To some people, decades of waste, inefficiency, and failed ambition across government is somehow evidence that the public sector isn’t proactive enough in spending taxpayer dollars.
Just listen to former Maryland Governor and Baltimore Mayor Martin O’Malley. During a speech at the Dentons Smart Cities and Communities Summit in Washington, D.C. on Aug. 1, he claimed that cities are at a “cutting edge of a new way of governing” but paralyzed by a fear of failure. O’Malley presented a rather generous view of local public service, despite systemic corruption that has paralyzed cities nationwide, and particularly in Baltimore, where he governed.
Instead of embracing their own, pernicious ideas about “innovation,” city leaders should pass the baton over to business leaders and entrepreneurs.
At the summit, O’Malley bemoaned that, “In Silicon Valley, you get rewarded for taking risks and failing. In government, you get fired for taking risks and failing.” That may sound plausible … for a Martian that has never spent time in a city run by actual humans. Look no further than O’Malley’s former city of Baltimore, built on failed dreams and ambition gone awry. Under the “leadership” of Mayor Theodore McKeldin in the 1960s, the city embarked on a billion-dollar project to develop the Inner Harbor from a warehouse mecca to a tourism hot spot.
That plan (and money) resulted in deliverables, including the Baltimore Aquarium, restaurants, and a display of various warships for tourists and others. But far from an engine of economic revitalization, the Inner Harbor proved little more than a tiny oasis in a violent, downtrodden city. Former mayor Kurt Schmoke rightly noted, “There have been many positive changes (around the harbor). But you can go 10 blocks in any direction and see the worst in urban America.”
I should add that even in the Harbor itself, things are headed downhill. The centerpiece Harborplace shopping complex is beset with vacancies, declining sales, and a backlog of needed maintenance.
Failed city ambitions are hardly limited to revitalization in O’Malley’s backyard. Across the country, cities have attempted to “go big” and build out their own municipal broadband networks. These attempts have almost always resulted in a surge of red ink without delivering internet to the people that need it the most. In 2004, the city of Provo, Utah financed a $39 million broadband project with bonds, promising that “investing” in high-speed internet access would pay for itself. A decade later, the municipality was forced to admit that “iProvo” was a failure. It had to sell the distressed network for $1. In all, taxpayers had to shoulder more than $60 million for upfront costs and operating expenses to finance a system that never reached more than a couple thousand residents.
Occasionally, these efforts prove a bit more “ambitious” and proceed at the state level. KentuckyWired, for instance, is running more than $100 million over budget and will likely cost taxpayers $1.5 billion over the next 30 years. The project isn’t near to completion. Audits suggest that its problems were foreseeable, yet state leadership wanted to “go big” even if it meant high debt and low internet coverage. By the time KentuckyWired’s fiber-optic ring is completed, it may already be obsolete thanks to the new 5G network.
Many of these mistakes could have been avoided with more modest ambitions and a proper understanding of the role of free enterprise in a market economy. Governments just don’t have the same motivations as businesses do to produce low-cost, high-quality projects. Public undertakings tend to be costlier, more poorly targeted, and even environmentally dirtier than their private counterparts.
The city level of government has also struggled to overcome endemic corruption, as officials in Chicago, Los Angeles, Atlanta, Philadelphia, and Baltimore are hauled away for having devious personal ambitions. City government enthusiasts can wish away these systematic problems, but it’s just not that likely that these institutions will deliver the goods better than private enterprise. Innovation and the “cutting edge” are great things, but only when the right people with the right motivations are empowered.
Ross Marchand is the director of policy for the Taxpayers Protection Alliance.
