Why We Can't Think Straight About Public Spending: California High-Speed Rail, and the Latest USAF Bomber

A few weeks ago I had the pleasure of addressing Stewart Brand’s “Long Now” seminar in San Francisco, talking about the various sorts of infrastructure on which civilization depends. Paved roads; public-health systems; the printing press; public schools; and these days the softer sorts of infrastructure that I’ve been writing about in venues ranging from China to the U.S. Capitol to the smaller-town and rural United States.

Part of this era’s big-civic-infrastructure: California High Speed Rail (map from UC Davis and ESRI)

One of the themes in the talk was the asymmetric bias in our public/civic consideration of big infrastructure projects. As I argued last year in the gala series of posts on California’s High-Speed Rail project, starting here, democratic societies are systematically prone to spend far too little on normal civic infrastructure. Bridges, canals, new schools, new parks — we repeatedly under-imagine their benefits in the long run, and over-emphasize their hassles and costs. Most of the big public efforts we now view as no-brainer steps to national greatness, from the Louisiana or Alaska purchases to the Golden Gate Bridge to the GI Bill, were controversial and seen as barely worth it in their time.

The strange converse, as argued in my Chickenhawk Nation piece early this year (and long before that in National Defense), is that the opposite bias applies to military purchases, infrastructure, and investment.  The historical record shows strongly that we under-estimate their costs, complexities, and delays, and over-estimate how long they’ll last, how well they’ll work, and how much more they will keep us safe.

Why the difference? That’s a bigger question than I can deal with now. But that there is a difference is the theme of a note that’s come in from Mike McCoy, long an official with California’s Strategic Growth Council and UC Davis.  He saw this very asymmetry in two big stories in the Los Angeles Times. It’s relevant to note that he has been a proponent of High-Speed Rail (HSR). Over to Mike McCoy:  

There is this odd schizophrenia the LA Times  has about public spending on essential infrastructure.

Here is the Times on October 24th speculating and lamenting, from limited knowledge and information, about the possibility for cost overruns with High Speed Rail in the article "$68-billion California bullet train project likely to overshoot budget and deadline targets."
It joins other laments in the Times about HSR on other dates. See the collection here.

But then on October 27th the paper celebrated Northrop Grumman’s $80 billion plus contract to build the next generation of Stealth Bomber near Palmdale praising it for its job generating public benefits. The article goes on practically to extol the virtue of cost overruns which seem inevitable on a plane announced at half the cost per unit as the last Stealth Bomber. The Times waives off the question of whether this investment is even needed.

Besides the obvious double standard regarding certainty in public expenditures there is the question of the highly differential economic benefits of the two projects. I only dabble in economics from the transportation perspective, but I think it is safe to say that HSR and Stealth are significantly different investments when it comes to economic impact.

The LAT story Mike McCoy is referring to.

HSR will benefit California in its construction phase.  So will Stealth.  HSR will create thousands of ongoing jobs in California.  Stealth may create some ongoing jobs depending on deployment and basing of the finished product.  HSR will create infrastructure that will have long term effects on economic productivity in California by providing significantly more accessibility to most major California destinations.  Stealth will not have a continued general economic benefit specific to the residents of California.  It is not a tool that adds value to normal economic productivity.

If previous transportation infrastructure investments are a gauge of future infrastructure investment longevity then HSR will be in use for many decades and even when obsolete will leave a right of way that can be reused.  If previous B-2 military spending is a gauge then 25 years after the first flight of this new stealth we'll be reading these headlines again and the military industrial complex will be looking for another nominal $80 billion.

I am sure you see hundreds of contradictions a day in press treatment of current events but this one is particularly painful to those of us struggling to keep HSR alive.

Of course this is not just the LAT. (Which was our morning paper when I was a kid, and was my first “real” journalistic employer, and which I have always wished well.) What Mike McCoy identified was an unusually crisp example of a longer-term slant in our public thinking. The related point, of course, is that most people in California, and all politicians there, have an opinion, pro or (usually) con on High-Speed Rail. But maybe one in a thousand would have any view on a military project that will end up costing more money. Ah dysfunction, ah life.