Pedestrian Observations: The Fish Rots from the Head

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Thought this was a very interesting read; article by Alon Levy.

 

https://pedestrianobservations.com/2019/01/31/the-fish-rots-from-the-head/

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The Fish Rots from the Head
All reform agendas run into the same problem: someone needs to implement the reform, and this someone needs to be more politically powerful than the entrenched interests that need reform. The big political incentive for a leader is to swoop in to fix an organization that is broken and get accolades for finally making government work. But whether this work depends on what exactly is broken. If the fish rots from the tail, and better management can fix things, then reformist politicians have an easy time. The problem is that if the fish rots from the head – that is, if the problem is the political leaders themselves – then there is no higher manager that can remove underperforming workers. My contention is that when it comes to poor American public transit practices, the fish usually rots from the head.

Whither fixing construction costs?

I wrote my first comment documenting high New York construction costs at the end of 2009. By 2011 this turned into my first post in my series here with some extra numbers. By the time I jumped from commenting to blogging, the MTA had already made a reference to its high costs in a 2010 report called Making Every Dollar Count (p. 11): “tunneling for the expansion projects has cost between three and six times as much as similar projects in Germany, France and Italy.” New York City Comptroller Scott Stringer has been plagiarizing my 2011 post since 2013.

However, the early recognition has not led to any concrete action. There has not been any attention even from leaders who could gain a lot of political capital from being seen as fixing the problem, such as governors in California, New York, and Massachusetts, as well as successive New York mayors. That Governor Cuomo himself has paid little attention to the subway can be explained in terms of his unique personal background from a car-oriented city neighborhood, but when it’s multiple governors and mayors, it’s most likely a more systemic issue.

What’s more, there has been plenty of time to come up with an actionable agenda, and to see it pay dividends to help catapult the career of whichever politician can take credit. The MTA report came out 9 years ago. An ambitious, forward-thinking politician could have investigated the issue and come up with ways to reduce costs in this timeframe – and in the region alone, four politicians in the relevant timeframe (Mayors Bloomberg and de Blasio, Cuomo, and Governor Christie) had obvious presidential ambitions.

Evidently, there has been action whenever a political priority was threatened. The LIRR had long opposed Metro-North’s Penn Station Access project, on the grounds that by sending trains through a tunnel used by the LIRR, Metro-North would impinge on its turf. As it was a visible project and a priority for Cuomo, Cuomo had to remove the LIRR’s obstruction, and thus fired LIRR President Helena Williams in 2014.

So what’s notable is that construction costs did not become a similar political priority, even though rhetoric of government effectiveness and fighting waste is ubiquitous on the center-left, center, and center-right.

Who benefits?

That successive powerful American leaders have neglected to take on construction costs suggests that there is no benefit to them in fixing the problem. The question is, who benefits from high costs, then?

The answer cannot be that these politicians are all corrupt. The inefficiency in construction does not go to any serious politician’s pockets. Corruption might, but that requires me to believe that all relevant mayors and governors take bribes, which I wouldn’t believe of Italy, let alone the United States. One or two crooks could plausibly lead to cost explosion in one place, but it is not plausible that every serious politician in the New York area in the last decade has been both corrupt and in on the exact same grift.

Another answer I’d like to exclude is powerful interest groups. For example, if the main cause of high American construction costs were unions, then this would explain why governors all over the more liberal states don’t make an effort to build infrastructure more cheaply. However, there are enough high-cost states with right-wing politics and anti-union laws. The other entrenched interest groups are quite weak nationwide, for example planners, who politicians of all flavors love to deride as unelected bureaucrats.

The pattern of competence and incompetence

In my dealings with New York, I’ve noticed a pattern: the individual planners I talk to are curious, informed, and very sharp, and I don’t just mean the ones who leak confidential information to me. This does not stop at the lower levels: while most of my dealings with planners were with people who are my age or not much older, one of my sources speaks highly of their supervisor, and moreover my interactions with senior planners at the MTA when Eric Goldwyn and I pitched our bus redesign were positive. Eric also reports very good interactions with bus drivers and union officials.

In contrast, the communications staff is obstructive and dishonest. Moreover, the most senior layer of management is simply incompetent. Adam Rahbee describes it as “the higher up you get, the less reasonable people are” (my paraphrase, not a direct quote); he brings up work he proposed to do on reworking on the subway schedules, but the head of subway operations did not have the budget to hire an outside consultant and the higher-up managers did not even know that there was a problem with trains running slower than scheduled (“running time”).

A number of area observers have also noticed how MTA head Ronnie Hakim, a Cuomo appointee, was responsible to much of the recent spate of subway slowdowns. Hakim, with background in law rather than operations, insisted speed should not be a priority according to Dan Rivoli’s sources. The operations staff seem to hate her, judging by the number and breadth of anonymous sources naming her as one of several managers who are responsible for the problem.

The pattern is, then, that the put-upon public workers who run the trains day in, day out are fine. It’s the political appointees who are the problem. I don’t have nearly so many sources at other transit agencies, but what I have seen there, at least in Boston and San Francisco, is consistent with the same pattern.

Quite often, governors who aim to control cost institute general hiring freezes, via managers brought in from the outside, even if some crucial departments are understaffed. For example, Boston has an epidemic of bus bunching, is staffed with only 5-8 dispatchers at a given time, and can’t go up to the necessary 15 or so because of a hiring freeze. The 40 or so full-time dispatchers who are needed to make up the difference cost much less than the overtime for bus drivers coming from the bunching, to say nothing of the extra revenue the MBTA could get if, with the same resources, its buses ran more punctually. In the name of prudence and saving money, the MBTA wastes it.

The risk aversion pattern

The above section has two examples of political interference making operations worse: a hiring freeze at the MBTA (and also at the MTA), and Ronnie Hakim deemphasizing train speed out of fear of lawsuits. There is a third example, concerning capital planning: Cuomo’s interference with the L shutdown, well covered by local sources like Second Avenue Sagas, in which the governor effectively took sides in an internal dispute against majority opinion just because engineering professors in the minority had his ear. All three examples have a common thread: the negative political interference is in a more risk-averse direction – hiring fewer people, running slower trains, performing ongoing maintenance with kludges rather than a long-term shutdown.

The importance of risk-aversion is that some of the problems concerning American construction costs are about exactly that. Instead of forcing agencies that fight turf battles to make nice, political leaders build gratuitous extra infrastructure to keep them on separate turf, for example in California for high-speed rail. Only when these turf battles risk a visible project, such as the LIRR’s opposition to Penn Station Access, do the politicians act. Costs are not so visible, so politicians let them keep piling, using slush funds and raiding the rest of the budget.

In New York, the mined stations, too, are a problem of risk-aversion. Instead of opening up portions of Second Avenue for 18 months and putting it platforms, the MTA preferred to mine stations from a smaller dig, a five-year project that caused less street disruption over a longer period of time. An open dig would invite open political opposition from within the neighborhood; dragging it over five years may have caused even more disruption, but it was less obtrusive. The result: while the tunneling for Second Avenue Subway was about twice as expensive as in Paris, the stations were each seven times as expensive. The overall multiplier is a factor of seven because overheads were 11 times as expensive, and because the stop spacing on Second Avenue is a bit narrower than on the Paris Metro extension I’m comparing it with.

In contrast with the current situation in New York, what I keep proposing is politically risky. It involves expanding public hiring, not on a massive level, but on a level noticeable enough that if one worker underperforms, it could turn into a minor political scandal in which people complain about big government. It involves promoting smart insiders as well as hiring smart outsiders – and those outsiders should have industry experience, like Andy Byford at New York City Transit today, not political experience, like the MBTA’s Luis Ramirez or the FRA’s Sarah Feinberg; by itself, hiring such people is not risky, but giving them more latitude to operate is, as Cuomo discovered when Byford began proposing his own agenda for subway investment.

On the engineering level, it involves more obtrusive construction: tunnels and els, not bus lanes that are compromised to death – and the tunnels may involve cut-and-cover at stations to save money. Regional rail is obtrusive politically, as modernization probably requires removal of many long-time managers who are used to the current way of doing things (in Toronto, the engineers at GO Transit obstructed the RER program, which was imposed from Metrolinx), and in New York the elimination of Long Island and the northern suburbs’ respective feudal ownership of the LIRR and Metro-North. The end result saves money, but little kings of hills will object and even though American states have the power to overrule them, they don’t want the controversy.

The fish rots from the head

American transportation infrastructure does not work, and is getting worse. The costs of building more of it are extremely high, and seem to increase with every construction cycle. Operating costs for public transit run the gamut, but in the most important transit city, New York, they are the highest among large world cities, and moreover, the cheapest option for extending high-quality public transit to the suburbs, regional rail, is not pursued except in Silicon Valley and even there it’s a half-measure.

The problems are political. Heavyweight politicians could use their power to force positive reforms, but in a number of states where they’ve been able to do so on favorable terms, they’ve done no such thing. On the contrary, political influence has been negative, installing incompetent or dishonest managers and refusing to deal with serious long-term problems with operations and maintenance.

The reason politicians are obstructive is not that there’s no gain in improving the state of public services. On the contrary, there is a huge potential upside to getting credit for eliminating waste, fraud, and abuse and delivering government projects for much cheaper than was thought possible. But they look at minor controversies that could come from bypassing local power brokers, who as a rule have a fraction of the influence of a governor or big city mayor, or from building bigger projects than the minimum necessary to be able to put their names or something, and stop there.

One animal analogy for this is that the fish rots from the head: the worst abuses come from the top, where politicians prefer slow degradation of public services to a big change that is likely to succeed but risks embarrassment or scandal. The other animal analogy is that, through a system that rewards people who talk big and act small, American politics creates a series of chickenshit leaders.