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Flint Water Crisis Is Everything Wrong with Municipal Government

By: Nick Zaiac - @NickZaiac - Jan 20, 2016, 9:36 am
Perverse incentives run amok in local government, and Flint, Michigan, is just the tip of the iceberg. (@Clarknt67)
Perverse incentives run amok in local government, and the disaster in Flint, Michigan, is just one example. (@Clarknt67)

Sometimes it only takes one mistake to cause a disaster. One error. One oversight.

Or sometimes everything is wrong and nobody knows quite how to fix it.

An American city, Flint, Michigan, has poisoned its people. The president has declared a State of Emergency, and FEMA funds and staff are flowing to Flint at this moment.

We have no idea how bad the damage will be, but we know that, of all chemicals, lead contamination has huge social costs. This happened because some municipal employees were in over their heads. And then, when tests started coming back with the wrong results, they lied and covered it up. The governor issued a public apology, since both the Environmental Protection Agency and the state of Michigan’s Department of Environmental Quality were asleep at the switch.

Local government is risky. The incentives to lie and cheat to protect jobs of unaccountable bureaucrats are everywhere. The job security this buys them comes directly at the expense of the people they govern.

Mistakes cascade in this system, as they did in Flint. Someone fails at his job and a cover-up ensues. It happens with local police. It happens in the water department too. The stakes are different, but entirely parallel. This is how local government works in many parts of the country.

When government has vast numbers of independent layers, oversight gets lax. We can’t expect many normal people to care about politics much at all, let alone to provide citizen oversight of the local water district. Ratepayers, like renters, are typically less organized than other interest groups, such as homeowners and municipal employees, at the local level. When the balance of power tips away from the consumers and toward the municipal employees, bad things happen, be they pension splurges for city employees or an out-of-control rail operations center.

Disasters like this happen when oversight breaks down. It ends up nobody’s job to look out for the interests of the people consuming the water that the cities are providing. It’s a political-economy disaster waiting to fall apart.

And Flint is one city. There are tens of thousands of sub-state governments in America. A similar political economy is in play in nearly every one of them. How many of these boards’ governing issues, from schools to zoning, are having the same thing happen, except in their case, it’s not as obvious as water coming out of the faucet brown? What does a board of interior designers do? How does that serve the public interest?

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That’s the most mundane of them. There, the losses are sartorial. We overvalue the interests of the people working in fields from train operation to interior design, and undervalue the people who consume these services. The monopolies are acting like, well, monopolies.

What Flint showed is the shoddy state of these monopolies. Big, fancy infrastructure requires maintenance to keep up, no matter if it’s the Mosul Dam or the pipes underneath Flint. If you don’t take care of it, if you don’t save in advance to replace it when its working life is done, things eventually break down. If you blow your money on too-high staff salaries, or under-trained staff mess up and cause costly damage or cause delays, then the money won’t be there to pay for the upkeep needed to keep it all working. Infrastructure money isn’t free, and somebody must pay, be they taxpayers, ratepayers, or, in some cases, bondholders.

The disaster in Flint was a preventable tragedy. It serves as a warning about what can happen when the people running our utilities have nobody looking over their shoulder. Is there a solution to this? I sure don’t know. Making people care about obscure parts of government is hard, and ratepayers have long been a nightmare to organize at any scale.

We can only hope it doesn’t take the poisoning of the residents of another city for the tide to turn in favor of radical reforms to municipal government. It simply cannot go on this way much longer.

Nick Zaiac Nick Zaiac

Nick Zaiac is a public-policy researcher in Washington, DC. He also serves as a policy analyst at the Maryland Public Policy Institute. His column, The DC Leviathan focuses on the often-ignored bureaucratic agencies, from the Department of the Interior to the General Services Administration. He has been published in the Baltimore Sun, City AM, CapX, and other outlets. Follow @NickZaiac.