Why Government Infrastructure Costs 50 Percent More Than Private

Episode 60 of The Fiscal Policy Podcast with Fexingo digs into why governments consistently pay significantly more for infrastructure projects than private firms. Lucas and Luna examine a recent study of 1,500 global projects showing that public roads, bridges, and transit systems average 50 percent cost overruns compared to private benchmarks. They focus on California's High-Speed Rail Authority, which spent $6 billion on 119 miles of track in the Central Valley — roughly $50 million per mile, triple the per-mile cost of Spain's high-speed rail. The hosts unpack the structural drivers: fragmented procurement rules, prevailing wage laws, environmental review layers, and political incentives to underestimate. They also explore a rare success story — Utah's Department of Transportation, which adopted private-style design-build contracts and cut cost overruns to 10 percent. The episode offers a clear, data-driven look at how public spending rules inflate costs, and what reforms might close the gap. #Infrastructure #PublicSpending #CostOverruns #CaliforniaHighSpeedRail #DesignBuild #PrevailingWage #NEPA #UtahDOT #FiscalPolicy #GovernmentEfficiency #Economics #PublicPrivatePartnerships #Transportation #BudgetOverruns #InfrastructureCosts #FexingoBusiness #BusinessPodcast #FiscalPolicyPodcast Keep every episode free: buymeacoffee.com/fexingo