March 18, 2009

Infrastructure stimulus in action!

Obama's first instinct after getting elected President was to promise to put America back to work through "infrastructure" projects. He seemed to have an image in his head of modern construction projects as employing roughly as many people as you see toiling on the Great Pyramid of Cheops in a CGI scene from a PBS documentary on Ancient Egypt.

So, I've been paying attention to an infrastructure project near my house that started up last fall.

A four-lane street near my house has been torn up for about four or five months now, with bigger water and sewer pipes going in to support all the huge apartment buildings on the street that are being finished. Two lanes remain open, while two lanes are shut for about 1,200 feet. There are usually 10 to 12 large pieces of equipment parked in the construction zone.

But, how many workers are actually employed on the job site? Often, I don't see anybody. At 2 pm yesterday, I counted three. Today was a busy day, with six hard hats on-site. Granted, only two of them were actually working, but that's not the point, the point is that six were drawing paychecks and thus, presumably, stimulating the economy. But six is a lot for this very expensive project that has made making a left turn onto the street an ordeal.

I presume they have good reasons for the lack of activity (perhaps they have to let concrete dry?), but it seems typical for a modern streets and sanitation-type project: the number of hard hats employed on any given day is vanishingly small.

32 comments:

Captain Jack Aubrey said...

We need to get rid of those damn machines so that more men can have jobs. Damn machines make us so much poorer.

Anonymous said...

I work in an office building that looks out on the World Trade Center site in downtown Manhattan. For all I know, it could be the biggest construction site in the United States right now. How many people are working there at any one time? I've never actually counted them, but it's not a lot. 20? 50? Something like that.

Here are some typical pics from skyscraperpage.com (a great site, by the way). You can look through dozens of WTC-related pages on that site, with several panoramic pics on each page, without ever seeing anything close to a 100 workers there at any one time. This confirms my personal impressions gotten from occasionally looking out the office window over the years.

Oy said...

We need to get rid of those damn machines so that more men can have jobs. Damn machines make us so much poorer.

Yes, to hell with productivity, and the jobs for engineers who design the machines, and the jobs of the technicians who maintain them. Luddites unite!

RF Interference said...

Q: What's orange and sleeps four?

A: A DOT truck.

Black Sea said...

Steve,

This isn't directly attributable to the stimulus program, but it illustrates what a sham many such efforts are. In Washington D.C. a $76 million jobs-creation program has yeilded a whopping 31 new jobs over a five-year period.

The city is trying to decide whether or not to continue the program. Care to lay odds on its being cancelled? Any guesses as to how much of that money was simply stolen?

http://www.washingtonpost.com/wp-dyn/content/article/2009/03/13/AR2009031303013.html?hpid=sec-metro

headache said...

Infrastructure projects typically employ 25% machinery on a cost basis. Usually the objects being moved about (sewer pipes, tunnel segments, piles) or the processing involved (grouting, mass concreting) require large machinery, so the idea of lots of spades is ludicrous and only shows how ignorant Obama is. I wrote in your previous posts why infrastructure is the worst way of kick-starting the economy. Apart from these facts which are known and obvious to engineers, the other problem with large infrastructure projects is that they run over long periods of time and attract all manner of criminals and corruption. Read any decent mafia book and the issue of kickbacks for contracts and protection money for construction sites comes into play. In Germany the federal investigators now routinely check for political corruption in a city when large projects are executed.

headache said...

"How many people are working there at any one time? I've never actually counted them, but it's not a lot. 20? 50? Something like that."


You need to realise that a large proportion of the construction costs are up front. Consulting engineering work is a protected trade, like law or banking, and can eat up lots of money. Architects also take their cut. Machinery is typically capital intensive, and the government has its fingers in the pie in all sorts of ways. By the time the concrete flows 50% of the money is gone. Those poor bastards you see on site only make up a miniscule portion of the cost structure. And I bet at least 3 engineers, a financial manager and others were busting their brains trying to minimise the labour content. Even at the expense of spending more money in man-hours thinking about cutting labour than saving money b cutting labour. Anybody can have an instant career boost by finding a way of reducing the labour count by even 1. But it’s all you're going to be able to employ. Of course the office jocks also get some action, so it’s not as dismal.

I agree with t99. War is the best employer. Producing lots of weaponry, soldiers doing the fighting, and reconstruction during and after the war. Plus good reason to make babies and have fun doing so. I bet another reason t99 likes war is that babes are less choosy during war times. So maybe Bush was smarter than we all thought.

K said...

headache said:
"I agree with t99. War is the best employer. Producing lots of weaponry, soldiers doing the fighting, and reconstruction during and after the war."

Yeah, that sounds great! Let's produce a ton of stuff, then ship it overseas explicitly for the purpose of breaking all the stuff we just made.
How exactly does that make us wealthier? Besides, we're already at war, remember?

WLindsayWheeler said...

In the 20's Construction was labor intensive. Concrete until the 1960's, was still pushed by wheel barrow. Pumping concrete removed tens of workers off the payroll of concrete companies. 20's construction projects were very labor intensive. One could employ hundreds of workers because they worked at .50 cents an hour. One could employ hundreds.

Now, with inflation, one man has to do the work of ten or more men because money is worthless and the labor cost is $13 to $18 and some electricians demanding $25 an hour.

So, you can see the mindset of Washington where nobody has ever worked in the construction field especially the Great Community Organizer; their minds are still stuck in the '20s. They don't have a clue.

ironrailsironweights said...

I work in an office building that looks out on the World Trade Center site in downtown Manhattan. For all I know, it could be the biggest construction site in the United States right now. How many people are working there at any one time? I've never actually counted them, but it's not a lot. 20? 50? Something like that.

Of course that doesn't stop the city from babbling about the thousands and thousands of jobs that the project will create.

A block away from the WTC, the Fulton Transit Center project seems to employ a fairly substantial number of construction workers, I'd guess at least 25 to 30 at a time, though being a subway project it's a very safe bet that most of the workers aren't really doing much.

Peter

Peter said...

War is no longer a good bet for rejuvenating the economy, for a number of reasons:

1) no booty. For most of human civilization you waged war to take the enemy's land, women and resources. We live in a post agrarian society, so we don't need the land. We have plenty of women. And it's far easier and cheaper these days to trade for the resources. If you are a less advanced society it might make sense to wage war on a more advanced society in order to steal technology and physical plant (as the USSR did to Germany), but who in the world has anything the US needs other than oil?

2) War is much more expensive to wage. We live in a democratic society, we can no longer treat soldiers as disposable resources. If they get seriously injured the government is on the hook for life. That adds up. And thanks to medical technology a lot more soldiers survive than used to, so more invalids to care for. Also the equipment we use has gotten ridiculously expensive and complicated, I would guess unjustifiably so when you look at what we're really trying to accomplish.

I could go on. But the proof is that our 7 year adventure in Iraq has produced no economic benefits whatsoever. Life is a lot more complicated now than it was in 1939.

jody said...

it still seems obvious that improving american roads will only make it easier for trucks loaded with chinese goods to make deliveries to wal-mart.

it might also improve the odds of border jumpers getting into the US by providing them a nice selection of good, paved roads to drive around on down there in the southwest.

we wouldn't want those SUVs packed with 20 border jumpers to tip over and crash due to bad roads, would we?

Mark said...

I agree with t99. War is the best employer.

War creates nothing permanently useful. The reconstruction jobs are (hopefully) on someone else's soil. And unless you're blowing to smithereens some of the world's major industrialized nations, you'll get little of your investment back.

Money spent on war is therefore worse than money spent on infrastructure, though still far better than more money thrown into the welfare bonfire - which is how Obama is actually spending most of the money.

albertosaurus said...

As others have said "its the machines stupid". Obama plans to create 150,000 jobs in road building. Caterpillar has layed off about 25,000 people this year. The road building stimulus may very well create enough demand that Caterpillar rehires at least some of them.

But giant Caterpillar road building machines themselves have only one operator. So its unlikely that anyone will ever see gangs of bare chested, sweaty men on the job site as in Cool Hand Luke

Cracker John said...

Steve, 'human infrastructure' http://www.suntimes.com/news/cityhall/1474318,chicago-daley-pothole-stimulus-031209.article

and a new one, 'program infrastructure'
http://www.venturacountystar.com/news/2009/mar/13/fewer-stimulus-dollars-go-to-infrastructure/

Lucius Vorenus said...

Captain Jack Aubrey: We need to get rid of those damn machines so that more men can have jobs. Damn machines make us so much poorer.

Thomas Sowell tells the story of going to some third world country [India, maybe?] and trying to explain to some government bureaucrat that the road would be finished much sooner and at a much lower cost if he would simply replace 100 workers using shovels with one worker and a bulldozer, but the bureaucrat looked at him quizzically and said something like, "But then how would I employ the other 99 workers?"

At least I seem to recall that it was Sowell - I suppose it might have been Milton Friedman, or V.S. Naipaul.

Lucius Vorenus said...

headache: I wrote in your previous posts why infrastructure is the worst way of kick-starting the economy. Apart from these facts which are known and obvious to engineers, the other problem with large infrastructure projects is that they run over long periods of time and attract all manner of criminals and corruption...

Can you imagine if, instead, we had used the $750 Billion [$1 Trillion? $1.25 Trillion?] on, say, a full fleet of F-22 Raptors, and maybe 10,000 unmanned predator drones, and some new missile submarines, and some anti-submarine tech, and a nice SDI umbrella covering the entire United States, and some anti-asteroid weapons, and an aggressive move by the Pentagon to seize the Lagrange Points as USA territory?

Heck, every single penny we're about to spend on "Cap-N-Trade" to combat the myth of global warming would be better spent on anti-asteroid weapons.

Alice Finkel said...

Jobs are not important, only jobs programs are important. It is the government program -- the immortal bureaucracy -- that matters. The more programs, the better.

Jobs themselves can be a problem. Wearing a hard hat is the first step to uppity-ness. Obama relates better to the jobless than to people with actual and realistic goals to work their own way up.

Obama is the one who gives, out of the goodness of his heart. How can he give to someone who has already worked out how he will help his own damned self?

Anonymous said...

You can usually attribute the snail's pace of major construction projects to one of three items:
1) Technical issues with the implementation such as waiting for dewatering, waiting for concrete to cure (concrete does not develop its full strength until weeks or months down the road).
2) Bureaucratic issues such as permit approvals (yes, even municipal government projects need to get building permits from the building department), foot dragging by environmental authorities.
3) Availability of material - it is very capital intensive and time-consuming to increase production volumes of certain materials such as cement, aggregate, and steel. This is why there are such large price swings in these commodities.

Cracker John said...

City expected more infrustructure funds
"Instead of physical infrastructure, the stimulus act will fund more of what County Executive Officer Marty Robinson calls “program infrastructure.” That means money to hire police officers, reimburse hospitals and doctors for Medicaid patients, and allow schools to avoid teacher layoffs. The stimulus will also increase food-stamp benefits and subsidize health insurance for people who have lost their jobs."

and
City will use stimulus to improve 'human infrastructure'
"Chicago’s $1 billion cut of the federal stimulus pie will be used, in part, to rebuild 43 miles of pothole-filled arterial streets, upgrade the police fleet, install more cameras in squad cars and defray the cost of police overtime, Mayor Daley said Thursday.

In the category of “human infrastructure,” the windfall will be used to create or save 16,000 jobs — 7,300 of them to keep teenagers occupied and off the streets this summer. Expanded after-school and preschool programs will be offered to 10,000 youngsters. Job training will be provided for 5,000 layoff victims."

Seamus said...

so the idea of lots of spades is ludicrous

That's racist!

David Davenport said...

We live in a democratic society, we can no longer treat soldiers as disposable resources. If they get seriously injured the government is on the hook for life.

Don't you keep up with the news? The O. is trying to change that, and reduce health care benefits for disabled military veterans.

Anonymous said...

Police Departments are a welfare program for ex-high school jocks. Sure, Chicago needs police, but most departments in suburbs and small towns are way over staffed.

Anonymous said...

Men will work as slowly and as shoddily as they can get away with. Hence: construction projects.

You can terrorize people into doing a better job, which is a common tactic with office drones. I doubt that any DOT workers are under the lash like that. If only....

The other way is to foster an esprit de corps: our company is the best, you are the best, therefore you must work long hours and perform miracles. You can't do this with office drones because their labour is pointless and degrading. You can do it with small manufacturing. I don't know about construction.

Mr. Anon said...

"Lucius Vorenus said...

Thomas Sowell tells the story of going to some third world country [India, maybe?] and trying to explain to some government bureaucrat that the road would be finished much sooner and at a much lower cost if he would simply replace 100 workers using shovels with one worker and a bulldozer, but the bureaucrat looked at him quizzically and said something like, "But then how would I employ the other 99 workers?"

So who is the fool in this story? That indian bureaucrat knew what he wanted - and employing 100 men was more important to him than building the road faster. Maybe in this instance it was more important for the well-being of India too.

Mr. Anon said...

"Peter said...

"I could go on. But the proof is that our 7 year adventure in Iraq has produced no economic benefits whatsoever. Life is a lot more complicated now than it was in 1939.

Well said, your whole post, but it will fall on deaf ears. For neocons it is still 1939. For neocons it will always be 1939.

Gene Berman said...

W. Lindsay Wheeler:


Fifty cents in the '20s was the rough equivalent of $21 now. (Which
is to say that employing hundreds was not so much cheaper than now.

You don't make much sense. Maybe I just can't figure out the sense you do make. Could you explain it a bit better?

And what about this: "their minds are still stuck in the '20s."???
None of these people were even alive in the '20s. Their minds may be stuck somewhere but it ain't in the '20s. Figuring a person's got to have been around 15 or so to even be aware of such stuff around him, a guy would be pushin' 100 to be "stuck in the '20s."

Been hittin' the Value-Rite?

ben tillman said...

We live in a democratic society, we can no longer treat soldiers as disposable resources.

A "democratic" government is one in which the people governs itself. The national government's immigration policy is trying to alter the people to strengthen itself.

No, this society is as undemocratic as you can get.

ben tillman said...

Fifty cents in the '20s was the rough equivalent of $21 now.

That's about the craziest thing I've ever read on this site. Try $8.

Gene Berman said...

Ben:

Neither of us was alive in the '20s
so we have no subjective feel for the comparison.

But I do know, as should you, that, until 1933, the price of gold (which was money) was $20.67
per ounce Troy, which means that $0.50 was the equivalent of 1/41 of an ounce of gold; with gold at $952 (now), that 1/41 would come to a shade over $23. In the years
1921-22 or thereabouts, the price of a barrel of petroleum was about a dollar and a quarter; divide that into the current ($52) price and you get the unsurprising ratio
of 1/41. We could get some "now and then" price comparisons between equivalent products of that day and this and we might get closer to a valid comparison. Such comparisons are always difficult because many things commonly available now and even at relatively low prices--cell phones, computers, TV, tires that last 60,000 mi., etc.--couldn't be had at any price then and some things that occupied prominent places in peoples' lives at that time--delivery ice and coal and shoveling the shit out of the streets, handmade shoes, mens' hats, etc.--occupy far different
positions on peoples' attention and value scales. Or, if we wanted to make another type of comparison, we could Google "pay scales 1922 or such like and try to get some idea of the pay of a cop, a fireman, a waitress, a clerk, a department-store salesperson, etc., and make the comparison.

I'm not holding the figure up as
"scientific" or anythig like that--just don't think I'm nearly as far off as you seem to believe.

Svigor said...

Heck, every single penny we're about to spend on "Cap-N-Trade" to combat the myth of global warming would be better spent on anti-asteroid weapons.

I like the Orion project, personally. And if we could get a real space project going, we could really tap solar power for use on Earth.

Anthony said...

There are a number of behind-the-scenes jobs on construction projects, too. There are the guys who work at the plant which makes those precast concrete pipe sections, the guys who work at the concrete batch plant, the guy who drives around refueling and oiling the heavy equipment, the guys who deliver cement and aggregate to the batch plant, etc. But compared to gangs of guys with shovels, it's not nearly so many.

The labor-intensive part of construction these days is tenant improvements, and to some extent, house framing. If there wasn't so much cheap labor available for house framing, architects would start designing around prefab wall sections, and half the framing would get done in a factory.