Jim Crawford: Public/Private Partnerships … NOT

Another great analysis from Jim pointing out the evil in governments, rather than the markets, picking the winners.  Think about the Rail Runner and the Space Port.  Two sucking holes which are not and probably never will do what was promised:

Following are some notes I sent to the Senate Judiciary Committee on SB 273 for hearing on 2-25.
Later Jim

——– Original Message ——–

Subject: Oppose SB 273 Public Private Partnerships
Date: Sun, 24 Feb 2013 13:34:08 -0700
From: James Crawford <jamesr.crawford61@gmail.com>
To: Richard Martinez <richard.martinez@nmlegis.gov>, Joseph Cervantes <Joseph@cervanteslawnm.com>, Ron Griggs <ron.griggs@nmlegis.gov>, Linda Lopez <linda.lopez@nmlegis.gov>, Cisco McSorley <cisco.mcsorley@nmlegis.gov>, William Payne <william.payne@nmlegis.gov>, John Ryan <john.ryan@nmlegis.gov>, Michael Sanchez <senatormichaelsanchez@gmail.com>, Lisa Torraco <lisa.torraco@nmlegis.gov>, Peter Wirth <peter.wirth@nmlegis.gov>
CC: Clemente Sanchez <clemente.sanchez@nmlegis.gov>

I am opposed to public private partnerships (P3).  There may be some specific, focused  P3’s that are successful but the very broad and all encompassing P3 legislation being proposed in the 2013 NM legislature (HB 405 and SB 273) is merely a way to increase government scope, size, and power.  P3’s allow the government to undertake projects that would not normally be financed through a normal budgeting process.  The government picks winners and losers in the business world and sets up unfair competition.  Normal procurement procedures do not apply and the least expensive and best proposal may not be the one selected for implementation.  The selection process is ripe for political cronyism.  Government power of eminent domain and bonding may be used to provide private gains.

There are many examples of failed P3’s that should make all legislators and tax payers wary of this kind of legislation.  A few of the more familiar are US Postal Service, Fanny Mae, Freddy Mac, Solyndra, General Motors, First Solar, Abound Solar, Evergreen Solar, and here in New Mexico, Eclipse Aviation, Earth Stone, Schott Solar, Lion’s Gate Entertainment, and TCI Medical.   The list could go on and on.  The government has dumped billions of taxpayer dollars down the partnership rat hole on these corporations and the many more like them.

P3’s are a way for government to side step the normal legislation, appropriation, and public involvement process for approval of “public” projects.  The process is handled by executive branch bureaucrats and elected officials will have little involvement let alone their constituents.

P3’s come with a combination of government  power to enforce policy, power to tax or not tax, power of eminent domain along with corporate wealth and advertising budgets to shape public policy and influence what services and products we consumers have available and use.  Many of these products could not compete in a free market.

P3’s often grant tax rebates or tax exemptions to the corporate partners which in turn give them unfair advantage over potential competitors.  P3’s also can set up monopoly situations where only the corporate partner may provide a product or service.

The most frightening aspect of P3’s is use of the government power of eminent domain to promote private development.  P3’s set up a mechanism for government confiscation of private property that is then turned over to private interests for development or other supposed “public purpose for the common good”.

The private partners essentially gain the power of government and become government sanctioned monopolies that may do as they please.  The executive bureaucrats in return have the independence of the private partner and no longer need to answer to the voters.

Because of the government contribution in most of these partnerships, they probably violate the anti-donation clause in the New Mexico constitution which tightly limits the amount of public participation with private enterprise.

There have been examples of P3’s working well for building specific school buildings, a specific toll bridge, or specific section of road.  These were uniquely identified projects.  The two NM bills have no specific projects but are a carte blanche list of anything and everything that might be dreamed up as “public projects for the common good”.

Separation of government and corporations needs to be maintained.  As there is more and more blending of the two, we are moving toward a corporate fascist state where free enterprise will be a thing of the past.

These bills should not see the light of day.

Thank you

James Crawford

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