Monopoly describes a situation of exclusive control of the supply or trade of a commodity or service. Further, corruption describes the dishonest behavior as displayed among those in power while gross inefficiency describes a situation where there is an obvious and unacceptable failure to put resources to their best use. In other words, the Libertarian Party (2000) has accused the government of polluting the processes involved in transportation policy and planning to the extent of failing unacceptably to deliver on its mandate. To that end, it has pointed out some of the perceived negative impacts of government involvement. Accordingly, it is necessary to establish the truth of this claim and offset it with an analysis of the features of private ownership.
Before delving further, it is vital to acknowledge the nature of transportation in the context of a good and its ownership. Starting with the latter, ownership of transportation is somewhat private. The highway system, for instance, has among other things, vehicles and roadside services that are private in nature alongside publicly-owned elements such as traffic control, road infrastructure and public transit services (Starkie, 2014). Furthermore, there are other means through which the private sector plays a role in the provision of transportation infrastructure and related policies. For illustration, private sectors consultants often avail their expertise during the planning and design phases of infrastructure projects. Again, they are sometimes participants in the operation of those infrastructures. Generally, it seems that the ownership of transport infrastructure along with the policy formulation processes are not controlled entirely by the government (McGowan, 2011). But, for the government to exercise monopolistic restrictions, it must have a monopoly. However, based on the nature of ownership and the private sector involvement highlighted herein, the claim of government monopoly appears problematic.
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Advancing further the notion of monopolistic control, while there are different government layers holding different hierarchical responsibilities, near seamless transition between layers is the norm. Further still, there is a significant lack of competitive incentive for revenues either between roads or layers. Government’s approach to managing traffic flow is that of distributing traffic and reducing congestion. The central location of traffic signs and other controls are helpful to road users (Sarkar, Maitri & Joshi, 2017). Then again, a natural monopoly describes a situation where there is only one entity that can supply a good or service. Considering that on streets, roads provide the only access to and from a destination implies a natural monopoly. On the other hand, this simply implies that the provision of transport infrastructure is monopolistic in nature, whether in private or public hands (Starkie, 2014).
Pork barreling , synonymous with earmarking describes how elected officials secure spending for projects that will benefit communities from their home districts, has been associated with the implementation of infrastructure projects without regard for social desirability (Roth, 2011). It is doubtless that transportation is the only sector where illegal and dishonest activities take place. Indeed, the federal surface transportation bill has provided the basis for the claim against the government (Roth, 2011). The notion present here is that corruption is inherently associated with power, then this simply means that handing over such power to private hands will not minimize corruption in this sector.
Perhaps, highways are emblematic of the gross inefficiency claim, for they bear witness to gradually increasing congestion. Even then, travelers are insulated from bearing the full cost of their journeys due to government subsidies. The seemingly natural outcome is congestion during peak hours (Roth, 2011). Furthermore, the perception of inefficiency is relative for whether it is intolerable depends on the city. Critically, it is vital to consider features that private ownership would create having looked at public ownership-created ones.
Primarily, the incentive for private firms is to maximize profits and the outcome is usually price-maximization usage as a tool that end (Roth, 2011). This means that the emphasis will not be on efficiency as alluded to but on profit maximization. If competition is imperfect then this increases the likelihood of over-priced private roads, resulting in price-based inefficiencies. On monopolistic leanings, a natural monopoly is the only suitable basis for consideration because it is the nature of the service that significantly influences this disposition (Sarkar et.al 2017). Once more, this means that even in private ownership, a natural monopoly will persist. In so doing, it discounts this portion of the Libertarian claim.
Doubtlessly, the claim against government corruption especially under the pork barreling approach because this leads governments to engage in infrastructure projects without regard for market incentives. On the other hand, firms are incentivized to increase capacity only when their marginal benefits exceed marginal costs (Roth, 2011). Here, service provision unobscured by corruption is characterized by among other things, efficiency. Then again, even the existence of a monopoly is not enough to guarantee an optimal road network. Furthermore, a monopoly only increases the likelihood of price-based inefficiency as for private companies will implement profit-maximizing prices in the absence of competition to incentive them towards welfare promoting prices (Roth, 2011).
It is evident that transportation policy and planning is an inherently complex undertaking and the same has been highlighted via the claims addressed herein. Fundamentally, it seems that it is the nature of roads and other forms of transport infrastructure that make government involvement acquire a monopolistic position. Even then, the role of the private sector is not completely diminished and they claim ownership in several ways. But the nature of the private enterprise is profit maximization, this increases the likelihood of the private sector pursuing this objective primarily.
References
McGowan, R. (2011). Privatize this?: Assessing the opportunities and costs of privatization . Santa Barbara, California: Praeger.
Roth, G. (2011). Street Smart: Competition, Entrepreneurship, and the Future of Roads . Piscataway, New Jersey: Transaction Publishers.
Sarkar, P. K., Maitri, V., & Joshi, G. J. (2017). Transportation planning: Principles, practices, and policies . Delhi: PHI Learning Private Limited.
Starkie, D. N. M. (2014). Transportation Planning, Policy and Analysis: Urban and Regional Planning Series . Kent: Elsevier Science.
The Libertarian Party Platform. (2000). Transportation. Retrieved from http://www.dehnbase.org/lpus/library/platform/2000/tra.html . Retrieved on October 9, 2018.
