US cities pay too much for buses

"Federal funding typically covers 80% of bus purchases, with agencies responsible for the remainder."

Well, there is your answer. The one making the purchase isn't the one primarily paying for the purchase. This makes them less sensitive to pricing.

Kinda like how expensive healthcare is since it is paid for by insurance.

Or how you don't care how much you put on your plate or what you choose to eat at an all you can eat buffet.

The second you detach the consumer from the price of something, even through an intermediary such as health insurance, that is when they stop caring about how much something costs, and so the price jumps.

And congratulations to any of today's lucky ten thousand who are just learning of the Principal-Agent Problem.

https://en.wikipedia.org/wiki/Principal%E2%80%93agent_proble...

I'm convinced that a great majority of problems in the US these days fundamentally boils down to principal agent problems. The 2008 financial crisis is a great example. Once banks no longer kept mortgages on their own books, it just became a matter of time until that was going to blow up. The incentives change.

It takes more than just misaligned incentives to get a banking crisis -- you have to have structural corruption preventing the transfer of the loss gradient back to the "misaligned" decision makers. It's somewhat disingenuous (or overly innocent) to reimagine the pathways which power structural corruption as "innocent ignorance in the face of bad incentives".

The real world has "actually bad" actors -- not just misaligned incentives.