5 ms·

Isn't this how any government project works? IT, construction, etc. Sees like the government is terrible at building anything, especially when contractors are

Isn't this how any government project works? IT, construction, etc. Sees like the government is terrible at building anything, especially when contractors are used to do the job. Probably why the government is so big and expense. I can only imagine what that $600+ billion gets us for the military. -_- http://en.wikipedia.org/wiki/Military_budget_of_the_United_States http://en.wikipedia.org/wiki/Military_budget_of_the_United_S...

deleted 13y ago
[deleted]
iskander 13y ago
> Sees like the government is terrible at building anything, especially when contractors are used to do the job. Strange to contrast that with a tremendously active and efficient era of public works from the 1890s through the 1950s. Just thinking of New York City, I suspect that the total cost of all the bridges, tunnels and highways (adjusted for inflation) might add up to a lot less than the 800 billion USD that disappeared into our recent stimulus bill. What changed? edit: Apparently the Brooklyn Bridge cost ~15 million USD to originally construct, which now would be somewhere between 300 million to 400 million USD (http://historical.whatitcosts.com/facts-brooklyn-bridge.htm http://historical.whatitcosts.com/facts-brooklyn-bridge.htm). Even though these are rough figures and inflation over large time horizons isn't a perfect measure, I'm still astounded. The government's totally broken healthcare website cost more to build than the Brooklyn Bridge.
- Jtsummers 13y ago
  The relationship between government and business, the much more short term approach to making money for businesses and individuals, a loss of the concept of "public good" or "common good".
  - jerf 13y ago
    I'm sorry, I don't really see how any of those explain the government being granted money (in staggering quantities), then spending it, then having nothing. Are you implying that because businesses have a short-term approach to making money that therefore, the government is forced to give money to unproductive contractors? Are you saying that because "the people" don't have a concept of "public good" that when the government bids something out they can't help but use a bidding approach that virtually guarantees failure? Vague platitudes about society at large aren't crashing government projects. Society at large aren't really involved in them, after all. Something specific between the interaction of the government and the government-chosen contractors is probably the problem. In a way, you're probably proving far more than you mean, accidentally; if the problem really is "society at large", then there is no solution and these large projects can't work, and therefore the most effective thing the government could possibly do is stop trying and wasting money. (A project with a prerequisite of "change the larger culture's attitudes" is simply a guaranteed failure, after all.) I suspect that's not the point you're going for. You probably really want to be arguing for a much more local reason.
    - Jtsummers 13y ago
      Sorry, it wasn't really a thorough answer or intended as one. Bad oversight: whoever's managing the project, doesn't understand the project. Not just, "I don't know how to read <some language>" lack of understanding, but "I don't know the difference between a spec and code". They don't specify terms that keep contractors in line which allow projects to run years and millions or billions over budget. Most of these contract managers aren't engineers, they may have engineers on staff, but it's not uncommon for those engineers to be employees of the same contractor that receives the benefits of the contract. The system is both incompetent and corrupted. The companies receiving contracts that habitually run late and over budget are also some of the largest. Small contractors don't make it when this happens, but NG, Lockheed Martin, Boeing, they can survive the political fallout thanks to their clout. If the companies have no oversight, and no accountability internally because they have no real concern for the other stakeholders (ie, the people paying them, the citizens/taxpayers), and the desire to make high quarterly profits, they'll rig the game by rent seeking, rather than completing a project effeciently and effectively and moving on to the next one. See NG and the maintenance of the JointSTARS aircraft as one such example. A rushed, but militarily valuable, project that had no maintenance plan in place, ends up contracted out to a company that destroyed one of the (few) planes and received no real punishment for it. Thanks to the tenure-like nature of civil service, a large chunk of government employees are retired in place, new employees have no place to start (few positions opening), and those that get in have a terrible example in place and become retired in place after a handful of years themselves. They may start off dedicated to the job, and many do remain dedicated, but they are also frustrated by the processes involved and either quit or ride it out to retirement. And regarding the platitudes, if companies and citizens (and consequently many of the elected and appointed officials) see profit as motive, rather than the future of the country or the society, then they make decisions based on that altered morality. Decisions based on short-term profit may not be harmful to long-term objectives, but they often are or are neutral to such objectives. A modern works project on the scale of the construction of the interstate system would likely never see the light of day, and if it did it would be mismanaged so as to never achieve its objectives. Normally I type these up in emacs and copy them over, this is not a well formatted message, sorry about that.
  - rprospero 13y ago
    Ironically, a large amount of the waste comes from the effort to avoid waste. Weeks of development time have been spent dealing with how to keep our memory load under 1Gb, since that's how much RAM we have. Granted, 4GB of RAM would have been more than enough, but all that developer time saved the tax payer $20. On the reverse side, I've seen half a million spent on hardware for a project where the sys-admin was making $35k.
    - jpollock 13y ago
      If the hardware meant they could get rid of the sysadmin, it was probably a good deal. The loaded labour cost (salary plus facilities, insurance, redundancy payments, etc) is probably upwards of 200k per year. That means the hardware is cheaper.
  - mstromb 13y ago
    I'd also add changes (improvements, in my opinion) in labor and safety laws. I suppose that falls under "[changes in] the relationship between government and business" but I think it's worth calling out specifically.
- Spooky23 13y ago
  Lots of things changed, especially unions and labor costs. The guy who digs a subway or water tunnel in NYC today probably makes $250k, retires at 55, and makes $150k for the rest of his life. The guys who built the Brooklyn bridge were day laborers who made nothing and died young.
  - anologwintermut 13y ago
    I highly doubt construction works make 250k a year at least if you account for down time. RegardlessLabor costs don't explain massive cost over runs. If the amount of labor were accurately predicted, it would just inflate the cost, not over run those estimates.
    - Spooky23 13y ago
      Here's an article from 2006 that quotes $100k without overtime. http://articles.latimes.com/2006/jul/02/news/adna-sand2 http://articles.latimes.com/2006/jul/02/news/adna-sand2 The young guys probably make 125-160k, the old guys get overtime preference. IMO they deserve it -- it's a really dangerous job. In any large scale project, any issue cascades and costs a shit-ton of money. For government contracts in many states, you have stuff like "prevailing wage" (where the gov pays too much for labor), "project labor agreements" (where the gov agrees to employ X number of people), minority and women owned business quotas (a big pit of corruption). Also remember that governments are run by politicians, and politicians embrace magical thinking. Painting a rosy picture to get something approved and blowing huge money with no tangible result is a good way to raise capital in govt. (whoops, $X didn't do the trick, but to avoid wasting it, give me $X+Y)
  - Symmetry 13y ago
    And yet somehow France, which also has high wages and unions, is able to construct rail for 1/5 the price per mile as the US.
    - jacques_chester 13y ago
      France's rights of way were in no small part established by Napoleon simply building roads where he wanted them to go. The USA, like many countries, has rules about simply seizing land that are of the form "well, OK, if it's for a good cause, but you better pay for it".
- nostromo 13y ago
  Many people don't know that the New York Subway was built and run by private companies until 1940. http://en.wikipedia.org/wiki/Interborough_Rapid_Transit_Company http://en.wikipedia.org/wiki/Interborough_Rapid_Transit_Comp... http://en.wikipedia.org/wiki/Brooklyn%E2%80%93Manhattan_Transit_Corporation http://en.wikipedia.org/wiki/Brooklyn%E2%80%93Manhattan_Tran... Busses and ferries were private too: http://en.wikipedia.org/wiki/Fifth_Avenue_Coach_Company http://en.wikipedia.org/wiki/Fifth_Avenue_Coach_Company
  - iskander 13y ago
    Any idea why the street cars were scrapped?
- digikata 13y ago
  Personally, I suspect that modern management practices for large scale projects are more inefficient than ad-hoc practices of the day.
digikata 13y ago
The inefficiency is primarily due to the scale and customization of the projects, not that it's government per se. In any project of sufficient scale, 1) you very likely use contractors at some level 2) you will have to invest into some sort of oversight infrastructure 3) with that much money invested, you want a strongly guaranteed outcome, so you'll err on the side of reliability over cost efficiency (or pay for the cost of failure and rework in subsets of the project). I agree though that the mix of in-house expertise vs outside contractor effort does play a big part in the outcome. Look at Boeing's 777 vs 787 aircraft development for different sides of cost to use internal resources, vs leaning more heavily on external resources. The 787 with it's heavy use of subcontractors has had a much more difficult introduction. The government in general has been upping the contractor content in a lot of projects with the belief that more "competitive private contractor" content automatically means better efficiency. But, in truth, it's no silver bullet, often increasing costs if it's blindly applied - especially if you fall below some threshold of in-house expert judgement.
polemic 13y ago
I disagree that "government projects" are uniformly terribly executed between industries. I can't vouch for the American case, but New Zealand has a similar history of disastrous government-run IT projects - from a terrible teacher payroll system[1] to a police information system[2]. The IT community hear is desperately trying to stop the same mistake with a massive tax system overhaul[3]. Nevertheless, civil infrastructure projects appear to be very well executed. Recent major roading engineering projects like the Victoria motorway tunnel in Auckland were completed on time and under budget, for example. There has been an active discussion in this country about why the IT industry, in particular as manifested as major systems projects executed by foreign software companies, are such consistent clusterfucks. It's a big discussion and I won't go into many of the points raised here, but the issues is, IMHO, very much a "software industry" one, and not a "government" one. 1. http://en.wikipedia.org/wiki/Novopay http://en.wikipedia.org/wiki/Novopay 2. http://en.wikipedia.org/wiki/INCIS http://en.wikipedia.org/wiki/INCIS 3. http://www.stuff.co.nz/business/industries/9261063/Row-deepens-over-IRD-tender http://www.stuff.co.nz/business/industries/9261063/Row-deepe...
- eigenvector 13y ago
  Most first-world governments have a century or more of experience in proper administration and project management of construction contracts. Designing, estimating, awarding and administering nine or ten figure construction projects is extremely complex but by and large, we know how to do it properly. Construction management is a serious discipline that is studied by civil engineers. It helps that construction methods don't change very often. Software technologies can become obsolete in a matter of months. I wouldn't start calling IT procurement a failure compared to civil infrastructure until software engineering has matured to the point that civil engineering has.
- jacques_chester 13y ago
  Non-software projects can go horribly badly too. I live in Perth, Australia. Almost every civil project there is blowing out like a balloon. Opera houses, hospitals, fancy developments. All going over budget and schedule. I was in Toronto a few days ago. What's on the cover of the newspaper? A civil project. A subway station running way over cost and time. Industrial and civil megaprojects routinely go way off course. Bad project management is universal, good project management is hard, any project of any serious size will require owner-commissioner organisations to not be useless idiots.
acdha 13y ago
You're repeating Tyler Cowen's Libertarian Vice: http://marginalrevolution.com/marginalrevolution/2006/08/the_libertarian.html http://marginalrevolution.com/marginalrevolution/2006/08/the... Large projects fail or run over budget because of organizational failures: poor goals, lack of accountability, internal gridlock, etc. Nothing about that is specific to government – and if we wanted to change that in the United States we could reach the level of, say, Scandinavia if we were willing to make significant cultural changes.

deleted 13y ago

[deleted]

iskander 13y ago

> Sees like the government is terrible at building anything, especially when contractors are used to do the job. Strange to contrast that with a tremendously active and efficient era of public works from the 1890s through the 1950s. Just thinking of New York City, I suspect that the total cost of all the bridges, tunnels and highways (adjusted for inflation) might add up to a lot less than the 800 billion USD that disappeared into our recent stimulus bill. What changed? edit: Apparently the Brooklyn Bridge cost ~15 million USD to originally construct, which now would be somewhere between 300 million to 400 million USD (http://historical.whatitcosts.com/facts-brooklyn-bridge.htm http://historical.whatitcosts.com/facts-brooklyn-bridge.htm). Even though these are rough figures and inflation over large time horizons isn't a perfect measure, I'm still astounded. The government's totally broken healthcare website cost more to build than the Brooklyn Bridge.

Jtsummers 13y ago
The relationship between government and business, the much more short term approach to making money for businesses and individuals, a loss of the concept of "public good" or "common good".
- jerf 13y ago
  I'm sorry, I don't really see how any of those explain the government being granted money (in staggering quantities), then spending it, then having nothing. Are you implying that because businesses have a short-term approach to making money that therefore, the government is forced to give money to unproductive contractors? Are you saying that because "the people" don't have a concept of "public good" that when the government bids something out they can't help but use a bidding approach that virtually guarantees failure? Vague platitudes about society at large aren't crashing government projects. Society at large aren't really involved in them, after all. Something specific between the interaction of the government and the government-chosen contractors is probably the problem. In a way, you're probably proving far more than you mean, accidentally; if the problem really is "society at large", then there is no solution and these large projects can't work, and therefore the most effective thing the government could possibly do is stop trying and wasting money. (A project with a prerequisite of "change the larger culture's attitudes" is simply a guaranteed failure, after all.) I suspect that's not the point you're going for. You probably really want to be arguing for a much more local reason.
  - Jtsummers 13y ago
    Sorry, it wasn't really a thorough answer or intended as one. Bad oversight: whoever's managing the project, doesn't understand the project. Not just, "I don't know how to read <some language>" lack of understanding, but "I don't know the difference between a spec and code". They don't specify terms that keep contractors in line which allow projects to run years and millions or billions over budget. Most of these contract managers aren't engineers, they may have engineers on staff, but it's not uncommon for those engineers to be employees of the same contractor that receives the benefits of the contract. The system is both incompetent and corrupted. The companies receiving contracts that habitually run late and over budget are also some of the largest. Small contractors don't make it when this happens, but NG, Lockheed Martin, Boeing, they can survive the political fallout thanks to their clout. If the companies have no oversight, and no accountability internally because they have no real concern for the other stakeholders (ie, the people paying them, the citizens/taxpayers), and the desire to make high quarterly profits, they'll rig the game by rent seeking, rather than completing a project effeciently and effectively and moving on to the next one. See NG and the maintenance of the JointSTARS aircraft as one such example. A rushed, but militarily valuable, project that had no maintenance plan in place, ends up contracted out to a company that destroyed one of the (few) planes and received no real punishment for it. Thanks to the tenure-like nature of civil service, a large chunk of government employees are retired in place, new employees have no place to start (few positions opening), and those that get in have a terrible example in place and become retired in place after a handful of years themselves. They may start off dedicated to the job, and many do remain dedicated, but they are also frustrated by the processes involved and either quit or ride it out to retirement. And regarding the platitudes, if companies and citizens (and consequently many of the elected and appointed officials) see profit as motive, rather than the future of the country or the society, then they make decisions based on that altered morality. Decisions based on short-term profit may not be harmful to long-term objectives, but they often are or are neutral to such objectives. A modern works project on the scale of the construction of the interstate system would likely never see the light of day, and if it did it would be mismanaged so as to never achieve its objectives. Normally I type these up in emacs and copy them over, this is not a well formatted message, sorry about that.
- rprospero 13y ago
  Ironically, a large amount of the waste comes from the effort to avoid waste. Weeks of development time have been spent dealing with how to keep our memory load under 1Gb, since that's how much RAM we have. Granted, 4GB of RAM would have been more than enough, but all that developer time saved the tax payer $20. On the reverse side, I've seen half a million spent on hardware for a project where the sys-admin was making $35k.
  - jpollock 13y ago
    If the hardware meant they could get rid of the sysadmin, it was probably a good deal. The loaded labour cost (salary plus facilities, insurance, redundancy payments, etc) is probably upwards of 200k per year. That means the hardware is cheaper.
- mstromb 13y ago
  I'd also add changes (improvements, in my opinion) in labor and safety laws. I suppose that falls under "[changes in] the relationship between government and business" but I think it's worth calling out specifically.
Spooky23 13y ago
Lots of things changed, especially unions and labor costs. The guy who digs a subway or water tunnel in NYC today probably makes $250k, retires at 55, and makes $150k for the rest of his life. The guys who built the Brooklyn bridge were day laborers who made nothing and died young.
- anologwintermut 13y ago
  I highly doubt construction works make 250k a year at least if you account for down time. RegardlessLabor costs don't explain massive cost over runs. If the amount of labor were accurately predicted, it would just inflate the cost, not over run those estimates.
  - Spooky23 13y ago
    Here's an article from 2006 that quotes $100k without overtime. http://articles.latimes.com/2006/jul/02/news/adna-sand2 http://articles.latimes.com/2006/jul/02/news/adna-sand2 The young guys probably make 125-160k, the old guys get overtime preference. IMO they deserve it -- it's a really dangerous job. In any large scale project, any issue cascades and costs a shit-ton of money. For government contracts in many states, you have stuff like "prevailing wage" (where the gov pays too much for labor), "project labor agreements" (where the gov agrees to employ X number of people), minority and women owned business quotas (a big pit of corruption). Also remember that governments are run by politicians, and politicians embrace magical thinking. Painting a rosy picture to get something approved and blowing huge money with no tangible result is a good way to raise capital in govt. (whoops, $X didn't do the trick, but to avoid wasting it, give me $X+Y)
- Symmetry 13y ago
  And yet somehow France, which also has high wages and unions, is able to construct rail for 1/5 the price per mile as the US.
  - jacques_chester 13y ago
    France's rights of way were in no small part established by Napoleon simply building roads where he wanted them to go. The USA, like many countries, has rules about simply seizing land that are of the form "well, OK, if it's for a good cause, but you better pay for it".
nostromo 13y ago
Many people don't know that the New York Subway was built and run by private companies until 1940. http://en.wikipedia.org/wiki/Interborough_Rapid_Transit_Company http://en.wikipedia.org/wiki/Interborough_Rapid_Transit_Comp... http://en.wikipedia.org/wiki/Brooklyn%E2%80%93Manhattan_Transit_Corporation http://en.wikipedia.org/wiki/Brooklyn%E2%80%93Manhattan_Tran... Busses and ferries were private too: http://en.wikipedia.org/wiki/Fifth_Avenue_Coach_Company http://en.wikipedia.org/wiki/Fifth_Avenue_Coach_Company
- iskander 13y ago
  Any idea why the street cars were scrapped?
digikata 13y ago
Personally, I suspect that modern management practices for large scale projects are more inefficient than ad-hoc practices of the day.

digikata 13y ago

The inefficiency is primarily due to the scale and customization of the projects, not that it's government per se. In any project of sufficient scale, 1) you very likely use contractors at some level 2) you will have to invest into some sort of oversight infrastructure 3) with that much money invested, you want a strongly guaranteed outcome, so you'll err on the side of reliability over cost efficiency (or pay for the cost of failure and rework in subsets of the project). I agree though that the mix of in-house expertise vs outside contractor effort does play a big part in the outcome. Look at Boeing's 777 vs 787 aircraft development for different sides of cost to use internal resources, vs leaning more heavily on external resources. The 787 with it's heavy use of subcontractors has had a much more difficult introduction. The government in general has been upping the contractor content in a lot of projects with the belief that more "competitive private contractor" content automatically means better efficiency. But, in truth, it's no silver bullet, often increasing costs if it's blindly applied - especially if you fall below some threshold of in-house expert judgement.

polemic 13y ago

I disagree that "government projects" are uniformly terribly executed between industries. I can't vouch for the American case, but New Zealand has a similar history of disastrous government-run IT projects - from a terrible teacher payroll system[1] to a police information system[2]. The IT community hear is desperately trying to stop the same mistake with a massive tax system overhaul[3]. Nevertheless, civil infrastructure projects appear to be very well executed. Recent major roading engineering projects like the Victoria motorway tunnel in Auckland were completed on time and under budget, for example. There has been an active discussion in this country about why the IT industry, in particular as manifested as major systems projects executed by foreign software companies, are such consistent clusterfucks. It's a big discussion and I won't go into many of the points raised here, but the issues is, IMHO, very much a "software industry" one, and not a "government" one. 1. http://en.wikipedia.org/wiki/Novopay http://en.wikipedia.org/wiki/Novopay 2. http://en.wikipedia.org/wiki/INCIS http://en.wikipedia.org/wiki/INCIS 3. http://www.stuff.co.nz/business/industries/9261063/Row-deepens-over-IRD-tender http://www.stuff.co.nz/business/industries/9261063/Row-deepe...

eigenvector 13y ago
Most first-world governments have a century or more of experience in proper administration and project management of construction contracts. Designing, estimating, awarding and administering nine or ten figure construction projects is extremely complex but by and large, we know how to do it properly. Construction management is a serious discipline that is studied by civil engineers. It helps that construction methods don't change very often. Software technologies can become obsolete in a matter of months. I wouldn't start calling IT procurement a failure compared to civil infrastructure until software engineering has matured to the point that civil engineering has.
jacques_chester 13y ago
Non-software projects can go horribly badly too. I live in Perth, Australia. Almost every civil project there is blowing out like a balloon. Opera houses, hospitals, fancy developments. All going over budget and schedule. I was in Toronto a few days ago. What's on the cover of the newspaper? A civil project. A subway station running way over cost and time. Industrial and civil megaprojects routinely go way off course. Bad project management is universal, good project management is hard, any project of any serious size will require owner-commissioner organisations to not be useless idiots.

acdha 13y ago

You're repeating Tyler Cowen's Libertarian Vice: http://marginalrevolution.com/marginalrevolution/2006/08/the_libertarian.html http://marginalrevolution.com/marginalrevolution/2006/08/the... Large projects fail or run over budget because of organizational failures: poor goals, lack of accountability, internal gridlock, etc. Nothing about that is specific to government – and if we wanted to change that in the United States we could reach the level of, say, Scandinavia if we were willing to make significant cultural changes.