Multibillion dollar infrastructural projects, or megaprojects such as the Channel Tunnel, the Øresund bridge between Denmark and Sweden, the Hong Kong and Denver airports, or many high-speed rail links in Europe, continue to be built in record numbers despite poor performance and colossal losses. Why? The authors provide ample evidence to substantiate their claim that such projects are systematically misrepresented in public and private deliberations because many of the participants in the process have incentives to underestimate costs, overestimate revenues, undervalue environmental impact, and overvalue economic development effects.

This book is about the political undervaluation of risk in democratic society. Megaprojects involve substantial risk, or consequential uncertainty. Because the time horizon and sheer complexity of such projects extend beyond that of a decade, companies and governments involved often collude to misrepresent the facts to the taxpayers who will ultimately foot the bill. Big business, which has the advantage of economies of scale, frequently underestimates costs to make the projects more appealing and manageable to politicians. Governments often overestimate revenues and development benefits to garner support by cash-strapped taxpayers. Forecasts turn out to be wildly unrealistic driven by optimistic assumptions. Benefits accrue to a few big business interests or users while taxpayers collectively bear the costs. Project objectives are not clearly spelled out often because they are being driven by narrow political or private interests. While the authors do not use this term, we are confronted with a classic case of clientelist politics. The end result is an unsurprisingly big feast of national prestige, public waste, and private greed.

Sound familiar? It should. Even if one were not aware or informed about the economics of such projects, the sheer magnitude of funds should make us all pause to think about the implications. Take the war in Iraq, if one may be permitted to stretch the concept of megaprojects a bit from transport policy to foreign policy. Whatever the reasons for undertaking it, the end result has been a feeding frenzy for all the big firms in charge of rebuilding the country. If the argument of this book is correct, we should all think carefully about the future of these activities. It is not that the Pentagon underestimated the cost of rebuilding Iraq because of the sheer magnitude and complexity of the operation. Rather, it was a politically calculated effort to subsidize big business in the name of national security.

So what are we to do about this? Can advanced democratic societies finally eliminate risk? Will technological advances help us achieve a “zero-friction society,” as many commentators predict? The answer is clearly no. It is not because technology is of little use, but rather because the process of conceiving, formulating, and implementing such risky operations is loaded. Important stakeholders are strategically kept out of the loop, be they such nongovernmental groups as environmental groups, scientific and professional experts, or the media. The key to understanding the problem and its solution, the authors conclude, is to gain insight into the institutional incentives actors have and the consequent manipulation of information. More risk deliberation, transparency, and accountability are not just good for democracy, a rather nebulous but important assertion. They also make good business sense.

Megaprojects and Risk is well written, amply documented, and well presented. Perhaps the only drawback in this otherwise admirable book is that it does not go far enough. Inductive in their analysis while practical in their recommendations, the authors do not tease out the full theoretical implications of their argument. Because they do not present an overarching framework of power and risk, they miss out on the general implications of manipulation in democratic society. Manipulation is endemic. If more information is not necessarily the answer—that is, cost overruns or other negative effects are the results not of misunderstanding risk but of misrepresenting it—tweaking institutional arrangements may not necessarily help. For example, the authors call for a reallocation of risk by redrawing the public–private boundaries. How? Reduce sovereign guarantees, they recommend among other things, and involve a greater degree of private risk capital (pp. 109–10). Sure, but how many bridges or roads will be built as a result? Even if this is exactly the point, far fewer projects should be undertaken than is currently the case, and one should not underestimate the importance of public human capital. In an era of downsizing and underfunding the public sector, we are in even greater need of better civil servants and politicians. We desperately need individuals who understand the politics of manipulation, recognize it, and are equipped professionally to deal with it. In other words, better institutional arrangements may (or may not) increase risk deliberation, transparency, and accountability, but better civil servants surely will. After all, risk is not simply a question of institutional incentives but, most importantly, of human qualities. Do you want to reduce risk and improve the performance of public–private ventures? Increase the quality of the employees who are at the heart of the decision-making process.

Finally, the authors miss out a bit on the so-what question. Manipulation comes at a price, but not all of us are unhappy about it. I know the Channel Tunnel turned out to be a financial disaster, but so what? I like the idea, I like the project, and though costly, I still think it was worth it. We may know a lot about risk, but as a society we are still poorly equipped to deal with it.