July 10, 2013


Pension Proposal Aims to Ease Burden on States and Cities. Orrin Hatch of Utah, the senior Republican on the Senate Finance Committee, has devised a way for states and cities to exit the pension business while still giving public workers the type of benefits they want. It involves a tax-law change that would enable governments to turn their pension plans over to life insurers. Big players like MetLife and Prudential, to cite just two, might thus step into shoes now occupied by the likes of Calpers, California’s giant state pension system.  New York Times

Privatize Schools Why It’s Crony Capitalism At Its Worst. Late economist Milton Friedman was among the early advocates of vouchers, but people forget he emphasized vouchers “must be universal, available to all parents, and large enough to cover the costs of a high-quality education.” Voucher policies in real life fall short of any of these criteria. Secondly, when private entities running schools are driven solely by profit, especially when big private equity firms are involved, the education they provide may not be the best for students. Education is not a consumer good. When buying a household item, one expects full information about this item to process in his head to make an informed decision. Education, on the other hand, is supposed to lift someone from ignorance and give him or her the very skills to process information. Lastly, when parents and the community do not adequately watch how schools entrusted to private entities are doing, fraud and abuses are bound to emerge from the schools.  PolicyMic.

NJ: Christie Vetoes Bill That Would Check His Power to Privatize. The bill would have required that a contract for the privatization of public services not be entered into without cost analyses demonstrating actual savings for the public agency and taxpayers, without increased fees or other charges to the public, reduced quantity or quality of services, or lowered workforce standards, including reduced staff qualifications and pay. The bill would have constricted the governor’s power to choose when to privatize, which he has now, as evidenced by the lottery bill. NJ Spotlight

IL: Chicago Infrastructure Bank Gets Slow Start. When Mayor Rahm Emanuel announced the Chicago Infrastructure Trust, he billed it as “the breakout strategy for the city of Chicago,” a nonprofit agency that’s supposed to lure private investment for public projects the city could not afford. More than a year later, however, the organization has yet to break ground on any ventures. Its first initiative, to make city buildings and schools more energy-efficient, is behind schedule. Governing

CA: Treasurer’s Office Report Says Default Is Likely if Road Tolls Aren’t Extended 13 Years. The report, by Montague DeRose and Associates, listed three reasons why the state should care about the debt restructure. First, the public/private venture will pay between $14.1 million and $18.9 million to the California Department of Transportation (Caltrans) between 2041 and 2053. Second, a default would look bad to investors and make it tougher for the state to raise money in capital markets. And, third, it is in the public interest that the tolling end and the roads become part of the state freeway system. The report mentioned, but did not note, the irony that restructuring will delay that day by 13 years and break a promise to voters who originally voted for the toll road plan.  AllGov.com

CA: If You Want To Privatize BART, You Can Probably Afford Something Else. These services aren’t intended to be used only by those who can afford it; these are basic necessities that everyone needs, and for those who depend on them, privatization is a dismantling of their support systems and crushes the possibility of aspiring to a middle-class life. Every attempt to privatize government services will be met with this split. Just because markets are efficient, assuming they are, it does not mean they’re equitable, and it’s the lack of sensitivity to this point that dominates the entire narrative of the industry’s techno-libertarian idealism…. It’s all a ruse; if you think government services are ready to be upended by privatization, you probably don’t rely on those public services to exist. International Business Times

OK: Governor establishes task force to consider privatizing, splitting Dam Authority. That order, issued July 8, develops a 15-member task force charged to examine the inner workings of the non-appropriated state agency, tasked to generate, transmit and sell electricity to Oklahoma municipalities, electric cooperatives and industrial customers, as well as off-system customers across a four-state region. Additionally, GRDA manages more than 70,000 surface acres of water in northeast Oklahoma, including Grand Lake and Lake Hudson. It has at least 500 state employees. Miami News Record

UT: Will privatizing Medicaid’s dental program hurt Utah kids? “We feel like privatizing introduces an entirely new challenge and hurdles for the children to receive their dental care,” said Horgesheimer, president of the Utah Academy of Pediatric Dentistry, which represents 85 pediatric dentists statewide. Salt Lake Tribune

VA: Should Virginia Sell Air Rights Over the Dulles Toll Road? “Dulles toll road users are on the hook for over $2 billion to pay for metro to Dulles,” Herrity said. “Proceeds from air rights could go a long way to reduce the projected burden on toll road users and protect the health of this critical economic corridor. Patch.com