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With outsourcing to China, a bridge too far in the Bay Area

In a story that should be a wake up call to policy-makers, outsourcing has gone public. As David Barboza of The New York Times reported on Saturday, seeking out low-wage workers off shore isn’t just for iconic American brands such as Apple, General Electric and Levi-Strauss; the phenomenon is increasingly prevalent among public agencies across the nation.

To illustrate the point, Barboza focuses on efforts to replace the eastern span of the San Francisco-Oakland Bay Bridge in California.  After the bridge was damaged in the 1989 Loma Prieta earthquake, officials decided a major overhaul of the Depression-era structure was necessary. The course of action for the 8.4 mile crossing was two-fold: strengthen the iconic double suspension four-tower west span and entirely replace the cantilever box east span.

Initial cost estimates said strengthening of the east span would cost about $700 million, but that for only $200 million more, a new bridge could be built that would withstand a major earthquake and act as a ‘lifeline’ for emergency services.

Some 22 years after the Loma Prieta quake, construction is still underway (it began about a decade ago) and the price tag is now an estimated $7.3 billion.

During the extended, decade-long planning phase, with projected costs soaring and a public outcry against profligacy, the State of California began looking for ways to economize. It opted against accepting any federal money for the project (even though the bridge span is, in fact, the final miles of Interstate 80) on the grounds that federal aid would trigger ‘Buy America’ provisions, driving up the costs further.  Instead, as Barboza writes, construction of major parts of the bridge were contracted out to Chinese companies.

At the time, it sort of made sense — the housing bubble placed a premium both on building materials and the labor needed to turn girders and rebar into a useable structure. A few years later, taxpayers aren’t griping about costs, they’re livid about the thousands of jobs and cutting edge industrial knowhow that sailed across the Pacific.

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