PRIVATIZATION

I love to get the truth about all the things going on in our
country. There are several journalists that one can depend on to give us the truth. Ed Wallace of the Fort Worth Star-Telegram and Stephen Dick of the Herald Bulletin in Anderson, Indiana.

Wallace wrote; Myth Sold as Truth: Privatization. In the new progressive language, ‘privatization’ is code for ‘profitization’—and the public gets none of the profits. We just pay more to use assets our taxes paid to build.
The public is deluged with Big Myths that it’s almost impossible to deal with all of them - much less disprove the untruths they’re built one. That’s probably the idea. These Big Myth premises, successfully foisted onto a gullible public incapable of critical thinking, serve only to enlarge the wealth of those spreading disinformation.

Privatization of publicly owned assets, sold to us wrapped in the shiny myth that “private companies can always do the job better than inefficient governments” is one of the most effective sales jobs. It is quickly altering the lives and draining the pocketbooks of all Americans. First maybe it’s true that private industry is more efficient at some thins than government if. But it is equally true that these companies are not buying public assets for anything as altruistic as lowering the costs of using these assets for the public good. They have little incentive to provide more efficient services; the reason they buy the assets that we all paid for is a simple investment/profit motive. Once the new owners control the asset, there only mission statement reads, “to maximize investors’ return on their investment.”

Your Taxes at Work-In India: This really struck home a week ago. ABC News did a story about Florida’s privatizing its food stamp operations to J.P. Morgan – which in turn contracted a call center in India to process the claims. Imagine that. Florida gives taxpayers’ money to J.P. Morgan, which to make a greater profit uses that money to hire people in India, putting Floridians out of a job. Then out-of-work Floridians have to call India to get approved for food stamps. Now that is ironic.

The best place to see how privatization really affects average Americans may be in Chicago. Like many cities, Chicago has had a hard time living within its budgetary means, even while collecting one of America’s highest city sales taxes: 10.25 percent. So two years ago Chicago decided to sell the city’s parking meters. According to Associated Content, William Blair is a close associate of Chicago Mayor Richard Daley. Selling off the city’s 36,000 parking meters to a private investment group was his idea, but Blair also was instrumental in getting Daley to sell off the city-owned downtown parking garages back in 2006. And for his clever suggestions for taking revenue-producing, publicly owned assets and privatizing them (and for being a member of Daley’s Kitchen Cabinet), Blair has received payments totaling $6.5 million.

Analysis After the Sale; Morgan Stanley eventually took majority ownership of the city’s parking meters for 75 years, in exchange for a one-time payment to Chicago of just under $1.2 billion. According to Chicago Sun Times political columnist Carol Marin, almost imme-diately the cost of using a parking meter inside the Loop jumped to 28 quarters ($7) for a two-hour period. But quickly increasing the cost of parking wasn’t the only pain inflicted by the new owners. Many parking meters couldn’t handle that much loose change in one day, and once full the meters would accept no more change; anyone who parked by one was doing so illegally. Yes, the number of parking tickets jumped so much they had to stop writing them while new meters that would accept credit cards were installed. Even more interesting is that
LAZ Parking – also owned by Morgan Stanley – was responsible for collecting the coins out of the meters and issuing the parking tickets,

The meters were set to demand payment 24 hour a day and seven days a week, ending the free parking that enticed many families to downtown Chicago on Sundays. Chicago’s Inspector General analyzed the deal only after it was done; and on June 1, 2009, his report on the sale said officially that Chicago had gotten the short end of the stick. The report faulted William Blair’s calculations of the 36,000 parking meters’ present and future value: They were worth not a mere $1.2 billion, but more in the neighborhood of $2 billion. Seems Blair wrote the entire report from the investors’ perspective, not from that of the real owners, the people of Chicago. The Inspector General concluded that the entire deal was “dubious.” It should be noted that Daley’s friend Blair wasn’t the only one who profited by suggesting and promoting this deal. The Mayor’s former spokes-woman, Avis Lavelle, emerged from it with a new job – spokeswoman for Morgan Stanley’s parking meter entity. By November the New York Times has shown the deal to numerous financial experts, who unanimously said, “Chicago could have made out much better in the long run had it kept the meters.” Here’s the next effect of that sale. Parking meter rates have quadrupled, and that was just in the first year after the sale went through. The lease still has 74 years to run. Chicago drivers are (and their great-grandkids will be) paying through the nose for the sins of those voters elected to govern the city’s finances wisely. (Frankly between, you, me and the gatepost I think Chicago needs too hire some good honest lawyers, if they can be found to protect the citizens of Chicago. ERC)

You Texans remember the Trans-Texas Corridor that Perry tried to push onto all of us. The people of Indiana had already been conned into selling their major toll road to the Cintra/Macquarie Group and it was privatized. Here is Wallace’s report on that: “A combination of toll increases have marked the Toll Road’s first three and a half years under private operation.” That comment came out of a column published a year ago, reminding readers that tolls would increase by another 8.2 percent last summer. The rationale? The recession lowered the number of drivers using the toll road, so keeping profits constant meant everyone still using it had to pay more.

And when summer came, it brought another surprise for the users of the Indiana Toll Road: A lawsuit against its new owner, ITR Concession, brought by a woman whose accident she blamed on their highway’s poorly maintained condition. The merits of her lawsuit notwithstanding, it’s interesting that ITR Concession tried to get the lawsuit thrown out under the legal concept of government immunity from legal actions. Really. A private, for-profit company buys up a publicly owned highway and then wants the same protection against lawsuits that government enjoys.

My two-cents worth: If all cities, counties and states are making deals like this, no wonder we have so much un-employment. Florida’s food stamp operation: Outsourcing captive consumers calls to India, Chicago changing parking meters to credit cards, so none one is paid to take the money out of the meters. Policemen not needed to issue parking tickets, as the new owner had its on crew. Indiana not keeping up the toll road repairs so that they are safe, therefore not having to pay as many employees. Good old AT&T, their customer service is outsourced: I always get someone in the Philippines that I can’t understand. I pay them in the United States and I want to talk to someone in the US, when I ask them to transfer my call to the US, they say they can’t, how odd.