Pence Pushes Infrastructure Public-Private Partnerships Amid Failure in Indiana

Donald Cohen

Donald Cohen Executive Director, In the Public Interest

On Wednesday, Vice President Mike Pence cancelled an interview with PBS out of the blue, provoking speculation. The growing controversy around former FBI director James Comey must’ve gotten to the man known for having a stone face.

But there may have been another reason.

On Monday, the state of Indiana announced it would take control of a troubled highway construction project, Interstate 69, between Bloomington and Martinsville. The contractor, the Spanish firm Insolux Corsan, is facing bankruptcy and had been missing deadlines for months.

Who brought Insolux Corsan to the state? Pence. As governor, he signed a 35-year public-private partnership with the firm in 2014 to finance, construct, and maintain a section of the highway. Pence said it would provide “better value for taxpayers” than if the state used the traditional — and cheaper — method of public financing. But with only half the project completed and taxpayers left cleaning up the mess, one wonders what he’d say now.

Monday also happened to be the kickoff of a weeklong rollout of the Trump administration’s infrastructure plan, which would rely heavily on public-private partnerships. On PBS, Pence was supposed to talk infrastructure — drawing attention to his failed project wouldn’t have been good for business.

 

The I-69 failure highlights the dangers of Trump’s plan. Rather than the $1 trillion the president promised on the campaign trail, the plan only commits $200 billion in direct federal spending, leaving cities and states desperate for funding and therefore more dependent on local taxes and the private sector to make up the difference.

Public-private partnerships are far more expensive than public financing and —without very strong protections — can hand control of infrastructure to private investors.

Trump’s plan wouldn’t rebuild America; it would encourage communities to make shortsighted deals with Wall Street and global corporations like Insolux Corsan.

Not only that, it would put a giant “for sale” sign on the country’s roads, bridges, water systems, and other infrastructure. Through a program based on a scheme pioneered in Australia — which crashed and burned — the federal government would pay a bonus to cities and states to outright sell public assets.

There’s no question we need to invest in rebuilding our infrastructure for the 21st century. But federal support should help cities and states maintain public control, avoid tolls and fees, create good jobs, and protect the environment.

Trump’s plan clearly helps someone else: Wall Street and global corporations.

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Reposted from The Huffington Post.

Posted In: Allied Approaches

Union Matters

An Invitation to Sunny Miami. What Could Be Bad?

Sam Pizzigati

Sam Pizzigati Editor, Too Much online magazine

If a billionaire “invites” you somewhere, you’d better go. Or be prepared to suffer the consequences. This past May, hedge fund kingpin Carl Icahn announced in a letter to his New York-based staff of about 50 that he would be moving his business operations to Florida. But the 83-year-old Icahn assured his staffers they had no reason to worry: “My employees have always been very important to the company, so I’d like to invite you all to join me in Miami.” Those who go south, his letter added, would get a $50,000 relocation benefit “once you have established your permanent residence in Florida.” Those who stay put, the letter continued, can file for state unemployment benefits, a $450 weekly maximum that “you can receive for a total of 26 weeks.” What about severance from Icahn Enterprises? The New York Post reported last week that the two dozen employees who have chosen not to uproot their families and follow Icahn to Florida “will be let go without any severance” when the billionaire shutters his New York offices this coming March. Bloomberg currently puts Carl Icahn’s net worth at $20.5 billion.

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Health Care Should Not Be A Bargaining Weapon

Health Care Should Not Be A Bargaining Weapon