06 September 2011

Concrete failure

This interesting story of path bridge dependency shows how a squabble over money resulted in a decision that continues to reek fail.

That story holds a useful lesson for the people contemplating a pipeline to bring water from rural areas to Las Vegas that "could double" water bills.

It would be better to just raise prices and cut demand down to current supply instead of spending more on supply (that others do not want to give!) and raising prices to pay for pipes.

Why? First, raising prices to cover costs doesn't mean that they will be high enough to keep demand in check. Shortage can still result. Second, not all price increases are equal: conservation prices will result in excess revenues that can be rebated to customers. Prices that cover the cost of infrastructure send money from customers to engineering firms. (I cover all this in chapter one of my book.)

Bottom Line: Pat Mulroy and the engineers of Las Vegas should stop using customers' money for their concrete fantasies.

1 comment:

Anonymous said...

Pat Mulroy is a real treasure isn't she.

If the people of LV want to know why they are having water problems - she is the answer.