Friday, April 05, 2019
Smooth Move, Mike
In 1998 the Ontario government of then premier, Mike Harris, sold the 407 highway to for $3.1 billion to a Spanish-led consortium that included - wait for it - SNC-Lavalin. The Ontario government had built the 407 for around $1.5 billion but Mike needed to get the books in order to win his second majority government.
Now SNC Lavalin wants to unload, not its entire 16 per cent minority interest, just 10 per cent, for $3.25 billion.
In 2019 dollars, the original privatization price was about $4.4 billion. The price Lavalin scored suggests the 407 highway is now worth upwards of $30 billion. That's close to 1,000 per cent appreciation.
And then there is the matter of the tolls that 407's owners have reaped over the years. For the year 2017 alone that totalled over $1.25 billion. A billion dollar plus toll revenue per year on an asset that originally cost just over $3-billion atop the killing you've made on ten-fold appreciation.
That's what happens, kids, when rightwingers flog off public assets for low, low prices. Governments and taxpayers get screwed, royally screwed.