I attended a computer conference this past week, during one session of which Dr. Moshe Rubenstein (click here for one of his excellent books), emeritus
The new bridge opened 17 days after the old bridge collapsed. A socialistic government, such as the one envisioned by Barack Obama, could never hope to accomplish such a monumental task.professor from UCLA, told the story of the rebuild of the I-580 bridge in Oakland, California in a stunning feat of free-market creativity.
In the case of the I-580 rebuild, government (CalTrans) did what it does best--find the best bid and get out of the way. It determined to give 50 days for the winning bid to complete the job. There would be a $200,000 penalty per day for completion after the 50-day limit, but there would be a $200,000 bonus for every day the project was completed sooner than 50 days. That made it so that the job could net the winning bidder a $5 million bonus.
The winning bidder went into action on April 29, 2007, the very day the bridge collapsed, which was 8 days before the government entity met to award the bid. By the time the bid was awarded on May 7th, the winning bidder already had his plan in place. His bid: $867,075. Here's how the government succeeded:
Caltrans officials were able to expedite the normally lengthy road repair process after Gov. Arnold Schwarzenegger declared an emergency for the site. The move gave Caltrans the power to cut through red tape.And here's how the free market succeeded. Because the free market has not yet been completely destroyed by well-meaning socialist overlords, the winning bidder knew that there still existed steel fabricators and welders in Pennsylvania and Arizona who had achieved excellence in their craft. He called these people and was able to have new steal beams and girders begin arriving on-site about 10 days after the accident.
The new bridge opened 17 days after the old bridge collapsed. The winning bidder achieved his $5 million bonus, and completed the rebuild even 8 days sooner than bonuses would have encouraged. This is the genius of morality in a free market. A socialistic government, such as the one envisioned by Barack Obama, could never hope to accomplish such a monumental task.