TW: We posted on this when it happened.
http://treylaura.blogspot.com/2008/12/these-privatization-programs-are-insane.html
http://treylaura.blogspot.com/2008/12/chicago-under-benevolent-dictatorship.html
http://treylaura.blogspot.com/2009/01/well-that-did-not-take-long.html
But it is always good to see the obvious stated in print by an actual economist. The net net Daley traded $300 million of future revenue over the next 75 years in order to fix the next two or three years budget shortfalls. Disgraceful governance.
From the Chi Tribune:
"Mayor Richard Daley reaped a windfall and avoided further budget cuts when he secured fast-track City Council approval of a 75-year lease of the parking-meter system, but an economist's analysis concludes he also gave up hundreds of millions down the line.The complex agreement, the first of its kind in the United States, nets the city a one-time cash payment of nearly $1.2 billion when the deal is closed this month.But the city could have earned $1.5 billion—in today's dollars—if it kept the meters and simply raised rates to the same levels it granted the winning bidder, according to H. Woods Bowman, a professor of public service at DePaul University.
..."There's nothing that would prevent the city from doing what the private sector is doing," Bowman said, noting aldermen already took heat for approving the rate increases in the deal...The reason they are doing it is because they can get the money now and close their budget gap."
...Pete Scales, spokesman for the city's Budget and Management Office, said Bowman's calculations don't take into account the risk of such a lengthy lease."[TW: this is happy horse dung from the City, what risks or at least what risks that could not have been mitigated in the future by the City]
http://tinyurl.com/d5qq77
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