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Georgia’s McKinsey Transportation Study - Throwing Money Down the Drain

Governor Sonny Perdue

Governor Sonny Perdue recently announced that Georgia has awarded McKinsey & Co. a $2.5 million contract to develop the state’s transportation strategy. Talk about throwing money away.

Preliminary plans show the consultant’s assignment is ambitious. It includes identifying policies and governance structures; evaluating transportation building programs and how to pay for them; and suggesting what to do about the state’s floundering toll road program.

McKinsey is also supposed to “support agencies as they develop a concessions pilot program.” For such programs, “concessionaires,” or private companies, might pay big sums up front to operate toll roads and collect the tolls for long periods.

Translation – no plan exists – this is all worthless consultant speak that amounts to nothing.

Notice, McKinsey isn’t getting paid to do anything, they have to “support agencies.” This actually has a translation – get worthless government hacks to do the jobs we pay them to do in the first place, and collect a healthy fee in the process. According to Gena Abraham, the Georgia Department of Transportation Commissioner:

her own staff is too busy to take on the work and, in any case, McKinsey will do a different type of work than other transportation consultants.

Too busy doing what exactly? Allowing Atlanta’s traffic to become tenth worst in the nation while they fling boogers at each other? If we don’t pay these clowns to develop transportation strategy, what do we pay them to do? Hey commissioner, time to wake up, your state’s traffic is abysmal, and you are at the helm. This is the kind of thing where non-essential tasks cease and you shift resources to deal with the problem. Moron.

State Department of Transportation Commissioner Gena Abraham said all policy decisions will be made by government policy makers, who will work closely with McKinsey throughout their research.

So again, what exactly are your people too busy to do? If they already have to be closely involved, why are we wasting $2.5 million instead of using it to fix some of these problems?

One of the things we’re talking about is privatization of roads:

“This is creating a business case” for adopting strategies, she said. “It’s not another plan or study. It’s pulling everything and all the research that’s been going on in all these entities into one location and move towards comprehensive goals and strategies.”

Georgia Regional Transportation Authority director Dick Anderson said that McKinsey could “look at our transportation issues through a business lens and a return-on-investment lens.”

I hate when people talk about government expenditures as “business cases” and “investments”. I understand that some of these things exist when determining what kind of policy we should implement – we don’t want to spend $400 million on a bridge to nowhere. But I notice that once we start down this road, we always end up talking about things that the government funds as if somehow they could actually generate a profit.

Government expenditures shouldn’t exist to generate a profit for the government, they should exist to generate profit and opportunity for the citizens. We pool our money through taxes to pay for things that are impractical or impossible for private citizens to do – national defense, roads, international diplomacy, etc… We don’t pay our taxes so that some private company can come along and charge a fee to use the road.
The road benefits everyone, and I don’t like to think of it as a business that has to cover its costs. We only look at the revenues in terms of the tolls collected, but this neglects the fact that the road spurns economic development along its whole length, which makes lives better and provides revenues to the government in the form of a larger tax base.

Unfortunately, we don’t talk or think about it this way, we expect every bridge, tunnel, road or mass transit system to pay for itself. I’m OK with it up to the point where the state is using all of the money it takes in wisely. I’m not OK when we’re subsidizing the profits of a private corporation by giving them a free road with tolls already built and telling them “staff as you see fit to make a profit.” Wrong answer.

If that’s what the citizens of Georgia will get for their $2.5 million – a private corporation that answers to no voter making recommendations about which private company, which also answers to no voter, should take charge of a road and levy a de-facto tax with an upfront taxpayer subsidy to make the whole thing possible – then we should consider another Boston tea party. If the road is financially feasible for a private company to build and turn profit on, then let them build it. We shouldn’t be paying for this.

Ultimately we find out what really motivates this study:

Asked if he hopes the study will produce a “business case” that convinces [Governor] Perdue of the need for a transportation tax, [Atlanta Regional Commission Chairman, Sam] Olens said, “I think the governor frankly believes that now. I think the governor wants to see the data to back up the impression.”

Great. So we’re really paying a weasely consulting firm to come in and tell us what we want to hear, just fancify it up and throw some pretty numbers on some slick charts first. That way the voters won’t kill us when we spinelessly shirk our duty to be fiscally responsible and trim fat before coming back to the feeding trough. Oink Oink, I smell pork.