With our bridges, roads and waterlines all threatening to crumble before our eyes, the United States could use a major boost in infrastructure spending. Unfortunately, however, government budgets are crumbling, too. The upshot, according to a new report from the Urban Land Institute: We can expect “less federal funding for everything from roads to rail.”
For that reason, the ULI report says, “States and cities, desperate for new sources of capital to fund infrastructure needs, will reach out to private funders and operators for solutions both for constructing new systems and managing existing networks.”
[EXPAND More]When it came to lamenting the deterioration of our public facilities and structures, highways and byways, Peter Drucker was right in step with most Americans. “In the developed countries the existing transportation infrastructure has been grossly undermaintained,” he wrote in his 1999 book Management Challenges for the 21st Century. That’s certainly just as true today, with the costs of the problem rising ever higher.
But for Drucker, having private funders take the lead in updating our infrastructure was clearly the right road to travel. “Privatization is the one way to ensure the needs for infrastructure will be fulfilled,” he concluded in Managing in a Time of Great Change. “No government in the world today is solvent enough to do so on its own, either through taxation or borrowing.”
“The needs of communication, the environment and transportation should be entrusted to investor-owned, profit-seeking enterprises, operating in competitive markets,” Drucker recommended. “There is a precedent for this: the concept of the ‘public utility,’ invented in the United States in the second half of the 19th century. This enabled American railroads, power companies and telephone companies to remain private and to stay competitive, while such services everywhere else in the world were taken over by government.”[/EXPAND]
What do you think: Is it hopeless to expect Uncle Sam to fix up our roads and bridges? Is the model of the old American railroads of the 19th century a better one for the future?