Making Things Less Expensive

   Any time you make things less expensive for the consumer, everyone wins.  Take the automobile.  Henry Ford reduced the cost of the car dramatically which allowed virtually all working people to afford a Ford.  In doing so, he increased sales and profits, he employed thousands of people making good wages and spurred all kinds of related industries from steel, to glass, to fabrics and tires.  These industries, in turn, created thousands of jobs which permitted even more people to afford an automobile.  This, in turn, increased the need for gasoline and oil, repair shops and roads.  With new roads motels and restaurants sprang up and created even more jobs.

   By reducing costs in the private sector and well as in government we can better allocate scarce resources and expand the economy.  An example cited earlier is to eliminate the three sets of auditors of banks.  One auditor would reduce costs and provide a better audit.  Another area related to banks is the high cost of title searches for real estate loans.  Each time a property is refinanced an attorney must be paid to research back at least 60 years to determine whether the title is good.  I propose that, once the first title search is prepared, that it be recorded at the courthouse.  Then when a new title search is required, it would only have to go back to the date of the previous title search.  This could significantly reduce the cost of title searches and thus the cost of borrowing.

   The same goes for surveys.  Once a survey is prepared it should be recorded at the courthouse with the GPS coordinates of all corners.  If a new survey is required it would then only be necessary to verify the GPS coordinates.  This could drastically reduce the cost of the survey, and thus the cost of borrowing.

   I also wonder why we don’t have title companies in West Virginia.  Most states have title companies that handle all matters related to closing mortgages.  They tend to be much less expensive than using attorneys.

   Appraisals are another cost that could be reduced significantly if handled correctly.  Real estate appraisals could also be recorded at the courthouse.  If a subsequent appraisal was required the appraiser could simply update the previous one.  The property could be inspected and changes in the condition noted.  It could then be updated for cost increases and changes in the neighborhood.

   Commercial appraisals could not be recorded at the courthouse because they may contain sensitive financial information about the business.  However, prior appraisals could be made available when a new appraisal was required and thus reduce the cost.  In many situations where the value of the business is determined primarily by the cash flow of the business, an audit would be more appropriate than an appraisal.  In any case, the banks should be given complete discretion when the customer has been in business a long time and there have never been any problems with the loan.

   Government employees should be given incentives to reduce costs while improving services.  Under the current system, the government is penalized for reducing costs because their budgets are then cut.  Therefore, they have an incentive to spend 100% of their budget and then ask for more the next year.  We have all heard stories of agencies that scramble to spend funds at the end of the year so their budgets will not be cut the next year.

   One area that I have observed waste is the turning lane stencils at intersections.  On average, the state road replaces these stencils every two years.  In the first place, these stencils are useless when covered with snow or when several vehicles are backed up at the intersection.  It would be much cheaper to hang the directional arrows near the stoplights so that everyone could see them.  They would be more functional and cheaper than the current system.

   Another DMV program that wastes tremendous amounts of money are the sensors in the highways that are supposed to control the stop lights.  For example, on most four lane highways, there are three sensors in each lane approaching the stop light.  This amounts to 12 sensors in total. However, these are useless.  This is because the sensors at the side roads tell the system when to change the stop lights on the main highway.  In addition, many of these sensors are not actually used.  The lights are actually timed making the sensors a waste of money.

   Another waste of money is unwanted road improvements, like stop lights and passing lanes.  In one small community, the DMV decided to replace a three way intersection stop sign with a traffic light.  Virtually no one in the community wanted the intersection changed and there was never a problem with backed up traffic at the intersection.  The DMV actually admitted that it was the friendliest intersection they had seen.  However, they proceeded with their plans to install a stop light and purchased a business, tore it down, and installed a turning lane.  They then installed the wiring for the stop light before the project was stopped by the local community.  The wiring was removed only to be replaced several years later with a stop light, completely ignoring the wishes of the community.  I estimate that the DMV wasted at least $1.5 million on this useless light.

   The DMV routinely pays engineering firms more than $300,000 to evaluate projects, such as passing lanes on highways.  Oftentimes, the local citizens are opposed to these projects because they cause more accidents than they solve.  However, the DMV proceeds to spend the money until the local citizens can get the projects stopped.

   Another problem which drives up insurance costs are uninsured motorists.  I see no reason why the county and the DMV do not verify insurance when new tags are issued.  Motorists are required to enter their insurance information on the registration form but no one verifies it.  How stupid! (This was finally changed in 2013.)

   I know that I have only scratched the surface when it comes to how we could cut costs in this country.  That’s why I recommend that the government establish a web site to encourage citizens to make suggestions on how we can operate more efficiently.  The government could even offer incentives for the best suggestions each year.