Public Works on Steroids
By Tibor Machan - July 21, 2011

What the Obama administration and its cheerleaders call "the stimulus" is by all sensible accounts the macroeconomic version of steroids. And you can get quite addicted to these – just as some athletes can to their versions.

Now there are lots of things wrong with these artificial public works projects, although sometimes they look benign enough. Many folks will not object to having extra upgrades and improvements on their roads and highways. After all, nearly everything suffers from some measure of wear and tear. And who can tell without considerable expertise when it is time for justified improvements on the infrastructure. Usually such matters are decided upon by individuals in their particular lives – like when should their cars be washed, when should they get an oil change, when is it time to visit the dentist again. Or when is it time to get a complete medical check up! Or get one's pants cleaned or shirts laundered. These are individual matters and highly contingent on personal and family factors, such as needs and budgets.

When it comes to roads and highways the local public work departments make these kinds of decisions based on the advice of the road engineers and on the budget bureaucrats. Some kind of rationale is arrived at, although with public works there is always the problem of some version of the tragedy of the commons. Too much attention to the parks may get in the way of enough attention to the recreation facilities or city pools. But when one adds the artificial stimuli provided by politics that's guided by the fantasy of Keynesian economics – you know, the multiplier and such – no rationale is possible. It is nearly all guesswork. Unless one has roads with gaping pot holes that just cannot accommodate traffic anymore, the time to spend funds on upgrades and fixes turns out to be arbitrary. Kind of like how many steroids should a body builder use – it is an artificial aid and no one can tell just how much, if any of it, is the right amount.

In my region of the country, Orange County, California, ever since I moved here about 12 years ago there's always been some road construction afoot. But not so much as to cause too many delays and detours. After years of experience with the local needs, those responsible manage to figure reasonably accurately just when the work is needed. But the stimulus funds arrived, which enabled the local authorities to spend on all kinds of projects whether any real need exists, it becomes a spectacle of arbitrary public works. Dozens of roads get shut down out of the blue. Thousands and more commuters need to stand and wait in long lines so the work can get done. Gasoline is wasted, not to mention people's time – life, actually – and who knows what other unintended harmful consequences result.

Never even mind for now the fact that the stimulus consists of loot extorted from citizens who are imposed and encroached upon with all kinds of costs that no one can tell buys anything worthwhile. I am certainly unable to tell if that shovel-ready road job that is keeping me from getting to work on time is required or invented by Keynes-inspired magical economics. I cannot judge whether the gasoline used standing idly by at innumerable road blocs is being wasted or not. No one can, I bet. We are all simply informed to put up and shut up – these are, after all, public works and interference from ordinary citizens can land one in jail!

It is bad enough that people are so much at the mercy of the decisions that are made about public works and, more generally, public affairs and not unless they vote out the team is there a chance of changing the guard. But when the policy of injecting funny money into the system is carried out, nothing resembling a rational system can be expected.

I believe it was my very first scholarly paper in a philosophy journal, titled "Justice and the Welfare State," that laid out the case showing that under the welfare state simple justice is impossible. Causes and results cannot be linked, responsibilities are vague and diffuse.

The current policy with stimulus-driven public works is just another case in point.

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