Rich man wanna be king
A couple of readers have sent us links this morning to stories about this. To us, it seems like just more privatization of traditional government functions, with a Democratic Party spin instead of a Republican Party spin. More corporate ownership of government, without the pretense of democracy. State and local governments have been selling off chunks of their infrastructure for a while now; the Chicago version would simply sell the assets before they are even built.
| Posted at 10:45 AM | Permalink |
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Comments (7)
Hmmm... sounds a lot like Portland's shady "public-private" partnerships, just more formal.
Posted by Mr. Grumpy | April 26, 2012 12:01 PM
"like just more privatization of traditional government functions"
I read the article and I don't see anything major outside of they are trying to set up their own bonding authority. I t probably makes sense since the state of Illinois looks pretty bad credit-wise and Chicago is not as bad - YET.
I'd guess all the paper they sell wouldn't be general obligation, so I'd be curious to see what the market would pay.
On the plus side, Chicago is a big market, on the negative I can't see anyone with a brain expecting Convention Center Hotel specific bonds to ever pay them back.
Posted by Steve | April 26, 2012 1:01 PM
Plus any sensible Portlander would avoid taking any cue from a city where last St Patricks's day weekend, 49 people got shot.
Posted by Gaye Harris | April 26, 2012 1:40 PM
this is not privatization, this is just government subcontracting and a way for the elected to funnel money to their friends.
Posted by Pistolero | April 26, 2012 2:00 PM
Would this be a newer and "better" version of collateralized debt obligations? Maybe "Chicago Style?"
Posted by pdxjim | April 26, 2012 2:38 PM
It's not debt -- it's equity ownership by private parties.
Posted by Jack Bog | April 26, 2012 2:52 PM
"An infrastructure bank, after all, is just another form of borrowing. Chicago would get money upfront from, say, Citibank or J.P. Morgan to build a new bus system or subway extension, and then the riders would pay the investors back over time in the form of higher fees and fares. This is just just another way to tax residents to pay for projects."
What could go wrong here? Similar to the Feds giving us money to extend light rail for capital costs, and all we have to worry about are operating costs. Cept, with Chicago, they will be paying off the infrastructure costs along with operating costs.
Posted by pdxjim | April 26, 2012 4:26 PM