Libertarians, Government Unions, and Infrastructure Development

“Alright, but apart from the sanitation, the medicine, education, wine, public order, irrigation, roads, the fresh water system and public health, what have the Romans ever done for us?”
–  John Cleese, Monty Python’s Life of Brian, 1979

Any discussion of California’s neglected infrastructure has to recognize the three factors most responsible, libertarians, environmentalists, and government unions. Picking libertarians as the first example is not by accident, because libertarians are perhaps the most unwitting participants in the squelching of public infrastructure investment. By resisting government involvement in any massive public works project, libertarians provide cover to public sector unions who know that public works funding competes for tax revenues with their own pay and benefits.

When it comes to squelching public infrastructure investment, however, nobody can compete with California’s environmentalist lobby. Their lawsuits have stalled infrastructure development for decades. And the identity of interests between government unions and environmentalists is multi-faceted. The most obvious is that when there is no money for infrastructure there is more money for government worker pay and benefits. And of course, the more environmentalist regulations are passed, the more need to hire more unionized government workers.

Then there are the unintended and largely unnoticed financial consequences of environmentalism abetting the government union agenda. As California’s carbon emission auction collections slowly grow into billions per year, government jobs are redefined to incorporate “climate change mitigation.” Code inspectors and planning dept. personnel become climate change enforcers ala revised building codes and zoning laws. Bus drivers become mass transit workers mitigating climate change. Firefighters combat lengthier fire seasons, and even police are called into action because hotter weather is correlated to higher crime rates. And as they work to mitigate the impact of climate change, all of them quietly qualify for a share of the carbon emission auction proceeds.

The unintended economic consequences of environmentalism abetting the government union agenda are among the hardest to explain. Of course environmentalism can slow down economic growth. At some reasonable level – which we’re well beyond – that’s even desirable. But the environmentalist squelching of public infrastructure development, along with competitive private sector development of land, energy and water resources, has created artificial scarcity. In turn, this drives up asset values which helps government pension funds two ways (1) directly through appreciation of their invested assets, and (2) indirectly, by creating new real estate collateral for consumer borrowing which stimulates consumer spending which creates corporate profits and stock appreciation. In short, the economic consequences of artificial scarcity are asset bubbles that, for a time, keep unionized government worker pension funds solvent. When you can’t afford to own a modest home, or run an energy intensive business, remember this.

What libertarians and environmentalists both need to understand is that massive public works are one of the prerequisites for broadly distributed prosperity. And the environmentalist bias against massive civil engineering projects is two-faced. For example, managing delta salinity, the flow of the San Joaquin River, and the very existence of one of the largest refuges for waterfowl in the American southwest, the Salton Sea, are all dependent on dams, aqueducts and irrigation. But no more?

If you search for interest groups that favor massive civil engineering projects, you’ll look far and wide and find nothing of significance. Private sector unions ought to be leading the charge, but in recognition of the power of environmentalists and government unions, they settle for politically correct projects of marginal productive value – high speed rail, delta tunnels, and the occasional stadium. The Silicon Valley lobby is even worse – rather than support abundance through innovation, they embrace conservation through surveillance. If Californians recovered an additional 10 million acre feet per year of fresh water through civil engineering projects such as desalination, dam storage, and sewage reuse, there would be no need to embed internet devices into “smart” (and mandatory) side loading washers, low flow toilets, water meters, dish washers, and irrigation systems.

The biggest challenge ideologically however confronts libertarians. Because in the real world, we need to build civil infrastructure within a financial and legal framework that relies to some significant degree on government. If libertarians can reconcile their ideals with the needs of Californians, they might rally private sector union leadership, practical environmentalists, and altruistic members of the public sector. Massive infrastructure development in California on all fronts is long overdue. The revenue producing elements of this infrastructure could be financed through the pension funds – only consuming a fraction of their assets – and give truth to their currently preposterous assertion that they’re helping our economy.

Imagine if California’s government, with help from private and federal sources, was truly committed to creating abundance again through massive civil engineering projects across all areas of critical infrastructure. Can libertarians find a formula that would enable them to urgently support this without violating their core ideals? Can they support development while also being the watchdog against corruption? It could make all the difference in the world.

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Ed Ring is the executive director of the California Policy Center.

5 replies
  1. Avatar
    Mathew Bell says:

    I couldn’t agree more with this article. While I consider myself an environmentalist (I worked for 32 years in wastewater treatment) the burden placed on projects that would eliminate the drought problem are ridiculous. Two are at the forefront. First, between Los Angeles, Orange, and San Diego city and county wastewater treatment plants they collectively discharge more than 1 billion gallons of treated wastewater into the ocean each day. This is a huge waste of water. What if all this water was redirected to the San Joaquin valley, given tertiary treatment, and used for growing food? Well, the entrenched interested in each locale want this water for the long run for use in their areas. Ok, then get to it! Orange County is the only one really moving forward quickly enough. Second, let’s move now on desalination. Yes it’s expensive and yes there’s a brine discharge into the ocean, but those are no reason not to build now. The population will continue to increase and no amount of conservation will keep up in the long run. Kill the bullet train. Build desalination.

  2. Jon Layne
    Jon Layne says:

    Geesh! Why the Libertarian bashing? Environmentalists and Unions I understand. But to include Libertarians? Where are you getting this info from? Perhaps you should inquire with Robert Poole from the Reason Foundation- an expert in transportation infrastructure that calls out the public sector on how to do it better by using the private sector. I think you’ll be surprised how similar you are- Coming from someone in the transportation infrastructure industry myself.

  3. Ed Ring
    Ed Ring says:

    Jon – there are lots of libertarians out there and they come in many stripes. The primary point of this article is that whenever some faction of government wants to take all the money on the table – or as much of it as they possibly can – then they attack infrastructure projects. Environmentalism is their most obvious cover story, but libertarians are also taken advantage of. For decades the Republicans in California have failed to reliably support infrastructure that we really need – not stadiums, civic centers, or shopping malls, but port expansion, road and rail upgrades, water infrastructure, an LNG terminal in Ventura County, the list goes on. There are a lot of worthy projects. But the Republicans often fight infrastructure proposals based on “limited government.” And the ideological underpinnings of that are libertarian.

    It is healthy to challenge libertarians to consider just how orthodox they are with their ideology – or how extreme, to put it plainly. Because it isn’t just about finance, it’s also the legal framework that has to include a government role. What if we really need a new pipeline? Imagine if there were no pipelines, and everything had to be transported by road and rail. Is that desirable? Is that in the public interest? The point: To build a pipeline you need eminent domain. There is no way around this. You cannot let one land owner out of 1,000+ parcels stop a pipeline. You just can’t. Pick your own hypothetical situation. You get the point.

    Similarly, there are public works investments that yield a general benefit to society. Maybe I don’t want to pay a toll for everything I ever use. Maybe it works just fine to have roads that we can all simply drive on, without paying “per mile” charges via surveillance devices on our cars. Service fee excess is an abusive way for government to get their hands on more money as well as invade our privacy, and their “fee for service” rationale and rhetoric comes straight out of a libertarian’s playbook. You’re being used. It is perfectly appropriate to have public and private sources of financing for legitimate public works that yield benefits to society.

    In any case, “bashing” libertarians is too strong. Challenging libertarians to rethink some of their assumptions would be more accurate.

  4. Avatar
    Terry Gannon says:

    Certainly I can understand your point of view, but to add libertarians in with environmentalists and unions one is more than 70% wrong (however that percentage could be computed) and two gives us libertarians much more power than I have ever seen in my home State of California. Certainly my good friend Bob Poole would argue that the influence of going private is far overdue in the State and has at best not budged a bit in the last 50+ years I have paid attention. Not sure what the intent is, but I would say that libertarian is on the rational side of these arguments while the other groups want more power, more emotion, and of course more taxes.

  5. Avatar
    Kurt Vangsness says:

    Blaming Libertarians? Really?

    In California that is almost like blaming Bigfoot. You can’t get more Progressive than California.

    You can’t blame libertarians for classic Progressive Political bait and switch, i.e., sell “infrastructure” to raise taxes, then spend the tax revenues on every possible Progressive social program instead of infrastructure. Unless of course it is the train to nowhere, i.e., California High-Speed Rail.

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