Tuesday, May 20, 2008
$12.8 billion offer may say another piece of U.S. sold off to foreign investors
The Pennsylvania Turnpike may soon be more aptly referred to as the Barcelona Turnpike if a $12.8 billion proposal by a Spanish toll road operator is approved by the Pennsylvania Legislature.
Pennsylvania Governor Edward Rendell made the announcement yesterday that Abertis Infraestructuras, of Barcelona won the right to operate the turnpike on a 75-year lease.
In making the largest bid ever for the private operation of a U.S. toll road, Abertis partnered with a subsidiary of U.S. investment bank Citigroup, and Spanish investment firm Criteria CaixaCorp, reports the Philadelphia Inquirer.
The next-highest bid was $12.1 billion by New York's Goldman Sachs Group Inc. and Transurban Group, Australia's second-largest toll-road operator.
"This bid will allow us to increase spending on roads, bridges and transit above what is in the current plan, Act 44, which includes plans to tolls I-80,'' Rendell said at a press conference in Harrisburg. "This is a very good deal.''
If the deal goes ahead, the Abertis/Citi consortium would also secure the right to raise tolls 25 percent next year and 2.5 percent or the rate of inflation every consecutive year. This would translate as an increase from $22.75 to travel 358 miles on the turnpike now, to at least $36.40 within a decade.
This is not the first time Rendell has attempted to lease the 537-mile (864-kilometer) turnpike. Last year saw a move to instigate a lease deal before the plans were eventually scuppered due to opposition from the Legislature. In response, Rendell signed into law Act 44, and began the much maligned "I-80 Project" which allowed the state to establish tolls on the 311-mile I-80. The I-80 Project, which has not yet gained federal approval, is expected to be scrapped should the Turnpike deal go ahead.
Legislative approval for the deal is expected to take months and much opposition from lawmakers is anticipated.
(Article continues below) In recent years the Bush administration has overseen a policy of selling off key U.S. infrastructure to the highest bidder - in most cases foreign owned corporations. Virginia's Pocahontas Parkway and a Texas toll road from Austin to Sequin are just two of the roads to have been siphoned off to foreign companies who will all enjoy billions in profits from American citizens forced to pay the tolls, while others will be thrown off their land and have their property revoked without just compensation following the trend of recent eminent domain rulings.
2004 saw the management of the Chicago Skyway, a stretch of elevated road connecting I-90 and I-94, granted to Cintra, another Spanish operation that outbid Abertis at $1.83 billion. Abertis lost out to Cintra again when the Indiana Toll Road was taken over in 2006 for $3.85 billion.
Cintra, which in turn is owned by the King of Spain Juan Carlos, now has leases to operate the two roads for 99 and 75 years respectively. Cintra and it's partner Macquarie lost out on the Pennsylvania Turnpike as it registered a bid of just $8.1 billion.
Cintra/Macquarie also owns the contract for The Texas Department of Transportation's Trans Texas Corridor superhighway, a key link in the proposed internationalization of America's highway systems into a NAFTA Super Highway that many, including U.S. representatives, have warned would facilitate a move towards a North American Union.
Last year Macquarie agreed to buy dozens of newspapers in Texas and Oklahoma that had been harsh critics of the Trans Texas Corridor and were shedding light on the wider NAFTA highway agenda.
The Pennsylvania Turnpike is a key part of the infrastructure of the proposed Atlantic Corridor, one of four transport channels being promoted by coalitions of interest under the NAFTA umbrella.
The leases for these roads are being made possible through "public-private partnerships" (PPP's), now under the stewardship of the secretive Security and Prosperity Partnership, which operates without Congressional oversight.
Essentially Government-sanctioned monopolies, PPP's are contracts between public agencies and private entities that enable private sector participation in public amenities such as roads, highways, transit routes, airports, pipelines, railways and train stations, river canal systems and port facilities, telecommunications networks and teleports.
The PPP's will seemingly expand to whatever the public owns – waste management, public parking facilities, even lotteries and sports stadiums. The USA is literally up for sale.
Former World Bank economist and Nobel Prize winner Joseph Stiglitz, has stated that the process of foreign corporations buying up U.S. infrastructure is part of the globalization endgame, where the America literally goes into receivership to other countries.