Quote of the week...please share your favourite line from Ayn Rand's writings

“Happiness is that state of consciousness which proceeds from the achievement of one's values.”

Monday, August 9, 2010

Private Ownership of Roads

At the recent discussion about capitalism at our Atlas Sunday Meet in Bombay, the issue of roads, traffic, congestion, and and infrastructure was brought up. I think my post on this issue from my blog Leitmotif is pertinent in response:

When we think of privatizing roads, the scenario is so far removed from anything we have witnessed in real life that we respond–-almost instinctively–-with suspicion and concern... of uncertainty, anarchy, high costs, and unpredictability. Our ability to imagine the operations of a free society is not inhibited our by level of intelligence but by the strictures of thought that we--and the current philosophical, statist, and educational system--has placed upon our minds; the concept of the government is so entrenched in our socio-political thinking and academia that life without the government produces a mental blank-out.

This blank-out is analagous to a theists incapacity to imagine a moral life without god; like the famouse Dostoyevsky quote says: "If there is no God, then anything is permitted."

For the secularist, the government replaces god as the moral authority and guide of all good behavior. We--mere moral, individual, humans--are considered incapable of managing our own moral lives, living well, and engaging in a morally prosperous life.

The issue of private roads is a good test of whether you hold your philosophy as a body of abstract, rationalistic principles or as a properly integrated system that you use in daily living, and which you can readily apply to concrete situations.

The effort required is much like shrugging off theism and stepping into a world without a god, which appears at first to be daunting, anarchic, amoral, uncertain, and even barbaric.

1) We just have to think about analogous situations that most closely resemble the operations of a free market; I submit that in a free society most people will not have to pay for practically any use of the roads. As analogous situations, think of your use of the Internet and the radio. The vast resources of the Internet are available to most of us for free. The Internet operates in such a way that there’s not only an abundance of voluntary content generators but also massive revenue generators: the revenue is generated by amazingly innovative methods that would be simply impossible were the Internet to be a government-regulated operation. The people who invest and wish to make money from the Internet are making their profits (provided they have been sensible in how they went about it), and those who simply wish to derive the benefits of using the Internet are doing it for FREE (like myself.) And note that the Internet is a globally free phenomena, at least in all the places where governments have not been foolish enough to interfere.

2) The radio is another similar example. Most of us do not pay for radio, and yet we derive the pleasurable and important benefits of it. Radio frequencies were only recently privatized in India; if our broadcast TV frequencies were also privatized likewise, then–as in America–we would even be enjoying high-quality broadcast programming for free on TV (however, since this is not the case, we have rampant cable thievery instead).

3) Who pays for all this? To a communist or socialist, it seems incomprehensible that such awesome benefits on the radio, television, and the Internet is being offered for free; to that kind of mindset, the limitation is not necessarily a low level of intelligence, but the accepted premise that man should not (indeed, cannot) be free to devise his own ways and means of living, trading, producing, and pursuing happiness.

4) In a society where roads are privatized–like radio air frequencies–I envision most roads to be of superior quality and mostly free for people to use: corporations and businesses that are situated alongside these roads will make it a point to have their access roads in good condition with ample parking space for customers to visit their stores and businesses.

5) Utility (water, electricity, telephone, etc.) and cable corporations will contract with road owners to gain access to establishments situated on their roads; they will pay the road owners a certain amount of money or percent of profits for laying their wires and pipes on top of or under these roads. The road owners, in turn, will ensure that these wires, pipes, cables, etc. are laid in place quickly, efficiently, and esthetically in order to maintain the high value of their property. The utility companies will pay the road owner a fee for access to residents, businesses, and the use of the owner’s property. This can be one of the many revenue models for private roads. (Objectivist blogger Qwertz made this point persuasively and at length in his post; I am indebted to him for this idea.)

6) Roads with all installed utilities and esthetic considerations will have high-property values, which would translate to high property rates for residents and businesses in that neighborhood and the surrounding area; property owners will be able to command higher prices for their property–either in rentals or in a sale. Thus, road ownership will be a big and thriving business, which means, more investors will be interested in ownership of roads and highways. This will invariably lead to increased competition, competitive rates, higher benefits and services on these roads, and a greater value for consumers, business owners, advertisers, restaurants, etc. The cost to the end user of these roads will be either very minimal and competitive or simply nothing at all.

7) I imagine monthly or annual subscription passes for the use of those few roads that are not free (perhaps, major expressways); and these passes could be highly subsidized by advertising, competition, rest-stop areas, or other perks that road owners might want to sell or include on their roads

8.) One of the best benefits of privatized roads (especially for India) would be the non-existence of public protests on the streets, processions, road blockages, and vandalism: corporations, businesses, and road owners would not want their private property to be clogged, their customers to have no access to their businesses, and their brandnames and reputation associated with such hooligans. Therefore, they will ensure and pay for strict security measures to enforce safety and brand value. Perhaps, these private corporations will threaten with the withdrawal of advertising revenue or legal suits if the operators of these roads become lapse in their duties to ensure safety and prevent road protests or blockages.

9) Finally, street hawking will become illegal only if the owner does not permit it or the vendor has violated certain parameters. I do not see why hawking will be extinguished entirely. I believe that some neighborhoods might wish to project a certain kind of charm to their area and thus encourage streetside vendors who are consistent with their neighborhood theme: for example, Chinatown, Little Italy, Indian Village, Little Mexico, Greek Town, etc., could be neighborhood themes that can attract tourism, business, night revellers, and much revenue. Therefore, street vendors could add to the charm and distinctness of such areas, and it could be entirely within the operations of a free society with privately owned roads.

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