The Nobel Prize for Stupidity

Paul Krugman won the Nobel Prize a few years back for Economics. The prize committee said that he won for his work explaining the patterns in international trade and the geographic concentration of wealth. The prize should have been awarded, however, for stupidity.

Two days ago, Krugman authored a column in the New York Times in which he took New Jersey governor Chris Christie to task for his cancelation two years ago of a new rail tunnel from New Jersey into New York City. At the time, Christie said that the state could not afford neither its portion of the tunnel costs nor the future operating costs that the state would have to underwrite. Krugman says that Christie was lying with those claims. The essence of Krugman's attack is that Government Accountability Office just issued a report confirming that the the tunnel's costs were not rising contrary to what Christie claimed. Therefore, Christie must have been lying according to Krugman.

Now let's consider the truth. Krugman himself is a fool, and idiot or a liar. Let me explain. I have a great deal of experience with large public constrution projects in the New York City area; I saw them from an overview perspective as the attorney for the owner or for for the contractor. I was involved with bridges, tunnels, highways, office buildings, hospitals, factories and all sorts of large projects. In my many decades of experience, I never saw a large public project that did not rise quickly in cost from the time design began (where the tunnel was when canceled) until the construction work was completed. It just does not happen. There were projects that more than tripled in cost even from the time construction began until completion was reached. The sad truth is that public construction in and around New York City is not structured to keep cost down. It is instead set up so that contractors, unions and others who feed at the public trough can be sure to be well paid for whatever work gets done.

The tunnel under the Hudson is no exception. It was to be built under the guidance of the Port authority of New York and New Jersey. These are the same folks who have been unable to have the World Trade Center site completed and rebuilt even though it is now more than ten years since the 9-11 attack. The cost of the new construction at ground zero rose by multiples since it was first proposed. Only and idiot or a fool would think that the cost of the rail tunnel would not have risen.

Of course, Krugman points to a study by the GAO that says that there was no price rise. Again, this is the kind of nonsense that an idiot or a fool would believe. Price rises during design come about mainly in two ways: first, there is a substantial change in timing or scope which leads to a new cost estimate being done; or second, when the design is complete, the project is given to contractors who submit bids for the work. When the project was terminated by Christie, it was not at the point where a new cost estimate would be done. That would have been months down the road, so the inevitable rising cost would not have been known. More important, there had not yet been any bids submitted by contractors, the event which leads to most of the major cost increase prior to construction. In many ways, Krugman's claim that the costs were not rising is the same as if he announced that a car with a flat tire was not losing in a race because the race had not yet started. That car would inevitably lose the race, but the loss would be in the future.

It is a sad thing to see the New York Times print drivel from Krugman week after week. Krugman may know something about international trade; I cannot say for sure. Krugman, however, knows nothing about public construction in and around New York City.

It is worse than sad, however, for Krugman to use misinformation and lies to attack someone like Christie who had the courage to stop the spending on the tunnel. Maybe this year, Krugman can get the Nobel Prize for Stupidity.