Trains of Thought

This is a topic I wish I could discuss with Fred Dabney.  Fred was a Renaissance Man— somebody who knew just about everything about anything.  Fred’s been gone a while now, but I still miss going to the radio station where he worked the graveyard shift, playing jazz all night long.  We’d drink coffee while discussing the news coming off the teletype.  

If there was one topic that Fred was really an expert on, it was trains.  I like trains and probably know as much about them as the next historian, but I can’t tell you the difference between a 4-2-0 and a 4-6-0 steam locomotive.  Fred could talk about that for days.  (I’m lying—I do know the difference but could only talk about it for a couple of minutes.)  I wonder what Fred would say about Edward Hopper’s fascination with trains.

Yes—Edward Hopper, the American artist, whose paintings primarily explore themes of isolation, solitude, and the alienation of modern life.  His work often depicts stark urban and rural scenes—empty diners, gas stations, theaters, or lone figures in rooms—with everything bathed in dramatic light and shadow.  These settings evoke a sense of loneliness, quiet contemplation, or disconnection, that reflect the emotional undercurrents of early-to-mid-20th-century America.  The most famous of his works is Nighthawks (1942).

If you’ve ever stared at a Hopper painting and felt an odd sense of loneliness, introspection, or the creeping suspicion that the guy at the diner counter is thinking deeply about the futility of it all… congratulations.  You’ve been Hoppered.  But amidst his sunlit isolation and moody diners lies another, often overlooked motif: the train.

That’s right—Edward Hopper’s trains are more than just steel and steam and they are not merely background scenery or a means to get from here to there.  Instead, they are symbolic workhorses, quietly chugging away with emotional freight.  Whether nestled on a track behind a country house or slicing through a gloomy overcast landscape, Hopper’s trains whisper stories about time, distance, longing, and that deeply American itch to move—even if we're not sure where to.

Let’s begin with the basics.  Trains are literal vehicles, but in Hopper’s world, they are also emotional vehicles—rolling metaphors for departure, arrival, waiting, and wondering.  For a man obsessed with stillness, Hopper had a surprisingly kinetic undercurrent running through his work.  Trains, in this context, act as symbols of transition, offering movement in otherwise frozen moments.

Take Railroad Sunset (1929), in which a lone signal tower basks in a garish sunset, and the track extends out of sight to both sides of the painting. Paradoxically, the train, itself, is absent—conspicuously so—but the train is missing in many of Hopper’s “train” paintings.  The glowing sky suggests that the train is either coming or has just gone.  It’s a portrait of in-betweenness, of anticipation hanging in the air like steam from an engine that’s just passed.  Here, the tracks (and the train we can only imagine) become a symbol of a dividing line—between day and night, solitude and contact, home and elsewhere.

It’s impossible to talk about Hopper’s trains without addressing the American mythology of the railroad.  Trains helped tame the West, connected small towns, and served as backdrops for tearful goodbyes and hopeful hellos.  In the collective American psyche, they are almost spiritual. They represent progress—and its discontents.

In Chair Car (1965), Hopper paints the inside of a railway car with passengers scattered like chess pieces.  No one speaks.  Everyone stares out the window or into space, even though nothing can be seen out the windows.  The seats are plush, the lighting is warm, and yet—there’s a heaviness.   The passengers are traveling together, but they are also clearly traveling alone. Are these people going somewhere? Or are they merely enduring the ride?  Is the train even moving?

Hopper’s trains aren’t the heroic beasts of industrial triumph ushering in a new age. They’re more introspective.  They reflect a deeply personal American contradiction: the desire to roam versus the longing to belong.  The train offers escape, yes—but it also implies disconnection.  It moves, but it never promises arrival.

In Hopper’s universe, even train stations throb with symbolism.  Consider Approaching a City (1946).  The canvas shows the view from a train approaching an almost featureless tunnel beneath looming urban buildings.  The city feels impersonal and closed off, without a single person visible.  The viewer doesn’t get to see the other isolated people inside the train; we only see the train’s passage—the mechanical act of entry into something unknown.

The station—normally a place of hustle, ticket stubs, welcoming kisses and final embraces—is stripped of both motion and emotion.  Hopper often preferred to paint the moments before or after the train arrives. Waiting is a recurring mood.   It becomes a metaphor for human existence: we’re always waiting for something—love, clarity, purpose, or perhaps the next train out of town.

Even The Camel’s Hump (1931), which features no train at all, but merely a glimpse of rail line in a rural setting, carries the ghost of movement. Hopper once said he was interested in the “sad desolation of a railroad track.”  That track, curving off into nowhere, becomes the physical embodiment of uncertainty.  The setting for this painting is in Massachusetts, near Hopper’s studio.  Did the abandoned tracks symbolize isolation to the artist?

A recurring theme in Hopper’s paintings is the view from the window—and nowhere is this more poignant than when one is seated on a train.  The window becomes a moving frame, slicing the world into a series of digestible vignettes.  The train window is both a portal and a barrier: it allows the viewer to see out, but not to engage.  This is peak Hopper—engaged detachment.

In Compartment C, Car 293 (1938), a young woman sits reading, oblivious to her surroundings.  She is the embodiment of the solitary traveler.  Outside the window, the world slips past unacknowledged.  It’s a quiet meditation on interior life amid exterior motion.  That the compartment is labeled and numbered—"Car 293"—hints at the industrial impersonality of modern travel.  And yet, inside, it’s deeply human, even if isolated.

Let’s not ignore the fact that many of Hopper’s train-centric works feature solitary women—reading, gazing, traveling.  In a time when women's mobility was becoming more socially acceptable, trains offered independence.  These female figures often look lost in thought, but they also exude a kind of quiet autonomy.  Hopper doesn’t portray them as helpless waifs or glamorous adventuresses, instead, they’re ordinary women in extraordinary states of self-possession.  The train offers a space for personal freedom, though it carries a heave dose of isolation.

In many Hopper paintings, time stands still.   But the presence of trains—whether visible or just implied—serves as a reminder that time is always passing.  The train tracks lead somewhere.  The people are en route to some place.  The signal tower is lit for something expected.

There’s a gentle irony to this: Hopper, the painter of frozen moments, uses the symbol of the train—a machine of relentless motion—to underscore stillness.  The train is always coming or going, even if we never see it.  It’s the heartbeat beneath the surface of his quiet worlds.

Ultimately, Hopper’s trains aren’t about transportation—they’re about transformation.  They represent the soul in transit, the mind on a journey, the heart caught between departure and destination.  They’re symbols of possibility and loss, of progress and estrangement, of the uniquely human condition of being neither here nor there, but somewhere in between.

And let’s face it: there’s a bit of wistful romance to the whole thing.  Who hasn’t watched a train slip past and thought, “Where is it going?  Should I be on it?  Would that solve anything—or just change the view from the window?”

Edward Hopper’s trains are subtle but powerful. They carry with them more than people—they carry questions.  Are we moving toward something, or away from it?  Are we passengers in our own lives?  Will the conductor ever explain the delay?

So, the next time you see a train in a Hopper painting, don’t just admire the brushwork.  Lean in.  Listen for the low clickety-clacking rumble of thought.  It may be whispering something you’ve felt but never put into words.

And if all this seems like a huge load of symbolism to load onto just a few tracks and a quiet car, remember—Hopper’s real subject was never actually the train.  It was always us.

Why the CBO is Frequently Wrong

 During the hectic, unreal days of Watergate, Congress decided it needed a trusty sidekick to wrangle the federal budget.  Thus, the Congressional Budget Office (CBO) was born on July 12, via the Congressional Budget and Impoundment Control Act.  Why? Well, President Nixon was playing fast and loose with funds, "impounding" money Congress had earmarked, causing a Capitol Hill kerfuffle…Congress wanted its wallet back!

The “how” was simple: lawmakers crafted a nonpartisan agency to give them the straight dope on budgets and economic forecasts, that was to be free from executive spin.  Modeled after California’s budget wizards, the CBO became Congress’s go-to for number-crunching. 

The CBO’s mission?  To arm Congress with clear, unbiased data for smarter spending decisions, without whispering policy advice. It’s like a financial crystal ball, helping lawmakers navigate the fiscal fog with confidence.  And so, the CBO was supposed to be a nonpartisan Capitol Hill hero, quietly crunching numbers to keep the budget battles light and bright while giving the voters the truth about pending legislation—without political spin.

Unfortunately, it hasn’t always worked out that way.

The CBO tries very hard to be nonpartisan, and there is no better proof that it generally is than the fact that each political party in turn has complained long and loudly about bias whenever its ox is gored but staunchly defends the office when the CBO’s projections ding the opposing party.  Even if we assume the CBO operates without appreciable bias—as I believe it does —that still doesn’t mean that its estimates are to be believed.

The problem is this:  from its inception, the CBO has created financial models based on static forecasting (sometimes called, “static scoring”).  So, what is “static forecasting”?  Let me give you a real-world example:

Back in 1990, Congress passed a luxury tax on high-dollar items that typically were only bought by the wealthy:  large yachts costing over $100,000, private jets, and very expensive cars.  Congress wanted to raise tax revenue without increasing taxes on either the middle class or the poor.  The bill, the Excise Tax on Luxury Goods was part of the Omnibus Revenue Reconciliation Act of 1990.  The CBO estimated that the tax on yachts alone would bring additional tax revenue of over $120 million.

At the time, American shipyards sold thousands of yachts annually, so the CBO just estimated that 10% of the existing revenue would be paid to the government annually.  Of course, nothing like that happened.

The global yacht business was competitive and when American-made yachts suddenly went up in price, customers immediately changed their buying behavior.  Since they were just rich and not stupid, consumers bought used yachts (which were not subject to the new tax) or they went overseas—particularly to Europe—to purchase their luxury boats.   New yacht sales in the United States dropped by more than 70%, causing many small and medium boat builders—especially in Florida, Maine, and the Pacific Northwest—to close or drastically downsize.  An estimated 7,600 to 9,000 jobs were lost in the yacht-building industry alone, with ancillary industries (marinas, suppliers, etc.) losing many thousands more.

Well, at least the government brought in more revenue, right?

Nope!  The total amount collected on the sale of yachts in the first year was $12.7 million—a figure less than the government spent enforcing and collecting the new tax.  The Government Accounting Office (GAO) said this was primarily because the IRS had to track complex sales of high-end goods and pursue evasions, such as shell companies buying boats offshore.

It won’t surprise you that these dismal results were duplicated on all the luxury goods that were mentioned in the new law.  Whether it was jewelry, expensive furs, private jets, or the latest Ferrari, the rich altered their purchase patterns in ways not predicted by static modeling.  A Congressman summed up the failure, “We intended to tax the millionaires, but we actually ended up punishing the middle-class boat builders.” 

Congress eventually repealed the law, but not before the disruption had long-lasting effects.  Some economists argue that the yacht industry still has not completely recovered, thirty-five years later!

Since static forecasting does not take into account the behavioral response of the taxpayers to new taxation, what is really needed is dynamic forecasting.

Static models are simpler: raise taxes, get more money.  But dynamic models say: “Wait—people might work less, invest differently, or shift money offshore!”

Dynamic modeling tries to account for how people, businesses, and markets adapt—sometimes in weird, unexpected ways.  It’s like trying to predict not just how the pool table balls move after the break, but also how the table might warp mid-game, or your pet cat might jump up on the table and attack the ball.

Why doesn’t the CBO just always use dynamic models?  Because they’re wildly complex.  To do it right, you need to make hundreds of assumptions—about interest rates, about labor markets, about consumer psychology, about unicorn migration patterns (okay, maybe not about that last one, but you get the picture).  And if Congress doesn’t like the answer?  Suddenly your assumptions are under fire and your budget is cut. 

So, the CBO sticks mostly to static scoring—not because they think it’s perfect, but because it’s safer, more transparent, and less politically explosive.  After all, nobody in the CBO wants to explain to a Senate committee on live television that the entire economic forecast turned into crap because millions of Americans suddenly went out and bought pet rocks.

We could—but we won’t—change the way the CBO makes economic forecasts.

Imagine the Congressional Budget Office (CBO) as a weather forecaster for the federal budget.  If Congress passes a tax cut, for example, the CBO could use dynamic scoring to say, “Here’s what might happen—if everything goes great, if things go as usual, or if the economy trips on a rake.”

Instead of a static forecast of the tax cut, they give three dynamic forecast scenarios:

·      High projection: Everyone starts businesses, hires like crazy, and the GDP soars.  Tax revenues fall at first, but the booming economy makes up for it.  Unicorns dance, it rains in Death Valley, and the Seattle Mariners win the World Series.  It’s the “rosy scenario.”

·      Medium projection: The tax cut boosts spending and work a bit, but not dramatically.  The economy grows, but mostly as expected.  This is the Goldilocks forecast—not too hot, not too cold.  Both proponents and opponents of the tax cut claim to be correct.

·      Low projection: People pocket the extra cash, but don’t do much with it.  The economy doesn’t pick up, and tax revenues drop more than hoped.  Cue the budget shortfall and awkward committee hearings while the talking heads with perfect hair speak confidently on television about the failure of “trickle-down economics.”

Dynamic scoring would let the CBO show how real people might react to policy changes—rather than just assuming that everyone keeps behaving the same as always.  Unfortunately, predicting human behavior is a tricky business, which is one reason the CBO avoids dynamic scoring.  The other reason—and the main reason—is that Congress doesn’t want to be in the position of explaining economics to voters who want simpler answers.  Lawmakers prefer a clean, single “score”—even if it’s less nuanced.

Or to put that more succinctly, Congress wants answers that can fit on a bumper sticker.  Even if they are wrong.

The Dangers of Economic Populism

 Last week I wrote about Zohran Mamdani, an…. unorthodox… primary candidate in the New York mayoral race.  Since then, Mamdani has won.  Whether or not this win was due to New York’s ranked choice voting system is open to debate.  I read two statistical analyses of the effect of RCV on the primary, and each claimed the system unfairly threw the election, but since neither report agreed on who benefitted nor did either show me its math, I have no idea it either is correct.

And it’s beside the point.  What’s really important is that economic populism looks like it is here to stay.

Which, of course, triggers the question, “What is economic populism?”  Economic populism is a political and economic approach that emphasizes the needs and interests of the "common people" over those of elites, of large corporations, or of financial institutions.  It often includes policies aimed at reducing inequality, at protecting domestic jobs, and at expanding government support for working- and middle-class citizens. 

Water, salt, oxygen, caffeine, vitamin A, and acetaminophen are all more or less good for you… And all of them in large doses will kill you.  Economic populism is exactly like that.

America has had several brushes with economic populism—FDR’s New Deal, any policy proposed by Elizabeth Warren or Bernie Sanders, and several of the economic proposals of President Trump are good examples.  In and of themselves, these policies are not bad things:  remember, too, that economic populism isn’t strictly left or right-wing, but is a style of economic politics that can appear across the spectrum.  Left-wing politicians focus on wealth redistribution, unions, healthcare, and taxation while right-wing politicians focus on tariffs, nationalism, and national job protection.

Economically, these measures lead to inflation, loss of jobs, and a shortage of the goods subject to the price controls.  The real danger lies in the political costs.  Economic populism starts off like a potluck dinner with a promising host.  “Come one, come all!” cries the candidate.  “Free healthcare!  Low rent!  Jobs that pay actual money!  And pie for dessert!” It’s music to the ears of anyone who’s been burned by recession or inflation, or who just got screwed over by the local cable company.

And honestly?  It’s hard not to cheer.  Economic populism is often a genuine human response to real pain.  If wages are stagnant, factories are shuttered, and billionaires are launching themselves into orbit, while you’re still trying to afford putting braces on your kid’s teeth, when a leader steps up and says, “Let’s take care of the people, not the elites,” it’s tempting to shout “Hallelujah!” and hand them the keys to the car.

But here’s the thing: sometimes the person you gave the keys to not only drives you home... they change the locks, reset the GPS, and push your saintly old grandma out the window.

First, a champion emerges, who begins with economic populism with an agenda focused on helping ordinary folks over the wealthy or well-connected.  (Think stimulus checks, rent control, union support, anti-monopoly crackdowns, or nationalizing things like utilities, grocery stores, or Wi-Fi.  (Because Wi-Fi should be a human right, obviously.)

This leader gets elected on the promise that they’ll take on “the system.” And, at first?  They do, as they slash bureaucratic red tape, defund the police, pass spending bills, and make Wall Street sweat a little.  People cheer.  Approval ratings soar.  The pigeons get off the park statues long enough to salute.

But soon, the populist leader realizes something uncomfortable: governing is harder than campaigning, and the realities of economics soon show you that numbers are too sharp to juggle.

When inflation creeps up or foreign investors get nervous, economic populists often find a convenient answer—just blame the “usual suspects”.  These include the media (“fake news!”), the judiciary (“corrupt judges!”), or the Federal Reserve (“saboteurs with calculators!”).  Instead of saying, “We need to fine-tune our policies,” the populist says, “We would’ve been perfect if it weren’t for those meddling institutions!” 

This is where the slide begins, because, now, the leader isn’t just fighting inequality—they’re fighting accountability.

Next comes the DIY phase—attempts to fix the system. But these measures are not designed to make it better, but to make it easier to control.  The courts?  “Far too slow or biased.”  Better pack them with friends.  Election laws?  “Too biased.”  Better replace them.  Independent media? “Unpatriotic.”  Better buy them out or shut them down.  Civil service? “Uncooperative.”  Better fire the lot and hire cousin Jimmy.

All of it is justified under the banner of “protecting the people’s will.”  The populist starts governing not for all citizens, but for “real” citizens (i.e., their base).  And dissent inevitably becomes treason.  This, of course, is much easier if you have state-owned and controlled media. 

By this point, the original economic populist dream—to create a more just economy—is buried under red flags and loyalty oaths.  Inflation is inevitably climbing.  Business investment has fled.  The budget may be bloated from all the free pie served by insolent civil servants.  But instead of changing course, the populist doubles down: more controls, more slogans, more enemies, and more free programs to be paid for by taxing what remains of the wealthy.

What has happened?  The inevitable.  All too easily, economic populism turns to authoritarian populism—where power is centralized, dissent is punished, and freedom is optional.

By now, citizens realize they’ve traded bread and butter policies for bread and circus politics.  There might still be subsidies and slogans, but transparency is gone.  The economy wobbles.  Institutions weaken.  And the charismatic leader who once promised fairness now rules by decree.

While some try to resist, others say, “Well, at least they’re not the other guys.” But deep down, everyone knows: the system’s not the same.

Well, since I’ve given you the sermon, I might as well reveal the moral of the story.

Economic populism doesn’t necessarily go authoritarian, but it usually does.  There are populist policies that uplift the working class without burning down the courthouse.  But if the leader you elect blames the courts, or says all economic woe is the fault of the rich, or promises services that are magically free—you may not be on the road to fairness.  You might be on the shortcut to autocracy, instead.

So enjoy the pie and cheer for the underdog—but keep an eye on the locks.  And if your grandma mysteriously vanishes from the passenger seat… it’s time to grab the wheel.

One last note, Dear Reader:  I was not talking about the other political party, I was talking about yours.

Bread, Circuses, Mamdani

New York City is pretending to have a primary election for mayor.  I say “pretending” because the metropolis switched to a “ranked choice” voting system four years ago.  Ranked choice voting is fine in competitive races, but anywhere a single party holds a large lead over a minority party, computer modeling shows that it almost always results in a majority party victory by minimizing the effects of a third party splitting the ballot.  Which is usually the reason the majority party imposed the new system of voting.

With ranked choice firmly in place and Democrats outnumbering Republicans 7 to 1in NYC, I can reliably predict that a Democrat will win, but which one?  If you believe the polls, the race is a toss-up between former Governor Andrew Cuomo and State Assembly member Zohran Mamdani.  Cuomo’s candidacy proves there is political life after public death and the Mamdani’s is a perfect example of why watching politics is better than viewing any television show.  Currently, Mamdani has strong backing among younger voters and progressive constituencies, while Cuomo maintains support from older and more moderate demographics.  The primary is set for June 24, so we will learn the winner shortly.

Thirty-three year-old Zohran Mamdani was born in Uganda and moved to the US at the age of seven.  After earning a bachelor’s degree in Africana Studies, he became a US citizen in 2018.  Two years later, he was elected to the New York State Assembly.  Apparently, Mamdani has never held a management job in the private sector.  Now, just five years after that, he is running to become the mayor of the largest city in the nation, on a platform that is…well…unique.

Mamdani, a Democratic Socialist running as a Democrat, wants to enact some sweeping economic reforms that would change New York City forever.  Here are some of his more striking proposals:

Rent Freeze: He proposes an immediate freeze on rents for all rent-stabilized apartments in NYC, impacting over 2 million tenants.  He plans to appoint members who support this initiative to the Rent Guidelines Board.

City-Run Grocery Stores: He advocates for establishing one municipally-owned grocery store in each borough that would offer affordable food options, especially in underserved areas.  These stores would operate without profit motive, aiming to reduce overhead costs and pass savings to consumers.

Free Public Transit: He aims to make all city buses fare-free and improve service by expanding bus lanes and reducing delays.

Universal Childcare: He plans to provide no-cost childcare and to increase wages for childcare workers to match those of public-school teachers.

Tax Reforms: He proposes raising corporate taxes from 7.25% to 11.5% and implementing an additional 2% flat income tax on millionaires to fund his programs, aiming to generate approximately $9.4 billion annually.

Let’s tackle each of these points individually.

Rent controls, like all price controls, simply do not work, and we have more than 2000 years of economic data to prove it.  If property owners cannot raise rents to align with rising costs, they either turn the apartments into salable condominiums or take the property off the market, creating a housing shortage that inevitably leads to rising prices. 

I could give you the well-established arguments and facts on rent control, but perhaps, it would be better to just relate what happened when the Argentine President Javier Milei repealed rent control in Buenos Aires in December 2023.  The effects have been both dramatic and aligned with free-market predictions.  Landlords who had exited the market promptly reentered it, increasing the number of available units by more than 170%.  More supply meant landlords competed on price—especially after allowing dollar-denominated contracts—resulting in a drop in rents by approximately 40%, adjusting for inflation.  Both of these conditions led to a “rental-market-boom” which gave prospective tenants more choice and bargaining power.

City-run grocery stores might sound nice—like a public library with bananas—but economically, they’re a recipe for wilted lettuce and financial indigestion. 

First, the government isn’t exactly known for its retail instincts.  If you’ve ever been to the DMV, imagine that vibe—but in the frozen food aisle.  Want a cart?  Fill out Form 27-B and return it to Window 3.  Prefer bagels over bureaucracy?  Too bad—the state has decided rice cakes are better for you.  My local store carries two dozen types of olives—the city-owned store will offer one type.  Thankfully, I’ll never have to shop at the only store left in a New York borough, since I like olives stuffed with anchovies.

Second, these stores would be funded by taxpayers, meaning everyone from grandma in Queens to a kid in the Bronx is helping subsidize Chad’s organic turmeric habit.  And if the store loses money (which, if they pride themselves on being non-profit, they absolutely will), the city just raises taxes or cuts funding to pothole repair.  Either way, the avocado hits the fan.

Private grocery stores already compete fiercely to bring you arugula at midnight and 87 flavors of hummus.  Government grocers would have no incentive to improve—because when profit doesn’t matter, neither do customers.  They won’t improve service or selection for you, but the competition will close some of the private stores, meaning you will have fewer choices, while the city is still open but receives less in taxes.

And let’s not forget politics.  One council member demands more kale, another wants a beef boycott, and someone inevitably proposes a tax on Pop-Tarts and Coca-Cola.

So, while the idea of city-run groceries might sound noble, the reality is more freezer-burn than fresh produce.  When it comes to stocking shelves, it's best to let the people who know a cantaloupe from a meatball do the shopping.  If that pothole has been sitting in the street in front of your house for the last three years, why would you want them to pick your pot roast.

Free and expanded public transit services and universal childcare sound good, but the New York Pension Service is already $177 billion in debt.  Dramatically increasing the number of people receiving those benefits will only make the problem worse, even if those services are run well.  How will the city pay for these new services?  It sure as hell won’t be with the profits from those grocery stores.

Which brings us to higher business taxes and a special tax on the rich.  In the last 20 years, 160 major financial firms headquartered in New York collectively managing $1 trillion in assets has left New York City, primarily because of existing taxes.  Let’s put that another way:  New York City has already lost the business equivalent of the entire economy of Switzerland. 

Many businesses have already left New York for New Jersey where the business taxes are already roughly 6% less.  If Mamdani can implement his tax proposal, New Jersey business taxes will be more than 10% less than New York City.   Currently, 22% of Manhattan commercial property is empty, the equivalent of 90 million square feet of property.  If Mamdani gets his way, a hell of a lot more buildings are going to become empty.

As for that additional tax on high earners, Mamdani believes this will result in a tax revenue increase of $9 billion, a figure he needs to fund all the progressive measures he has proposed.  Multiple cities and numerous countries have tried to pass punitive taxes on the rich only to discover that capital flight is always the result.  The rich simply move their riches where they will be left alone.  The cost of enforcing those draconian taxes frequently cost more than the new revenue produced. 

Well, in only four days from now, we will see who the voters of New York City select to be their new mayor.  Well, then technically, he will only be the winner of the Democratic Primary, but as I have already explained, that’s a minor detail. 

The Hidden Cost of Highway Construction

Back in the early seventies, while I was a student at the University of Houston, the local newspaper ran a joke front page on April Fools’ Day.  Set fifty years into the future, the headline was “Two Cyborgs Killed in Laser Car Crash on Soon-to-be-Completed Gulf Freeway.”

The joke wasn’t about cyborgs or laser cars, but about the idea that the Gulf Freeway Project, begun in 1952, would still be under construction in the 21^st Century.  Sadly, that bogus newspaper story was printed more than fifty years ago and the freeway project is still under construction. 

I was reminded of that old newspaper story as I drove between Las Cruces and El Paso yesterday.  Though the two cities are only about fifty miles apart, the trip took considerably longer than it should have because twenty miles of Interstate 10 was still under construction.  When the highway was last modernized, it desperately needed three lanes per side and they built only two, so now it needs four and they are only building three.  Long before they finish the three, there will be cyborgs driving laser cars.

It was the middle of the afternoon, and if there was anyone working along that long stretch, I missed them.  None of the heavy machinery was moving and the whole site looked shut down.

Highways can be completed much faster:  half a century ago, between Puebla and Mexico City, I saw more than a half mile of highway constructed in a single week.  I’ll grant you that it was flat land and the Mexican authorities were not hindered by such niceties as legal rights-of-way or environmental impact studies, but the highway was certainly finished.

Why do American highway jobs take so much longer to complete? 

Delays result from multiple reasons.  First, the projects are divided into multiple stages, frequently, with different contractors responsible for each stage.  Ignoring the companies that plan and design the construction, there may be multiple companies responsible for relocating utilities (water, gas, electric, and fiber), for roadbed prep and drainage, for paving and surfacing, and for installing signage and barriers.  If any of the companies responsible for any of these tasks is late, it creates a chain reaction of ever-increasing, subsequent delays. 

Next is the problem of funding.  State departments of transportation (like NMDOT and TxDOT) often don’t get all the money needed at once.  Projects are split into fundable phases that may be spaced out over years.  Politicians frequently divide the funding over years to lessen the “sticker shock” of the project cost.  (Ever notice that politicians spread the cost or the income of a proposal over ten years?  They assume you can’t do simple math.)  Delays in federal or state budget cycles can push projects back months or years.

Getting all the required permits frequently delays projects, too.  On just the fifty-mile trip I took yesterday, I crossed through two states, two counties, federal lands, and several small townships.  The route passed through both areas of archaeological interest and endangered species zones.  Even if a permit is acquired, special interest groups frequently challenge those permits in court, producing even more delays.

In addition, there is a nation-wide shortage of skilled highway construction workers.  General construction workers can make $40K a year, with skilled heavy-construction workers bringing home three times as much.  Along with a shortage of workers, there is a growing shortage of contracting companies bidding on the jobs. 

The last two reasons for delays are a little unusual.  First, there is a problem with safety barriers.  I complained to my wife that the orange barrels were positioned such that they created very narrow lanes even though there was obviously nothing going on behind the barriers for at least twenty more feet.  It turns out that if the barriers are only needed, for example, in phases 2 and 5 of a project, they leave them up for phases 3 and 4 to save money and to prevent driver confusion.  The contractors are afraid that if they took down the barriers after the completion of Phase 2, you would ignore them when they went back up for Phase 5 ad thus endanger construction workers.  This doesn’t actually delay construction, but the longer period of driving inconvenience makes us think it takes longer.

The last general cause of construction delay is the project bidding process.  By law, the government must take the lowest bid.  A contractor can save money by lengthening the construction project to the maximum time in order to shuffle construction crews and heavy machinery among multiple job sites and multiple projects.  This approach keeps overhead low, maximizes equipment usage, and enables profit—even if the work proceeds slowly. 

The contractor wins the bid, even though his completion time is much longer than that of other competitive bids.  Public projects that are put out to bid rarely penalize a bid on the basis of the time to complete a project.

However, this “lowest cost” does not take into consideration several factors.  Businesses along the proposed route suffer financial losses from the loss of customers," resulting in lower sales and hiring fewer employees.  The government then loses both sales taxes and income taxes.  Many businesses—particularly restaurants—end up closing along construction routes because their customers avoid the inevitable delays caused by traveling through construction sites.

Nor is the added cost from delayed highway construction strictly financial.   Highway workers are seventeen times more likely to die on the job than office workers are, with the vast majority of those deaths due to accidents involving motorists.  A motorist traveling through a mile of road construction is four times more likely to be involved in a fatal accident than while making the same trip on a completed highway.  What is the estimated cost of a human life?

When calculating the cost of highway construction, U.S. government agencies, particularly the Department of Transportation (DOT) and the Federal Highway Administration (FHWA), use a monetary value for a human life to assess safety measures and cost-benefit analyses.  This value, known as the Value of a Statistical Life (VSL), represents the economic cost of preventing a fatality, not the intrinsic worth of an individual.  Currently, that number is between $10 and $12 million.  Needless to say, that pitifully low number is not factored into the cost of highway construction bids.

There is an alternative method of bidding that voters should insist our government use: it’s called A+B bidding.  And no, it’s not a math quiz—it’s a way to keep bulldozers and construction workers from vanishing into thin air for six months at a time.

In the world of government construction contracts, “A” stands for the amount of money a contractor wants to be paid.  That’s pretty standard—everyone wants the best deal, and the government usually picks the lowest bidder.  But here's the twist: “B” stands for time—how many days the contractor says they'll take to finish the job.  Each day has a price tag attached, called a "road user cost," representing the financial loss caused by traffic delays, detours, and donut spills.

So instead of just saying “Hey, we’ll do it for $4 million,” a contractor using A+B bidding says, “We’ll do it for $4 million in 100 days.”  The government adds the money (A) and the time cost (B × daily delay cost), and whoever has the lowest total wins.  This means a slightly more expensive bid that finishes faster will beat a slower, cheaper one.

A+B bidding flips the usual system by rewarding speed and efficiency, not just bargain-basement pricing.  It’s good for taxpayers, great for commuters, and just might mean fewer orange cones decorating the freeway for years at a time.  And fewer accidents. 

There are a few other things that government could do to cut down the delays.  Don’t award contracts until enough funding to finish the project has been allocated.  Insist that contractors have bonds to ensure the cost of penalties imposed by delays.  Pass legislation that allows businesses to sue contractors for business losses resulting from those delays.  Currently, many government contracts explicitly waive consequential damages, limiting what can be claimed.

I could go on, but that is enough for you to think about the next time traffic is not moving and you have nothing to do but stare at the orange barrels and wonder why the cars in the other lane always move faster.