Saturday, August 18, 2007

Big Dig Redux? How Would You Minimize Corruption in Big City Infrastructure Projects?

Today the New York Times editorial page endorses bigger government. Perhaps C + I + G = Y, but what units is "G" measured in? What is "high quality" government services and how do we design contracts and accountability to achieve this? I agree with the Times that clean, high quality water may be a good investments for cities. This EPA price tag of $277 billion dollars over 20 years caught my eye. Will this be a national "Boston Big Dig" with cost over-runs and ex-post questionable quality? How would the EPA write contracts and set up its regulatory oversight to guarantee that this wouldn't be a major waste of money captured by government sub-contractors?

This smells like a great example of asymetric information and perhaps the EPA should buy Laffont and Tirole's Procurement textbook and read it.

August 18, 2007
Editorial
Keeping Cool, Clear Tap Water

Americans have some of the best water in the world — a bragging point that seems to have gotten lost lately, even by those who take their daily exercise by waving the flag. Perhaps it is because the bottled water industry markets their product with waterfalls and soothing colors to make it seem like the clearest, cleanest, healthiest drink on earth. Unfortunately, that marketing can make tap water seem less clear, less clean and less healthy. When New York City did a survey on tap water recently, one youth was asked whether he drank from the public water fountains. “Yes,” he said, “but I’m going to die.”

Luckily, he’s wrong. The public water supply in this country is generally so good that bottlers of several leading brands of water have recently explained to consumers that their product originally springs from the tap. The problem is that it won’t stay so good without more government help.

Pipes and tunnels are aging fast with many of these subterranean networks nearly a century old. In 2003, the Environmental Protection Agency estimated that it would take nearly $277 billion to keep the nation’s water distribution systems up to par over the next 20 years. That is a lot of money. And to get the necessary federal, state and local funds, it will take a lot of public support for a system people blissfully take for granted.

The fear is that if too many people convert to bottled water, there would be even less political support for such spending. The last thing America needs is two water streams — one for the rich and another for the rest of us.

Right now most drinking water experts see little difference between bottled water and tap water. The E.P.A. already requires public systems to test for 96 contaminants and to release their findings to the public. The bottled water industry is regulated by the Food and Drug Administration, which requires many of the same tests — but a lot less frequently. And the F.D.A. reports are tucked away in the Washington bureaucracy. Both agencies could tighten those regulations and test for more contaminants. And the F.D.A. needs to make the results of their bottled water tests readily available to the public.

Any discussion about public water needs to mention the weak link: the pipes from the public system to your home faucet. In some cities, like New York, a substance is added to the water to help keep metals from leaching from older pipes — theirs and yours. Some health officials advise letting the water run for a minute to get the lead out, literally. And home filters are mostly about taste, although the some experts recommend filtering water for the young, the old, the infirm and the pregnant.

Filtered or not, American tap water is a national treasure that badly needs a little public respect and a lot of public funding to go with it

1 comment :

Anonymous said...

^^ nice blog!! ^@^

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