06 November 2009


The elected leaders of a democratic government basically deal with only three "tools" with which to accomplish their goals:

1) Establishing a tax rate, the revenue the government will receive for it to spend.

2) Assignment/management of public goods, such as schools, utilities, roads, etc.

3) Assignment of private goods, such as contracts, incentives, etc.

Now Let's be clear on one thing: the primary purpose of elected government leaders, if not of all government leaders, is to ensure they remain in power. They have no other primary purpose, no matter how much they lie about it. Again: their primary purpose is to ensure they remain in power. And the only tools they have to do so are listed above.

When handled for the larger benefit of the people, tax rates are proportional to the cost of government assignments and management. But this happens rarely, mainly because revenue amounts can vary widely, costs can be easily over- or underestimated and "friction"--a polite term for corruption--adds largely-unseen costs to the system. Then there's debt, which shouldn't happen in well-run governments, but can and does cast an ever-darker shadow of doom over the whole process.

Now what happens in a government where revenue is dropping and is projected to drop even further, costs are rising and are projected to continue rising and the "friction" in the system blocks reforms? What happens when you, the elected leaders, know you can't remain in power if you raise taxes? What happens when you know you can't sustain the public goods or keep assigning the same private goods as before, because they cost too much, you project insufficient future revenue and making the required cuts will obviously cost you power? What happens then?

You change the rules.

You take the power base of public goods--government control--and you redefine and reassign them as private goods, essentially making them profit-based assets. You keep a measure of government control, but now have profits tossed into the mix as a substitute for the revenue you cannot receive (tax base)...and you use the funds to accomplish your primary goal: staying in power.

And you give it a name like Public-Private Partnerships, code for Public-Private Plunder.

You doubt it? Here's the listed Approval Flowchart of the Puerto Rico PPPlunder process:

Summary of Public-Private Partnerships Approval Process

Step #1 Government Entity
Any government entity is authorized to establish a public-private partnership and to award a corresponding Partnership Contract related to any function, service or facility, in accordance with the public policy set forth in Act 29.

Step #2: Public-Private Partnerships Authority (PPPA)
The PPPA Board of Directors determines the need to request a Study of Desirability and Convenience.

Final Decision
After evaluating the Study of Desirability and Convenience, the PPPA Board of Directors will determine whether to proceed with the evaluated project.

Step #3: Naming the Partnership Committee
The Authority will create a Partnership Committee for each referred project that it has deemed appropriate and viable.

The Partnership Committee will be constituted by:

---the President of the Government Development Bank or his/her delegate;

---the officer of the partnering government entity with direct authority in the project or his/her delegate;

---one (1) member of the Board of Directors of the partnering government entity or, in the case of government entities with no Board of Directors, the head of the given partnering government entity; and 

---two (2) officials from any government entity chosen by the PPPA Board of Directors for their knowledge and experience in the kind of project that is object of the Partnership under consideration.

The Committee will evaluate the potential proponents and the proposals submitted in order to select the best one(s).
Step #4: Request for Qualifications and Request for Proposals
The Partnership Committee will evaluate all the potential proponents’ qualifications and the proposals in order to facilitate the selection of a proponent and awarding of a contract.
Step #5: Partnership Committee
Following the approval of (a) proposal(s) that, at the Committee’s discretion, best meets the established criteria, the Committee will hold or oversee the negotiation of the terms and conditions of the Partnership Contract. 
Step #6: Board of Directors and Government Entity
The PPPA Board of Directors along with the participant government entity will approve the report and the Partnership Contract through a resolution.

Following the PPPA Board of Directors and the government entity’s approval of the report submitted by the Partnership Committee, the report will be submitted to the Governor, or to his (her) official representative for the purposes of approval.

The Governor, or official representative, will have thirty (30) days to approve or reject the Partnership Contract.

And where's the legislative outhouse in all of this?

Joint Committee on Public-Private Partnerships
The Joint Committee on Public-Private Partnerships of the Legislature of Puerto Rico is created, to be composed of four (4) senators and four (4) representatives, from among whom one (1) in each House shall belong to the Parliamentary Minority. The Joint Committee shall have jurisdiction to examine, investigate, evaluate, and study all matters relative to PPPs.

Folks, people, Brethren, where do We appear in this process of assigning Our goods and Our services to whoever the government chooses?

That's right: We don't. But We damn well will pay for it, every last bit.

The Jenius Has Spoken.


Someone like you said...

Just went through an outdated list of the PPP projects submitted by Government Entities. Not even the letters to Santa from an entire neighborhood full of kids can keep up with this list. It includes 108 projects, big and small. Every single municipio is asking for a waste-to-energy plant (Thanks Willie "Multiple Nicknames").

Immediately the following rushes into my mind: Is there a concerted plan to harmonize all of these requests made by every single government office?

GCSchmidt said...

"Is there a concerted plan?" No, though the Fools say they have one.

Here's My proof: The PPA Reports includes an energy development plan covering several existing facilities to be upgraded and new ones to be built and implemented. And yet, nowhere in this or other Reports do they discuss specific permit changes needed, land acquisition or reassignment procedures, specific reserach policies or programs or even forcing energy buy-back that has been on the books for a decade and that the AEE refuses to implement.

The only concerted plan I see is one involving a shaft, Our butts and the Fools' piggish grunts of laughter.

stephan Tychon said...

The biggest PPP/P3 in the world since 1963 is the Dutch Gasunie=Exxon+Shell+Gov.nl the rootcause of global imbalances and global crime.

Please compare: