Analyzing America’s Infrastructure Need
One too many Experts

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Analyzing America’s Infrastructure Need
One too many Experts
Herbert M Barber, Jr, PhD, PhD
Xicon Economics

Politicians, engineers, and others tout infrastructure as a means of promoting economic growth. Unfortunately, however, most politicians and engineers do not understand the complexities of ensuring such growth occurs, let alone proving it through what should be sophisticated econometric means of analyses, modeling, and forecasting. Indeed, it is true; today we have politicians elected by touting such promises and engineers increasing their profits by claiming such increases, yet neither making claims they can substantiate. And it is costing clients billions. For example, the Southern California Association of Governments (SCAG) currently is soliciting RFPs for the development of an “Interregional Passenger & Freight Rail Forecast.” Thus far, around ten firms are responding to the RFP, including engineering firms, construction companies, and self-proclaimed experts in rail “economics.” So far, so good, right?

Honestly, no. As in most cases, those here claiming to have expertise developing so-called “interregional passenger and freight rail forecasting” have no idea how ridiculous they appear to persons who indeed are experts in econometrics. In fact, they look like fools. As for me personally, I have seen their work; I have reviewed their “analysis.” Their analysis is so elementary my children could have conducted it in the sixth grade. The methods they use are pseudo-econometrics, meaning their “analysis” is a complete sham, a disgrace to the analytical world. Yet, SCAG will see all the pretty pictures in their proposals, get lost in the verbiage while never fully understanding the lack of expertise of the proposer, and award the project to one of these companies. We have seen this scenario play out over and over and over.
But what makes it worse is the fact that SCAG will use the recommendations of this “expert” as the gospel, rendering financial and economic decisions that will cost SCAG millions and perhaps billions of dollars in superfluous spending over the years. Moreover, it will cost the private sector taxpayer, those who actually fund SCAG, millions or billions—all because the consultant selected was grossly unqualified in advanced statistical and econometric analyses, modeling, and forecasting.

Consider my rant further. Do you think that a self-proclaiming expert with limited academic credentials qualified to conduct what should be advanced scientific research—in this case, research using advanced multi-variant time series models with multiple independent variables simultaneously? You do not learn these type analyses with on-the-job training. I had a bachelor’s degree and two master’s degrees coupled with substantial experience and had no idea how to conduct scientific research. Not until my first doctoral program did I learn this level of research. Yet, a self-proclaimed expert in one of these companies is going to conduct this level of scientific rigor using statistical and econometric analysis? Right. Call me a slow learner.

This scenario would be worse than my serving as the structural engineer of record on the world’s tallest building on the coast—in a seismic zone. I mean, I know enough to sound impressive. After all, I easily understand wl2 over 8. I even know what 29×103 ksi is. I can calculate the moment of inertia and section modulus from scratch on any structural shape. Of course, if I really wanted to sound important to the perspective client, I could even cut sections and take moments to determine the shear at any point on a beam…. or even size a beam or two simultaneously subjected to axial loading and biaxial bending. But serve as the structural engineer of record on the world’s tallest building on the coast in a seismic zone? I know just enough to be dangerous.

Must I provide another example to drive home this point? Recently I reviewed some work in Miami where the retained consultant from Jacksonville was charged with developing what should have been a straight-forward economic impact study for a proposed infrastructure project. In so doing, there are two basic approaches he could have taken. One, he could have opted to use a canned input-output software package such as IMPLAN—that offers little evidence of scientific validity—or two, he could have conducted the study using the scientific method through which he would be required to conduct original research, research that would have stood the scrutiny from someone like myself. Unfortunately, he opted for option three—developing the study using big words with no econometric analysis, modeling, or forecasting at all. He did, however, throw around lots of numbers he had added, multiplied, and divided as he presented the same data in a different format—called descriptive statistics, whereby no statistical techniques are used outside of very elementary methods. Even at a mere glance of this firm’s work, we easily determined those conducting the study were grossly unqualified to conduct the work. Yet the client retained them.

But can you imagine being the client? Can you image rendering multi-million-dollar decisions with data they already had with no serious analytic inquiry? Well, that is exactly what the client did. They paid hundreds of thousands of dollars for something a grade school student could have produced. It happens all the time. And just because the so-called expert has pretty pictures in their proposal, lists a hundred self-proclaimed experts, and lists a thousand engineering and construction projects does not make them experts in post-PhD level research, statistics, and econometrics. Believing I am competent to serve as the structural engineer of record on the world’s tallest building on the coast in a seismic zone, where the engineering design level required a PhD with 35 years of experience, does not make me such. It merely makes me a fool to think so—and the public a little broker to use me, not to mention several people dead.

This foolishness must end. If your statistical and econometric analysis, modeling, and forecasting cannot stand up against true experts, stop claiming to be an expert in the field. Aside from appearing as a fool, you are costing private sector tax payers infrastructure monies our country simply does not have. And as much as I hate to even broach this subject, perhaps it is time we begin levying stiff penalties for such. After all, at the very minimum, claiming to be an expert in a field while not being such is fraud—and fraud is not only unethical; it is illegal.

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