Topic: Government and Politics

Cost Overruns, Again

The Washington Post reported yesterday that the cost of new combat ships from Lockheed Martin and General Dynamics will likely be at least $350 million each, instead of the originally budgeted $220 million.

That 59 percent cost increase is routine for big federal procurements. The table below summarizes official government estimates of costs for various defense, energy, and transportation projects.

No doubt, what goes on with these projects is a “nudge nudge, wink wink” between federal officials and major contractors. The game involves key players on both sides low-balling initial costs in order to get project approval, and then having an informal agreement to let costs float up over time.

In this case, one cause of the combat ship cost increase, noted the Post, was that ”the Navy said its original cost estimate did not factor in some management costs.” How convenient!

A Sampling of Federal Cost Overruns
(Defense items in constant dollars; other figures in current dollars)
Project Estimated Cost and Date of Estimate
Original Latest or Actual
Transportation    
Boston “Big Dig” $2.6b (1985) $14.6b (2005)
Virginia Springfield interchange $241m (1994) $676m (2003)
Kennedy Center parking lot $28m (1998) $88m (2003)
Air traffic control modernization $8.9b (1998-2004) $14.6b (2005)
Denver International Airport $1.7b (1989) $4.8b (1995)
Seattle light rail system $1.7b (1996) $2.6b (2000)
     
Energy  
Yucca mountain radioactive waste $6.3b (1992) $8.4b (2001)
Hanford nuclear fuels site $715m (1995) $1.6b (2001)
Idaho Falls nuclear fuels site $124m (1998) $273m (2001)
National ignition laser facility $2.1b (1995) $3.3b (2001)
Weldon Springs remedial action $358m (1989) $905m (2001)
     
Defense (per unit in 2003 dollars)  
Global Hawk surveillance plane $86m (2001) $123m (2004)
F/A-22 Raptor fighter $117m (1992) $254m (2002)
V-22 Osprey aircraft $36m (1987) $93m (2001)
RAH-66 Comanche helicopter $33m (2000) $53m (2002)
CH-47F cargo helicopter $9m (1998) $18m (2002)
SBIRS satellite system $825m (1998) $1.6b (2002)
Patriot advanced missile $5m (1995) $10m (2002)
EX-171 guided munition $45,000 (1997) $150,000 (2002)
     
Other  
Capitol Hill visitor center $374m (2002) $559m (2004)
Kennedy Center opera house $18.3m (1995) $22.2m (2003)
Kennedy Center concert hall $15.1m (1995) $21.3m (1997)
Washington D.C. baseball stadium $435m (2004) $611m (2007)
International space station $17b (1995) $30b (2002)
FBI Trilogy computer system $477m (2000) $600m (2004)
Pentagon secret spy satellite $5b (n/a) $9.5b (2004)
Pentagon laser anti-missile system $1b (1996) $2b (2004)
Sources: Compilation by Chris Edwards based on GAO reports and Washington Post stories. Figures in $millions (m) or $billions (b).

Meet the New Boss, Same as the Old Boss

In the 2006 campaign, Democrats accused Republicans of “selling access” to Congress. But now, the Washington Post reports,

Eager to shore up their fragile House and Senate majorities, congressional Democrats have enlisted their committee chairmen in an early blitz to bring millions of dollars into the party’s coffers, culminating in a late-March event featuring House Speaker Nancy Pelosi and 10 of the powerful panel chairs.

In the next 10 days alone, Democratic fundraisers will feature the chairmen of the House’s financial services panel and the House and Senate tax-writing committees. Senate Democrats also plan a fundraising reception during a major gathering of Native Americans in the capital Tuesday evening, an event hosted by lobbyists and the political action committee for tribal casinos, including those Jack Abramoff was paid to represent.

Where is The Who now that we need them?

I’ll tip my hat to the new constitution
Take a bow for the new revolution
Smile and grin at the change all around
Pick up my guitar and play
Just like yesterday
Then I’ll get on my knees and pray
We don’t get fooled again

Pork and Principle

The Hill reports that Blue Dog Democrats are very concerned about the proper balance of powers between the president and Congress. But for a big hike in farm subsidies, they’ll forget about that little constitutional matter. 

House Democratic leaders will add nearly $4 billion for farmers to a bill funding military operations in Iraq and Afghanistan to attract conservative Democrats concerned that the measure would wrongly constrict President Bush’s power as commander in chief.

The Democrats hope that moderate Republicans are just as malleable:

Democrats may also add money for children’s health insurance in the hope of winning the votes of Republicans such as Illinois Reps. Mark Kirk (R) and Judy Biggert (R), whose home state faces a $240 million deficit in its State Children’s Health Insurance Program (SCHIP).

To be fair, there’s no proof in the story that Kirk and Biggert are considering such a deal, but Republican leaders are reported to fear it.

In the civics books, they tell us that members of Congress deliberate about war, separation of powers, balanced budgets, and so on, and then make collective decisions. If you read a newspaper, though, you soon learn about logrolling and other budget games. Still, it’s one thing to trade your vote for farm pork for the other guy’s vote for urban pork; the taxpayers lose twice, but at least it’s only money. Trading your vote on a matter of life and death, which is also a fundamental constitutional issue, for a few billion in home-state pork seems entirely unbecoming to a member of the legislature of the world’s most successful republic.

The “Anger Index” or, “Profane in the Brain”

Having spent the better part of a year developing Cato’s Education Market Index, I’m obviously interested in the use of statistical indices to assess policies and measure trends. Well, it seems that the blogosphere is on the verge of developing a new “Anger Index” to measure the discomfiture of the left and right in America.

Blogger Patrick Ishmael has just compiled statistics on the use of profanity by the main left-wing and right-wing political blogs (hat tip Instapundit). The left is currently in the “lead” (waaaay in the lead).

It will be interesting to see how the distribution of political anger, as manifested by use of profanity, will be affected by the 2008 presidential election outcome. If a Democrat takes the White House, will the Anger Index flop the other way? Will it turn out to be lower in states that are more free than in states that are less free? What does it tell us, if anything, about the left, the right, and American political discourse?

T.R. with Nukes

So Senator John McCain has officially entered the race.  Which may be good news if you like the idea of a president who puts sardonic quote marks around the phrase “First Amendment rights.”  But if you like your government limited and constitutional, and the aims it pursues sober and realistic, you may not feel like cheering.   

Matt Welch has a piece in the latest issue of Reason detailing the myriad reasons limited-government types should fear a McCain presidency, among them: McCain’s fascination with Teddy Roosevelt, his indiscriminate hawkishness, and his affinity for National Greatness Conservatism, libertarianism’s bete noire.  The Reason piece isn’t online yet, but Welch’s recent LA Times op-ed on the subject will give you the flavor:

Sifting through McCain’s four bestselling books and nearly three decades of work on Capitol Hill, a distinct approach toward governance begins to emerge. And it’s one that the electorate ought to be particularly worried about right now. McCain, it turns out, wants to restore your faith in the U.S. government by any means necessary, even if that requires thousands of more military deaths, national service for civilians and federal micromanaging of innumerable private transactions. He’ll kick down the doors of boardroom and bedroom, mixing Democrats’ nanny-state regulations with the GOP’s red-meat paternalism in a dangerous brew of government activism. And he’s trying to accomplish this, in part, for reasons of self-realization.

But there’s a detail that I haven’t seen in any of Welch’s writings on McCain that further supports his case.  It’s stuck with me since I read it in newsprint some seven years ago.  From a profile of McCain in the February 27, 2000 edition of the New York Times, there’s this:

“I think he sensed that life held something bigger for him, but he didn’t know what it was yet,” said Doug McCain, his eldest son. The younger Mr. McCain remembers once going with his parents to France and visiting Napoleon’s tomb – Napoleon had been a childhood hero of John McCain – and sensing that his father was searching for any lessons history might hold about how he himself might best serve his country. [Emphasis added].

Napoleon “a childhood hero”?  No kidding.  As a kid, I think I preferred Aquaman, but it takes all kinds.   

Giuliani

A new poll shows that Rudy Giuliani has pulled into the frontrunner position for the Republican nomination for President. Thus, it is worth looking at his fiscal performance as New York City Mayor (1994 through 2001).

A good source of data are the Comprehensive Annual Financial Reports issued by the city’s comptroller. See the CAFR for fiscal 2002, which contains 10 years of historical data.

Total NYC general fund expenditures.

1994: $31.3 billion

2001: $40.2 billion

representing a 3.6 percent average growth rate.

NYC Outstanding General Obligation Bonds.

1994: $22.9 billion

2001: $26.8 billion

representing a 2.3 percent average growth rate.

The data suggest that Giuliani exerted reasonable fiscal control, particularly in comparison to prior NYC mayors, or President Bush. For example, NYC debt more than doubled in the five years prior to Giuliani entering office. But more analysis needs to be done.  

Inquiring Minds Want to Know

The Hill reports on a senator’s curiosity about 527 groups:

“I promised a group of people that we would do some hearings on it,” said Feinstein. “We’ll take a look at the 527, what it is today and where it appears to be going. I’d like to know exactly what 527s are doing. My exposure to them is necessarily limited, as it is for most members. It’s when you have a 527 weighing in against you that you want to know where this money is coming from.” (emphasis added)

Not that Senator Feinstein would do anything to harm the people weighing in against her. She is just curious, eager to learn.