The new budget agreement has suspended the anti-privatization “Pacheco Law” (yes, of course that’s what it is) for three years for the MBTA. It has been my strong sense from the beginning that the Pacheco Law discussion is a continuation of a longer, very ideological battle, and not actually central to the T’s problems.
Unfortunately this policy seems to be heavily based on a Pioneer Institute study, which — predictably! — shows that not privatizing has cost beaucoup bucks. This assertion is based on comparing the T to other transit agencies — apples to oranges at best. Here is a sample of a very cogent takedown of Pioneer’s work [a previous report, not the Pacheco report -ed]:
To make its case that the T’s costs are “out of control”, Pioneer first needs to find other agencies to compare the costs to. While there are many ways to use the National Transit Database to choose systems similar to the T, the Pioneer Institute takes an interesting approach. And I don’t mean interesting as in novel, I mean interesting as in suspect. The most logical idea would be to use a list of other large transit systems, but the Pioneer Institute uses miles between “failures” which the NTD explicitly points out in their definitions is subject to variation in agency policy.
By doing so, and by selecting agencies which carry one fifteenth as many passengers at MBTA buses alone (and in some cases as few as one fiftieth—or two percent—of the total number of passengers) they are really comparing apples to oranges. The T is being compared to sunbelt cities (no road salt, roads with less traffic and fewer acceleration and deceleration cycles) with many fewer passengers. These include systems which serve Palm Beach County, suburban Detroit and El Paso, for example, yet the report doesn’t compare the T to Philadelphia or Seattle, much better analogs. Comparing the T to its actual peers—other top-20 transit agencies—makes the costs go from 100% higher to just 40%. More than half of the supposed out of control costs are because of a false comparison.
It goes on. There are many ways in which every regional transit system is sui generis, which makes comparison a very delicate thing indeed; one would want to be cautious with far-reaching conclusions. The conservative Pioneer Institute (“Markets work”, well okey doke then) got the result they wanted.
Privatization is not a panacea. Things might be cheaper, they might not be. Look around Washington DC, or at the Pentagon budget, and see how much “efficiency” has been created by outsourcing.
I should say that I’m not an enormous fan of the Carmen’s Union. They negotiated 23-and-out as a campaign-year bonbon back in 1998, and defended it to its dying breath. But Jim Aloisi got it right a month ago:
Fixing MA privatization law will advance smart P3s [public-private-partnerships]. Repealing Pacheco law is just union busting. Let’s be smart not ideological #mapoli
— Jim Aloisi (@JimAloisi) June 5, 2015
For now, the Pioneer Institute looks like it got a scalp, based on highly questionable evidence. Another pig-in-a-poke for our under-informed legislature.
Who can you trust?