Sunday, December 28, 2008

A Bushoviks wet dream

Things are getting so bad in some states, due in part to Republican reduction of federal revenue sharing, that they are seriously considering selling off public assets for short term gain.
Like families pawning the silver to get through a tight spot, states such as Minnesota, New York, Massachusetts and Illinois are thinking of selling or leasing toll roads, parks, lotteries and other assets to raise desperately needed cash..

..GOP lawmakers are pushing to privatize the Minneapolis-St. Paul International Airport and the state lottery. Both steps require a higher authority — federal legislation in the case of the airport, a voter-approved constitutional amendment for the lottery. But one lawmaker estimated an airport deal could bring in at least $2.5 billion, and the lottery $500 million.

Massachusetts lawmakers are considering putting the Massachusetts Turnpike in private hands. That could bring in upfront money to help with a $1.4 billion deficit, while also saving on highway operating costs.

In New York, Democratic Gov. David Paterson appointed a commission to look into leasing state assets, including the Tappan Zee Bridge north of New York City, the lottery, golf courses, toll roads, parks and beaches. Recommendations are expected next month.
So the states get a windfall today in return for significant reductions in cash flow which is needed every year. And you just know these public assets will go for fire sale prices to companies more interested in profit than service. This will lead to the now famous corporate bust out where the companies will strip out all salable assets, load up the debt ledger and declare bankruptcy, walking away with all the value as the states will be left to rebuild what they sold off. All in all a worse idea than allowing deficit spending.

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