Brian PCF's Blog

PA Highway Privitzation and Commentary

Just an email exchange between me and some friends on road privatization:

The article that got it started

Mayer Brown, Ballard Spar Advising Pennsylvania on 12.8 Billion Turnpike Privatization

Comment 1 from J.H.

As a native Pennsylvanian I’m embarrassed. It’s not enough the state is consistently ranked with having the worst roads in America. Now they have to go and pull this sh**!?
I’m so enraged I’m not even going to attempt to craft a coherent reply. But I think Doug’s wisecrack is DEAD ON. Wake the hell up America!!!! Do you want YOUR government outsourced!?! Cause that is basically what you are doing.
And if you think government red tape is a headache now … combine that with the experience you have currently calling the support hotline (which routes to Bangalore) to get help with your ailing Dell computer … or that of anyone doing private sector systems development, getting working up by calls from India at 3 am because all work has stopped due their confusion over why there are US addresses that don’t align to one of the 50 states, and they don’t know how to use Google or wikipedia well enough to brush up on the current status DC, Puerto Rico, and APOs. And let me tell you first hand, in case you couldn’t speculate, teaching Geography lessons to middle aged co-workers half way round the world in the middle of the night really F’s up ones Ch’i!!!

Comment 2 from BSW:

Here’s a question for you: If Pennsylvania is planning on privatizing their largest and most used road in the state, which must take up significant amounts of money for maintenance from both PA and Fed monies, how much will they reduce the amount of gas tax the state currently collects (currently at $0.507/gal for regular, $0.637 for deisel; 1, 2)? Especially considering the proposed sale price of $12.1 billion, which is 21% of the $56 billion total operating expenditures for the PA govt in fiscal 2006-2007 [3].

Sounds to me that PA could sell this road and drastically decrease there current rank of 24th highest tax burden in the country [4]. Or at least stop the sham of a tax law that charges oil companies operating in the states $0.193/gal, which is immediately passed on to the consumer (as are all “corporate” taxes due to the inherent monopoly this gives any specific industry which is levied).

But shockingly enough, PA won’t reduce any of their taxes, they will continue to spend their citizens money wastefully and irresponsibly because that’s what governments do. Who’s to say that private roads couldn’t be absolutely free as opposed to our current tax system. There is a private road in Hong Kong that is free, and the road company simply leases out office space around the road.

Here’s my “novel and completely original idea” – charge advertisers for billboards, etc., along the route thereby allowing commuters free access. I know, I know – a crazy idea – what business could be successful giving a free service to consumers and charging advertisers – could never work (ahem, ahem, cough – Google).

Here’s a fascinating book review on “Street Smarts” that gives an historical and global perspective on road privatization.


May 21, 2008 - Posted by | Uncategorized

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