Thursday, October 14, 2010
This But Not That
In a recent article David Brooks asks "Why are important projects now unaffordable?". In large part, Brooks lays the blame squarely on the public employees unions. He suggests that they've become such resource hogs that the funding for other needs and goals has to suffer. I agree with Brooks that the public employees unions have become a problem. I'll agree with him that something's got to give and the resouce commitments for public sector workers has to be trimmed back.
But, I think he's missing something here. The public employees unions represent an ongoing expense of government. They are a flow. A cost of doing business that has become too high. However, the great projects Brooks seems to express such nostalgia for (the Space Program, the Interstate Highway System, NJ's cancelled rail tunnel) are capital projects, one-time expenditures that generate a capital asset. Once it's done, you have only to pay for whatever upkeep and maintenance the project requires once completed. As a result, excessive demands from public sector unions would logically represent a less significant factor in decision-making. The fixed asset is paid for over many years and countless uses. Labor costs are capitalized and then amortized over the life of the asset. Excessive labor costs, then , only represent a portion of the skyrocketing costs of completing public projects.
The real problem is that the goal of most projects is rarely the only, or even overriding objective of most projects. When we built the Interstates, we did so because we wanted a cool set of highways. When we launched the space program, we did so to go to the moon. With most projects, today, we attempt to satisfy every want, wish, need or demand. As a result, projects sit in limbo for years, as the concerns of environmentalists about the project's effects on the mating habits of the freckled-penised snail darter are studied and addressed. And, by all means, we can't proceed without the acceptance of the project's aesthetic and historical/cultural effects on the wider community has gotten the okay from a team of urban planners and architects. And that's just in the planning stages. We then have to actually get the project up and running. In that case, welcome to the wonderful world of negotiating with local residents. Want to build a new stadium? Well, maybe you can. If you give them a new park, a new community center, grants for the schools, and guarantee a number of jobs for local residents. But, at last we can get started. Now, we go on to face the fact that we have to pay union scale to the entire labor force, we have to allot a significant portion of our construction to historically disadvantaged contractors, oh, and can't forget the sensibilities of local residents with all that banging and dust and stuff.
But, the thing is, these are all understandable and, to some extent, legitimate wants needs and desires. Would Brooks say "Screw the freckled-penised snail darter"? Is he prepared to say that workers shouldn't get union scale? Does he want ugly public works? Doesn't he want to give the little guy a chance? Does he want construction keeping people awake at all hours and choking them with dust? Is he in favor of leaving ghettos as they are? Somehow, I think the answer is no. Yes, at some point we have to say "This but not that". The thing is, it's not just the unions demanding this and that. It's everyone who looks at the government as the distributor of all good things.
In a recent article David Brooks asks "Why are important projects now unaffordable?". In large part, Brooks lays the blame squarely on the public employees unions. He suggests that they've become such resource hogs that the funding for other needs and goals has to suffer. I agree with Brooks that the public employees unions have become a problem. I'll agree with him that something's got to give and the resouce commitments for public sector workers has to be trimmed back.
But, I think he's missing something here. The public employees unions represent an ongoing expense of government. They are a flow. A cost of doing business that has become too high. However, the great projects Brooks seems to express such nostalgia for (the Space Program, the Interstate Highway System, NJ's cancelled rail tunnel) are capital projects, one-time expenditures that generate a capital asset. Once it's done, you have only to pay for whatever upkeep and maintenance the project requires once completed. As a result, excessive demands from public sector unions would logically represent a less significant factor in decision-making. The fixed asset is paid for over many years and countless uses. Labor costs are capitalized and then amortized over the life of the asset. Excessive labor costs, then , only represent a portion of the skyrocketing costs of completing public projects.
The real problem is that the goal of most projects is rarely the only, or even overriding objective of most projects. When we built the Interstates, we did so because we wanted a cool set of highways. When we launched the space program, we did so to go to the moon. With most projects, today, we attempt to satisfy every want, wish, need or demand. As a result, projects sit in limbo for years, as the concerns of environmentalists about the project's effects on the mating habits of the freckled-penised snail darter are studied and addressed. And, by all means, we can't proceed without the acceptance of the project's aesthetic and historical/cultural effects on the wider community has gotten the okay from a team of urban planners and architects. And that's just in the planning stages. We then have to actually get the project up and running. In that case, welcome to the wonderful world of negotiating with local residents. Want to build a new stadium? Well, maybe you can. If you give them a new park, a new community center, grants for the schools, and guarantee a number of jobs for local residents. But, at last we can get started. Now, we go on to face the fact that we have to pay union scale to the entire labor force, we have to allot a significant portion of our construction to historically disadvantaged contractors, oh, and can't forget the sensibilities of local residents with all that banging and dust and stuff.
But, the thing is, these are all understandable and, to some extent, legitimate wants needs and desires. Would Brooks say "Screw the freckled-penised snail darter"? Is he prepared to say that workers shouldn't get union scale? Does he want ugly public works? Doesn't he want to give the little guy a chance? Does he want construction keeping people awake at all hours and choking them with dust? Is he in favor of leaving ghettos as they are? Somehow, I think the answer is no. Yes, at some point we have to say "This but not that". The thing is, it's not just the unions demanding this and that. It's everyone who looks at the government as the distributor of all good things.
