Tea Party Consequences

06.16.12

The Price of the Tea Party

A billionaire monopolist mobilizes a Tea Party protest movement to stifle competition—thwarting thousands of jobs in the process. It could be a scene from my novel—I sort of wish it were—but in fact it's the story of the decade-long battle to add a second crossing of the Detroit River between the United States and Canada. On Friday, the good guys won a round. But if those who decry "crony capitalism" want their words to be something more than a partisan slogan, they ought to consider how and by whom they got maneuvered onto the wrong side of this battle.

Click here to read my column in the National Post about this fight:

It’s just a toll booth on a bridge — but it symbolizes the challenges to Canadians of living next-door to an increasingly dysfunctional American political system.

The Ambassador Bridge over the Detroit River is the busiest Canada-U.S. border crossing. It’s been improved and modernized over the years, but shippers fear that the bridge’s capacity will soon be overwhelmed. Proposals to add a second span have gone nowhere. And anyway, a second span would be a poor solution: The bridge, built in 1929, is in the wrong place. It disgorges into Windsor city streets.

Shippers have long urged the construction of an entirely new border crossing that could connect U.S. Interstates 75 and 94 directly to Ontario’s Highway 401. On the eve of the 2008 financial crisis, those shippers finally got their way: The new crossing gained approval from the Michigan and Ontario highway departments.

The recession that began in 2007 temporarily depressed cross-border traffic. Yet it also added to the logic of a new crossing. With unemployment soaring in the Detroit-Windsor region, a big new bridge-highway project would deliver a welcome jolt to the local economy.

Plans for the new crossing failed, however, to reckon with two characteristics of the increasingly dysfunctional U.S. political system: Its extreme and intensifying tax aversion — and its vulnerability to manipulation by wealthy entrenched interest groups.

The existing Ambassador bridge is privately owned, and the main owner — Forbes 400 member Manuel Maroun — does not welcome competition. Even more than competition to his bridge, Maroun objects to competition for his duty-free gasoline stations. Those stations are exempt from taxes, yet sell gasoline for only marginally less than their tax-paying competition. Maroun has mounted a furious lobbying campaign against the second river crossing. He has gained some unexpected allies, including Americans for Prosperity, the Tea Party group headed by Dick Armey. The Michigan chapter of AFP posted convincing-looking (but fake) eviction notices on homes near the proposed crossing route. The group acknowledged that the tactic “was meant to startle people.”

AFP refused to say whether Maroun was paying for the campaign, explaining that its donor lists were private.

Bridges cost money: In this case, almost $4-billion. The state of Michigan’s share of the cost would have been $550-million, with the balance to come from the province of Ontario and the U.S. and Canadian federal governments. That $550-million sounds like a lot of money, but put it in context: Almost $500-million in traffic crosses the river every day. Yet the Tea Party Republican majority in the Michigan legislature — perhaps influenced by their friends, allies, supporters and donors at Americans for Prosperity — has objected to the cost, and passed a law forbidding the state to spend any money to build the bridge.