Wednesday, 18 June 2008

Not government, but pluralism

Megan McArdle is answering questions by request from her readers; returning to a theme near and dear to Prof. Karlson’s heart, she again addresses why passenger rail sucks in the U.S.:

I am about to blame—you will perhaps be unsurprised—the government. Why isn’t there a high speed train from New York to Chicago? Well, first of all, this would greatly anger legislators from New York and Michigan, who like the fact that the Chicago train must pass through Buffalo and Detroit, even if this assures that almost no one with a job will actually use it.

There’s also the problem of the Federal construction process. The high speed train between DC and Charlotte was first conceived in the early 1990s. The EIS for this project will be completed probably sometime in 2010. Then we have to get final legislative authority. Then we have to put out the project for bids. By the time the thing is actually built, we’ll probably all have evolved an extra leg and be able to run faster than the high speed train.

Neither of these things are true of government in general. As a couple of her commenters point out, Japan and, to a lesser extent, Germany (where things are more of a work-in-progress) have managed to create impressive high-speed rail systems, as has (of course) France.

It’s in the Anglo-American countries where high-speed rail has hit a roadblock. The United States in particular has the ideal conditions for low support for efficient HSR: legislators with a great deal of autonomy from their parties and an interest in developing a personal vote through constituency service and pork-barrel spending, a geographically dispersed population, and few potential logrolls that can produce a majority vote in either house for practical HSR schemes. Even voter-initiated schemes in states fall prey to these issues; witness the California High-Speed Rail proposal, which has to promise future HSR access to as many communities as possible to maximize the chances of a funding referendum passing in November.

And, as I’ve pointed out before, the U.S. and Britain have much more stringent environmental review procedures than France and Germany—to say nothing of 1960s Japan, when official LDP policy was to maximize the amount of pork spending diverted to infrastructure companies, environment be damned—which (at best) lead to delays as the potential impacts, real and imagined, of projects are cataloged by the government and consultants and (at worst) allow every interest group and NIMBY under the sun multiple chances to stall the process along the way.

In an entirely different venue, compare the war on plastic bags in China (via Matthew Stinson’s shared items feed) and Laredo. Both situations involve “government,” but government is acting in very different ways. I personally wouldn’t trade our pluralist system for a more centralized one, but there are times the transaction costs associated with the former make one long for the latter.


Any views expressed in these comments are solely those of their authors; they do not reflect the views of the authors of Signifying Nothing, unless attributed to one of us.

From the time I took my first political science class the problem of federalist vs. unitary governments has been one continuing theme. The advantage that Britain and France have over the US in transportation and energy is that they are unitary governments that can often care about the good of the whole and not the local. The US with its federalist government has many more problems like this post point out because of states vs the good of the whole. Nice post.


There’s definitely a federalism aspect to the differences; I’d probably go a little broader and say it’s an issue of polycentrism versus monocentrism, where federalism is an institutionalized, formal form of polycentrism.

A completely aside thought: Germany’s federalism is a bit odd in that the states retain a lot of power but primarily exercise it through getting the national government to do what they want collectively via the Bundesrat rather than through autonomy from the national government and doing what they want individually. I’ve always wondered whether the Senate should have been constituted similarly and if that would have forestalled the 17th Amendment (or if the Senate should have been reconstituted along those lines after the railroad and telegraph made such a model practical after the Civil War).

[Permalink] 3. Matthew Stinson wrote @ Sat, 28 Jun 2008, 8:44 pm CDT:

Getting to this post late. In application, the Chinese will have a problem with their new plastic bags ban, since while the government is centralized and can make these arbitrary decisions with lower transaction costs, the Chinese rule of law is far weaker than Western countries, so these decisions cannot be implemented effectively and uniformly. For instance, the gray market is so big here that many small businesses such as street vendors or corner markets don’t follow the laws as written.* What’s more, they make up the majority of businesses giving out bags, as most Chinese cannot afford to regularly shop at large-scale retailers, so I’m skeptical about the net benefits to the environment of the bag ban. The main benefit, in fact, seems to be to China’s image.

  • Supermarkets, department stores, and delis in Tianjin follow the bag ban—which is actually a “no free bags” charge—while my local mom & pop doesn’t, and most little boutiques or specialty shops seem similarly disinclined to follow the law or else just throw the bags in for free. This perhaps reflects a hidden economic cost of the bag ban, which is that steady inflation means that Chinese cities have been slowly moving away from using small money denominations (below .5 RMB), yet paying for bags means having to carry smaller coins (or else receiving them as change after a purchase). Before June 1st, nobody wanted to carry the small denominations around, but now they have to. Most small businesses still don’t think it’s worth the trouble and common folks seem to agree. Hmm, there’s a economics paper to be written here.
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