[ChuckFrank]

Politically, from my own personal experience, most infrastructure projects are sold to the public with a much lower price tag than what they know to be the actual costs, because people are incredibly price sensitive when approving important infrastructure projects.

What we need is a true accounting of the cost of things, and the political willingness to do them. This way we don't have to worry about politicians 'underbidding' their projects just to get enough popular support. It becomes a rigged game when that happens, where the public approves projects that everyone on the project side knows will costs several times that early estimate.

If we want the bridges and the tunnels and the shared transportation, sanitation, etc. We need to understand that these projects cost money, and we need to be able to have t true accounting of them, not one that is politically convenient.

Otherwise, we'll just have this, with 2x and 3x being common run ups, ad infinitum.

Good numbers, on all projects, would help us better allocate our future dollars. Big numbers shouldn't kill meaningful and worthwhile projects. Bad ideas should.

The Swiss seem to be able to do it.

https://en.wikipedia.org/wiki/Gotthard_Base_Tunnel

On time and on budget.

[sien]

Bent Flyvbjerg is an academic at Oxford who studied a large number of megaprojects costing 1Bn or more.

His conclusion was that 9/10 projects of this size run over budget, 9/10 run over time and 9/10 have benefits that are oversold.

Rail projects are particularly bad. The average traffic on them was 61% of that forecast and some are as low as 25%.

His homepage: http://www.sbs.ox.ac.uk/community/people/bent-flyvbjerg

An interview with him : http://www.econtalk.org/archives/2015/05/bent_flyvbjerg.html

One of his books that is very readable: http://www.amazon.com/Megaprojects-Risk-An-Anatomy-Ambition/...

This isn't to say that such projects should not be built, just that those selected should be the ones with the best realistic cost benefit, not those where the backers have made up the numbers most creatively.

[tfgg]

I've noticed during the HS2 high-speed rail arguments in the UK that one effect of giving more accurate costing up front (which the UK govt appears to have got better at recently) is that people will just double your numbers anyway, due to long-standing lack of trust. Despite the government giving a very generous £40bn cap on the project, opposition groups still quote £80bn as the final price.

Of course, no-one will actually know if the costing was accurate until it's finished. Does being accurate really pay off for a politician?

[adwf]

And then there are the people who will round that figure up. I've heard some Green campaigners calling it a £100bn project...

[andreasley]

The initial budget for the Gotthard Base Tunnel was CHF 8 billion; the actual costs are now up to about CHF 12 billion. So not exactly on budget either. :) The increased costs were because of geology (4.5%), changed requirements (6.3%), environmental enhancements (1.3%) and upgrades for rail technology and safety (8.5%).

[JoeAltmaier]

Hm, that adds up to ~20%; yet the project went 50% over. So the bulk of the overrun is ... something else?

Anyway, the point of these large project is, we will need them. We can build them easier now, than later as congestion and land prices go up even more. When calculating overruns, I'd like to compare the ultimate cost with, what would it cost if we hadn't? Congestion, choked commerce, slowed economic growth all cost something.

Sometimes you have to buckle down and actually build the brave new world. "Skate toward the puck" is how its sometimes called - build the thing we will need to be a functional, thriving society in 100 years.

[arethuza]

I'm not sure you can make many inferences from a single project - here in/near Edinburgh we had a terrible trams project (way over budget at about £1B, greatly reduced scope, years late) and a new bridge over the Forth that is under budget (now down to £1.4B) and going to open early.

I hope someone does a detailed comparison between the two projects!

[crdoconnor]

I suspect there's more than a little graft in that price tag as well.

[TeMPOraL]

I heard rumours once that graft is actually accounted for in price tags for big projects, just not labelled explicitly.