Thursday, June 21, 2012

New Bridge Proposed Between Detroit and Canada Illustrates the Problem with Private Ownership of Infrastructure

Michigan Economic Activity Penalized for Years by Selfish Private Bridge Owner

A staple of modern Conservatism is that the private sector is always better than the public sector.  So Conservatives must be overjoyed at the existence of private ownership of the only bridge that connects Detroit and Canada.  This bridge monopoly has brought it owners huge profits, and because the bridge is old, and contributes to huge traffic jams it has stifled economic growth in Michigan, growth the state can ill afford.

So why didn’t the state of Michigan just build another bridge?  Because lobbying by the owner of the private bridge has prevented legislative action.  But now the state’s Republican Governor has acted, and has reached a deal with Canada that on paper (and over the water) looks like a very good deal indeed.

First of all no state of Michigan money will be involved and Canada is really pitching in here.

Among the other details:
—No state money will be used and no state appropriation is required to pay it off.
Michigan can use Canada's expenditure of $550 million to qualify for U.S. matching funds for highway projects elsewhere in the state.
Canada will make annual payments to the contractor to design and construct the bridge and for ongoing maintenance during the course of a 40-50-year public-private partnership agreement.
—Tolls will be charged only in Canada to reimburse it for costs.
Canada will pay for land acquisition in both countries.
Canada will pay to connect the bridge to Interstate 75 between the Ambassador Bridge and the Rouge River Bridge.
—The public-private partnership deal must include community benefit plans for impacted areas in Michigan and Canada.

Of course, the 'job destroying' Obama Administration was crucial here, allowing Michigan to use Canada’s $550 million expenditure to qualify for federal matching funds for other highway use.  And of course Republicans in the state legislature, more beholding to the special interests of the existing  bridge owner than the benefits to the state are not happy.  Business as usual.

But hopefully common sense and public interest will prevail over the greedy demands of a millionaire wanting to preserve a monopoly at public expense.  And maybe Michigan voters will reward Mr. Obama with their votes in the fall.  But maybe not, after all he doesn’t support tax cuts for the wealthy.

1 comment:

  1. "The bridge monopoly." Yeah, because the [government owned] Detroit-Windsor Tunnel is a tunnel, not a bridge. So if you absolutely have to drive to Canada on a bridge (claustrophobic?) you have NO OPTION but to choose the "bridge monopoly." Seriously, WTF