone who's seen construction in progress in the US knows that there are usually 5 guys standing around for every one working. Everyone one of them is getting health care, a pension and a decent salary if they are standing around or not. And they are getting the best health care and pensions of just about any group in the US.

Shivetya 10y ago
You want a true transit authority horror story go read up on Washington DCs. The unions are not their big issue though they do cost the TA a lot of time and money, its the money games that came about because of years if not decades of mismanagement by government appointees and officials. https://www.washingtonpost.com/local/trafficandcommuting/metro-sank-into-crisis-despite-decades-of-warnings/2016/04/24/1c4db91c-0736-11e6-a12f-ea5aed7958dc_story.html https://www.washingtonpost.com/local/trafficandcommuting/met... and its not just infrastructure. Canada privatized into a non profit entity their air traffic control to good success. We have the TSA running security in airports where if you want timely service it will cost you hours of time and nearly a hundred bucks for membership and even that is not guaranteed. The worst example of how government mismanages everything is sadly still not fixed, the VA There is just too much up front cost in government projects that weighs down the economy but the real danger is all the deferred costs from maintenance to pensions.

MicroBerto 10y ago

In general, we do make the worst deals. I know this place hates Trump, but that statement is not false. The major issue of having a business-driven economy is that the best (or most "tactical") businessmen are running businesses, not the government. As it stands right now, there is very little incentive for US government officials to run things efficiently. Whether they're promoted for incompetence, applauded for employing so many government employees, or getting paid by dirty contractors, it all leads towards the corrupt situation at hand. I don't know the solution, but true campaign finance reform, removing corporate money from politics, would be the best blanket to start with. Good luck with all that, though... Take a look at how Hong Kong's rail system operates, that's the best model I've seen.

Bartweiss 10y ago
There's also an argument that a mandate to select the lowest bid massively increases cost overruns, even when everyone in government is sincere and not corrupt. If you're selecting a crappy company that lied about their bid over a competent, accurate higher bidder, you tend to get massive cost overruns that outweigh the promised savings. Everything looks good up front ("we'll build a new railway for only $XXX,000,000!") but in practice it's a disaster.
- MicroBerto 10y ago
  That falls under the category of "bad deals" too.
  - Bartweiss 10y ago
    It does, I don't disagree, but it seems worth separating "bad deals we actively picked" from "bad deals our laws forced us to make".
    - MicroBerto 10y ago
      Correct, and leads me back to my original point. Our nation's best minds are simply not in politics - they're in business, engineering, finance, or are retired. Anyone even suggesting that we take the lowest bid by default is unfit for office.

bradleyjg 10y ago

I don't have any love for NYC construction unions and their ridiculous work rules, but the fact that France -- France! where strikes shutting down the whole country is a national pastime -- does better means that can't be the number one answer. Similarly we can rule out corruption because even Chicago is a piker compared to Shanghai. I think both unions and corruption play a part but not of the first rank. The first candidate I'd propose for the top slot is diffusion of responsibility stemming from a US obsession with localism. An MTA project might well be paid for by: the federal government, NY state, NYC, and bonds to be paid back by a dedicated tax in 10 downstate counties. There are contracting rules imposed by each of those sources. And it is administered by the MTA board, a monstrosity with appointments from eight different sources. The buck stops nowhere. The second candidate is, paradoxically, the progressive era procurement rules designed to rein in corruption. They leave too little discretion. In a two sided competitive game, if one side is hampered in by slow changing inflexible rules the other side is going to dominate. That's exactly what happens. Government contractors play the system like a fiddle and there's little the government negotiators even when they are supremely competent and diligent can do about it.

rtpg 10y ago
I was talking to somebody about how education ends up being so expensive in the US, and I kind of feel like there are similar reasons. Subcontracting out work + massive federalism creates $200 textbooks. Now I know national textbooks are a bit much, but I would be interested in seeing a state completely co-opt the textbook creation process and produce some textbooks and learning material at cost. As for the budget distribution, this pretty much happens in other places too. My French school's expansion was half funded by the ministry of industry, some by the region, some by the national government... I think that's a side effect of how budgeting works.
- random28345 10y ago
  > Subcontracting out work + massive federalism I think you meant massive anti-federalism. If we had a federal procurement system for math and english textbooks, after being put out for a nationwide bid, the per-unit cost would be about 10% over the cost of paper and printing. (the 10% premium is the bid adjustment for a women or minority owned business) Now $8 textbooks wouldn't save a lot of money compared to the national education budget, but it would be a good start. And do we really need regional variations in math textbooks?

zaroth 10y ago

Perhaps the NYC subway is a special case in the cost-per-kilometer club but how about something more run-of-the-mill like the MA green line extension [0] which is $2-$3B for 4.3 miles of above ground track? [1] They recently had to go back and try to slash the budget since the Fed and State have pledged $1B each and no more. Some of the reasons given for rthe explosion from $2N -> $3B were poor oversight over the bidding process [2]. To cut cost they scaled back the station designs (apparently people were complaining after some stations became little more than a platform without even shelter from the weather), kept some bridges they originally planned to replace, and shortened a walk/bike path. Nowhere in the news do I see anyone talking about labor rates, unions, health insurance / pension, or eminent domain issues causing the cost overruns. I've been on the board of a small condo (27 units) which did a major residing project a few years ago. The process of spec'ing, bidding, overseeing the construction was hugely involved for the huge for us but relatively tiny project. The contractor bids, which were against a very detailed 3rd party specification, had a huge spread. During the project there were significant work items which were outside the spec and ended up being negotiated to control costs. The takeaway for me is that these projects are insanely complicated and cities just don't have the expertise and dedication to tightly manage them and wring out the cost savings. The experts outmaneuver the municipality and we end up paying far too much. What's interesting about the Green Line Extension is the nature of the funding means the first $2B is almost like free funny money but every dollar thereafter is like spilling blood because it comes from the locals. So at least the funding structure is trying to impose some limits. And lo-and-behold if the choice is for a city to cough up the extra cash versus cutting costs, they cut the cost by 1/3rd. I think the biggest problem is cultural. The people overseeing the project are not spending every dollar like it's their own. If the cost isn't "real" to the people running the project, it completely changes how the project is run. Human nature. [0] - http://greenlineextension.eot.state.ma.us/docs_about.html http://greenlineextension.eot.state.ma.us/docs_about.html [1] - https://en.m.wikipedia.org/wiki/Green_Line_Extension https://en.m.wikipedia.org/wiki/Green_Line_Extension [2] - http://www.boston.com/news/local-news/2016/01/15/report-green-line-extension-budget-issues-brewed-long-before-crisis http://www.boston.com/news/local-news/2016/01/15/report-gree...

ChemicalWarfare 10y ago

With things like subway stations it's not easy to compare the cost because more 'extravagant' design will drive the cost up. Apples and apples type comparison would be comparing things like cost of building one mile of the highway. If you look at those figures they are very comparable with US having a slight edge over the EU - $6-10 mil per mile vs. €7-12 mil per km.

gvb 10y ago

We need a corollary to Betteridge's law: newspaper headlines that start with "Why..." do not answer the question.

transfire 10y ago

Trickle-down contracting -- the many guys on top rake in big $$$, while the guy on the bottom who actually builds the thing gets a few cents.

betaby 10y ago
This. Costs go x10 because of layers of subcontractors and machinery rentals up to the smallest screwdrivers.

exelius 10y ago

It's simple: there is so much money in our political system (and there always has been) that unless you're donating to a candidate / party machine, your pet projects don't get done. This means a lot of things that matter to average citizens like roads, schools, parks, etc. don't have anyone championing them -- unless there are investors who want to build up the area and want to externalize some of their costs. So they make a small investment in getting some friendly candidates elected to city council or smaller county positions to ensure the access to the various groups they need to lobby to get their projects approved. In return for this investment, they get 100x in public money. What it also means is that unless your project (or collective projects as often the case in gentrifying neighborhoods) promises a big return, it's not gonna get done. What's more is that so much of our infrastructure is so old and in such poor condition that it's often cheaper to just build new stuff in another area than it is to rip out what's already there and replace it. In Philadelphia where I live, large parts of our water and sewer infrastructure date back to the early 1800s.

baron816 10y ago

One thing people don't realize is that Union affiliation is actually still quite high in New York state--25%, and probably higher in the NYC area. New York YIMBY address the topic two years ago: http://newyorkyimby.com/2014/09/the-mta-wants-second-avenue-subway-downpayment-but-cant-tell-us-how-much-itll-cost.html http://newyorkyimby.com/2014/09/the-mta-wants-second-avenue-... In it, they cite union rules that require four times the necessary personnel on underground construction projects. They don't blame it all on unions, but I'm definitely in the camp that unions do much more harm than good.

mikeyouse 10y ago
It's hard to blame unions in the US for any substantial part of the cost when areas with much cheaper infrastructure costs have much stronger unions and equivalent salary levels.
- baron816 10y ago
  My point is that New York HAS strong unions, especially for the MTA. And regardless of their salaries (which are higher than their European and Asian counterparts), they have to employ 4x more people to complete a similar job.

zeveb 10y ago

I think this is similar to the issue that Americans tend to pay relatively high taxes and get relatively little in return, compared to citizens of other countries. I don't know to what extent this is a result of a few folks gaming the system to their own advantage (e.g. by paying very little taxes on a lot), or to the fact that by and large America is responsible for the security and peace of the global (and hence other states need not spend as much on global issues), or to the extent that American civil service appears from the outside to be very much a handout to people who can't get honest employment, or to the extent that government contractors are experts in milking tax dollars, or what. It completely doesn't surprise me that we spend more on less infrastructure.

ido 10y ago
by and large America is responsible for the security and peace of the global A task it took on itself mostly unasked for and unappreciated by the rest of that globe.
- vkou 10y ago
  America is largely responsible for the security and peace of American overseas interests.
  - TeMPOraL 10y ago
    And the big mess that is the Middle East.
    - leonroy 10y ago
      As a Brit I have to chime in to say we deserve at least some of the 'credit'...
      - allendoerfer 10y ago
        As a German I have to thank luckily timed elections [0] and a chancellor Schröder, who I imagine could not believe his luck to get served both an upcoming war and an historic flooding [1] while campaigning. He thanked good, put on gumboots and a rainjacket, and won even though Germany was called the sick man of Europe [2] under his chancellorship. 3 years later his party lost so much support that he semi-lawfully dissolved the parliament, campaigned, made a huge comeback and had the balls to tell Merkel on live television on the evening of her victory, that his party will never collate with her and she will not become chancellor - legendary show [3]. Well, 11 years later Merkel is still chancellor, his party back-paddled many of his policies and is nearly dead (<20%). [0]: https://en.wikipedia.org/wiki/German_federal_election,_2002#Issues_and_campaign https://en.wikipedia.org/wiki/German_federal_election,_2002#... [1]: https://en.wikipedia.org/wiki/2002_European_floods#Germany https://en.wikipedia.org/wiki/2002_European_floods#Germany [2]: http://www.economist.com/node/209559 http://www.economist.com/node/209559 [3]: https://www.youtube.com/watch?v=IYs4CjWMkIM https://www.youtube.com/watch?v=IYs4CjWMkIM

JacobJans 10y ago

This article seems quite specific at first – but when you dig down, it is actually rather vague. For example, the author complains that his mother needs a license to bake food. What kind of license? What state? Maybe a food handlers license? These are incredibly common, and very easy to obtain. Maybe a business license? Again – most states are falling over themselves to make it easy to give you a business license. It's hard to tell exactly what is being argued against. Food safety is incredibly important – and food handler's licenses are easy to obtain. States need to collect taxes, that's the basic reason a business needs to get a license. Neither of these things are controversial. That's why I'm guessing the author of this article didn't go into specifics.

zanny 10y ago
> Neither of these things are controversial. I'll give plenty of controversy, because your point is fundamental to the runaway problem of licensing and certification in the US and elsewhere. You think it is just one (well, you list two) licenses, but then you find out you also need commercial permits for the building, you need permits for the imports of most of the ingredients, you need certification to serve certain kinds of foods (especially in many states alcohol), and by the end you do not have just two licenses you need to get, you can have dozens of them. And there is no established canonical way to find out which you need, because they vary not only by state but by municipality. And even if you somehow "ask" your regional better business bureau for all the licenses and certifications you need, if they get them wrong, you are still liable and at fault for not knowing. Food safety is incredibly important. If every distributor of food needs a license, the barrier to entry by its nature either must be insanely low or a huge amount of potential productivity lost to the licensing process. If the barrier to entry is low, violating such a license is painless and easy. It is a meme now that restaurants will only clean up the cockroaches the week of food and safety inspections in New York, and that applies everywhere. In the end, the only safeguard against unethical business behavior is an informed consumer. And those do not come from annual state inspections where the inspector is often bought off in the first place. They come from consumers having communication channels to better inform themselves and others about what is or is not trustworthy. We would have significantly higher standards of food safety if instead of state agencies doing it restaurants sought certification from highly respected private firms that do such inspections, because then the reputation of both inspector and restaurant on the line, and consumers can dynamically create or trust any number of inspectors to meet demand. Compare that to how well trusted the state is for just about anything by anyone, and consider which would be better, aside from the lovely side effect of there being no outdated over-saturated government bureaucracy around food inspections.

mschuster91 10y ago

It's not just the US that is expensive and riddled with cost explosions. This seems to be a failure of pretty much every political system - for example, Germany, where construction costs explode (BER, Stuttgart 21, Hamburg Opera House). The most common cause why costs have exploded is that, unlike "old times", where either the state itself has employed all kinds of construction planners and workers or awarded a specific company all construction projects in a given timeframe, now everything has to be available for bidding - usually the lowest bid recieves the contract. This, in turn, creates incentives (often lined with kickbacks for the responsible politicians!) for the construction companies to underestimate the bids and charging the government for each and every change to the contract, to cut corners and generally mismanage the projects. Also, in the EU, projects above a certain threshold have to be advertised in the entire EU - leading to projects with little to no "native" people employed on site, and regular language problems and misunderstandings due to different legal requirements in the EU states (e.g. training of the work force, different specifications - what may very well be an acceptable project under Polish regulations is totally unacceptable by German standards). Furthermore, regulatory oversight has been on a massive decline as competent people leave or don't even enter state service, so that too few people in government employment are available to properly assess and control construction process.

sageikosa 10y ago
Well, maybe Europe built itself with government projects, but apart from some dubious transcontinental rail lines, America's "original" heavy and light rail systems were built by combinations of corporate, municipal and state entities. Roads were municipal matters, heavy trucks were seldom seen as that channel grew in symbiosis with the Eisenhower Highway system. Heavy trucks drive the need for durable roads, and they just weren't the norm until the Fed subsidized the crap out of inter-city highways and regulated the rail (most predominantly: the Pennsylvania RR) until if collapsed. Light-rail had its own similar history with roads and busses (and the fight for "right-of-way" at street level).
- mschuster91 10y ago
  Weren't the beginnings of cross-US rail lines laid back at a time where regulatory frameworks (esp. cross-county/state, and noise emission) weren't that strict as today? Also, back in the time it was customary to create stock companies where people bought shares to actually BUILD something of value? When was the last time that a stock company was founded to build long lasting infrastructure? Stock companies, these days, in my opinion focus WAY too much on creating short-term gains on the back of employees and unsuspecting investors...

excalibur 10y ago

Red tape.

scotty79 10y ago

Usually question "Why X is so expensive in US?" can be answered with "Because such and such for-profit entity wedged itself between buyer and a seller and siphoned so much money that can buy off politicians that in other circumstances would kick it out." I guess case with infrastructure is more complex.

redthrowaway 10y ago

I thought the reason NYC cost so much to build subways in was because it's all granite bedrock, which is expensive to tunnel through, and there's a ton of spottily-documented crap already down there.