What happens when politicians allocate?

This opinion for the WSJ gives a glimpse into how the political process allocates scarce resources.

Opinion. All Aboard the Infrastructure Boondoggle
by: Michael J. Boskin
Nov 01, 2016
Click here to view the full article on WSJ.com

TOPICS: Cost Benefit Analysis

SUMMARY: Whoever wins on Nov. 8, a flood of public-works money is coming. Cost-benefit tests are crucial. "No matter who wins the presidency, a huge pot of additional money earmarked for infrastructure, on top of the recently passed $305 billion five-year highway bill, is sure to unleash a mad scramble in Congress to secure funds for the home turf. The logrolling and pork will get ugly without far tighter cost-benefit tests and oversight."

CLASSROOM APPLICATION: Students can discuss whether cost-benefit analysis should be applied to decisions about whether to improve infrastructure. They can also analyze the incentive problem created by the U.S. federal, state, and local budgeting system; and they can learn about the ways that politicians hide the true costs of projects to taxpayers.

QUESTIONS: 
1. (Advanced) "The logrolling and pork will get ugly without far tighter cost-benefit tests and oversight." What is "logrolling"? What is "pork-barrel spending"? Why are logrolling and pork-barrel spending especially problematic when cost-benefit tests are not applied?

2. (Advanced) What is the incentive problem created by the U.S. public budget model in which most infrastructure requests and decisions are made at the state and local level while being funded mostly at the federal level?

3. (Introductory) What are ways for politicians to hide the true costs of infrastructure projects from taxpayers?

4. (Introductory) Should politicians use social spending for social engineering?

Reviewed By: James Dearden, Lehigh University