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by sofard 1660 days ago
I was a management consultant ages ago and worked on large capital projects. In my experience (as the article mentions) it was a mix of:

1. Red tape & public "input" 2. Layers of contractors and subcontractors, each taking their slice 3. No real incentives for governments to be cost sensitive. Usually capital projects last well into the next administration. 4. Too many cooks in the kitchen and consultations

5 comments

Yeah my first reaction to this was "Oh it's going to be the public". Because the US has strong rights and legal system basically anyone can come along and considerably screw up a project just by claiming some endangered bat is living in the path of it, or some economic harm will be done, or some community will be damaged, it's far easier to just to just stick planning notice on display in the bottom of a locked filing cabinet stuck in a disused lavatory with a sign on the door saying 'Beware of the Leopard.'

A great example of this is in the UK where the main road going east to west from london to cornwall is a single carriage way with 2 lanes going past one of the country's most historic sites (stone henge). It's a fucking disaster. So the plan is to build a massive tunnel under stone henge to help traffic and remove the blotch on this area of historic importance. It's expected to cost £1.7Bn but it's already been completely tied up in legal fights, it was proposed over 25 years ago (when it was already desparately needed). Essentially plenty of people either don't want it built at all (presumably just accepting that we'll never ever be able to have economic in england west of stonehenge) or they want a tunnel that is several times longer than the proposal sending costs and construction time soaring.

What you could do, if you were Turkey, you could just built a 12 lane motorway and shove stonehenge a few miles north. It'd be cheaper.

Stonehenge isn’t that big. I don’t know what the surrounding area is like, but isn’t it an option to build the road around it? With compulsory purchases of properties along the way, if necessary.
I've had the same thought.

I confess to not having closely followed the issue, but every time I see it mentioned, my brain twitches. Is the choice between A) large construction project that overlaps with a site of immense historical and cultural significance, and B) spend the money for a couple extra miles of freeway, seems to be a very obvious one. The only reason I can see for B is a sort of aggressive anti-humanism.

These are all things, but they're things in other countries, too. France has strong unions and subcontractors and bureaucrats and all of that. And yet it costs less there.
> 1. Red tape & public "input"

> [...] and bureaucrats and all of that.

On a recent episode of the Ezra Klein show, Jerusalem Demsas argued that part of the problem is that the bureaucrats in the US are too constrained in their powers, so e.g. when weighing an infrastructure project against wildlife protection laws, it's not a bureaucratic organisation making a final decision on how to proceed with minimal impact, but it's private organised interest groups litigating without any limits on re-litigation, and a ruling that does not necessarily weigh the public interest of having projects proceeding towards completion.

I don't do podcasts, but I read that that was a really good one, and everything she writes about housing is fantastic.

https://www.vox.com/authors/jerusalem-demsas

I think it was this article that's most relevant? https://www.vox.com/22534714/rail-roads-infrastructure-costs...
I think it's a mistake to think of european unions and american unions as "the same thing". Relationships with unions in the US seem much more adversarial than there, on average.

As you say, there are politics, labor relations, etc. in europe too - I wonder if they are just better at cooperating on this sort of project for some reason?

US unions are that way as a consequence of racism. No, really. There was a US union that wasn’t doing its duty to represent African-American members. So it goes all the way to the USSC and the gist is that unions have to represent every member or be decertified.

In contrast, in a country like Germany, the union and management can agree that Hans is a fuckup and it’s in everyone’s best interest that he finds a new job.

> Relationships with unions in the US seem much more adversarial than there, on average.

Depends. You have "red" unions, which tend to be more aggressive, have revolutionary ideologies, and see bosses as enemies to perpetually keep at bay.

Then "yellow" unions tend to be more centrist, conciliatory and, arguably, somewhat toothless.

Which kind of union is more present varies from sector to sector.

But in any case, if you've ever seen a CGT propaganda poster, you'll never be under any impression that these guys are feeling "cooperative" with management / the government.

I think that's what makes it interesting and important to figure out on a deeper level. Simplistic answers don't seem to explain the problem.
> Relationships with unions in the US seem much more adversarial than there, on average.

Which is a function of relationships between employers and employees being more adversarial in the US.

What? This could only be so naively said by someone who has never lived in a heavily prop labor socialist country like France. Les grèves are terribly adversarial and a near constant aspect of labor negotiations.

The only way they could be considered better, in the way you imply, is that the unions are considered something to negotiate with instead of something to destroy.

Defeat, not destroy. Unions aren't destroyed in the US today and they're not sought out to be destroyed, no large government agencies or corporation is hunting them. In the Jimmy Hoffa days certainly there were some powerful people inside and outside of government that wanted the Teamsters destroyed.

The corporations aim to defeat them in the sense of keeping them voted down / out of the operations. John Deere for example recently came back with a rather lame offer for wage increases, the union went on strike, Deere capitulated and gave them a more fair wage hike, the union accepted; Deere didn't attempt to destroy the union.

Kellogs and their union haven't been able to agree to terms. Kellogs didn't attempt to destroy the union, they didn't send assassins or thugs to kill or rough up the union leadership. They replaced the union members with temporary labor and resumed limited operations. And that's entirely fair, the union can strike and refuse to work, the company can replace them.

Amazon didn't destroy the union in Alabama, that battle will continue; Amazon - at least temporarily - defeated them.

France is known for its aggressive unions, but aren't Germany and the Nordics known for more cooperative labor relations?
Germany is more cooperative yes. But their "workers council" concept is very strict. We've had several times we couldn't implement a global change in the multinational I work for because some workers council in a 10-man office in some German village didn't agree.

In Holland we used to have good union representation that really worked together with government and employers. The "polder model" it was called. However since we've had many neoliberal governments this concept has been hollowed out and the unions are now run as companies by the same kind of people so they no longer really represent the workers. They're just corporate puppets now. It's gone completely the other way from France or Germany. When it did work it was pretty good though. There was a decent balance between workers rights and efficiency and there was no need for many strikes.

French bureaucracy has the expertise in house to do high level planning rather than having a subcontractor do it. They're also a lot more insulated than US bureaucracies from the vagaries of political turnover. And they're more often dealing with laws written ahead of time rather than things that can't be decided without a court decision.
My broad impression is that in the EU and the US, a given project is a "meal" that all the interests involved will take a cut out of.

But in the EU or elsewhere, the "cut" the interests will take is just financial, the project will be designed for cost-efficiency by competent architects and engineers and it's just that the different interests will be paid off with money to make things happen.

In the US, the spread-out state and administrative structure results in a situation where each interest gets it's cut through its ability to make some small change or demand some particular process. A lot of this involves a lot of adversarial relations, some of them intended to stop corruption but which actually result inefficiency and corruption (complex bidding processes legal repercussions for failure to adhere to bid etc. etc.).

California spending $3 billion planning ("planning") a high speed rail system is good example. A lot of that involved buying land whose value had inflated.

I have seen some public transportation work up close in the USA -- "me first" and competition between different teams ate up quite a bit of the (expensive) time.. lots of very competent, skilled people and also quite cynical and profit-seeking management. The actions of management were sometimes directly contradictory to recommendations by hard-working staff. Worse, management that tried to get things done quickly were pushed out by others who were better at looking good (or something else I dont know about).

The old expression "we have the worst system in the world, except for all the others" .. comes to mind

edit- I would like to point to NORESCO in particular as a sponge-like entity with a long history of failed, expensive projects and a long pipeline of new funding, based on what I saw with my own eyes.

The old expression "we have the worst system in the world, except for all the others" .. comes to mind

That's what (I think) Winston Churchill said about democracy (might be true there). But here, I think you can just say "we have the worst system". Period. The US has a variety of sectors (public works, health care, etc) which aren't just bad but fated to get worse and worse through both through the particular way US ruling interests deal with each other. Each solution introduces more pork interests since each solution follows the haphazard paradigm.

For example; I think Yimby ("yes in my back yard") proposals have aimed to facilitate development in at transit hubs, a worthy seeming cause. But since there's no California state transit plan, this approach has to define "transit hub" haphazardly - "there's currently a bus stop there". This allows those aiming to sink a development to do so by removing the bus stop. Or oppositely, allows someone to facilitate a development by adding an otherwise unneeded bus stop. I'm not sure if this approach was implemented but just proposal illustrates the inherent problem of trying to solve transfic/housing/development problems by tossing random legislation at them.

> That's what (I think) Winston Churchill said about democracy (might be true there).

As E.M. Forster put it (from memory, so I'm sure less well-worded than the original):

"So, two cheers for democracy—there's no occasion for three, two is quite enough."

> But here, I think you can just "we have the worst system". Period.

Yeah, our system's about as bad as it could possibly be and have held together this long, true. And our country's too disunited to ever fix that without breaking apart to do it.

> And our country's too disunited to ever fix that without breaking apart to do it.

A tribe that lacks a serious external threat often goes to war with itself.

I think in the case of US infrastructure spend it’s more like “we have the best system in the world, except for all the others”.
> "we have the worst system in the world, except for all the others" .. comes to mind

Wouldn't that imply the US system has better execution, not just higher costs?

I think in-sourcing management expertise to the public agencies would save a lot of money. Management consultants are expensive and their incentives are in conflict with public projects.
IMO #2 takes the cake (rest is all icing)
In my experience with construction projects, legal costs and liabilities take the cake. Once something is in court, there is zero telling how long and how much money it takes to resolve.
This is interesting from a foreign perspective. I still follow urban planning in Helsinki, Finland. Major public projects always face opposition and go to court, but it's not a big deal.

Because zoning plans and similar project plans are decisions made by public officials, all complaints about them go to the administrative court system. Administrative courts don't care about the substance of the argument. (That's for elected representatives.) They only determine if the officials followed all appropriate regulations and decisiomaking processes. Going to administrative court is cheap enough and fast enough that the costs and delays are usually included in the project plan.

Sometime the court overturns the decision, delaying or canceling the project. Sometimes their justifications are stupid and sometimes there are unintended consequences. Regardless, the system more or less works most of the time.

Sounds like a despotate, residents are fucked if one of the officials make a wrong decision.
I'm leaning towards #3. There just doesn't seem to be any real incentive for governments to look for cost savings, like it's all Monopoly money.
That's the case for other countries too but they still manage to do better
That seems like a political culture issue rather than something inherent to governments. If you really care about doing good in the world (isn't that the whole point of politics?) then you have a huge incentive to save on costs as any money saved can be put to good use elsewhere.