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How Trump's Trillion-Dollar Infrastructure Plan Could Succeed

Former Indianapolis Mayor Stephen Goldsmith on the privatization revolution.

"We're at a really interesting moment where public-private partnerships could blossom in a pretty dramatic way," says Stephen Goldsmith, former mayor of Indianapolis and professor at Harvard's Kennedy School of Government. "If we have technologies that are highly refined…we can anticipate a problem and fix it before it occurs."

Goldsmith, author of 2014's The Responsive City: Engaging Communities Through Data-Smart Governance, was the recipient of the Reason Foundation's 2017 Savas Award for promoting public-private partnerships. (The nonprofit Reason Foundation is also the publisher of Reason.com.) As mayor of Indianapolis from 1992 to 1999, Goldsmith trimmed $100 million from the city budget mainly by requiring departments of the municipal government to compete with private companies.

"The ideas...frankly, were from Reason," states Goldsmith. "[Director of Transportation Policy] Bob Poole spent I don't know how many lunches in Indianapolis when I was running for mayor and after I got elected kind of going through A to Z on how to privatize."

Goldsmith states that one impediment keeping struggling cities from embracing public-private partnerships is a basic understanding of the goal. "[It] isn't to monetize assets," explains Goldsmith. "The goal is efficiency."

At the national level, Goldsmith says public-private partnerships could be key to making President Donald Trump's one trillion dollar infrastructure investment program successful.

"Regardless of how much money it is that Washington ends up [spending]… it can't be done effectively without public-private partnerships," Goldsmith states. "Both for purposes of paying back the money and for purposes of maintaining the asset."

Edited by Alexis Garcia. Hosted by Nick Gillespie. Camera by Jim Epstein and Kevin Alexander.

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**This is a rush transcript—check all quotes against the audio for accuracy.**

Stephen Goldsmith: Regardless of how much money it is that Washington ends up doing.

Donald Trump: We're gonna start spending on infrastructure big.

Stephen Goldsmith: It can't be done effectively without public/private partnerships.

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  • Chipper Morning, Now #1||

    Isn't this just government contracting? Are the businesses getting paid directly by the customers, or do the "customers" pay taxes, which are then used to pay for the contracts?

  • Scarecrow Repair & Chippering||

    Yes it's just government contracting mostly. The benefits come from competition for the projects.

    A lot of PPP is where private businesses buy the project and make money off it, long term. Toll bridges, toll lanes, airports, that kind of thing. Buy a 30 year or 50 year lease, develop it using private funds, manage it with private funds, and make a steady profit which goes to private funds.

    It's by no means libertarian. But it's a heck of a lot better than leaving it in government hands, where any revenue is sucked off to pet projects or the general fund while the maintenance is deferred.

    I think of it as good enough for now, a baby step, etc. Kinda makes my skin crawl, thinking of "legitimizing" government control of so many things. But again, it's better than the status quo, and it might lead some people to eventually realize the benefits of markets and competition.

  • some guy||

    I take it eminent domain plays a major role, either way, though, right?

  • Scarecrow Repair & Chippering||

    Probably. It ain't perfect.

  • Nuwanda||

    You're right, it ain't perfect. And I wonder if, despite its superficial charms, whether it's just as destructive and distorting as pure state ownership.

    It's not just the eminent domain, it's the granting of monopoly (which is often seen as essential by the private operator), and state oversight of fees, charges, etc., all of which make the private operator just as dangerous as the state would be, and perhaps more so since you have a new potential for graft.

  • Robert||

    It is by no means libertarian if liberty is not quantitative, but instead nonexistent if not perfect. But liberty is quantitative. Less tax, more freedom. So if it cuts taxes, it's libertarian. & how does it legitimize gov't control of something if the status quo is complete gov't control of the thing in question?

  • The Divine Reactionoid||

    I like the cut taxes and liberty, but the rest of what you wrote is literally a god damned Egyptian mystery.
    The fuck?

    Is he paying for this shit with my money or do I get to buy more porn? (Yeah I know it's free everywhere online, but you gotta join some sites to get the legit shit without a lot of sorting).

    I demand a clear answer.

  • Rhywun||

    Here's a libertarianish moment for you: last week the idea of privatizing NYC's Penn Station - host to both Amtrak and Long Island Rail Road - was floated. That's how bad it's getting with the State running things here.

  • DOOMco||

    They're just trading it for healthcare.

  • Rhywun||

    At least that will crash and burn relatively quickly.

  • Agammamon||

    Rhywun, heard you were dead.

  • Juice||

    Reason Foundation's 2017 Savas Award for promoting public-private partnerships

    What.
    The.
    Fuck.

  • Fist of Etiquette||

    The Reason Award for Pragmatic Achievements in the Field of Cronyism

  • DOOMco||

    No, it makes sense.
    It explains a fuckton

  • Hugh Akston||

    Did.
    You.
    Keep.
    Reading.

    As mayor of Indianapolis from 1992 to 1999, Goldsmith trimmed $100 million from the city budget mainly by requiring departments of the municipal government to compete with private companies.

  • Crusty Juggler aka "Chad"||

    "The ideas...frankly, were from Reason," states Goldsmith.

    You might want to use someone else's tech guy.

  • The Divine Reactionoid||

    Uh yeah, dipshit, that's what we want from the federal government, not to waste money, paying people for shit.

    God damn you're so fucking retarded, you're actually arguing for Trump now.
    You make such a cute little Republican puppy. Good doggy, run off to Breitbart now.

  • Diane Reynolds (Paul.)||

    Bob Poole is a pretty tireless guy who's done a lot of good work, but my primary issue with him is he's very much about the pragmatism of the possible.

    My problem with the public-private partnerships idea is that such partnerships are no bulwark against the very same problems you have with a strictly publicly run service or system. I understand that you can structure these deals in infinite ways so one may be much better suited to competition an openness than another.

    But I've seen plenty of public/private partnerships go utterly sideways. We had a bikeshare system here that was just such a system and it was an unmitigated disaster with deals so shady it was essentially an ongoing criminal enterprise.

  • Citizen X - #6||

    Public-private partnerships almost invariably offer the worst aspects of both.

  • Robert||

    That's not the case w charter schools, for example. I'd like to see some #s behind that "almost invariably".

  • ||

    At 74 I have not worked for the govt., directly or indirectly, willingly, nor will I, on principle.

    I have found living as close a principled life as possible is not easy, but it is less complicated than trying to rationalize moral contradictions to myself/others and less destructive of my self esteem.

  • Jerryskids||

    I'm sorry, but any time I hear about the trillion dollar infrastructure plan I get a picture of Doctor Evil with his pinky to his lips saying "One trrrriiiilllion dollars" and then my mind wanders off somewhere else.

  • Crusty Juggler aka "Chad"||

    Go on...

  • ||

    Taxation is theft of monetary assets. Eminent Domain is theft of property. Regulation is destruction of choice, innovation, and time.
    Leaving this system in place while helping it become more efficient is no comfort to me. I do not flatter it by contrasting it to North Korea. I do not focus on the accidental benefits.
    I boycott it. I resist it. I do as much as I can to bring about a voluntary society.

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