Bruce and the Incentives of the Central Planner

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Here’s a telling note from Ted Nesi’s Nesi’s Notes on WPRI.com:

The CNBC list drew a lot of attention on social media, including from economic-development expert Bruce Katz, who tweeted: “I find this ranking difficult to understand given large drop in RI unemployment, investments in infrastructure, off-shore wind, innovation vouchers + innovation campuses, attraction of Infosys and other significant companies and many other smart moves.” Turns out Katz had good reason to have Rhode Island on the mind: on Wednesday night I ran into him in Providence, and discovered he was in town to interview with Commerce RI about writing its new economic development study. Katz, of course, helped put together the 2015 Brookings Institution report that provided the blueprint for the Raimondo administration on economic development. Katz has since left Brookings, and now runs a consultancy called New Localism Advisers. The other three contenders are Camoin Associates, TIP Strategies, and The Research Associates. Commerce spokesperson Matt Sheaff says there’s no timeline yet for making a pick.

How perfect is this.  A guy who was at the center of RI’s failed economic development strategy is publicly praising the state’s economy four or five years later while also secretly in the running for a big contract from the state government.

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The archetypal central planner would no doubt disagree with this assessment, but a skeptical observer might see in the above blockquote a reason to doubt central planning.  Even by their own philosophies central planners aren’t demigods who should be expected to get every decision right from the start, which means they have to be able and willing to review their results with a cold, clinical eye.  The political incentives and human nature, however, make that practice virtually impossible.

 

Featured image: Bruce Katz presenting his big plan for Rhode Island in 2013.



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