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Challenging the Wisdom of the Trans Texas Corridor.
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The road to a mortgaged future April 24, 2007 The April 12 article, "N.J. treasurer: Don't fix pension by leasing assets," did a good job of discussing the shortfalls of the state pension fund, but it contained two misconceptions about toll-road privatization. The article stated that " 'monetizing' assets means squeezing latent income from them by selling or leasing them." The Inquirer's readers may imagine that this process harnesses additional value or productivity from the roads themselves. That is not the case. "Monetization" simply means to borrow against a future source of revenue. Instead of receiving toll money at a later date, the government would receive cash up front today. Thus, monetization only "extracts latent income" the way individuals do when they take out a payday loan or a second mortgage. The article also quoted an analogy by State Sen. Steven Sweeney (D., Gloucester), comparing toll privatization to a family's having to sell its Shore house in order to keep its main home. A more apt analogy would be a family selling its bathrooms and kitchen. New Jersey's Turnpike and Parkway are not luxuries. They are the backbones of our transportation infrastructure, and how they are managed has profound ramifications for the way New Jerseyans live. In the coming months, residents of New Jersey and Pennsylvania must think clearly about potential road deals. Abigail Caplovitz Field
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This Page Last Updated: Tuesday April 24, 2007