All Infrastructure Users Are Created Equal
Investments in infrastructure are a big topic right now. Infrastructure investments create local jobs, they can lower the cost of doing business for the private sector, and they can provide quality of life improvements like clean water and sewage treatment plants. Currently, there is loud debate on all sides of the issue. For the sake of this entry, let us assume that all debaters have honest intentions.
The tools of the debate are well-known by now. Proponents argue on the side of benefits, detractors argue the costs of the work. Both sides have merit, so we compromise and ask for a "cost-benefit analysis" (CBA) to break down the project into facts and figures rather than emotions and promises.
The CBA is a great tool. It is widely used in business and government agencies to compare different alternatives. Key assumptions made in the CBA are:
A recent example of the CBA being used in debate is the national High-Speed Rail (HSR) network proposals. The analysis was taken up by Edward Glaeser of Harvard/NYT in his set of articles "Is High-Speed Rail a Good Public Investment?" but his conclusions were called into question in the Infrastructurist article "Why Edward Glaeser Got it Wrong: Re-Running the Numbers on High-Speed Rail." Both articles show the process is very sensitive to initial assumptions and uncertainties.
But the reason I write this is not to point out the difficulties in using this type of analysis, it is to say that it should not be used at all. Government should not be run as a for-profit businesses. Basing decisions solely on cost-benefit analyses, opportunity costs, and return on investment projections means that the cities are rewarding companies and wealthy property owners exclusively.
The amount of wealth generated after infrastructure improvements in a nice part of town will be much higher than the same infrastructure improvements in a below average part of town. The strict use of CBA ensures that poor neighborhoods get bulldozed for suburban highway access, workers ride inexpensive buses rather than rail systems, and pedestrians are only allowed in shopping districts. Should this type of thinking dictate our infrastructure investments?
If the only measure of a project's worth is how much investment will be generated, then civic governments will fail to provide infrastructure to their citizens equitably. Cities need to remember that they have a duty, enshrined in our founding principles, that all are created equal and all deserve equal treatment.
There have been many transit projects, brownsfield and pollution cleanup projects, and neighborhood development plans derailed by short-sighted opposition. Some people refer to projects that don't pay for themselves as unacceptable welfare programs, but engineers have always had an ethical responsibility to "hold paramount the safety, health and welfare of the public." Why are we allowed to abdicate this responsibility when the ROI doesn't look good?
The tools of the debate are well-known by now. Proponents argue on the side of benefits, detractors argue the costs of the work. Both sides have merit, so we compromise and ask for a "cost-benefit analysis" (CBA) to break down the project into facts and figures rather than emotions and promises.
The CBA is a great tool. It is widely used in business and government agencies to compare different alternatives. Key assumptions made in the CBA are:
- Anything can be represented in present day cost, even human life and welfare
- Doing nothing means that present trends will continue
- Potential costs and benefits can be given a real value
A recent example of the CBA being used in debate is the national High-Speed Rail (HSR) network proposals. The analysis was taken up by Edward Glaeser of Harvard/NYT in his set of articles "Is High-Speed Rail a Good Public Investment?" but his conclusions were called into question in the Infrastructurist article "Why Edward Glaeser Got it Wrong: Re-Running the Numbers on High-Speed Rail." Both articles show the process is very sensitive to initial assumptions and uncertainties.
But the reason I write this is not to point out the difficulties in using this type of analysis, it is to say that it should not be used at all. Government should not be run as a for-profit businesses. Basing decisions solely on cost-benefit analyses, opportunity costs, and return on investment projections means that the cities are rewarding companies and wealthy property owners exclusively.
The amount of wealth generated after infrastructure improvements in a nice part of town will be much higher than the same infrastructure improvements in a below average part of town. The strict use of CBA ensures that poor neighborhoods get bulldozed for suburban highway access, workers ride inexpensive buses rather than rail systems, and pedestrians are only allowed in shopping districts. Should this type of thinking dictate our infrastructure investments?
If the only measure of a project's worth is how much investment will be generated, then civic governments will fail to provide infrastructure to their citizens equitably. Cities need to remember that they have a duty, enshrined in our founding principles, that all are created equal and all deserve equal treatment.
There have been many transit projects, brownsfield and pollution cleanup projects, and neighborhood development plans derailed by short-sighted opposition. Some people refer to projects that don't pay for themselves as unacceptable welfare programs, but engineers have always had an ethical responsibility to "hold paramount the safety, health and welfare of the public." Why are we allowed to abdicate this responsibility when the ROI doesn't look good?
Labels: controversy Friday, infrastructure, Public transit, Urban Environment
posted by Graeme at
7:30 AM
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