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Insanity in government and business

February 18, 2007

The Washington Post reports that The governments of Spain and Morocco want to build an underwater tunnel from Cape Malabata, Morocco, to Punta Paloma, Spain.  It will run 25 miles under nearly a thousand feet of water, in a “geologically tormented” region.  They think they can get it done by 2025, for only “6.5bn through $13bn.”

(Question: what’s with the “.5” when you can’t even narrow it down to a factor of two? )

OK, neat.  That’s slightly shorter, but through five times deeper water and much worse geology by far, than the British/French “Chunnel” which ended up costing almost twice as much as the largest estimate for their tunnel, and has bobbled around the bankruptcy point since it was built.

What is it about governments, civic boosters, and other hucksters that they always say; “We’ll do it in less time for half the cost!  It’ll make tons of money!”  It reminds me of the Simpsons’ “Monorail” episode.  I have no problem with the idea of the tunnel.  It’ll probably help Africa, help the countries involved, and be one of the great engineering wonders of the world. But stop lying about what it will cost.

This is a universal problem.  My little town of Normal, Illinois is restructuring its downtown, and the same thing is happening – we’re building a tunnel to Morocco.  No wait, that isn’t it; we’re just buying a lot of land through eminent domain and mismanaging it to grease wealthy companies after the voters said “no” to the whole project.  (Project was re-worded and presto! now it’s a different project! Nearby Bloomington did the same thing when voters said “no” to a civic arena.)

The local paper says:

“The $75 million Uptown Normal project outlined by OneMain Development builds on a vision and creates the energy needed to continue Normal’s push into the future.”

Well as long as we’re building on a vision and creating energy, then.  Gotta push into the future, y’know.  (Oh, they officially changed the name of the area from “downtown Normal” to “Uptown Normal” because it sounded more, well, uptown.)

I think it’s high time that “civic boosterism” be recognized as a mental disease. 

  1. rodch
    February 18, 2007 at 14:52 | #1

    (Question: what’s with the “.5” when you can’t even narrow it down to a factor of two? )

    They might have said “5 to 10 billion Euros”

  2. February 18, 2007 at 19:05 | #2

    5 to 10 billion Euros would at least make sense.  The .5 is a level of precision that it out of place in the scale of the whole range.

  3. February 18, 2007 at 22:30 | #3

    “Power too cheap to meter.” That’s what they said about Nuclear power plants. It’s all about who pays for it, and who gets paid to build it. I smell a bond issue.

  4. February 18, 2007 at 22:45 | #4

    Yes.  With that much money changing hands, it’s easy to imagine some of it slipping sideways to bend the decision process.

  5. rodch
    February 19, 2007 at 00:44 | #5

    “The .5 is a level of precision that it out of place in the scale of the whole range.”

    Yeah. My point, which I did not make clear, is that reporters often lack numeracy, so we need to take care not to blame the original source.

    Here in South Africa, we often see news reports of the form: “The project will cost R7,120,820”, when what was actually said was “about a million dollars”. I have read similar conversions to British Pounds.

    In the past, such figures were usually presented in US$, as it is the dominant unit of international exchange, so USAians hardly ever saw the reporting problem, but that is changing, so brace yourselves for more.

  6. February 19, 2007 at 09:31 | #6

    I think the rebuilding of the Downtown area is a good idea.  At first I was against it, especially the hotel, but looking at other cities and their successful projects, it only makes sense.  Plus some very nice restaurants are coming in.

    The downtown, oops I mean uptown, area already had a lot of nice shops.  It just looked dilapidated.  I think the renovation will bring in a much need change, and hopefully revenue, to the area.

    I have watched some of those tunnel projects on Discovery Channel, and everyone went over budget and was off-schedule.  But maybe Spain and Morocco see something different.

    BTW DOF, have you seen those new tunnel diggers they use.  Friggin amazing!  The machine chews through the rock wall in a circular fashion creating the tunnel wall, while an attached machine sets concrete slabs into place for the tunnel wall.  Then hydraulic pumps push attached to the newly placed concrete slabs push the whole machine forward at a predetermined pace.

  7. February 19, 2007 at 10:02 | #7

    The original price tag for the hotel project was $10m, now it’s $75m.  The hotel competes with other, non tax-advantaged hotels in town.  The town is offering $16.5m incentives to the development company.  If the project makes economic sense on its own, why do we have to pay them to do it?  Why did they have to practically confiscate property from certain downtown businessmen and then egregiously mismanage it?  Why are they so clueless as not to know how ludicrous “Uptown” sounds? I can’t help think about these things as I write out huge property-tax checks twice a year.

    Yes, the new tunnel-digging machines are amazing.  Let’s meet up in 2025.  If the Gibraltar tunnel is finished, and for any less than double their current highest estimate, I will buy you a steak dinner with all the trimmings at the best restaurant in town.

    Rodch, you are so right about “journalist’s” innumeracy.  Here’s another example that comes to mind :-S

  8. February 19, 2007 at 10:49 | #8

    If the project makes economic sense on its own, why do we have to pay them to do it?

    My guess here would be they wanted to lock in the hotel company.  That and their estimates of the return would outweigh the upfront money.  All towns do business this way for these types of projects and many others.  Bloomington/Normal did the same thing with Mitsubishi whom got offered a tax free business for the guarantee of x number of workers.  Then they laid off 3,000 workers.  This upsets me a lot more than what is currently going with the uptown dev project.

    I can’t say for certain, but I do know that the same development scheme being used here helped Champaign, Iowa City, and many others.  Will it help Normal?  I hope so seeing as I am going to be in this area for awhile.

    As far as Normal city officials mismanaging the project, I am not that surprised.  I just hope the development company does a good job and leaves the town of Normal with a smaller window of error.

    If the Gibraltar tunnel is finished, and for any less than double their current highest estimate, I will buy you a steak dinner with all the trimmings at the best restaurant in town.

    You must be crazy if you think I will take that bet…  :o hh:

  9. February 19, 2007 at 10:56 | #9

    Let’s not forget the Outlet Mall over by Farm & Fleet!  That heavily tax-incentived boondoggle was going to be a big frakkin’ tourist attraction and bring people into the community from a 9-county area.  Go out there sometime.  Most of the storefronts are empty and have been for years.

  10. February 19, 2007 at 11:00 | #10

    Let’s not forget the Outlet Mall over by Farm & Fleet!  That heavily tax-incentived boondoggle was going to be a big frakkin’ tourist attraction and bring people into the community from a 9-county area.  Go out there sometime.  Most of the storefronts are empty and have been for years.

    I do go out there from time to time, they have really good closeout sales… ;-P

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