…pretty soon you’re talking real money.

A New York Times article reports the opening of a half-mile section of bike path, recently built along the west side of Manhattan at a cost of $16M, or roughly $30 million per mile. That’s about $5700 per linear foot. Kinda sounds like a lot, doesn’t it?

Well, $30 million per mile for about one car-lane mile is a lot, but it’s not out of line compared to other urban highway construction costs. The Doyle Drive project in San Francisco — a freeway to replace the current old and deteriorating freeway approach to the Golden Gate Bridge — is currently under way at $1 billion for 1.6 miles…but hey, it will have six lanes each way, so that isn’t so bad, at $50 million per lane-mile. And there are other components to the project, too, not just building the highway (there will also be bike paths, landscaping, on- and off-ramps, and so on). All in all it seems roughly in line with the New York bike lane project.

Speaking of the Doyle Drive project, one expense was the cost of moving a bush called a “San Francisco Manzanita” out of the way. Maybe I shouldn’t say A San Francisco Manzanita, I should say THE San Francisco Manzanita: this species hadn’t been reported since 1947 and was presumed extinct, but a single bush was found last year, in the path of the Doyle Drive project. It was moved this January at a reported cost of $175,000. If you look at the photos linked to that article, you’ll see that the move involved a heavy crane, a bunch of workers, etc.; and I think it’s understandable that when you are working with possibly the very last example of a species, you hire some consultants to make sure that the place you’re moving it to will actually support it. But still. (I’m a big fan of preserving endangered species, and if this is what it costs then so be it, but…is this really what it costs? Well, maybe it is).

It’s very tempting to be snarky about these high prices, but I’m hardly in a position to criticize, considering that my work time (including overhead and benefits) is charged at about $320,000 per year, which, trust me on this, is far more than my salary.

And of course, anyone who has work done on their house will discover that it costs about 3 times more than you think it should, and that is true even after you have inflated your initial guess by a factor of 3.

And if you’re a cyclist, like me, you know that buying a nice (but by no means top-of-the-line) bicycle can easily cost $1800, and that the local bike shop where you buy it is probably struggling to make ends meet (which might also be true of the manufacturer).

If there’s a point to all of this (which, I must admit, I’m not sure there is), I guess it’s that some things cost much, much more than you think they should, but you’re probably kidding yourself if you think you could do them cheaper yourself.

20 thoughts on “…pretty soon you’re talking real money.

  1. Just to point out, in case anyone missed it, there are reasons for the high price of this particular piece of bike path. From the blog you link to:

    To build the bike path extension, which is suspended over the water like a concrete bridge or boardwalk, workers had to sink 102 pilings into bedrock, 78 of them in the water, Mr. Benepe said. “It was incredible, the marine engineering needed,” he said. “That’s why this was an expensive and time-consuming project.”

    The average cost for a mile of bike path would, of course, be much lower than that for an average mile of road (let alone highway) cos a bike path needs to carry very little load (virtually none compared to weight of the path itself).

  2. It's utterly amazing how often the
    World's Only Living Whatever is found directly in the path of some construction project that other people oppose. You might almost imagine that the opponents are exploiting the Endangered Species Act by finding an example of something that nobody has bothered looking for in decades. It's almost as if opponents are hiring grad students in biology to trawl through the site picking up hundreds of samples and then looking through books to see if any of them are considered rare. A cynic might guess that it's easier for opponents to find one purportedly rare species on a site than for the proponents to go out and show that the supposedly rare species isn't really rare.

  3. The real question here is not whether the cost is reasonable, but can we afford it? The state of California finds itself absolutely broke. How can anyone justify spending $175,000 to move a single bush when there is no money to pay for it? The state can't even pay the bills for ordinary expenses let alone extravagances like saving the Manzanita bush. Throw the bush away.

    I suppose New York City started bike path project before the city (along with state) went into a financial hole, but that's no excuse. When the city can no longer sell its bonds to rollover it's debt, it will "blow up." It happened in 1975, and the feds bailed out the city. Today the feds will have bail out everyone. But the federal government itself has an outstanding debt of about $110 trillion if one uses the more realistic method of accrual accounting instead of the fraudulent cash accounting. The bankrupt cannot bailout the insolvent.

  4. Sailer:
    That IS a pretty cynical attitude. Considering that this conspiracy to stop the bridge ended up costing $175,000 out of $1 billion, it looks like a stupid strategy for doing — what exactly, thwarting the overdue rebuilding of a freeway in a fully urban area? Why would they do that? Do you imagine that San Francisco greens oppose all construction on existing urban edifices on principle?

    A less cynical attitude would be that, in THIS particular case, the endangered species act provides a means for documenting and discovering endangered species by requiring projects that might threaten them to spend, in this case, 0.0175% of their budget to handle the issue. For this trifle, biologists learn more about the Bay Area ecosystem. It's easy to call it a worthless bush when you know nothing about it except that it was in the way.

    There's plenty to complain about with the Endangered Species Act, but that does not include discovering and saving the San Francisco Manzanita at the cost half of year of Phil — good deal I say.

    Zarkov:
    San Francisco can't afford this? They got $1 billion in bond and federal money to afford this — it's part of the deal. It's not like they can spend that money on teachers in Salinas. And they did NOT spend $175,00 on a bush. The bush is still broke. This is government spending on productive research and useful labor by professionals. Besides, if there is any time to justify government spending, it is during a recession. Tightening government belts during economic downturns is counterproductive — it just puts more people out of work, people the private sector isn't hiring. If you want the government to go bankrupt, the best route is to stop hiring people when unemployment is high and watch tax receipts disappear.

  5. Actually many Greens do take a principled position against any construction, anywhere.

    I'm not a Green, but I live in New York and have been developing a pretty knee jerk attitude against all but the most necessary new projects. The problem is that corruption in this city means that building something here costs four times what it would cost elsewhere, for various reasons but largely because most of the money is stolen. And as an earlier commentator pointed out, the city and state can't afford to do this any more. So we can't have nice things -we're too deep into a hole fiscally and in terms of government.

  6. As far as the San Francisco Manzanita, there are two separate issues (1) how much is it worth spending, to save the last known example of this species, and (2) how much does it cost to move a single medium-sized bush. (These same two points are relevant for the bike path, for which David provides some useful context to point 2).

    In my post, I was trying to focus on the second question — how much does it cost to do a thing — but the only comments on the issue are about the former. As for me, I am definitely in favor of spending $175,000 (or, indeed, a great deal more) to save the last example of this species, if that's what it costs; but I can't help but feel that it could have been done for a lot less money than that: As Ralph points out, even at my ridiculously overheaded charge rate, you could hire me for months for that price! Or, more to the point perhaps, you could hire me for a couple of weeks to get things organized, and give me 1/5 of that money to hire a crew (including an arborist), rent a backhoe and a truck and a crane for a couple of days, and move the thing myself. But — the subtext of my post — presumably there is a lot more to it than that. Public sector or private, lots of things cost much much more than it seems like they should, and I guess this is a good example.

  7. Ralph:

    How about San Francisco returning the $175,000 to the federal government? I also challenge your characterization of the the spending as "productive research." It might or might not be productive in a scientific sense, but it certainly not productive in an economic sense. If the research does not have a positive net present value, it's not productive. In other words, the present value of the future cash flows from the research must exceed $175,000. There's big difference between spending a billion dollars to find the top quark and spending it on a bridge that generates toll revenue. The former is a form of consumption, not investment.

    I also challenge your characterization of government spending during a recession as necessarily productive and desirable. Government spending during the 1930's did not fix the Depression. This is actually the mainstream position in economics. Going off the gold standard was more effective than deficit spending. If you look closely you will see that the Keynesian multiplier is something more assumed than proven. One can justify deficit spending if you believe the unproven and rejected Keyesian macro economic model. Recall that it failed with the 1970s stagflation. It has now been reanimated for political purposes to justify all kinds of economically non-productive spending.

    I ask: Why is the Keynesian model more credible than Hyman Minsky's Financial Instability Hypothesis? According to Minsky, our current financial difficulties result from excessive debt. If Minsky is right, then trying to fix excessive debt with more debt won't work.

    Finally, with your reasoning any expenditure, no matter how extravagant is necessarily desirable because (using the multiplier) we put people to work and get a net benefit. Surely it must matter what we spend it on even if we believe Keynes.

  8. "That IS a pretty cynical attitude."

    It's a well-informed attitude. This would be a good subject for statistical analysis: what are the odds that you can discover something on a proposed construction site that versus the odds that developers can then go out and find the exact same thing elsewhere in a reasonable amount of time. Or can you move the thingie, like Caltrans did with this bush (which, by the way, you can buy from nurseries).

    Opponents of construction projects have trawled sites for obscure species going all the way back to the famous snail darter case in the 1970s. A professor who opposed the dam brought a bunch of grad students and had them grab one of everything alive, then they went back and looked through encyclopedias, then announced that one of their finds was the rare snail darter.

    Or consider the Ahmanson Ranch development in Ventura County, where opponents announced that they had rediscovered the supposedly rare San Fernando Spineflower, a dime-sized weed, on the site. It looks just like the San Gabriel Spineflower, except even uglier. Is the SF Spineflower really endangered, or is it that nobody has been looking for it?

    The funniest case was in the Hamptons, where rich people were protesting the proposed construction of low rent apartments near their mansions. One day, a swamp on the proposed site was suddenly full of a small aquatic animal that was considered endangered under New York state law. But, it wasn't endangered in South Carolina, where you could call up and buy a bucket from a baitshop and have it Fed-Exed to your mansion in the Hamptons.

    And how do we know whether something is a separate species or not? Was the California gnatcatcher, which held up many billions of dollars of development in Southern California a different species than the abundant Baja Gnatcatcher? The biologist, Jonathan Atwood, who examined samples ruled yes, on the grounds that they were different shades (which is also true for people in California and Baja California), but then changed his mind a decade later when genetic tests became available.

    http://www.isteve.com/Golf_Course_30_Years.htm

    It's all a game.

  9. Let's get the terminology straight here. Caltrans uprooted a Franciscan manzanita bush (no "San") also known as "arctostaphylos franciscana," which is a subspecies of Arctostaphylos hookeri G. Don. Using google images we can get a picture of this bush growing in the Strybing Arboretum in San Francisco's Golden Gate Park. See here: http://plants.usda.gov/java/profile?symbol=ARHOF. As one can see it's a pretty ordinary bush. CalTrans found the only known arctostaphylos franciscana growing in the wild. The Arboretum has it, and so do many private gardens. The newspapers seem to have left out the fact that this bush still exists in cultivation, so it's possible you can buy it at a nursery. It's also possible that CalTrans found something that's a hybrid of what exists in cultivation.

    Phil says he's also in favor of spending $175,000 (or even much more) to save the last example of a species. I think he means he's in favor of spending $175,000 of other people's money. I'd be curious to know how much of his own money he would spend. Moreover, it's a sub-species that being saved, not a species and it's doubtful it's really being saved because it's still under private cultivation.

    As to the primary question as to why it costs so much, apart from the merits, to do the work; let me say the following. Back in the 1980s when my daughter was in elementary school, I found out that her school paid about $60 for a box 10 hard-shell floppy disks. At the time I was able to buy the same thing at Costco for about $20 (or was it $10). Why so much more? The school had to buy from "qualified" vendors and that reduced competition. At the time I was working for a government contractor, and it had the same policy for computer purchases. They got soaked by "qualified" minority-owned middlemen often pay twice for something I could order from PC Warehouse. In time they got over that and had their buyers purchase at competitive prices.

    Another reason it costs so much to move the bush is the federal deep pocket supporting the project. Since the feds can borrow money at low rates, and ultimately even print money, it can make purchase decisions more based on politics than economics. And it does. That's why we have such a huge national debt.

  10. Sorry my link as given above will not work because of a spurious period at the end. Use this: http://plants.usda.gov/java/profile?symbol=ARHOF to see a picture of arctostaphylos franciscana growing in Strybing Arboretum in San Francisco's Golden Gate Park.

    If Phil would like to buy his very own arctostaphylos franciscana he can order it from Las Pilitas Nursery located in Santa Margrita California. See here: http://www.laspilitas.com/nature-of-california/pl
    But be aware this bush is best grown in the temperate climate as found in California.

    Note also the nursery's comment: "This is a manzanita that is presumed extinct and has been saved by botanic gardens and nurseries." Thus it would appear that Steve Sailer is correct.

    I suppose it's possible that the Franciscan manzanita CalTrans founding growing in the "wild" has slight variations in its DNA caused by random mutations and genetic drift, but this does not make it the the only surviving member of a plant species. Again, Franciscan manzanita is a subspecies of Arctostaphylos hookeri. It's not extinct, and Franciscan manzanita is only extinct in the sense it does not commonly grow in the wild. I'll guess that no one has bothered to try and replant the Franciscan manzanita in the wild because there's nothing particularly desirable about this subspecies and the very similar Arctostaphylos hookeri does grow wild.

    It certainly looks like CalTrans wasted $175,000 to satisfy botanical purists.

  11. I hope that just because noone has bothered replying to Zarkov's verbose comments, it is not taken as agreement.

  12. Zarkov,
    I'm on the board of (and am a substantial donor to) the Golden Gate Audubon Society, a local nature organization (the largest Audubon chapter in California) that is associated with the National Audubon Society. In fact, I spent all day Saturday (8am-6pm) at a board meeting. My wife and I also contribute significant amounts to other environmental organizations, including Center for Biological Diversity, Defenders of Wildlife, and a slew of others. We spent a substantial amount two years ago to put a photovoltaic system on our roof. Last year, we put a conservation easement on some property we own in Maine, thus permanently preventing anyone (including us) from building on it and thereby reducing its value by tens of thousands of dollars. For what it's worth, I also commute by bike and my wife and I only own one car…which is, of course, a money _savings_ but is nonetheless a sacrifice of sorts. So, take your accusations of hypocrisy and stick them where they belong.

  13. Phil,

    It's fine you do all that stuff. But you still avoid the question. How much would you personally pay to move this particular bush? I think not much because you know that the money would be better spent on more substantive conservation. It's also unfortunate that you have to resort to abusive language. In my opinion, it's extremely unprofessional.

  14. One fundamental problem with the Endangered Species Act is that nobody is to sure what the definition of a "species" is. The last I checked, scientists had proposed about two dozen different ones. Ernst Mayr's is probably the most popular, although it doesn't apply to organisms that reproduce asexually.

    Everybody is in favor of saving bald eagles, but a lot of the cause celebres of ESA brouhahas are just pretexts dredged up by opponents of development. Caltrans probably figures they got off cheap by spending $175,000 to move the bush to an "undisclosed location" (it's the Dick Cheney of bushes) instead of having their entire project canceled.

    There is a lot to be said for restrictions on development, but this kind of thing also explains why it will be many decades before there is high-speed rail between San Francisco and Los Angeles.

  15. Steve, how does knowing the reason for $175k of spending in a $1b budget help explain much at all? The cost of moving the bush may well be excessive and unnecessary but it is a negligible portion of the budget.

    I'd agree that "this sort of thing" explains why there is no decent rail over there if you mean "spending lots of freeways". It is quite possible that if arguments about the environment were taken seriously, high-speed rail (or even medium speed rail) would already be built instead of two multi-lane highways and lots of airports.

  16. Zarkov, there are 7 million people in the Bay Area, so the cost of moving the bush is under 3 cents each. Or, if you prefer, there are about 40 million crossings of the Golden Gate Bridge each year, which means moving the bush would cost under 0.5 cents per crossing if we insisted that this part of the project (unlike the rest of it) had to be paid for in a single year. Either way, I am indeed willing to pay far, far more than my share of the cost, as my charitable contributions demonstrate.

    If what you're suggesting is that anyone who is in favor of a policy should be willing to pay the _entire_ cost…well, you can't really mean that, it's ridiculous.

    Saying "stick your accusations where they belong" is not "abusive language." As for unprofessional, it is unprofessional of you to falsely accuse me of hypocrisy, so perhaps we are even.

    Steve, you say "Everybody is in favor of saving bald eagles," but in fact that isn't right, or at least it wasn't right when proposals to ban DDT and ban hunting of eagles were proposed: both of those policies had plenty of opposition. There is always somebody who will complain that a poor, underprivileged country like the United States can't afford to do X, whatever X is.

    And, finally, I agree with David: as far as the impact on a high-speed rail system, spending over $1 billion to build a short stretch of highway is a much bigger impediment to building a rail system than spending $175K to save a bush.

  17. Phil,

    You continue to refuse to answer a very simple question: how much is it worth to you personally to save that particular Franciscan manzanita bush? In other words, how much would you contribute to a "save the bush" charity if that charity were the only resource to save the bush? Instead you give me normalizations by fishing around for various big numbers to put in the denominator. That tells me nothing, and could be used to justify spending almost anything. It gives me no real sense of how important that bush is in your mind because it's very easy to spend other people's money.

    As for accusing you of hypocrisy, that's your misinterpretation of my question. Moreover, I think the meaning of "stick your accusations where they belong," is pretty clear to anyone. It's both abusive and vulgar and you know it. My question was simple one and not accusatory. Why not just say something like, "I'd pay ten dollars to save the bush, and I hope others would do likewise." Or you could say, "I wouldn't pay anything because the bush really isn't extinct because I can buy an equivalent in a nursery." See how easy it is to give a straightforward answer. Instead you respond like a politican.

  18. Zarkov, you say "You continue to refuse to answer a very simple question: how much is it worth to you personally to save that particular Franciscan manzanita bush?" I don't "refuse" to answer that question, I just didn't realize you had asked it, I guess I missed that if you asked it earlier. I stopped reading when I got to "I think he means he's in favor of spending $175,000 of other people's money."

    You now say "As for accusing you of hypocrisy, that's your misinterpretation of my question." I hadn't even read a question, I had read the part where you say "I think he means he's in favor of spending $175,000 of other people's money." Right, right "My question was simple one and not accusatory." Sure. Tell me another.

    As for your question, I will answer it and then I'll tell you why it's not relevant. But first, I have to say that I don't know whether the bush is actually an endangered species or not: as far as that issue goes, I only know what I'd read in the papers. Anyway, the answer is that in principle I'd go up to something like $500 but as a practical matter I probably wouldn't contribute more than $10 or perhaps $20 tops to a "Save the Manzanita" organization: there's the usual worry that other people will free-ride on my willingness to step up.

    But your question isn't really relevant because in this case, as with many many others, the government makes everybody pay whether they want to or not. I was opposed to going to war in Iraq, but the government doesn't (and shouldn't) let me off the hook for paying for it just like everybody else. (By the way, the monetary cost of that war is over $500 million per DAY. I can still barely believe that, in spite of having done the math several times. We could save a lot of endangered bushes for that).

    I'm done with this thread, so Zarkov or anyone else can have the last word.

  19. Phil,

    If you want to understand me, it pays to read what I write, and not stop at a certain point and then imagine that you have been insulted. I asked the question because people can have very different notions of utility for public and personal expenditures. I submit that spending money to save a bush is more in the nature of a private preference than a public need. When you compare saving a bush with making war, you conflate two very different functions of government. The Constitution explicitly charges the federal government with making war. It might abuse that power as (I think) it's doing in both Iraq and Afghanistan, but there's no doubt it has that power, and in some cases it needs to make war. On the other hand, keeping a community of botanical purists happy is another matter. Why should the purists have a claim on public money to satisfy what really amounts to a personal need? I can see no public benefit to saving an obscure ordinary bush. It's not like saving the Bald Eagle, which is a symbol of America and a magnificent bird. I would pay money out of my own pocket to save it. I have spent a small fortune (>$5,000) keeping an ordinary house cat alive, but that's my money and that's how I choose to use it. I'm one of those crazy people who loves animals, but I don't expect to get indulged at public expense.

    Finally I see that you're extremely thin-skinned. That's not a good way to be in the blog world where people push back. I get called all kinds of names. It doesn't bother me at all.

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