George W. Bush’s time in office has been marked by repeated and often successful attempts to use the power of the presidency for the benefit of large corporations. In fact, the Bush administration’s policy making, in opposition to the Goldwater/Reagan “limited government” views it claims to uphold, has erred on the side of increasing the size of the federal operation – in order to pass the goodies resulting from two wars on to some of the nation’s most wealthy and powerful corporations. As documented in Naomi Klein’s masterful The Shock Doctrine (2007), this policy was most disastrously implemented in the pursuit of the war in Iraq, during which giant corporate friends like Bechtel and Halliburton received giant, multi-billion-dollar contracts to conduct the failed “rebuilding” of that country, rather than allowing the Corps of Engineers or qualified Iraqis to do the job. As a result, the U.S. government spent large amounts of tax revenues to directly subsidize the growth of giant corporations whose productive output amounted to a few malfunctioning schools, a poorly maintained Iraqi electricity grid, and Taco Bell-outfitted U.S. military bases.
Less documented have been the results of a similar effort to remove the government from involvement in the production of infrastructure in the United States. Systematically, the Bush administration has attempted to sell off roads, railways, and ports to private investors, and has encouraged local governments, often the owners of such public assets, to do the same. This effort was made most conspicious during the Dubai Ports World controversy, in which the U.S. government tried to sell a series of ports (some of them already private). The heated congressional interchange mostly revolved around the dangers of selling ports to a middle eastern corporation, and the implication of the exchange was clear: the Bush Administration was more interested in selling public property to a private corporation than thinking about national security.
Transportation Department (DOT) Secretary Mary Peters has spent much of her lifetime in in the transportation industry, working for the Arizona Department of Transportation in 1998 and becoming its director in 1998. Bush appointed her to the directorship of the Federal Highway Administration (FHA) in 2001, and she replaced Norman Mineta (a Democrat and Commerce Secretary during the Clinton Administration) at the helm of the DOT in 2006.
The focus of her efforts at FHA and then at the helm of the DOT were on roads. From the beginning, though, Peters disavowed the method that had been implemented at the beginning of the construction of the Eisenhower Interstate Highway System in the 1950s. Rather than allocating money directly to state DOTs, which would then implement the national highway network, Peters de-emphasized the construction of new roads and even limited spending on refurbishing existing highways. Rather, this secretary envisioned a different infrastructure-building process: one that focused on Public-Private Partnerships, or PPPs.
The Secretary took as example the Chicago Skyway, which was originally completed in 1958 and which connects Chicago to northern Indiana. In 1995, the city – starved for resources – began negotiating its lease, and the result was a $1.8 billion, 99-year lease on the road which privatized this public resource for the benefit of yet another foreign company. The city received a huge lump sum, but the lease certainly put into question whether the city was getting a good deal. If a company was willing to put up front almost $2 billion for a toll road, couldn’t the city have made more money if it had kept the roads in its own hands? And wouldn’t a steady supply of several million dollars a year be worth more than one giant transaction?
But Peters, instead of recognizing that Chicago’s decision to sell the road was in fact a desperate search for cash, saw the light in the deal. Repeating the time-worn conservative mantra, she insisted that private industry “knows” how to do things better than the government does. As a result, in 2008, she proposed a radical change in the manner highways in the U.S. are funded: instead of taking advantage of the readily-diminishing gas tax, she argued that people pay to use the roads they use. In some ways, her argument made sense: the gas tax could not continue to provide adequate revenues as electric and hydrogen-based cars replace gasoline ones, and a user fee makes sense. (And that’s ultimately what the gas tax is: theoretically, the more gas you use, the more miles you drive. This obviously punishes people who drive gas guzzlers and rewards people in more efficient cars, of course.)
But instead of pushing for public agencies, which continue to own and operate the vast majority of the nation’s roads, to work for this solution, she pointed to the Skyway again, and argued that private companies should be hired to build, operate, and profit from the nation’s roads, which would in her vision almost all become tolled. In some cases, the public should pay private industry to build the roads, and then allow those same companies to profit from the roads once they’re constructed. Using dubious evidence that “poor people don’t use toll roads,” Peters argued that any effort to provide an equitable solution – in which the impoverished living in transit-deficient areas might get a discount – was unnecessary. Her approach was to remove the roads from the public sphere and transfer their ownership, and profit-making mechanism, to private industry.
Peters’ anti-public philosophy has been demonstrated in full force in the transit sphere, an environment a highway woman is likely to feel uncomfortable in. Since she became full fledged DOT Secretary, Peters has been embroiled in the dispute over the construction of the Dulles Metrorail Extension of the Washington, D.C. subway to the suburban Virginian airport. After years of promises, Peters seemingly without justification, suddenly announced that the project would not meet federal standards, even though the year before, the project had been supported. Her evidence was that the now 40-years-old D.C. Metro was having increasing infrastructure problems; rather than providing a funding mechanism to solve the problem, however, she simply announced that Metro would not be able to handle the desperately sought and needed subway extension. After being pressured by some powerful Republican members of the Virginia Congressional delegation as well as the members of the Bechtel contracting team which had been hired to build the project, Peters suddenly reversed course, as if realizing that this public project would in fact provide some private benefits and was therefore acceptable. The D.C. Metro’s failings suddenly escaped her notice.
And in fact, the Bush Administration has done little to invest in the nation’s older transit systems, such as those in New York City, Chicago, and Philadelphia, which are grossly under-maintained mostly because they are provided far fewer resources per user than smaller systems as a result of the federal government’s spending formula, which prioritizes small and medium towns’ transit networks. The New Starts program, which was intended to provide grants for new “fixed guideway” projects all over the country, has not had its resources increased with the rest of the federal budget, and the result is increasing inability for cities to finance new transit programs. The Small Starts program, which was intended for the construction of streetcar and BRT projects, was never allocated much of anything at all. Seeing New York’s subway fall into increasing decline even as traffic on the streets continued to mount, Peters encouraged the creation of Mayor Michael Bloomberg’s Congestion Zone, which would have charged drivers to enter Manhattan below 72nd Street. Favoring the wealthy over the poor, however, the system would not have guaranteed revenues to the transit system nor would it have ensured a lower fee for lower-income business owners and artists, some of whom truly are dependent on vehicles even in Manhattan. The inequitable program was defeated in the back rooms of the New York State Assembly, but the conservative mantra – the rich above the poor, the corporation above the people – stayed alive.
Nowhere more evident has this been true, in fact, than in the Bush Administration’s approach to intercity rail policy. The President, beginning early in his term, decreased his proposed allocations to Amtrak to nil. He claimed that the national railways should be self-sustaining, even though highways and airports are paid for by the public. Never mentioning that Japanese and French rail systems only became profitable once they had invested tens of billions of dollars in high-speed rail infrastructure, the President simply assumed that he could pass off Amtrak to private industry, and find a way for the business people to make money off of it. And in fact, one of the President’s only solutions to the problem was considering auctioning off the railroad’s Northeast Corridor, perhaps the nation’s most valuable single infrastructure asset, to the highest bidder. Let business take care of it – why should government invest in the public’s right-of-way?
Peters has reciprocated, doing virtually nothing in her post to push for intercity rail. This year, she proposed $30 million to new intercity rail projects nationwide, but the sum is so minimal it would only pay for about five miles of high speed rail track. It’s quite clear that the Bush Administration will do all it can to push transportation off of the docket of the public, and into the hands of someone else.
But the problem of this lack of investment is quite clear, as evidenced in 2007’s infamous Minneapolis bridge incident. We need a strong transportation infrastructure in the United States, or our country will literally fall apart. The public sphere exists to provide resources that the private sphere cannot, and to do so in an equitable way. By systematically finding ways to move public resources into private hands, by encouraging the use of tolling mechanisms that favor the wealthy, and by de-investing in transit and rail, the Bush Administration has done just the opposite. The result is a nation whose roads and railways are in significantly worse shape than they were eight years ago. According to the American Society of Civil Engineers, the country requires a mind-boggling $1.6 trillion dollars in infrastructure investment, just to bring it to a good condition. Clearly, we have a big task ahead of us.
It remains to be seen whether the next administration, whether Obama’s or McCain’s, will significantly change our broken system of infrastructure investment. Let it be clear, however, that for the future of this country, we better hope that it does.