I took a road trip recently. It reminded me of the tall tale of privatization.
In West Virginia, the toll has doubled to $4. To cross West Virginia on I-77, a person needs to pay this three times, once every approximately every 30 miles, because the highway uses no state or federal funds. This decision has been made on a state level. Some people take country roads and locals can get a cheaper pass but trucks can’t. Costs get passed on to consumers.
We all pay gasoline taxes to fund our roads. However, it’s not enough and despite promises, infrastructure dollars will not be increased unless cuts are made to other domestic programs. In a punishing move, Trump has said that money will be taken from California, one of our most productive states. In the mean time, states are coming up with solutions that increase inequality.
Indiana privatized its toll roads, using a foreign company. The company then went bankrupt. This is common for privatized toll roads. Despite the disaster in his state, Pence is still a fan of the practice–which requires tax payers to subsidize the private partnerships. These partnerships have a track record of going broke. Additionally, they sell our public lands and roads to profiteers.
In North Carolina, a crowded freeway has some much needed new lanes but people can only drive on them if they have an Express pass, costing $6 or more. The passes are sold and the new highway lanes, where you can go as fast as you want, are owned by a company in Spain, Cintra. I-77 needed more lanes, the tax base did not allow for it, so privatization stepped in. Now there are two tiers of people on the road, the fast people with money and the rest of us.
This is similar to the anti-Net Neutrality folks, who want people to pay to get their sites into the fast lane. My site will be in the slow lane.
My district once had a politician who promoted private prisons…along with less regulation (he owned a factory). He called them a growth industry. Private prisons pay employees less than government run prisons. However, they don’t appear to save any money because they have a profit motive, unlike government prisons. They’ve been implicated in scandals such as Kids for Cash, bribery, and campaign contributions. They’ve been linked to an increase in incarceration and people returning to prison because they have no incentives to rehabilitate people.
Iowa threw its lot in with Medicaid privatization. Many critics said it was a thank you gift to political donors. In any case, costs of providing coverage have nearly tripled, because, um, profit motive. What did you expect? Unable to learn from others, the U of Iowa president is pursuing privatization of the university’s utilities.
Privatization of city services has increased costs across the country. Services to poor areas of cities have been cut when privatization sweeps in. Drinking water costs have increased while service decreases. Veolia, a private company, was in part responsible for Flint’s water woes and caused problems in Philadelphia. Famously, parking meters in Chicago have been privatized for the next 75 years. (U of Iowa is seeking a 50 year privatization.) Fees went up and meters started malfunctioning. Privatization has a disregard for the environment. It’s all about profits. Despite this, corrupt politicians want to privatize the popular US postal service even as privately held FedEx suffers numerous woes.
Do a search for Privatization Horror Stories for more.
It isn’t just happening in the US. In Australia, privatization has raised costs for everything from airport parking to energy. In Russia, privatization has created oligarchs.