Public-Private Partnerships Aren’t Free
Public-Private Partnerships (P3s) promote crony capitalism, whereby profits are privatized and losses can be socialized on the backs of taxpayers
City manager of Rancho Cucamonga California, John Gillison, touts the benefits of public-private partnerships (P3s) in the Fall 2017 and Spring 2018 issue of Grapevine, the city’s community recreation guide. On page 2 of “The Reporter” insert, he says that partnerships promote unity in the word, commUNITY between departments and the private sector. Examples include: the Epicenter Adult Sports Complex, the Goals Soccer Facility and a new Family Sports Center.
This all sounds great; however, the thrust is in the details of the partnership contract agreements and how they are written. Residents and taxpayers should review the contracts to see who is liable in the event a private contractor fails or breach of contract, including the city.
David Hall, Laura Bliss and Technocracy News present an alternative point of view regarding P3s.
Public private partnerships(P3s) were introduced so governments could be seen to be reducing government debt by passing off expenditure as private debt, says David Hall, an internationally recognized expert in public service investment, privatization, asset sales and public private partnerships. He explains how P3s got started and that in Europe, they have fallen out of vogue.
The reason P3s became popular were they were a big way of cooking the books. They’re inexpensive. We’re cooking the books they make government’s look as though they weren’t borrowing as much as they really were.
3-22-2017 , Laura Bliss
Everyone wants sparkling new roads, bridges, airports, and transit systems. But most Americans aren’t willing to crank up tax rates to pay for those projects, and many politicians aren’t eager to try and convince them. That’s why a growing chorus of elected officials, both liberal and conservative, are singing the praises of public-private partnerships.
There are many ways to define this term, but the most common understanding is an arrangement where a private investor—think Morgan Stanley or TIAA-CREF—plunks down a big chunk of a project’s upfront cost. Theoretically, with all that upfront private capital on hand, a highway, water system, or transit line can be built much more quickly than it would be if it were relying on a slow trickle of public funds or government bond sales. The project may also cost less, since, theoretically, companies have a bigger incentive to build efficiently. A local government can also build price/quality assurance check-points into the contracts they write. If the project fails, the Monopoly men are theoretically the ones who’ve taken on most of the risk, rather than the public.
To politicians sensitive to shrinking budgets and hoping for a short-term ratings boost, it all sounds awesome. But the promises can be pretty misleading. “In theory, [public-private partnerships] can be effective—but they provide no free lunches,” writes Hunter Blair, a budget analyst at the Economic Policy Institute, a left-leaning think-tank, in a new report on the pitfalls of these strategies.
The thing about investment firms, see, is that they make investments; they expect to see their money back. Indeed, they want even more money. One way or another, the bucks are going to come out of the public’s pockets, whether through local or state taxes, a toll on the new road, or rates paid on that upgraded water or power grid… read more
The UN’s agenda for America rolls on without respect to which party is elected to office, whether conservative or liberal, Democrat or Republican. Interior Secretary Ryan Zinke, appointed by President Trump is no exception as he implements PPP throughout the nation’s land holdings.