from the bigdumbHoosier Archive - 06.19.2002
Cost vs. benefit
According to U.S. senators threaten action over Army Corps reforms [6/19/2002 - Reuters - ENN], Senators Smith and Feingold are stepping up efforts to enforce accountability in the US Army Corps of Engineers, the government agency responsible for most large navigation and dam building projects.
The key thing in this story is that ACOE has been criticized (well, pretty much caught) 'cooking the books' to justify big public works projects. Typically, it happens like this: before a public works project can be built, an economic 'cost/benefit' analysis must be conducted. The purpose is to demonstrate that the cost of the project to the taxpayers is outweighed by the benefits the public will derive from the project over its useful life. Governmental agencies, unfortunately, have shown a propensity for overestimating benefits and underestimating costs. This means that projects that shouldn't get built, do; and due to budget limitations, projects that should get built don't.
This analysis is a key step in protecting both the taxpayers and the environment because it is the gateway between beneficial government action that creates common assets for a better tomorrow, you know with spandex jackets and flying cars, and wasteful white elephant-build a monument to yourself-pork barrel nonsense. Drawing the line isn't easy, of course. Predicting tourism revenues, from a reservoir for instance, is not an exact science. Quantifying environmental benefits and costs isn't easy either, because environmental values aren't commodity items in the marketplace.
On the other hand, enforcing rigor in these economic studies is something the left and right ought to able to agree on. Engineers love to build things. Big things, the bigger the better. Why does somebody get into ACOE? Because they like steel reinforced concrete, rip-rap, big yellow diesel powered digging machines. Heck, these guys are Americans! They made the Panama canal work, they put a man on the moon, and got him back alive too. Well, not lately. Anyway, they're can-do fellas. That's good, we don't want wimps managing shipping on the Mississippi River. But don't leave 'em in charge of the checkbook!
