Advance New Zealand bags Nationals brave new world
ADVANCE New Zealand
A new design for our economic future
Date: 25/08/2008 9:54 AM
ADVANCE New Zealand bags Nationals brave new world!!
The ‘new’ concept announced by National’s Maurice Williamson to fund Auckland’s roads by way of a privatisation process, funded by tolls on the user (taxpayer) is a step back into the past.
The history of ‘money’ around the world since the 1980’s deregulation/privatisation/market orientation of economics is the unrestrained growth of speculative investment and the equally spectacular shrinkage of money available for the real economy where most of us have to live, work and if we have time, play.
John Key would of course favour the role of private money in road building and the profits to be made from tolling simply because it marries into his brand of private enterprise which was extremely good for him in his role as a speculative debt broker.
The reality of PPPs around the world is that the costs of projects have overrun their budgets, the quality of many of the ‘assets’ built have been questionable, the return on investment below that claimed and the downside costs have always been loaded onto the taxpayer. Privatise the gains and socialise the losses.
How brave is that and what sort of world does it promise for future generations of already heavily indebted taxpayers? The only advantage is to those who will provide the funding in the form of interest bearing debt, which will roll on and over forever and ever.
The solution to the issue is funding essential infrastructure by using a credit facility created specifically for individual projects. That means that future generations will not inherit debt because, just like any credit facility, once it has been repaid it ceases to exist.
Likewise the ongoing taxes and charges associated with debt based funding would also be history and taxpayers would indeed see a brave new world of having more of their money in their pockets instead of it feeding into the already bulging wallets of speculative debt merchants.