A giant bureaucracy in the making?

The Greater Bay Area mustn’t become a giant bureaucracy

(Next Magazine, 2017/8/10, Second Opinion, Bill Stacey)

Integrating the Pearl River Delta to form a Greater Bay Area conurbation is founded on the compelling logic that the largest urban area in the world, with high incomes, leading manufacturing and education facilities, and a stock of accumulated human capital unmatched in any emerging market can only bring about greater prosperity. We are at the center of this and can buttress this mix with a greater degree of liberty and the rule of law.

The economic benefits of faster transport, more efficient linkages between airports, and continued regional specialization are real. Professor Richard Wong of Hong Kong University’s School of Economics and Finance has shown that our “soft skills”, not least a common law system that allows for efficient contracting and adjudication of disputes, provide the region a soft power that is world class.

Yet the Pearl River Delta is not the only region in the world to have these advantages, and we can learn from successes – and failures – elsewhere. Perhaps the greatest urban and industrial center of the last century was the Tri-State Region, which includes New York City and large parts of New Jersey and Connecticut, with a population of around 23 million. We do not need to dwell on the positives of the region,  a world-class center of industry, commerce, education, and culture. However, we should learn from its mistakes.

I have visited this region for 30 years and observed at first hand its ups and downs. Right now, greater New York is in eclipse. Minor repairs to Penn Station have been billed as delivering the “summer of hell” for commuters. The tired infrastructure is showing more stress than ever. The homeless are returning to Manhattan’s streets. Shop vacancies are increasing as taxes make services and goods less competitive. Favorite diners and haunts are closing. Friends that have seemed fixtures there for decades are moving away.

Much of this comes from failures of governance. As it had evolved in the late 19th and early 20th centuries, the Tri-State Region had the best infrastructure in the world. Private companies competed and built the railway networks that linked the region as well as New York’s famous subway. The enterprising boroughs and cities of the region would compete to attract talent and business.

However, from the New Deal onwards, the role of the governments in the region grew. In the name of efficient coordination across state lines, the Port Authority of New York and New Jersey, a bureaucracy, came to own or operate much of the port, rail, road, and air transport infrastructure in the region, thus sowing the seed for its present miseries.

Bureaucratic and political management stifled commercial and economic incentives. The result is deplorable. The three states of the region all rank in the highest 10 for state tax burden, and New York is at the top of most lists. The region is beset by problems such as unfunded pension liabilities for public employees. Projects across jurisdictions have been hotbeds for corruption, delays, and union power, driving up costs.

The Greater Bay Area –  and Hong Kong –  should take heed by privatizing the airports, bridges, and railways owned by governments. Privatization will improve management, lower costs, and reduce the scope for corruption. The private sector will keep its assets well maintained and promote regional linkages on business terms.

The most intractable problems of the Tri-State Region come from the involvement of the Federal government, states, and unaccountable regional authorities. The Greater Bay Area should therefore encourage jurisdictional competition to foster governance. Not only is our autonomy vital, so is the ability of our neighbors to look after their own interests –  region-wide authorities of any kind, with the inevitable bureaucracy – and corruption –  that they entail, should be resisted at all cost.

Taxes must remain low and liberties high. The great regions of the world are created by people, not bureaucrats, and people are attracted and retained by keeping the fruits of their enterprise.

Writer: Bill Stacey


The Lion Rock Institute




快速的運輸、機場間的更高效連繫及持續成為專業地區的確是有利經濟的。香港大學經濟及金融學院 王于漸教授也表示,我們的普通法制度能有效地制訂合同及排解爭議是世界上一流的軟實力









作者:Bill Stacey


翻譯:Joe Chan

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