An unintended indictment of government regulation


Former CA governor offers advice to New Orleans and unintentionally makes a case against government regulation
Pete Wilson writes a column in today's OpinionJournal.com, he explains how Los Angeles recovered from the 1994 earthquake.

First, I quickly exercised the extraordinary emergency powers conferred upon the governor of California by the state Government Code. I suspended the operation of statutes and regulations that would have required the protracted public hearings called for before environmental impact reports could be filed and acted upon, and I suspended other normally demanded procedural hurdles. The elimination of these legal requirements drastically reduced purposeless delays that would have impeded recovery and compounded the injury inflicted by the quake.

I cannot emphasize too strongly the need for governors to be given such clear emergency powers if they are not provided them by existing state law.

Second, we took a page from the book of private-sector incentives for accelerating performance. We told contractors bidding to repair the bridges that they must submit bids that specified not only the cost but the date of completion, and that they must agree to an added condition: For every day they were late, they would incur a penalty of $200,000; and for every day they were early, they would be rewarded with a bonus of $200,000. The winning bidder, C.C. Myers Inc., put on three shifts that worked 24/7. In order to prevent any delay in the work, they hired a locomotive and crew to haul to Los Angeles steel sitting on a siding in Texas. Myers made more on the bonus than they did on the bid.

Although it was entirely unintentional, Mr. Wilson also makes a strong case against statism. If the statutes and regulations add to the cost and to the time necessary to complete a project, do the additional benefits outweigh the increased cost and time? Wouldn't those same contractual incentives that Mr. Wilson raves about also serve to protect the environment or any of the other regulation goals?

Or, why have the state spend money when you can do it cheaper and faster in the private sector?

The only way to deliver under budget and on time was to ignore all the laws and regulations that the State had put into place to "protect" the people and their interests.

That is a pretty good argument for KYFHO.

— NeoWayland

Posted: Tue - September 13, 2005 at 04:59 AM  Tag


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