SPECIAL REPORT: New coalition calls privatization 'pawn-shop mentality'

| 2/9/2007

Friday, Feb. 9, 2007 - The united voice of the entire range of highway users and the highway-based service community told the federal government today that privatizing the nation's roads is all about big-business profit, and that it short-changes the needs of the highway system.

The coalition, Americans for a Strong National Highway Network, held a press conference Friday morning at the National Press Club in Washington, DC, outlining the group's concerns about the federal push to privatize more highways.

A letter was also sent to U.S. Secretary of Transportation Mary E. Peters Thursday afternoon.

"Federal promotion of privatization deals that do not consider highway users' interest as the top priority will not achieve your goals of promoting safety, mobility, economic growth, and congestion relief," the members of the coalition wrote in the letter to Peters.

"If ensuring the profit for private companies and quick cash for state and local governments remain the top priorities, these plans could actually lead to a decline in safety and mobility on both the privatized roads and the parallel public roads, as private companies try to maximize their profits and prevent competition."

The Owner-Operator Independent Drivers Association spearheaded the formation of the coalition, which includes AAA, the American Trucking Association, the American Highway Users Alliance, the American Motorcyclist Association, Natso and the Recreation Vehicle Industry Association.

OOIDA has been very vocal in its opposition to auctioning off the interstate system. For example, the Association took a strong stance against the 75-year lease of the Indiana Toll Road. The Association is also lobbying hard in other states where privatization is being considered, including New Jersey and Pennsylvania.

OOIDA Executive Vice President Todd Spencer closed out the coalition's press conference by highlighting just how unpopular private toll roads are - using Indiana's recent lease as an example.

The Association commissioned a poll of Indiana voters on, among other things, the popularity of the lease of the Toll Road and the governor who made it happen.

A majority - 52 percent - of actual voters statewide voiced displeasure with the lease of the toll road. Voters in northern Indiana were more upset with it, where 66 percent opposed the lease.

The opinion poll also revealed a plunge in the approval rating of Gov. Mitch Daniels following the lease of the Indiana Toll Road. His approval rating dropped to 35 percent in April 2006 and rebounded to only 44 percent by the time of the mid-term election in November 2006.

Voters displeasure with the lease appears to be bearing impact on Daniels' political career as the likelihood of Daniels being re-elected isn't very good, according to the opinion poll. Nearly half of the statewide voters - 49 percent - and an "eye-popping" 64 percent of northern Indiana voters would support another candidate over Daniels in 2008, according to a summary of the opinion poll.

"The media did a good job of talking about the issue in Indiana, unfortunately for voters the governor was aware and did a better job of rushing the sale through the legislature, without the consent of voters," Spencer said.

"Voters never truly had a say in the process, so come 2008 we'll see what the voters have to say."

In addition to the lack of support from the voters, Spencer and others in the coalition expressed serious concern that the leases would not help eliminate the problems the infrastructure is already facing.

"Rest assured the companies lining up to buy our roads aren't doing it out of the goodness of their hearts. They see long-term cash flows and guaranteed, healthy profits at the public's expense," Spencer said.

One of the big arguments for privatization is that allowing the private sector to operate these roads will help reduce congestion - a major problem nationally and one talked about frequently by the feds.

"The companies investing in our roads want to induce congestion on the roads they profit from, not reduce it. Their profits are derived from high traffic volumes and high tolls," Spencer said. "Remember, they are accountable to their shareholders, not to the public."

"We recognize elected officials are confronted with difficult funding decisions, but these deals are akin to a pawn-shop mentality of hocking your assets for cash now, but paying much more down the road."


- By Jami Jones, senior editor