INDIANA Gov. Mitch Daniels can hardly wait to lease the 157-mile Indiana Toll Road, billed as the "Main Street of the Midwest," to a Spanish-Australian partnership that would run the toll road for the next 75 years.
So it has finally come to this. The United States of America, technically the one remaining superpower on this globe, is too broke to fix its roads and has to lease important parts of its infrastructure to affluent foreigners in countries that do not have such a crushing military burden to bear. The cost of running the Pentagon, aside from the wars in Iraq and Afghanistan, is about equal to the U.S. budget deficit for the current fiscal year.
So the superpower is cash-strapped and running in the red. Meanwhile, the states are hard-pressed, too, and thus the governor of Indiana is enviously eying a new treasure trove of cash from overseas, hailing the proposed lease as "the Louisiana Purchase of our time for Indiana." How he arrived at that conclusion, we have no idea. The United States paid $15 million 200 years ago for a 828,000 square-mile tract of land stretching to the Rockies, an investment that any land-buyer today would salivate over.
Mr. Daniels' scheme is a kind of Louisiana purchase in reverse. The state would get $3.85 billion to use for other road projects, and the consortium would repay it in 17 years and then skim off an estimated $21 billion over the next 58 years, less any cost of repairs. This country's infrastructure was financed in large part by foreign investors, who sensed that the young nation offered great opportunity for them. But it taxes belief to think that this country cannot preserve its infrastructure today.
Of course, if the state were able to find U.S. investors, that money would stay at home. Even though the U.S. savings rate is disgracefully low, there must be equity funds floating around for a project as basically sound as the toll road, which is familiar to Ohioans who travel to Chicago via the Ohio Turnpike.
There might be a logical reason for using foreign investments for costly projects to improve connector toll roads and viaducts in heavily urbanized areas, as was done with the Chicago Skyway, the bane of motorists during the many years of neglect of that connector by the City of the Big Shoulders, as poet Carl Sandburg once described Chicago
Narrow shoulders, tunnel vision, and political cowardice are more apt descriptions of the leasing scheme. Indiana lawmakers have been unwilling for 20 years to raise tolls, and as a result the highway, which had 55 million paying customers last year, lost money five of the last seven years.
Road construction and maintenance is one of the basic public services offered by state governments. The privatization gambit is a pathetic example of what passes for U.S. political leadership and vision in the 21st century.