Scene: Jordan alone in office late working on the paper for POTUS.  Earlier POTUS asked Jordan for ideas how to convince politicians and the public that it would be a good idea to fund rebuilding US infrastructure by fixing the price for gas and diesel fuel.  The paper is overdue, POTUS is frustrated and Jordan struggling to finish because of a series of interruptions.  Original conversation with POTUS Entries #104, #105.

(Jordan talking to himself.)  Getting support from Republicans for $5.00 gasoline is going to be tough, even those elected after the Revenge Revolution.  They seems obsessed with privatizing a whole range of functions of government, including infrastructure.

Claiming societal benefits by privatizing many government functions is a fallacy.  Look, government is not the most efficient organization at many tasks, but…and this is what many people fail to grasp – Republicans and some Democrats…government is a system that works most efficiently when tasks are grouped or integrated.

Any one task might be completed more efficiently by private business.  But “outsourcing” these tasks results in even more inefficient government.  I can hear the Republicans screaming now.

Many Republicans congressman and many business leaders seem to forget a key lesson from private enterprise.  The lesson?  Companies that are more vertically integrated make the most money.

Historical examples.  General Motors, when it was the most vertically integrated might as well have printed money it was so profitable.  More recently, Apple, has become hugely profitable because it controls the integration of hardware and software.

Vertical integration – I wonder if the lawyers in Congress really understand what it means and the potential benefits vertical integration offers.  Probably not.  OK, I’ll need to include a definition for POTUS.   The Wikipedia definition is a good overview.  http://en.wikipedia.org/wiki/Vertical_integration

POTUS will have to link the discussion of vertical integration to why many functions of the Federal government should be vertically integrated and how vertical integration applies to rebuilding US infrastructure.

Maybe we start the conversation with a discussion of roads.  During the Obama Administration Republicans kept pushing to privatize rebuilding the infrastructure.  Many Republicans said the government should have private enterprise provide the capital to rebuild roads, bridges, water treatment facilities…and a bunch of other stuff.  But, with the private capital came one caveat – the companies could charge the public for using the privately funded infrastructure.

What a dumb-ass idea.  It basically turns control of the public infrastructure to the private sector.  Why?  Because some Republicans were opposed to any function run by government?  I dislike the idea intently…and I hope POTUS opposes strongly.

What if the company decides profits are more important and neglects maintenance and repair of infrastructure?  What if the company decides to increase fees or tolls?  The company could also decide the terms of the contract are onerous and then declares bankruptcy.  And what is the public left with?  The tab for repairing the infrastructure.  Meanwhile the company has reaped profits…maybe raped the public is more appropriate.

The idea of private water and sewage treatment is even more risky.  A failure by the company could have a huge negative impact on the public with virtually no accountability by the company.  I need to have POTUS remind people of the financial crisis of 2008.  Let’s see, how many executives from the banks and Wall Street firms went to jail?  Goose egg, nada.  There was no accountability then.  The only difference today is the Revenge Revolution and people are fed up with executives and corporations not being held accountable.

The public might not understand effective oversight of private companies requires government staff.  Republicans, of course, will claim “market forces” will keep the companies competitive.

Excuse me…but the last I looked roads, bridges and water treatment facilities were all monopolies, not free-market enterprises.  Monopolies do not have a natural check-and-balance system.

Since we’ve had the Revenge Revolution I think there’s a better chance people will understand why infrastructure should be funded and managed by government.  Using private companies to help rebuild infrastructure is OK and keeps government out of certain businesses.  But government needs to manage the process.

Once POTUS makes this argument, he’ll need to talk about why $5.00 gas is necessary.  Avoid getting into too much detail about cost during the early sessions.  It’s an easy way to get sidetracked.  But he needs to make the case that $5.00/gallon gasoline will make enough funds available to fund rebuilding infrastructure.

Maybe he should mention the Apollo program of the 1960’s.  When President Kennedy said the US would put a man on the moon in less than a decade, I think the budget was 3-4% of GDP.  Need to confirm but seems right.  That program was highly successful with vast spin-off benefits.  Rebuilding could have the same benefits.

OK, I think this section is OK for now.  I’ll need to polish and make sure it flows smoothly.  But POTUS needs to make the strong argument that government, not private companies, needs to fund and manage rebuilding infrastructure.

(To be continued)