Federal Infrastructure for Private Profit

Posted: Feb 13, 2013 12:01 AM

In my recent study on infrastructure, I noted that federal spending is often designed to aid private interests, not the general public interest. As one example, I pointed to the Army Corps’ “MRGO” canal in Louisiana that was aimed at helping the shipping industry, but ended up being a wasteful boondoggle and harming the public interest.

The Washington Post today focuses on another dubious Army Corps project: the New Madrid Floodway project in Missouri. The aim of the project is to confer taxpayer benefits on a small group of private landowners, but it will harm the environment and undermine effective flood management on the Mississippi River.

Why would Congress consider going ahead with such a counterproductive project? Because the Army Corps has an institutional pro-construction bias and the agency is under the sway of certain powerful members of Congress, who do the bidding of private interests in their states. From the Post:

[Senator Roy] Blunt — who told reporters on Feb. 4 that he and Rep. Jo Ann Emerson (R-Mo.) ‘spent all of last year trying to browbeat the EPA and the Corps of Engineers into doing this job’ — tweeted Friday that he would ratchet up the pressure.

Blunt’s comments make clear that political power, not sound economics, dominates policy in Washington. Yet many pundits and wonks continue to believe the fairy tale that if we boost federal infrastructure spending it will allocated in an efficient manner by impartial experts toward high-return projects that benefit the general welfare.

Perhaps there are exceptions, but, in general, the federal government has never worked that way. With regard to the Corps, pork barrel politics, boondoggles, and environmental harm have been the modus operandi for more than a century. Here’s what I noted regarding the New Madrid Floodway project in my study of the Corps:

The Corps and some members of Congress have pushed a $108 million project to drain tens of thousands of acres of flood-prone land in Southeastern Missouri to benefit a small number of corn, soybean, and cotton farmers. The area currently acts as a beneficial relief valve for the Mississippi River during floods. Many experts think that this project is absurd, but the Corps sought to speed project approval on the basis of a manipulated cost-benefit analysis. In 2007 D.C. District Court Judge James Robertson harshly criticized the Corps’ analysis as ‘arbitrary and capricious,’ and he said that ‘the Corps has demonstrated its willingness to do whatever it takes to proceed.’

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