John Stossel / April 1, 2009

Sell The Roads!

Under President Obama’s stimulus plan, the government will spend billions of your dollars building new roads and fixing old ones. They say they’ll do it efficiently. I say, bull; government has never before been efficient. It isn’t going to start now.

Need proof? How about rush hour?

Rush hours from hell are not natural phenomena. They’re manmade – more precisely, politician-made. But what if commuting didn’t have to be a horrendous experience? What if, for example, someone wanted to add some lanes to a road or build an entirely new road?

It’s happening. Private road builders are doing it. They built a double-decker underground highway in Paris. A 45-minute trip now takes 10 minutes. Three hundred-fifty cameras watch for traffic delays or accidents. Once the camera detects a problem, a crew rushes to tow the obstacle away so traffic keeps moving.

They did a similar thing in California, too, on Highway 91. Instead of building a brand-new road, a private developer added two lanes in the median strip of an existing highway. The beauty of it: Unlike government work, the private highway is all voluntary. No driver or taxpayer was forced to pay for the extra lanes. Drivers can choose to use them or not. Those who want to go faster have to pay a toll – from a buck fifty to $9 – depending on traffic. By paying you save time. And for some people, time is money.

The success of private roads made politicians from other states want to try leasing roads. Mayor Richard Daley did it with the Chicago Skyway. Indiana Gov. Mitch Daniels leased the Indiana toll road to a private company.

“We received $4 billion, free and clear, no taxes, no debt left to our kids,” Daniels told me for my ABC special “Bailouts and Bull” (

But many people are horrified by the idea of leasing roads to businesses. When Florida considered leasing Alligator Alley, the highway that spans Florida from east to west, people held protests and screamed about the evil of corporate profit. Politicians shelved the idea.

The governor of New Jersey gave up, too. A private highway is dying in Pennsylvania and dead in Texas.

“Privatizing existing taxpayer infrastructure is not a solution for anybody,” Congressman Peter DeFazio of Oregon told me.

He also says that what Gov. Daniels did is wrong.

Daniels made money for the taxpayer. What’s wrong with that? I asked DeFazio.

“Money that the people of Indiana could have had in the future is going to go to a private company.”

“What money?” Daniels asks. “The toll road was losing money!”

If Indiana couldn’t make money running the toll road, how can a private company do it?

“Your first insurance that they’re going to run a better road than the politicians did is, if they don’t, people won’t drive on it, and they’ll lose a lot of money. They have every incentive to make traffic flow swiftly, to make that drive as pleasant and safe as possible.”

Private owners also have an incentive to maintain the road. Bureaucracies let the highways decay. Why did it take a recession to get them thinking about repairs?

DeFazio disagrees: “If you have toll roads, the toll authority, if properly run, can meet all of those requirements.”

But do they?

“I can’t account for the crummy government in Indiana or Pennsylvania. They could run them better. They could run them just as well as the private sector because the private sector runs it well and makes a profit.”

But that’s exactly the point! Profit management beats government management every time.

“When government runs things, it’s a monopoly, and it has no competition, and there’s no upside to doing a lot better job,” Daniels says. “That’s why we didn’t have, until this new situation, electronic tolling. People were still stopping, chucking quarters into baskets. Politicians never run things well.”

Why then do some congressman say you shouldn’t sell public highways? Gov. Daniels has an answer:

“There are people, frankly, in Congress, who can’t abide the thought that you might be able to pay for something without going down there and kissing their ring for the money.”


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