Selling of American Taxpayer Funded Property

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Some of you are likely aware of this happening if you live in an area where roads or bridges have already been sold. I was not aware of this happening.

Quote:

Foreign companies buy U.S. roads, bridges

By LESLIE MILLER, Associated Press Writer
Sat Jul 15, 2:44 PM ET

WASHINGTON - Roads and bridges built by U.S. taxpayers are starting to be sold off, and so far foreign-owned companies are doing the buying.

On a single day in June, an Australian-Spanish partnership paid $3.8 billion to lease the Indiana Toll Road. An Australian company bought a 99-year lease on Virginia's Pocahontas Parkway, and Texas officials decided to let a Spanish-American partnership build and run a toll road from Austin to Seguin for 50 years.

Few people know that the tolls from the U.S. side of the tunnel between Detroit and Windsor, Canada, go to a subsidiary of an Australian company ?- which also owns a bridge in Alabama.

Some experts welcome the trend. Robert Poole, transportation director for the conservative think tank Reason Foundation, said private investors can raise more money than politicians to build new roads because these kind of owners are willing to raise tolls.

"They depoliticize the tolling decision," Poole said. Besides, he said, foreign companies have purchased infrastructure in Europe for years; only now are U.S. companies beginning to get into the business of buying roads and bridges.

Gas taxes and user fees have fueled the expansion of the nation's highway system. Thousands of miles of roads built since the 1950s changed the landscape, accelerating the growth of suburbia and creating a reliance on motor vehicles to move freight, get to work and take vacations.

In 1956, President Eisenhower pushed to create the interstate highway system for a different: to move troops and tanks and evacuate civilians.

The Bush administration's plan to let a foreign company ...

READ THE REST

Is this acceptable? Expected due to globalization? What problems can you foresee, if any? What happens to the funds after the sale, and how do we, as taxpayers ensure that it is actually beneficial?

Can I sell dlowan and msolga the Brooklyn Bridge?

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you'll probably have to throw in some glass beads and maybe a hand mirror.....

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Seems to be part of the growing trend of giving away everything we have- -jobs, land, whatever.

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Well, since US firms and consortiums own roads, sewerage systems, etc etc paid by foreign taxpayers in foreign contries as well - why shouldn't it work the other way around as well?

Sounds "typically American": we can do it, but no one else!

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I wasn't aware that we (American companies) owned basic infrastructures in other countries that were originally paid for by citizens, Walter Guess I haven't previously thought about it.

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Especially the sewerarge systems are something, Americans like to buy .... while you seem to like selling roads, highways etc Laughing

Quote:

In little more than 12 months, beginning in late 2004, the following events occurred: A Spanish toll road company proposed to invest $7.2 billion to build the first leg of the Trans-Texas Corridor (TTC), a major highway, rail, and utility corridor running north-south from Oklahoma to Mexico. A global consortium agreed to pay $1.8 billion to lease, toll, operate, and maintain the Chicago Skyway for 99 years. And an Australian toll road operator bought out a struggling public-private toll road in Virginia.

source

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squinney, I didn't even know there WAS a Pocahontas Parkway.

Seems to me that another country bought Rockefeller Center, but I'm not certain of that.

Hey, Arizona bought the London Bridge. <smile>

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Squinney , baby, weve been doing this for years. Waste Management Inc, handles most all of the trash in AUstralia.and Aqua America owns and runs many big treatment works and water systems in Europe and Australia and South AMerica.

I wish some outfit would buy the PA and Maine Turnpikes sothey would finally get finished .

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Re: Selling of American Taxpayer Funded Property

squinney wrote:

Is this acceptable? Expected due to globalization?

I don't know if it's good policy to sell bridges. But given that the state sells them, I don't see what difference it makes to the public welfare wether the buyer is foreign or domestic. They will both charge what the traffic will bear.

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I suppose, bridges would be the same as ports/harbours .... homeland security.

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I am surprised that there isn't the outrage from the right as there was about the ports deal. In this case it seems to be the left that is shrieking about foreign ownership of infrastructure. Regardless of where the criticism comes from the notion of "them foreigners" is, in my mind, just plain dumb.
The task of government is to build the things in the public sector that are needed to keep the society functioning efficiently. We can debate forever about our transportation system and whether more resources should be devoted to highways or rail or mass transport.

Here is the crux of my argument (using the Indiana Turnpike as an example): it was designed and built by the government because of a public need for it, not because (unlike private businesses) of a desire to make a profit. Once built and operating, this leasing to an investment group simply monetizes today the flow of income that will come in over the next 75 years.

Presumably the government can regulate what the rate of return will be on the $4 billion investment. Say 10% per year. So that will determine what the tolls will be. If some investors (foreign companies, the Widows and Orphans Fund, or the Social Security wants to go for that 10%), I say let them.

In the Read More link in Squinney's original post was a comment from some (Democratic) politician saying that this deal would generate something like $133B over 75 years for a $4B investment. I question his numbers. I think his number is bogus.

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I don't get what the problem is.

If the public is selling publically owned property, it is the public that will get the proceeds from this sale. If the administration that was elected by the public think that these sales are a good idea, then it should happen. If not then it won't.

Rejecting something that may be a fiscally good idea based simply on a fear of foreigners seems awfully irrational to me.

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I don't think the public really knows / pays that much attention. I also don't think there will ever be enough public outrage to stop the government from selling off public property (ie forests, roads or anything else) considering we can't get enough outrage gathered for an illegal invasion of another country.

And, "a fear of foreigners"?? There's a legitimate concern and argument in recent years for selling off / privatizing our water supply. I don't think it's a fear of foreigners as much as a fear of taking publically owned property and making it "for profit." If things intended for the benefit of citizens is no longer in control of government or the public, I think it's fair to ask where that may lead us.

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Squinney,

I don't know how to interpret the phrase " we can't get enough outrage gathered for an illegal invasion of another country." Either you are reffering Iraq (in which case we did generate enough outrage for an invasion), Mexico (which is just silly to compare people taking care of our kids to our invasion of Iraq), or some other country (Iran or North Korea who I hope we never reach the level of invasion).

Please tell me what you are scared of... or is this just a politcal diatribe on some nationalistic "principal".

This phenominon happens because

1) Taxpayers don't want to pay the taxes necessary to maintain these resources.
2) The only other option is to sell shares of these resources to raise the money needed to maintain them.
3) People (some of them foreign) consider these shares as an investment.

You make it sound like some hostile foreign power, because of their business investment... will have the power to turn off our water for political reasons.

This doesn't make any sense. After all the fact that I own shares of Sprint doesn't give me the power to turn off your phone...

If you are truly upset about this-- there is only one solution. You need to convince your fellow citizens to accept higher taxes.

But don't let the desire of Americans to lower taxes stoke a fear of foreigners. After all, they are not foreign invaders... they are simply investers accepting a business deal that we, the American taxpayers, are offering.

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squinney wrote:

And, "a fear of foreigners"?? There's a legitimate concern and argument in recent years for selling off / privatizing our water supply. I don't think it's a fear of foreigners as much as a fear of taking publically owned property and making it "for profit." If things intended for the benefit of citizens is no longer in control of government or the public, I think it's fair to ask where that may lead us.

(1) Bakers benefit the public. They are baking for a profit. I either don't understand your distinction between "for profit and "for the benefit of citizens", or you are presenting a false choice.

(2) When a city sells municipal works to a private operator, the buyer pays for it, presumably a fair price. Thus, the transaction shouldn't change the total amount of public property -- only the composition of it.

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Bakers that's a feed:
in medieval Europe, paternalistic urban authorities regulated commercial activities considered too important to the general good to be left to the whims of the market or the discretion of profit-minded individuals. (The irst source about this is, if I remmember correctly, from the 13th century in Paris, where regulations about baking bread, cake etc were published.)

When New Amsterdam experienced a bread shortage in 1661, there was a dispute about it as well - but it seems that social obligations weren't so closely connected to commerce anymore: it turned out that the bakers could increase their price by 10% instead being excluded from the trade for a period of a year and six weeks as the burgomasters first ordered.

Earliest American free-market society :wink:

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Walter Hinteler wrote:

Bakers that's a feed:
in medieval Europe, paternalistic urban authorities regulated commercial activities considered too important to the general good to be left to the whims of the market or the discretion of profit-minded individuals.

Interesting parallel. Smile

To get back to your earlier point, I disagree bridges are comparable to ports in terms of homeland security. Ports are instruments of foreign commerce. Therefore, if a Saudi company owns the port of New York, and the Saudi intelligence service "persuades" him not to pay attention to their container on ship X, that's a homeland security risk. I don't see such a risk when a Saudi owns a bridge -- even an important bridge, say, over the Mississippi from Saint Louis to East Saint Louis. What do you suggest the evil foreign intelligence service will be able to do if one of their people owns that bridge?

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So, it's acceptable and just part of globalization as I asked in my original post?

(ebrown - can't gather enough outrage over the invasion of Iraq, which many of us view as wrongheaded, and the persuasion to do so decietful.)

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squinney wrote:

So, it's acceptable and just part of globalization as I asked in my original post?

In my view, it's acceptable and has barely anything to do with globalization. Even if there was no economic life outside the United States, municipal governments would still experiment on how a public benefit is best produced: Whether it's by having the government run the show, or by having the government regulate private producers, or by leaving it entirely private enterprise with no strings attached at all. Globalization is just a lightening rod. The rhetoric about it frequently tempts Americans into believing that their domestic problems come from evil foreigners. It appears that for many, blaming foreigners feels more comfortable than blaming fellow Americans for pursuing the wrong public policies -- which is what this is really about.

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The port discussion was wrongly reported as well: the Dubai company just would have owned them, like a bridge or a road.

I'm no fan of globalisation at all, but I totally agree to your post(s). :wink:

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Selling of American Taxpayer Funded Property

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