In A World Where Middlemen Rule....

AllTheShystersThatFit

KillingTheCommonsVille

....There is no room for fully funding silly things like public schools and their sillier boards.

Norman Farrell, following up on Laila and NVG's fine work on the Shadow Tolling of everything (Roll On Kevvie....Roll On), has the story:

....(S)hadow tolls are well understood by money people as evidenced by this recent publication issued by the Boston office of RBC Global Asset Management (of course, the initials stand for Royal Bank of Canada). It discusses the appeal of very low risk, long term investments to institutional investors who seek assets to match their long term liabilities and talks of different repayment methods.

"Shadow tolls – With a shadow toll, the government makes a payment to the investor at a rate based on the number of cars travelled, but there is no physical toll booth on the road. Motorists avoid congestion, and there is no collection cost of operating the booth. Often the government funds the payment through fuel taxes, vehicle registration fees or other charges not directly based on who actually uses the road. In some cases, the government is willing to provide a floor of how much it will pay, so there are characteristics similar to an availability payment and revenue, therefore, is not purely driven by the number of cars."

Of course, this is exactly the kind of investing in infrastructure that institutions have always done. Government bonds, largely sold to institutional investors, funded projects including roads, bridges, schools, hospitals and other capital work that served the public over long terms. Government employed its own professional staff who supervising capital projects, arranged construction through competitive bidding by private contractors and financed the projects through direct government debt.

The difference today is the insertion of a layer of private matchmakers and dealmakers. Their main skill is in gaining influence over decision makers, convincing them to discard competitive bidding in return for the RFPs (Requests for Proposals), followed by negotiated design-build contracts. Whether a project is a formalized Public Private Partnership or an extended term operating agreement, government takes almost all risk and financing sits ultimately in the hands of long term investors.

Costs of projects rise of course so that dealmakers, who no longer work for government, take their profits out early. Political operators get rewarded financially. Public information about deals and details is minimized because of 'privacy concerns' for private companies....

Shadow tolls?

More like killer Zombie Tolls designed to walk amongst us while they inexorably suck the life out of you and yours as they strip-mine us of everything we hold dear.

OK?

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And where are the proMedia mavens on this one?....Well, when Laila first broke this story with irrefutable, in-depth reportage, a number of folks in the Lotuslandian Bloggodome tried to engage the mavens but it barely made a ripple despite the fact that Mark Hume in The Globe briefly gave it the imprimatur of proMedia legitimacy....I did hear back from a couple of folks in the know and was told it was old news...nothing new....everybody knows about that....it was all part of the deal from the beginning...You do 'know' the deal, right?....Meanwhile....If a bunch of people are stranded at airports because of snow for a little while....In winter?!!!....Well.....You will hear about that on every single goldarned newscast on every single goldarned news outlet, public or otherwise, for 36 hours straight until....Poof....the story disappears down the rabbit hole completely....with nary a whisper about how none of it really mattered to anyone at all because, after all, nothing from nothing really is nothing....You know....the more I think about it, the more I think Mr. Beer 'N Hockey just might be onto something...

Oh, and by the way.....It's Christmas Eve and the PAB Bots appear to have the day off....Or, perhaps, they are already in their cups because there has not been one single visitor from the gov.bc.ca domain today....Now, compare that to yesterday when the monitoring was set on something approaching infinity....I guess even the government Scrooge lets them off the hook once a year....Or....Does it just have something to do with the fact that Marty is now off on the hustings shucking and jiving for the folks from Sandals Jamaica?....Who really knows with this bunch given that the last man standing appears to be....And this I cannot believe this given this....John Les...

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