The American Interest
Analysis by Walter Russell Mead & Staff
Shock: Audit Finds Government Agency “Dysfunctional” As Costs Explode

The Port Authority of New York and New Jersey is a dysfunctional monster leeching the life out of the regional economy with bad management, bloated costs, poor decision making and no clear sense of mission said a group of expensive consultants and experts.

Everyone surprised by that finding, please raise your hands.

New Jersey governor Chris Christie, who pushed the audit as a way of making his point that the agency was wasting money and out of control, was pleased with the result.  New York mayor Michael Bloomberg, for whom no money is misspent if his city gets an appropriate cut, dismissed key criticisms through a spokesperson.

The biggest point at issue: the grotesquely over budget effort to build the World Trade Center.  Costs for this boondoggle have now reached $14.8 billion, up from estimates of $11 billion as recently as 2008.  Much of the extra cost came from an all out push to have the visitor’s center at Ground Zero finished by the tenth anniversary of the 9/11 attack.  Since the pharaohs built the pyramids, artificial deadlines imposed by grandstanding politicians have been a leading cause of cost overruns in the world of public construction projects.

But don’t worry, kids. The federal government will pick up much of the extra cost, so there’s really no problem, right?

The Port Authority was originally put together as a classic blue social model agency that would raise huge sums of money through bond issues and take the corruption and inefficiency of cheap backroom politics out of infrastructure policy for the New York New Jersey harbor area.  Rational, scientific planning and impartial decisions would give the region world class infrastructure at the lowest possible cost.

The agency raised plenty of money through bond issues, but the Port Authority has been politicized and badly managed for years as governors in both states have stuffed its management with patronage appointments, used its resources as a piggy bank for pet projects and vested interests sank their claws ever deeper into the agency. Amazingly, calling something nonpartisan and non-political did not change the laws of human nature, even with the addition of cumbersome layers of bureaucracy.

Now the region’s transport network is underfinanced, badly managed, poorly maintained — and the debt service and high costs of the Port Authority are slowly draining the region of economic vitality.

This is how the blue social model slowly strangles itself in red tape.

Published on February 8, 2012 7:27 am
  • Kenny

    Can’t any government agency do anything right?????

  • Mrs. Davis

    DOD. But it’s very expensive.

  • Toni

    “strangles itself in red tape” while running up massive debt to be repaid with interest by taxes on the rest of us, and on our grandchildren.

    Chris Christie pulled NJ out of a hugely expensive NY-NJ project. Chris Christie for President! 2016, if Obama gets four more years, alas. We need hard-headed, plain-speaking leaders at the national level who can get things done even in the face of fierce Blue opposition.

  • WigWag

    I agree with much of what Professor Mead says here about the Port Authority but it is too bad the Professor can’t get over his habit of exaggerating. Gilding the lilly as he is apt to do makes his argument weaker not stronger.

    Professor Mead complains about the region’s transportation system being mismanaged, poorly financed and terribly maintained. He is right that there are problems, but the New York metropolitan area that the Port Authority serves, has by far the most diverse and successful system of public transportation in the United States.

    If he can name a better one, he should tell us where it is.

  • Eurydice

    Yes, indeed. All those lazy, corrupt and thievish people, wanting their Porsches without having to work for them. How dare they expect the Germans to bail them out! Oh, wait…

  • http://facingzionwards.blogspot.com/ Luke Lea

    Is bureaucratic inefficiency part of the blue social model?

    Take welfare for example. Right now we have a hodge podge of means tested social benefit programs. They all add up (according to the Heritage Foundation) to something like $700 billion a year, and no doubt there is plenty of waste.

    OTH the Social Security Administration is a fairly efficient bureaucracy in so far as the collection and distribution of retirement benefits is concerned. Payroll taxes are automatically deducted and benefits are calculated on the basis of past earnings and age.

    Doesn’t this suggest that government is better at transferring income than in administering means-tested benefits? An across-the-board wage subsidy for all hourly wage workers might be the better option.

    Suppose, for example, that for every dollar earned the government would add an additional 25% or 30% right out of the treasury and onto the paycheck. Reverse withholding as it were. That would preserve the link between effort and reward — a key consideration for the working poor — and would be a lot simpler to administer.

    In principle we could restore real hourly take-home pay to what it would have been in the absence of our current trade and immigration policies, but that’s a bigger issue.

  • http://facingzionwards.blogspot.com/ Luke Lea

    Or maybe just a vast expansion of EITC, since that’s a program we already know.

  • Gary L

    Who shall doubt the secret hid
    Under Cheops’ pyramid
    Was that the contractor did
    Cheops out of several millions?
    Or that Joseph’s sudden rise
    To Comptroller of Supplies
    Was a fraud of monstrous size
    On King Pharoah’s swart civilians?

    – Rudyard Kipling, A General Summary