Defying the Laws of Nature

It seems that a lot of governmental units in Minnesota are having trouble hiring senior administrators. The reason is the our clever legislature imposed salary caps for government employees. Guess what? Qualified applicants can find higher paying jobs in the open market. This is what happens with salary caps. The consequence is that many governmental functions are being administered by people who aren’t really qualified. Want to see a real mess? Imagine what would happen if we capped CEO pay!

Of course, it works are both ends of the spectrum. Setting price minimums is as dangerous as setting price maximums. Only a few politicians seem to recognize this, but at least one who did gave a funny speech in Congress.

Prices are a way of communicating information that encourages good decision making. Mess with prices and you distort the information and get less informed decisions. Whether it’s the minimum wage, price supports, salary caps, rent controls, or anti-gouging laws, any distortion of free market pricing leads to  misallocation of resources, making us all a little poorer.

More Bridge Nonsense

Today’s WSJ editorial pretty much sums up my reaction to the I-35W bridge collapse and the political response. The current political noisemaking is about whether the new bridge should make allowances for light rail. What is it about light rail that politicians find so attractive? All the numbers I’ve seen make it look like a pretty anemic alternative to traditional roads and bridges unless you have an incredible population density (New York) or historic antiquities that make road expansion impractical (London and Paris). Maybe the politicians want Minneapolis to be like Portland. There are, after all, good jobs to be had for transit lobbyists after your political career implodes.

Rock and A Hard Place

There’s still a lot of blogging going on about the Minnesota bridge collapse. Most everyone agrees that the state didn’t do a good enough job. People that have studied the economic thoughts of Mises and Hayek know that, by definition, a government entity can’t do a very good job, at least not for long. (News to you? Read this.)

On the other hand, the alternatives don’t look very good either. It’s doubtful that a major highway could be built without eminent domain, so some government involvement is necessary. And transportation is hard to monetize. Sure, you can do it with airports, bridges, and restricted turnpikes, but a larger interconnected system of roads? And who would be dumb enough to buy a light rail system?

So, government management inevitably leads to mediocre results, while private management seems impossible to implement. I’d say we’re caught between a rock and a hard place.

Bridge Politics

Reality is not optional. Those words alone would have put Thomas Sowell into my pantheon of intellectual heroes. But his much greater qualification was writing the best introduction to economics ever. And Dr. Sowell continues to address topical subjects with a clarity of vision which is astounding. Now he’s written about the Minnesota bridge collapse. I wish I was half as good at thinking things through and even a tenth as good at articulating them.

Priorities at Work

This article stirred a desire to write several things. The most important subject is Bush’s comments on priorities. He is indeed correct: you can’t prioritize spending (or anything else) if you don’t have general priorities in the first place. (As usual, Bush said the right thing in an awkward way). The notion of priorities is often missing from political discourse. People will support a lot of policies as long they don’t interfere with higher priorities. This explains the controversy on lots and lots of issues. It’s not always that priorities are different - it’s often the case that the conflicts between policies are unseen.

A good example is the state of roads and bridges. The collapse of the I-35W bridge has certainly sharpened the focus on highway funding, but even prior to that the poor state of roads and traffic congestion have been hot button issues in Minnesota. But recent polling shows that Minnesotans don’t want an increase in the gas tax. Priorities at work!

Panic Over the Bridge

OK - maybe I was guilty of panic.

More Bridging

The immediate response to the collapse of the bridge was heroic and inspiring. Not only were the first responders prepared, capable, and effective, ordinary citizens, whose only qualifications were being nearby, leaped into the chaos and began helping, sometimes at great personal risk. This was Minnesota at it’s best.

But now, things are sliding back to their usual state. There seems to be a groundswell of stupidity in the aftermath. Lots of politicians and ordinary people have concluded that the solution to the bridge collapse is to raise taxes and spend more money on transportation. Never mind that no one knows the cause of the bridge collapse. Should more money have been spent? No one knows. How should money have been spent differently? No one knows. Never mind that that the unfunded transportation wishlist has a lot of projects, but nothing about the bridge that went down. Never mind that in Minnesota a big slice of the transport budget gets spent on mass transit. Exactly how would more mass transit help with falling bridges?

A sensible person would first determine the cause of the problem, then determine the appropriate corrective and preventative actions. We are probably going to do it the other way around. This is so typical of our state government which, I am told, is better than most. Ready! Fire! Aim!

Stories of the Bridge

As you might imagine, local news coverage has concentrated on the collapse of the I-35W bridge over the Mississippi. The stories of the survivors are heartening. The professionalism of the emergency services folks and the NTSB analysts is encouraging. The press conferences are almost interesting, but the questions from reporters are distressing. It’s like they have to have the most apparent things explained to them - almost like they have no experience living on this planet. The politicians and pundits are a mixed bag. A few seem useful, but far too many want to score political points. Someone even went so far as to blame Bush for the bridge’s collapse! But, in the midst of it all, there is at least one good idea.

The Bridge

Blogging is light - everyone (including me) is preoccupied with the I-35W bridge collapse. There’s video! This could be even a bigger problem than it appears.

Minnesota Not So Nice

Minnesota’s new flag law is the kind of thing that makes us look really stupid to the rest of the world. It seems to me that one of our most basic rights is to do business with whom we please. Allowing only “made in America” flags is telling us which manufacturers are state sanctioned - and doing business with anyone else can get you a few nights in the slammer. Great. Here we are trying to convince a skeptical world about the virtues of freedom and democracy and Minnesota does something worthy of Putin or Castro or Chavez.