Monday, September 30, 2013

Not how this game works

The LA Times reports polling of California voters, the majority of whom now report buyers' remorse and worry over the California bullet train project. "52% want bullet train stopped, poll finds ... California voters are showing signs of buyer's remorse over the $68-billion bullet train project, poll finds." 

Sorry guys. That is not how the game is played. 

Sunk costs are irrelevant every time businesses drop product lines or even close shop. These are tough choices made every day. But sunk costs are seriously considered in emotional contexts. Marriage counselors routinely deal with some version of "I cannot leave this [unpleasant] relationship; I have invested so much in it." My guess is that such counselors do not then reach for the economic thinking.

It is not at all strange that sunk costs are taken seriously in politics.  When it is other people's money, we may as well go with unexamined impulses.

Here politics as usual where rhetoric matters.  The great practitioner of all this was Robert Moses. Robert Caro does a good job laying it all out in The Power Broker.  My copy is not handy but the key passage is cited by Peter Ubel here.

Is this a cynical use of power? Is there any other kind? Is the "buyer's remorse" of Californians relevant to anything?  Once some concrete is poured, it's all over.


Here is Timothy Taylor citing a wonderful paper by Cliff Winston.  The way transportation should be (Winston) and the way it is (Robert Moses, Jerry Brown and countless others) remain breathtakingly far apart.