Wolf Repeating Same Mistakes of the Past
Earlier this week, we pointed out how Gov. Tom Wolf’s veto of liquor privatization—using talking points from union leaders to justify his action—didn’t make much sense.
Wolf’s reasoning can be summarized as this:
We shouldn’t get rid of a “government asset.” Prices will go up if we privatize. Despite rampant corruption at the agency, we should keep state control and “modernize” the asset.
This mirrors almost exactly the arguments made against leasing the Pennsylvania Turnpike eight years ago:
We shouldn’t get rid of a “government asset.” Tolls will go up if we privatize. Despite rampant corruption at the agency, we should keep state control and “monetize” the asset.
A proposed lease of the Pennsylvania Turnpike, proposed by Governor Ed Rendell and supported by the Commonwealth Foundation, would have netted Pennsylvania $12.8 billion in upfront lease payments. It would also have capped toll increases (after a planned increase in 2008) to 2.5 percent per year. Instead, lawmakers passed Act 44 of 2007 to “monetize” the Turnpike, requiring annual payments to the state funded by new debt (and backed by higher tolls).
This week, the Pennsylvania Turnpike Commission announced that tolls would increase by 6 percent next year, and 4.5 percent every single year through 2044. Cash tolls have already more than doubled since 2008, and there is no end in sight to increases.
The cost of a one-way car ride from Ohio to New Jersey has gone from $21.40 in 2004 to $48.90 next year.
Instead of leasing the Turnpike and receiving $12 billion in upfront funding with a cap on toll increase, Pennsylvanians instead have a massive increase in their debt and skyrocketing tolls.
Gov. Wolf is repeating the same mistakes of the past.
Instead of a liquor privatization plan that would generate additional revenue for the state—while providing consumers greater choice, convenience, and, yes, lower prices—Wolf is pushing for “modernization” which literally calls for raising prices on wine and liquor products.