Wednesday, November 16, 2016

Wednesday Morning Links

Miscellaneous material for your mid-week reading.

- Kevin Connor reports that the more Ontario voters are exposed to the realities of public-private partnerships, the more they're turning against the idea - with a quarter or less of respondents seeing any upside to handing public services over to businesses. Tony Keller writes that Canada's history of corrupt infrastructure projects designed to enrich government supporters goes back at least to the Pacific Scandal. And David Dayen highlights why there's every reason to be suspicious of Donald Trump's privatized infrastructure plan for the U.S.:
This report from Peter Navarro, set to be one of Trump’s leading economists, lays out the blueprint. The government would sell $1 trillion in revenue-producing bonds, needing only to supply an equity cushion to ensure everyone gets paid. Navarro estimates around $140 billion in government funding when all is said and done, which you could easily get through repatriation.

Investors would get a tax credit to entice them to buy bonds, and Navarro claims that the tax revenue from new jobs created by the projects makes up for that cost. He also wants to contract out these projects, building in a 10 percent profit margin for the private contractor. Navarro claims that construction costs are higher when built by the government, and the private sector is more efficient.

Does this sound familiar? It’s the common justification for privatization, and it’s been a disaster virtually everywhere it’s been tried. First of all, this specifically ties infrastructure—designed for the common good—to a grab for profits. Private operators will only undertake projects if they promise a revenue stream. You may end up with another bridge in New York City or another road in Los Angeles, which can be monetized. But someplace that actually needs infrastructure investment is more dicey without user fees.
(T)he stock market may love this idea. But it’s designed to funnel money to big investors and contractors by essentially letting them purchase public assets. This could impoverish the people these projects are supposed to help, allow corporations to choose investment destinations, and further climate disasters. And given the likelihood of profit-gouging, there’s no guarantee it even has a net benefit for workers and communities over time.
- Richard Adams reports on the UK social mobility commission's conclusion that today's younger workers represent the first generation in recent memory facing worse income and career prospects than preceding ones. 

- Monika Dutt examines the evidence on two-tiered health care, and concludes that a for-profit stream only exacerbates the wait times and lack of resources in a public health care system.

- Finally, Kyle Curlew reminds us how Bill C-51 is designed to intrude on Canadians' rights. And Andrew Mitrovica points out that Canada's hands are far from clean when it comes to state spying on journalists trying to report in the public interest.


  1. Here is the Ipsos Reid poll on P3s

  2. Nova Scotia is buying 2 PPP schools to save millions on the leases.