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Transportation Infrastructure - Who Will Finance Rail?
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<P mce_keep="true">[quote user="The Butler"] <P>[quote user="Bucyrus"]</P><BR> <P class=MsoNormal style="MARGIN: 0in 0in 0pt"><FONT face="Times New Roman" size=3>But if there is a real need for an improvement then investors will finance it and the improvement will get done.<SPAN> </SPAN>So by definition, if it does not get done, there was no need for it.<SPAN> </SPAN></FONT></P> <P>[/quote] </P> <P> <FONT face=verdana,geneva>That seem a little simplistic to me. I might be wrong, but doesn't the length of return play a major role on whether investors finance or not? It seems to me, we are in a day of "<I>instant returns."</I> If it takes more than a year or two to show desired returns, investors are not interested. There for, it puts the second sentence into question.</FONT><BR> </P> <P>[/quote]</P> <P class=MsoNormal style="MARGIN: 0in 0.5in 0pt"><FONT face="Times New Roman" size=3>Well I am putting it in a rather simplistic way to make a clean point.<SPAN style="mso-spacerun: yes"> </SPAN>We live in a tangle of real needs, agenda driven needs, public and private financing.<SPAN style="mso-spacerun: yes"> </SPAN>And it is true that if the return is too long-term, it will discourage private investment.<SPAN style="mso-spacerun: yes"> </SPAN>But if the return is too low, that will likewise discourage investment.<SPAN style="mso-spacerun: yes"> </SPAN>Add to that the fact that somebody can easily make a case for need, and you have needs going unfunded. </FONT><SPAN style="FONT-SIZE: 12pt; FONT-FAMILY: 'Times New Roman'; mso-fareast-font-family: 'Times New Roman'; mso-ansi-language: EN-US; mso-fareast-language: EN-US; mso-bidi-language: AR-SA">So there is a threshold at which a need is great enough to attract private investment.<SPAN style="mso-spacerun: yes"> </SPAN>But if a need is not great enough to meet that threshold, I think that is excellent criteria for ruling out pubic financing of it.<SPAN style="mso-spacerun: yes"> </SPAN>And even if a need registers above that threshold, I think that in most cases public financing would be worse than no financing.<SPAN style="mso-spacerun: yes"> </SPAN>Every time we publicly finance the fulfillment of a need, the government grows bigger and better equipped to dredge up more <I>needs</I>.<SPAN style="mso-spacerun: yes"> </SPAN></SPAN></P>
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