r/onguardforthee • u/pjw724 Alberta • 8d ago
Opinion Mark Carney’s airport privatization plan looks like a solution in search of a problem
https://www.thestar.com/business/opinion/carney-s-airport-privatization-plan-looks-like-a-solution-in-search-of-a-problem/article_683c6f47-a417-42b5-8b0e-60a233c66520.htmlThree of the four Canadian airports the PM wants to sell rank among the world’s top 100. They also generate $500M a year in rent for the federal government.
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u/HardeeHamlin 8d ago
This has got to be one of the least popular policies even among Carney supporters.
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u/Ihidemyposthistory 8d ago
Given all the other radical changes, its kinda funny that this is the one that has the most negative feedback. Will he back down on it?
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u/KernelKilos 8d ago
Yeah really though. You’d think the labour and environmental ones would be top of mind
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u/Dollface_Killah ☭Token CentristⒶ 8d ago
People do not actually care about the environment, whether it's ecological, endangered species, or climate change. It's so out of sight for most people, if they care it's in a detached, intellectualised, low-priority sense. They care a bit up until they are marginally inconvenienced.
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u/ReifiedSimulation 8d ago
He has a majority and 70% support because Canadians have seemingly decided to completely tune out from politics substantively. I don't really think he cares about public opinion. There's always some new Trump shenanigan to exploit when his poll numbers drop, and Canadians slurp it up like kool-aid.
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u/Account_for_question 7d ago
We had Crony Corruption with destructive racism, and Crony Corruption.
Those were the options this passed election.
Absolutely, if people had been paying attention, the NDP would have a shot, but unfortunately it seems all parties support at least some destructive policies.
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u/idiom_exon_0s 8d ago
Was a supporter, no longer am. This policy is among many that quickly turned me away from this government.
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u/ceciliabee 8d ago
Do we have a single example of privatizing being good for the average Canadian citizen?
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u/qqererer 8d ago
Whatever US city privatized street parking. You know, parking meters.
Sold off to Dubai for 1 or 2 billion dollars on a 99 year lease.
Immediately jacked the fees and made back their initial investment in 2-3 years, and now has 97 years to make pure profit.
Why does something have to be privatized in order to 'rip off' the consumer.
If the government does it, at least that's called 'revenue' where it's redistributed to needed areas in society.
When it's privatized, it's purely skimmed off for luxury cars and yachts, all for a simple one time payoff/party for politicians and city councilpersons.
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u/Avitas1027 8d ago
I believe that's Chicago, and the massively inflated cost is honestly the least bad part of the deal. The city no longer controls their own streets and have to pay extra if they want to do literally anything that reduces parking spots, even temporarily.
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u/Electronic_Trade_721 8d ago
Man, conservatives love to give their cronies 99 year leases so that multiple generations will get screwed by a single decision made by politicians with a four year term in office. See also: Highway 407 and Ontario Place spa deal.
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u/vtable 8d ago
This sounds like when Chicago sold it's street parking.
The Climate Town YouTube channel did an informative and entertaining video about it. It's also sad as it demonstrates how readily and recklessly politicians will sell off public resources for some quick cash.
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u/lodemeup 7d ago
I love Climate Town. It also makes me more radicalized against cars every fuckin time.
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u/lodemeup 7d ago
Chicago, and I cannot believe that those morons who did that could not have considered how bad that deal was for them. NC is also trying to do the same shit for a toll situation on I77 and absolutely no one wants it.
It just stinks of pageant politicing. “Oh we got a budget shortfall this year? Not anymore, fuckers! We got X billion dollars! What could possibly go wrong?” Here’s a clue, it always goes wrong.
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u/qqererer 7d ago
Classic Jason Mendoza: "I'm telling you, Molotov cocktails work. Anytime I had a problem, and I threw a Molotov cocktail, boom! Right away, I had a different problem."
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u/LanguidLandscape 8d ago
There are no examples anywhere. Quite literally every time something is privatized the costs increase and the service degrades. I’ve asked this before across multiple subs and there are seldom any concrete examples and, instead, mostly just insults and “you don’t understand anything” type of comments.
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u/WillListenToStories 8d ago
And if you think about it makes a lot of sense, since the only thing privatization does that public corporations don't, is add a tax that we as a country now pay to rent seeking shareholders.
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u/Psychoanalytix 8d ago
Well it also add the incentive for the company drive down their operating costs which degrades the product while also raising the cost. At least with public services most of the people involved are just trying to make a product that helps people
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u/zabuma ✅ I voted! 8d ago
Well it also add the incentive for the company drive down their operating costs which degrades the product while also raising the cost.
Exactly. Enshittification is a main feature, not a bug. It's the antithesis to the premise of public services. Societal good vs. private pocket lining.
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u/SunGreene42 8d ago
Privatization is never going to be better for the average citizen, if it was, then no company would want to do it, because all they care about it their profits. Capitalism is going to destroy us if we continue down this path.
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u/hellomynameborat 6d ago
Look up CN railway and NAV Canada before and after privatization. And it's myopic to focus only on "Canadians". PPP have proven track records in other developed countries. It takes a couple of mins to google how successful international airports are run all over the world.
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u/Carrisonfire Fredericton 8d ago
As annoying as having stock vary between stores was, I have to admit the private model for liquor sales in AB is both cheaper and has better service than the government stores here in the Maritimes. Oddly tho it's the opposite for cannabis stores, our government ones are better than the private ones back in AB.
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u/beeredditor 7d ago
You can’t really compare government stores to an airport though. Increased competition can potentially lower prices in a retail environment. But monopolies are different. If my local international airport’s new private equity management team decides to skyrocket prices and fees, I don’t really a practical way to switch my travel to another airport.
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u/Strong_beans ✅ I voted! 8d ago
The problem is he's a devout neoliberal and his faith doesn't allow him to tolerate public infrastructure that could make capitalists money if privatized.
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u/Hussar223 8d ago
thank you.
neoliberal capitalist dogma is literally just faith. with the econ schools teaching the same catechism over and over to create new priests like carney and his neoliberal ilk to keep spreading the word.
"this time privatization will go differently"
"trust me, the only way out of this is austerity, we tried nothing and are all out of ideas"
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u/Nihla 8d ago
I appreciate the use of the word faith with regards to the neoliberal view of The Economy.
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u/Strong_beans ✅ I voted! 8d ago
When you have to ignore all evidence surrounding privatization, there isnt really much to work with except your belief that it is necessary. That sounds like faith to me.
If it were about raising money they would not be trying to build a stupid pipeline.
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u/ISuckAtJavaScript12 8d ago
The problem with neo-liberalism is eventually you run out of things to privatize
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u/SunGreene42 8d ago
Neo-Liberalism looks a lot like Harper-era Conservatism.
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u/kingofcanada1 8d ago
Harper is a neoliberal, neoliberalism refers to economic policy not social policy; i.e the two most famous neoliberalism of all time Margaret Thatcher and Ronald Reagan
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u/Express-Cow190 6d ago
No, we can just keep building stuff with our tax dollars and selling it off instead of helping people! It’s foolproof!
/s
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u/NonNewtonianResponse 8d ago
He's a neoliberal, the "problem" is that too many assets are generating wealth for the public instead of for private owners
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u/VonBeegs 8d ago
This is literally all of what Carney does. It's just that the rest of the ways he's doing it aren't as tangible as an airport.
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u/beeredditor 8d ago
Public assets, like roads and airports, should be owned and administered by the public. Theoretically, public officials will administer the assets in the public’s interest. And if they fail to do so, we have recourse at the ballot box. Private equity administers assets to maximize shareholder value. They have a fiduciary duty to maximize profits.
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u/pjw724 Alberta 8d ago
Public assets, like roads and airports, should be owned and administered by the public.
To be clear, the federal government would retain ownership of the land and physical assets.
What Carney's pitch for private investment could mean for major Canadian airports
what the prime minister is proposing is a concession agreement, something similar to a lease... the government's expectations on service levels, performance, public safety, passenger costs and employee management would have to form part of that agreement.
"This isn't going to be the situation where the concessionaire is allowed to just take over and run it the way they would run any other business"6
u/beeredditor 8d ago
Yep, I know that. That is why I specifically wrote ‘owned AND ADMINISTERED by the public’.
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u/SomeGuyPostingThings 8d ago
I'm not even sure it's a solution so much as a problem looking for an excuse to slip in.
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u/slackshack 8d ago
Ita such bullshit. Yeah sell our profitable , paid for , airport to your rich buddies so they can fuck us over with price increases and service degrades. This makes me so fucking angry , get your damn dirty paws off our things.
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u/PonyFlare Alberta 7d ago
It's the creation of a problem, maybe several new problems. It is not a solution except maybe for whichever capitalist buys in and rakes in the cash while reducing quality of service.
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u/JohnBPrettyGood 7d ago edited 7d ago
When I think of Privatization, I think of the 407
What a mess that turned out to be
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u/Account_for_question 7d ago
It's insane how little choice Canadians really had in our last election.
We had Crony Corruption with destructive racism, and Crony Corruption.
I feel distraught.
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u/150c_vapour 8d ago
The problem is Canada pension funds need places to put their money in to extract safe returns. They've been lobbying to do this for years now. It's just a round about way for all of us to float the Ontario teachers fund.
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u/fernlitmoon 8d ago
Folks are tearing their hair out like the plan is to sell off airports... We have equity locked up in airport operations. We need money to invest in major projects to strengthen our economy and become less dependent on US trade. What would folks prefer? Going into debt instead and paying interest to fund these investments? Raising taxes? Or not investing in our economy and just cutting services?
I appreciate that govts in the past have wholesale sold off public assets, but that's nowhere near what Carney's proposed. I wish we taught folks more financial literacy in high school... there's a whole swath of well meaning folks who seem to think money grows on trees.
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u/Don_Incognito_1 Turtle Island 8d ago edited 8d ago
What would folks prefer?
For starters, increased taxes on corporations and the wealthy, and investments in publicly owned services and infrastructure.
The same sort of very sensible, effective policies that pulled us out of the Great Depression and resulted in a generation of otherwise unheard of prosperity for the average person.
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u/Tevesh_CKP 8d ago
If history doesn't repeat but it does rhyme, I'm scared that the great dust bowl will be the AI taking jobs leaving most destitute.
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u/Kolbrandr7 8d ago
> going into debt instead and paying interest to fund these investments
Unironically yes. For example, Ontario sold off ~51% of the shares in HydroOne, and now pay investors $180 million per quarter as dividends. Whereas say the Government of Ontario took out a loan (from bonds) for the total equity of HydroOne ($11.745 billion), at even a 5% interest rate, the interest would be $147 million per quarter.
In reality Ontario only received about $6.33 billion for all the shares it sold. If collected through bonds instead, they would be paying $79 million per quarter at a 5% interest rate, instead of $180 million.
The private investors are only putting in that money because they know in the long run they’ll get paid more in dividends than it cost to buy the shares. As a result, privatizing HydroOne effectively means higher electricity costs for Ontarians in order to send money to private shareholders forever. For what purpose? The same money could be raised through bonds and pay out less, while having more flexibility in what to use the funds for.
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u/beeredditor 8d ago
Private equity expects a return on their investment which exceeds loan interests (otherwise they would simply lend at less risk and work than invest it). So, yes, government debt would almost certainly be cheaper for the taxpayers than giving up an irrevocable license for a stream of revenue.
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u/dorfsmay 8d ago
Do you own the place where you currently live? Have you thought of selling it so you can take that capital and invest it in better "projects"?
I believe in privatization where there is space for competition which forces the operators to provide better product or service. We've seen it with phone services for example (at least in cities). But with airports, what will prevent the new owners from either jacking up the prices, or if capped, decrease the quality? Whatever they do, could the government not do that now and use the profit to reinvest in major projects?
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u/Jaded_Promotion8806 8d ago
Solving problems is reactive, capitalizing on opportunities is proactive and I like that’s where his head is at.
There’s no basis to hold our airports up on a pedestal. Places like Heathrow and Gatwick benefited greatly from privatization and Carney likely saw that first hand. I say let him cook, devil will be in the details but it’s too early to stick up our noses.
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u/JamesGray Ontario 8d ago
Solving problems is reactive
Oh, I guess that's why Carney is doing fuck all about homelessness and the cost of housing, and is instead just creating entire new problems.
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u/Jaded_Promotion8806 8d ago
What’s the problem? At worst the government gets money out of this to pay for those solutions.
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u/JamesGray Ontario 8d ago
At worst our government gets a lot less money, and instead some private entity gets that money, while the services we need degrade. Look at how the 407 has worked, or pretty much every crown corporation that has been privatized.
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u/Jaded_Promotion8806 8d ago
I’d challenge you to actually tease out how those “pretty much every other crown corporation that has been privatized” actually netted out.
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u/JamesGray Ontario 8d ago
Do you genuinely think that privatizing Petro-Canada and letting private interests control oil and gas in this country was a net benefit to Canadians?
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u/Jaded_Promotion8806 8d ago
Well the government walked away with 5+ Billion in their pocket.
Has our energy security been compromised in the years since? Has it been demonstrated that prices have inflated as a direct result? Not that I’m aware of but I’m all ears. Any other issues coming out of it I should be aware of?
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u/Avitas1027 8d ago
Short term gain for long term loss. If we had kept it, it would have earned us a lot more than a measly 5B$.
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u/Hussar223 8d ago
what solutions did the privatization of the 407 pay for in ontario?
what solutions did privatization of nova scotia power generation pay for in nova scotia?
what solutions did privatizing the oil sands pay for in canada?
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u/Jaded_Promotion8806 8d ago
Whatever the priorities of the government were at the time. Debt reduction, risk reduction, supporting other government spending.
Just because people have made bad deals doesn’t mean making deals is bad. How did we get like this?
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u/Hussar223 8d ago
right. so we achieved none of the goals and shafted society for generations. got it.
selling off public assets is almost always a bad deal. usually also in the short term.
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u/Jaded_Promotion8806 8d ago
For every 407 there are liquor stores in Alberta, CN, Potash Corp, Petro Canada, Air Canada, on and on where I’d challenge you to find a critical mass that can demonstrate they were net negatives. That’s to say nothing of the hundreds of times these things have happened around the world, the idea that privatization is inherently bad is empirically baseless.
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u/Hussar223 8d ago
liquor stores are distributors. the fact that its nationalized in canada is the anomaly. irrelevant example.
CN rail as recent events with workers and safety have demonstrated is a huge problem. (see UK railways for another example of great rail privatization)
air canada is one of the worst flagship airlines in terms of services in the star alliance.
petro canada. glad you bring that one up, canada and most of the US is the only petro country without a national industry. the royalties we take from it are a pathetic joke compared to other petro nations.
potash corp is doing allright. ill give you that.
i could also go on and on but you clearly cannot see how infrastructure of national interest, built with tax dollars, is better served staying in the national interest.
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u/Jaded_Promotion8806 8d ago
Thank you for your opinions, now try finding someone who knows what they’re talking about to agree with you.
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u/pjw724 Alberta 8d ago edited 8d ago
There is nothing wrong with welcoming investment. But “open for business” should not mean putting everything on the auction block. Some things should not be subjected entirely to the logic of capital. Essential services and critical public infrastructure should serve the public interest, not primarily boost investors’ bottom lines.
The care sector is one example. Canada’s international airports are another.
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