I have a pretty concrete institutional theory for why the United States, and to some extent the rest of the Anglosphere, lags in infrastructure. It mostly fits the available evidence, but “mostly” and “available” are the operative words, and I don’t want to expound on it too much before doing more interviews to contrast American infrastructure planning with Continental European and democratic Asian examples, to see if there’s basis to what I’m saying.
But one piece of the theory is worth talking about early: the concept of managerialism. The relevance to infrastructure is roughly the following set of propositions that constitute this theory as applied to public policy:
- Big outfits should be run by professional managers, who should be trained primarily in management and not in a specific industry; it is acceptable and even desirable for a CEO to bounce between different industries. A successful founder or manager in one field should be presumed capable of quickly acquiring expertise in another field if they move to a new industry.
- Domain knowledge is suspect, because the people who hold it are self-interested – in public policy this relates to public choice theory. At best, domain knowledge means you get to work for a manager.
- Managers should set up the right incentives to force underlings with domain knowledge to innovate, and do not need to acquire detailed domain knowledge themselves. For example, they should set up objective metrics to evaluate employees by rather than have close enough relationships with the employees to know intuitively who to promote.
- The recruitment pipeline for the managers should combine a set of institutions producing a single elite (Oxbridge, Ivy League) with a proof-of-pudding system measuring success by earned wealth.
The upshot is that if you don’t trust any of your workers (public choice theory, again) and do trust the managerial elite to be able to run all industries equally, then you can just do whatever you want and blame the inevitable failure on the workers being too stupid or incompetent.
Note that even though this is often an anti-government theory of how to run public-sector agencies, it is as written politically neutral, and even used by leaders on the left. Politicians of all stripes appoint people with the wrong skillset to run public agencies, preferring political appointees (who in both the US and UK come from the same institutions as the private-sector managerial elite) to career professionals. Career professionals may be too politically independent and have long-term plans that are not compatible with self-aggrandizing schemes to build visible infrastructure that a politician can claim full credit for.
Note also that even though the full set of propositions I associate with managerialism comes from the English-speaking world, segments of it can be found elsewhere. France, for example, has a Grande Ecole-educated elite that views itself as omnicompetent. It differs from the Anglo-American model somewhat in that the institution that produces engineering executives (Polytéchnique) are not the same as the one that produces politicians (ENA), and a a lot in that bouncing between industries is narrower, so that SNCF is run by airline executives without experience in railways rather than by industrialists and financiers without experience in transportation.
I make no claim about whether managerialism works in other spheres, like general business. That said, in the fastest-growing high-end segment of the American economy, tech, the business culture is very different: everyone, including management, is expected to know how to code; managers are recruited from among experienced programmers; the culture regards external managers much less than it does coder-founders like Larry Page, Sergey Brin, or Mark Zuckerberg, to the point that most people in tech and tech media regard Microsoft’s stagnation in the 2000s as the fault of the transition from founder Bill Gates to the more managerial Steve Ballmer.
But in the public sector, at least in infrastructure, managerialism has not succeeded. Any of the following reasons may be relevant to the failure of turnaround experts, political appointees, private-sector CEOs, and other non-industry professionals to improve American public transportation.
- American business culture assumes that the same methods work regardless of scale. Public transit is scale-dependent, which fries a lot of common private-sector assumptions. Most importantly, starting small is not always possible, especially in trains. Managers who are used to starting small end up deemphasizing the most productive parts of public transportation, like rail operations, in favor of things that can be done incrementally, like bus lanes.
- American culture is generally closed to foreign knowledge. It is also pragmatic and anti-theoretical, viewing foreign knowledge as a kind of theory that must be tested at very small scale before being applied widely; one American big-city transit manager denigrated international cost comparisons as “Paris or something.” The difference between managers and industry professionals is that some of the latter understand that public transportation works better in Europe and East Asia and try to learn, whereas managers see nothing to learn in countries with living standards that are (on average) comparable to the US’s or (for senior managers) much lower.
- Public transportation has a lot of moving parts that have to be planned together – timetable, infrastructure, equipment, and more broadly also development. Even within operations, there are different departments that affect one another closely, like dispatching and actual operations. This makes typical responses to bad news, like a hiring freeze, atrocious, because an overstaffed agency may have one understaffed department creating too much work for everyone else; only an experienced transportation professional would know to fix the problem department by hiring more people even in a bad economy in order to increase productivity elsewhere.
- Infrastructure has very long time horizons. Agency heads have to think on the scale of decades, not quarterly earnings calls with the shareholders.
- Competition is destructive. The real competition is cars, and not other modes of public transportation. Competitive private businesses generally understand coordination (“synergy” was a much-mocked buzzword in the 1990s and 2000s), but less deeply than researchers with familiarity with the situation of multimodal public transportation.
What this means is that the penchant of so many American politicians to hire outsiders to the field is not part of the solution to the problem of failing transit agencies, but rather part of the problem. Success comes from hiring people who are experienced in the field, and if the agency bureaucracy seems too inflexible, then hiring from other countries. There’s a reason Andy Byford, a career transportation planner with experience in London and Toronto, was such a hit success in New York – and there’s a reason this success involved developing much greater levels of mutual trust between management and the workers. In contrast, a string of people whose background is in a culture that treats everything as an American business to be turned around with tough management does not produce good results – rather, such leaders create problems that justify their own continued existence, blaming their own failures on the people below them.