How Privatization Works (Part 2,351,142)

Here's a recent story from the DC area Fox affiliate that shows how things play out when you privatize a public service.

In this case, the service is roads. And this picture tells you what you need to know.

That's right-- $30 to use the express lane.

Express lanes are managed by Transurban, an Australian company that manages, develops, and owns urban toll roads. There's a whole website just for the express lanes of Transurban's piece of the giant paved hellhole that is DC roadways, and it offered an explanation of why they were suddenly gouging commuters on this particular evening:

Tolls for the Express Lanes are dynamic, meaning they change periodically based on real-time traffic conditions to keep the Lanes free-flowing. Because toll prices are based on demand, it is difficult to predict exactly what the tolls will be at any given time.

Tolls can range from as low as $0.20 per mile during less busy times, and up to approximately $1.00 per mile in some sections during rush hour. However, rates may rise significantly above the typical range for periods of time in the event of unusually heavy congestion or a specific event like a traffic accident or lane(s) closure.

Dynamic pricing means that tolls on the Express Lanes change periodically to keep the Lanes free-flowing. Sensors alongside the road monitor traffic levels and speed, and toll prices adjust to maintain free-flowing conditions in the Lanes – even during peak times – to provide value to customers. A network of electronic signs displays the latest toll prices.

Those of you who aren't east coasters may note that tolls for the express lanes are EZPass, a nifty system by which you put a sensor in your car and just breeze through toll booths and pay your toll electronically. So if you are plenty wealthy, or driving a company car, a toll like this doesn't affect your travels other than by keeping the riff-raff off the road so that you can still enjoy a speedy express lane trip. Perhaps that's what we mean by "provide value to customers." Of course, providing value to one customer means discouraging or blocking other customers from using the service at all. And suddenly-- voila!-- you can end up paying taxes to create a public service that you can't afford to use yourself.

All of this makes perfect business sense, right down to using high prices to manage demand for a service that is momentarily "scarce." Sure, it means that you have to forget the whole purpose of the operation in the first place-- in this case, providing roadways that serve all drivers in the DC area and keep the community as a whole functioning well. Now, instead of a single efficient(-ish) public roadway system, you get a two-tiered system, with better services for those who can afford them, and a guaranteed profit for private interests. Does this all seem vaguely familiar?

This will sound familiar, too. The argument for privatizing key roadways is that the state doesn't have enough money to do a really good job, and by bringing in private corporations, the service can get a great new infusion of cash and support-- an odd argument, since no corporation will fail to get every cent of their cash back, and then some, and the public will have lost any say over this. DC customers who find the price of the express lane obnoxious are free to call a "customer service" number at the company and register their distress with an answering machine. Good luck with that.

This is how charterized roads work-- service for some people, big costs for all people, and a voice for no people.This is what privatizing a public service looks like. (This is also, incidentally, what Herr Trump's proposed umpty-zillion-dollar infrastructure plan look like-- use a pile of money to get companies like Transurban to buy and run a bunch of US infrastructure.) (It is also a good analogy for the whole argument about net neutrality.)

Private enterprise and the free market do not-- can not-- value all customers equally. Some customers are "worth" extra attention and service, and some customers (poor customers, customers who can't pay to make themselves worth the company's while) are "worth" little or no service at all.

If we intend to hold onto the value that there are some services that ALL Americans deserve, we cannot privatize those very services. If we want to say that America is a country where we declare that some people just don't deserve anything-- well, then, we need to have some hard conversations about what that means to our national and personal character.