By David L. Seader
President, David Seader Associates
(davidseader@aol.com)
And
Co-Founder and Chairman
The National Council for Public-Private Partnerships
(www.ncppp.org)
Although the principles and practices of implementing public-private partnerships are quite similar around the world, the United States has a unique history and culture of developing working relationships between the public and private sectors in the provision of public services and infrastructure. From the earliest of colonial times to the present, the U.S. private sector has always had an active and sometimes leading role in building what we now consider public goods and services.
The earliest major roads in the 18th century were private toll roads. Most all of the country's first urban water supplies were built and maintained by privately owned water companies, some of which are still in business today. The great expansion westward in the US in the late 19th century was driven by a major public-private partnership between the federal government and the private railroads. The government provided the right-of-way and related development property while the railroads used private capital to build the rail facilities and rolling stock. Urban transit was primarily a private venture, with bus and rail transit companies providing service under exclusive franchises from local governments. The electrical sector was founded as a private initiative and is essentially still a private industry publicly regulated by each of the 50 state governments. Many other examples abound - in education, social welfare, transportation, utilities and elsewhere - of what we now consider to be the public realm that were begun under private, non-governmental or public-private partnership auspices.
A major shift in U.S. policy occurred during the Great Depression of the 1930's when private providers went bankrupt and were taken over by governments that needed to maintain those vital services. The federal government adopted an activist role in spurring the economy through public works and public payrolls. Vast initiatives, like the Tennessee Valley Authority, as well as hundreds of small local projects effectively claimed the development of infrastructure as a government job. The command-control mentality during World War II effectively cemented the government's role as the provider of preference for the public sector, so that in the 50's and beyond, when it came time to redevelop the nation's transportation and environmental control infrastructure, the solutions were new government programs, like the Interstate highway program, the Clean Water Act program for sewage treatment and the Airports and Airways Development Act program. During those decades, governments at all levels expanded their size, scope and level of control.