Monday, August 25, 2008
Obama and the Chinese infrastructure gaffe
Mindles linked to this clip of Barack Obama praising the great Chinese infrustructure he must have seen during Olympics coverage -- “Beijing looks like a pretty good option. Why aren't we doing the same thing?” Dan Riehl cuts him up for it, with links to stories that describe how the Chinese built such nice infrastructure:
Obama is either incredibly naive, terribly misinformed, a communist, just flat out dumb or all of the above to be caught on tape making a statement like that.
I'm going to climb out on a limb and say that there is a nugget of truth buried inside Obama's thought. It has become extremely difficult to build new public works and private projects of great magnitude in many parts of the United States, and that has made our economy more sclerotic than most of us on the right would prefer. I am not a development expert, but my strong sense is that the main obstacle to big and otherwise useful projects is litigation or the political equivalent of it (land use hearings, tough zoning requirements, and the like).
Litigation in opposition of development does not have to be ultimately victorious or even meritorious to stop a project. It only needs to extend the schedule long enough to make the project's cost in capital and management time unacceptable to investors.
In rough terms, anti-development litigation derives from two different impulses. The first is, ironically, a new and more expansive definition of "property rights" that has gained currency in the last generation. Increasingly, courts are granting property owners "rights" that heretofore needed to be purchased, and the enforcement of those rights can derail development. So, for instance, plaintiffs or complainants are arguing that they have rights in the "view" from their property even though they purchased no restrictive covenant to protect that view. Sympathetic courts or local regulators will hear these claims -- which should be regarded as asinine on their face -- and in the process delay or defeat the project. The political and legal opposition to putting wind power generators in Nantucket Sound -- an obviously great place for a wind farm -- is a famous but hardly unique example.
The second source of anti-development litigation comes from the environmental laws passed in the 1970s. In particular, the National Environmental Policy Act ("NEPA", the law that requires the preparation of an "environmental impact statement" for most public infrastructure projects) has become a favored vehicle for anti-development litigation. Not only does the environmental impact statement take a great deal of time and money to prepare, but citizens have standing to bring cases that challenge the process or result.
There is no small irony here. If you believe, as Barack Obama does, that we must restructure our economy to reduce greenhouse gas emissions, we are going to need massive investments in environmentally intrusive infrastructure. We will need wind farms off our beaches, nuclear power plants along our rivers, and solar collectors in our deserts. The most effective means for blocking these projects will be the laws put in place to, well, protect the environment.
So rather than saying that Barack Obama is an idiot, I would ask him a follow up question: What specific changes in law and regulation would he propose that would significantly accelerate (and thereby massively lower the capital requirements of) major infrastructure projects, whether to improve American competitiveness or reduce GHG emissions?
4 Comments:
By 
Elise, at
Mon Aug 25, 07:55:00 PM:
A simple way to ask Obama this question would be to ask him if he supports the Pickens Plan. As far as I can tell, Pickens plans to fund his wind farm through private investment but wants the Federal government to fund transmission lines. In addition, however, he wants the Feds to cut a path through existing regulations that might hold up construction and to wield eminent domain to take the land he needs.
By 
, at
Mon Aug 25, 09:43:00 PM:
Thanks for that.
The last time I looked into the numbers here in California, the cost of "regulation" boosted the cost of a house by as much as 33%, depending on where you live. Some of that is, of course, necessary, but a lot of it is not. A family buying a home is mortgaging for 30 years the cost of unnecessary bureaucracy.
When it comes to major infrastructure projects, the cost can eat up more bureaucratic cost can east up more than 50% of the budget. Cutting through the red tape and reining in the out of control lawsuit industry would help every American.
By , at
Tue Aug 26, 12:13:00 AM:
Newt Gingrich had a speech about Islamic terrorism and had this to say (I believe here: http://www.youtube.com/watch?v=sZiw3qVdFzw) The interesting part (related to this post) is around 240-270 seconds:
I finished a novel recently called Pearl Harbor. You look at the Second World War. From December 7th 1941 to August 14 1945 is less than four years. In less than four years, we defeated Nazi Germany, Fascist Italy, and Imperial Japan. Today it takes 23 years to add a fifth runway to the Atlanta airport.
Vilmos
By , at
Tue Aug 26, 09:59:00 AM:
Your post raises a valid point but it also mixes apples & oranges. Obama is a naive, mis-informed idiot; there is no grain of truth in his statement; and it is indeed difficult to develop some kinds of instructure in the US for the reasons you cite.
However, the third point has nothing to do with the others. There is no "there" there in China's infrastructure. Obama was simply taken in and played for the yokel he is by the Chinese Leadership. This has nothing to do with infrastructure development over here.
Further Obama has no idea how to improve infrastructure development; he in fact does not even know what that means. To be fair, it is not an easy question. Building and improving real infrastructure is a much different thing than the Potempkin villages the Chinese displayed. It is not at all obvious that we are doiong nearly as bad a job as your post seems to imply and certainly Chinese foolery is no way to measure whether we are or not.
