Urban Fold

Last-Minute Bush Decision Paves Way For Privatization

An obscure new rule pushed through the Federal Highway Administration requires public toll roads to collect 'fair market value' from drivers, rather than to serve the public interest.

[A] state government will now be required to assess how much a private company might bid for the right to operate a road under a private concession agreement. Then it would be required to charge the 'market-determined' rate, regardless of whether that is best for the public. The goal is to force government to administer toll roads according to the logic of the marketplace, and by this means, gradually push the management of public roads into the hands of private vendors.

Normally, Republicans rail against new layers of bureaucratic 'red tape,' which this 'market-valuation' requirement surely is. But in this case, the rule is a quiet attempt to force government to adopt the logic of the market in its decision-making. Once the profit-driven norms of the market become the default, the customary logic of government-provisioning of roads will be seen as suspect.

Private toll roads are becoming increasingly common ways of building new roads because they are easier to build than conventional government-financed roads. Many states have bond limits that make it hard to raise capital to finance construction, so it can be easier to raise money if a private developer provides the upfront cash."

Full Story: Privatizing Public Roads Just Got Easier

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