MORTGAGING THE FUTURE: A LETTER TO THE ECONOMIST (January 15, 2007)

Translate Private Finance Initiative (PFI) into Public-Private Partnership (PPP) and Britain into America, and you will have the same love affair between the top army brass and buying on credit (“Under PFIre,” January 13, 2007). The only difference is that the American affliction goes almost a quarter of a century back. We are mortgaging the future, the critics charged back then, just as you do now. But the reason for the love affair has little to do with economic criteria used to assess public spending, including defense spending. With PPP and PFI the top brass can get around the myriad bureaucratic hurdles in the budgeting process. These take considerable time, too. Whatever they need, such as housing or food services for their soldiers, they can get by signing long-term contracts with developers or restaurant chains. And in a jiffy. Judging by the American experience with PPP, the future never got mortgaged. It should not be mortgaged with PFI in Britain, either.