3 ms·

No, the problem would exist even if the bidding process was completely fair, because it still creates a situation where a long-standing project creates stable r

by advael 3y ago

No, the problem would exist even if the bidding process was completely fair, because it still creates a situation where a long-standing project creates stable returns for a company while decoupling the service it provides from both market forces and public accountability. It is the worst of both worlds: shielded from market forces by having its customer be the government, providing a government service shielded from public accountability by the corporate veil Yes, we should reduce corruption and break up existing entrenched players, but the core issue is in the structure of that kind of arrangement. I do also think that there's no good reason to have a "corporate veil" in the first place, but that's a broader problem

AnthonyMouse 3y ago
> it still creates a situation where a long-standing project creates stable returns for a company while decoupling the service it provides from both market forces and public accountability. But that's just a mechanism for the corruption. The contract for the design of something and its manufacture and maintenance should each be separate bids. Even each stage of the design should be a separate contract that could go to someone else. The government says "we need a design for a ship" and they put it out to firms who submit their proposals and then the government picks one and buys it outright. Then they say "we need a design for a propulsion system for this ship" and take bids again. If you need to modify the ship's design some to facilitate it, that's fine, because none have been built yet and the necessary change gets incorporated into the design before you put out contracts to build any of it. What you want is for each of the contracts to be as small as practicable, to maximize the number of potential bidders. None of this "single contract to design and build an entire fleet of ships and maintain them for 30 years" nonsense.
- advael 3y ago
  Yea, that does seem like a reasonable way to design less corrupt mechanisms for these processes, but I think the standard way piecemeal designs like that get rejected is by arguments to "efficiency" (Nevermind that efficiencies gained by bundling require some pretty strict discipline within a firm, mostly benefit the firm, and are easily dwarfed from the government's perspective by the inefficiencies taken on by the problem we're talking about)
  - AnthonyMouse 3y ago
    That's the "monopolies are efficient" argument. Look, see, they can amortize their fixed costs over so many more units if they have the whole market. Claims that you can increase the efficiency of a system by reducing competition should be met with the same level of skepticism as claims that you can violate of the second law of thermodynamics. But let's try one that should get their ears to perk up. Monopoly suppliers are systemic risk, which is a threat to national security.

by advael 3y ago

AnthonyMouse 3y ago

> it still creates a situation where a long-standing project creates stable returns for a company while decoupling the service it provides from both market forces and public accountability. But that's just a mechanism for the corruption. The contract for the design of something and its manufacture and maintenance should each be separate bids. Even each stage of the design should be a separate contract that could go to someone else. The government says "we need a design for a ship" and they put it out to firms who submit their proposals and then the government picks one and buys it outright. Then they say "we need a design for a propulsion system for this ship" and take bids again. If you need to modify the ship's design some to facilitate it, that's fine, because none have been built yet and the necessary change gets incorporated into the design before you put out contracts to build any of it. What you want is for each of the contracts to be as small as practicable, to maximize the number of potential bidders. None of this "single contract to design and build an entire fleet of ships and maintain them for 30 years" nonsense.

advael 3y ago
Yea, that does seem like a reasonable way to design less corrupt mechanisms for these processes, but I think the standard way piecemeal designs like that get rejected is by arguments to "efficiency" (Nevermind that efficiencies gained by bundling require some pretty strict discipline within a firm, mostly benefit the firm, and are easily dwarfed from the government's perspective by the inefficiencies taken on by the problem we're talking about)
- AnthonyMouse 3y ago
  That's the "monopolies are efficient" argument. Look, see, they can amortize their fixed costs over so many more units if they have the whole market. Claims that you can increase the efficiency of a system by reducing competition should be met with the same level of skepticism as claims that you can violate of the second law of thermodynamics. But let's try one that should get their ears to perk up. Monopoly suppliers are systemic risk, which is a threat to national security.