Full Version: Privatizing roads
http://www.breitbart.com/news/2006/07/15/D8ISHMO00.html
This article just shows how desperate the politicians are for money. Instead of having the guts to raise taxes or cut spending, politicians have decided to start selling off public assets like roads and public utilities to foreign companies. This is just plain nuts. For starters, the people using those roads will now have to start paying higher tolls. Second of all, the money from those tolls is now going to go to foreign companies instead of staying inside the United States.
Privatization can work when there's actual competition betwen different companies to provide the most value for the product. The taxpayers are supposed to have that kind of competition when DOT hires construction companies to maintain the highways. The management of highways itself though, is monopolistic by its very nature (imagine 10 different highways going between Baltimore and Washington DC).
What's outrageous is that the politicians who approve these deals did not do the basic math. In one instance, a company bid $3 Billion for a 75 year lease. Given the budgets of most states, $3 Billion cannot last for more than 5 years but the leases themselves are for several lifetimes. This is another example of how politicians use 1 time sales of assets to cover operating expenses.
So the question for debate is
Should States be privatizing roads
If so, should there be reasonable limits such as limitations on price hikes or having a short lease?
This article just shows how desperate the politicians are for money. Instead of having the guts to raise taxes or cut spending, politicians have decided to start selling off public assets like roads and public utilities to foreign companies. This is just plain nuts. For starters, the people using those roads will now have to start paying higher tolls. Second of all, the money from those tolls is now going to go to foreign companies instead of staying inside the United States.
Privatization can work when there's actual competition betwen different companies to provide the most value for the product. The taxpayers are supposed to have that kind of competition when DOT hires construction companies to maintain the highways. The management of highways itself though, is monopolistic by its very nature (imagine 10 different highways going between Baltimore and Washington DC).
What's outrageous is that the politicians who approve these deals did not do the basic math. In one instance, a company bid $3 Billion for a 75 year lease. Given the budgets of most states, $3 Billion cannot last for more than 5 years but the leases themselves are for several lifetimes. This is another example of how politicians use 1 time sales of assets to cover operating expenses.
So the question for debate is
Should States be privatizing roads
If so, should there be reasonable limits such as limitations on price hikes or having a short lease?
Should States be privatizing roads
If so, should there be reasonable limits such as limitations on price hikes or having a short lease?
When it comes to who's laying the tolls, I don't suppose it matters much whether it's a private or a public entity doing it. The far more important thing, in either instance, is that we make sure that tolling does not become too widespread. It's one thing when only major highways become taxed, but if it starts to spread to back roads, then we're on the road back to serfdom. That's what has to be watched out for, regardless of who's doing the tolling.
If so, should there be reasonable limits such as limitations on price hikes or having a short lease?
When it comes to who's laying the tolls, I don't suppose it matters much whether it's a private or a public entity doing it. The far more important thing, in either instance, is that we make sure that tolling does not become too widespread. It's one thing when only major highways become taxed, but if it starts to spread to back roads, then we're on the road back to serfdom. That's what has to be watched out for, regardless of who's doing the tolling.
I don't think roads should be privatized. Where would the competition come from to maintain them? We already compete the building and maintenance of roads.
Should States be privatizing roads
If so, should there be reasonable limits such as limitations on price hikes or having a short lease?
Roads should not be privatized for two main reasons. First, there is no real competition. Private enterprise and the market economy only functions with the basis for competition. There are only so many roads and those that are privatized would be a de facto monopoly. Second, privatization would require government regulation in this case which defeats the purpose of privatizing them in the first place.
As usually happens a third reason pops into my head. Roads should be public because the ability to freely transport your selves and your goods is a right. If someone owns the roads then there is the implication that he/she would be able to prevent certain private citizens from using their property.
If so, should there be reasonable limits such as limitations on price hikes or having a short lease?
Roads should not be privatized for two main reasons. First, there is no real competition. Private enterprise and the market economy only functions with the basis for competition. There are only so many roads and those that are privatized would be a de facto monopoly. Second, privatization would require government regulation in this case which defeats the purpose of privatizing them in the first place.
As usually happens a third reason pops into my head. Roads should be public because the ability to freely transport your selves and your goods is a right. If someone owns the roads then there is the implication that he/she would be able to prevent certain private citizens from using their property.
But fellas, they are being privatized to foreign countries...where's your sense of globalization? I mean, why not have your taxes go to England or France of Japan or China? We have a huge enough debt here, why would we need to pay it off? We're going to be part of the North American Union before long...where's your sense of adventure? 
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