Monday, May 12, 2003
Coquihalla a bad place to start privatization push
By Paul Willcocks
VICTORIA - It's too early to say if the plan to privatize the Coquihalla is a good deal for the province, but it's sure not good news for the Interior.
And it's a shaky start to the Liberals' effort to come up with a successful public-private partnership.
There's three elements that make the deal attractive to the government.
First, the LIberals get to trade a stream of future revenue for some big cash now, helping to pay for road projects and taking them a lot closer to a balanced budget in one big deal.
Second, they hope that a private operator will see ways to wring more money out of the highway over the next 55 years. The Coquihalla makes about $30 million a year for government now. Tolls are worth $40 million, and maintenance costs about $10 million.
Based on those numbers - and depending on a lot of variables - a private company could probably justify paying $350 million for the right to operate the highway.
But the government hopes the operator will see ways to get higher profits, and bid up to $600 million. There are no services on the highway now; a private operator might cash in with a roadside development that it leases to fast food places, motels and other services. More revenue for the operator, more profits and thus a willingness to pay a higher price.
And third, the government dodges all the heat for the highway's operations. Businesses in Merritt, for example, aren't going to like the idea of a big highway commercial development that captures customers who used to head into town for gas and a burger. They could pressure a government to halt the project; they won't have any clout with a private operator.
The switch to private operation also helps the government dodge the perpetual questions from Interior residents about why they're paying tolls to subsidize highway improvements for other people.
There's nothing wrong with handing highway operations over to a private company. No one should really care whether the person driving the snowplow works for the province or some banking syndicate. The only issue is whether it's a good deal, one that produces more revenue and protects the quality of road maintenance.
And there's nothing wrong with using tolls to pay for new highways, or big improvements, the user-pay approach the Liberals initially outlined.
But the Liberals have made a mistake by picking the Coquihalla for their first big privatization effort.
Tolls were supposed to come off when the highway was paid for. Like everything else about the highway project, the deal was never clear, but the best recollection of key participants is that the Socreds agreed that tolls would be lifted when the Hope-Merritt section was paid off. That section cost about $450 million; tolls have raised about $550 million. The communities have a case.
The bigger issue is the government's failure to establish a real link between tolls and improvements. People in the area aren't getting a new road, or a better bridge. They're being asked to pay tolls - which will rise every year - for the rest of their lives, with few direct benefits.
In fact, communities along the Coquihalla now see the prospect of paying tolls and watching the money being spent on projects in other regions that will be toll-free. Every time people in Kelowna read a story about a road mega-project like the Sea-to-Sky Highway improvements, they will be reminded that they're paying tolls - on top of gas taxes - to subsidize projects for others who don't have to come up with $13 every time they head down the road.
Details are still sketchy. This could turn out to be a good business deal.
But the Liberals are going to have a tough time convincing anyone in this part of the Heartland that it's a fair one.
Footnote: Here's Kamloops Liberal MLA Kevin Krueger in the legisalture in 2000, arguing tolls should come off. "I've got to tell you, on behalf of my constituents and the constituents throughout the Interior, we don't like this at all -- that this government can ride roughshod over all the rules of doing business. The people in Merritt, the people throughout Yale-Lillooet, don't appreciate having to pay a toll on the Coquihalla Highway and having that money sucked out of our local economy and squandered down here."
U.S. drug czar's get-tough pitch both insulting and wrong
By Paul Willcocks
VICTORIA - Taking advice about drug policy from the U.S. makes about as much sense as hiring Saddam Hussein as a foreign policy advisor.
Every aspect of U.S. drug policy has been a costly, stunning failure, wrecking lives and whole cities while achieving absolutely nothing.
And yet here's a U.S. drug czar, flying in to Vancouver to warn that we're heading for major trouble with our drug policies.
David Murray, special assistant in the Office of National Drug Control Policy, said crazy ideas like decriminalizing marijuana possession and opening a safe injection site in Vancouver will lead to no good.
The U.S. will even have to tighten border controls, hurting the Canadian economy, said Murray, whose visit was aimed at persuading police, politicians and media that Canada should copy the U.S. war on drugs.
Murray didn't just use threats of U.S. retaliation. He also warned that we will be stumbling towards disaster.
Decriminalize marijuana, and more kids will use it, police will be swamped and vulnerable minority communities will be turned into dazed potheads, Murray claimed. Safe injection sites will also lead to something bad, he said, although he was pretty vague about what that might be.
Murray couldn't offer any evidence for his claims.
In fact, the reality is that marijuana use has gone down among youth in Holland, which took marjuana use out of the criminal process. And every country that has tried to deal with heroin and other drug addictions as a medical problem has reported fewer deaths, less crime, lower health care costs and fewer addicts.
Compare that with the U.S. record. America has been waging a stupid, costly and ineffective war on drugs for decades. The result has been more addiction, deaths, crime and social decay. Twenty years ago there were about 80,000 drug offenders in U.S. jails; now there are 400,000, at a cost of $16 billion a year. Drugs are far more potent, far more widely available and far more widely used. There is more crime, more shattered families and more death.
The U.S. approach has been tried. And it has failed.
I feel a little foolish even using this space to respond to Murray's nonsense. He claimed that people need the threat of the "sanctions of law enforcement" or they have no reason to give up drugs. As if disease, poverty, despair and the threat of death weren't enough.
He claimed marijuana is the first step on the ladder of drugs, even though a study last year by the U.S. RAND think-tank found that people who are going to use hard drugs will start with whatever is easiest to get - beer, or pot, or glue.
And asked for evidence that the U.S. approach to drugs is better than other approaches, Murray had nothing to offer.
The problem with this kind of misinformation, and U.S. pressure, is that we're talking about a life-and-death issue. Drugs do take a terrible toll. Peoples' lives are destroyed, families are shattered and communities are terribly damaged. Organized criminals profit, and addicts commit countless small and stupid crimes.
But that makes it all the more important that we tackle the problem sensibly, based on what works, not slogans.
If our goal is to reduce the damage done to individuals and communities by intravenous drug use, then safe injection sites and other harm reduction measures have been proven to be the most effective path. They save lives, and offer a gateway to health care services, addiction programs and employment, while reducing crime.
If our goal is to keep organized criminals from an expanding role in the marijuana trade, then perhaps we could make the biggest gains by eliminating the risk of prosecution for people interested in growing a few plants.
We don't need a war on drugs, which generally turns out to be a war on the most vulnerable members of society.
We need education to help people avoid addiction and abuse, support for people who want to quit and harm reduction for people who can't or won't quit.
We need solutions, not rhetoric.
Posted by paul at 8:40 AM