Regarding the pervasive problem of cost overruns (defined as government programs and projects that wind up costing far more than initial estimates), I’ve always appreciated this image sent by a reader.

It nicely captures a key reason for cost overruns, which is that there is no bottom-line incentive for bureaucrats and politicians to monitor costs.

Indeed, the incentives are bad, since contractors and other beneficiaries of ever-rising costs have incentive reward politicians with votes and campaign cash.

One of the most infamous examples of ever-rising costs is California’s “train to nowhere,” the supposed high-speed rail between San Francisco and Los Angeles that seems to get more expensive every day.

But New York City has equally absurd examples, as do other countries.

You know who else is guilty of promising low-cost initiatives that turn into expensive boondoggles?

Donald Trump.

Let’s review three examples, starting with his new plan to change the reflecting pool in Washington. Here are some excerpts from a report in the New York Times by David Fahrenthold and Luke Broadwater.

President Trump said that his handpicked contractor would charge only $1.8 million to repair the Lincoln Memorial Reflecting Pool and paint it blue. The actual cost is now more than seven times that, after the Interior Department nearly doubled the size of the contract late last week, federal records show. …The government awarded that firm a no-bid contract last month, bypassing the requirement to seek competing offers by saying that the situation was so urgent that any delay would cause “serious injury” to the government. The government has not publicly said what that injury would have been.

Next, Mike Bebernes has a story for Yahoo!News about the controversial White House ballroom.

Here are some relevant details.

…a new proposal…would provide $1 billion in new funding for security upgrades to the East Wing of the White House, where President Trump’s new ballroom is being built. …From the beginning, Trump has said that all of the money to build the 90,000-square-foot event space would come from “Patriot Donors and Contributors.” So, when the $1 billion funding proposal was announced, critics of Trump’s plan to build the ballroom seized on the news as an opportunity to accuse Trump of breaking his pledge that “not one dollar of taxpayer money” would be spent on the project. …the price tag for Trump’s ballroom has risen dramatically since it was first announced. When the White House released the first official plans for it last July, the full cost of the project was quoted at $200 million.

Last but not least (especially from a fiscal perspective!), we have another New York Times story, this one by John Ismay.

Trump wants to copy Israel’s missile-defense system.

A national missile defense system like President Trump’s proposed “Golden Dome” could cost taxpayers $1.2 trillion over 20 years, according to a government report… Even if the system is built, the report concluded, an adversary like Russia or China that has a large arsenal of nuclear weapons could overwhelm it and some missiles would hit their targets. …Mr. Trump has…estimated that the project would cost $175 billion.

If my simple math is correct, $1.2 trillion is almost seven times higher than $175 billion.

And if the Golden Dome actually goes through, I’m sure the actual cost would be considerably more than $1.2 trillion. That’s simply the nature of government budgeting.

I’ll close with the observation that cost overruns don’t necessarily mean that a program or project should not take place.

But it does mean that when policy makers do a cost-benefit analysis (focusing on what’s best for the country, hopefully, not what’s best for their reelection), they should automatically assume any program or project will cost at least five time as much as originally claimed.

With any luck, they might then conclude they are spending too much of other people’s money.