Next, the Market Consumes the State
Always on the prowl for new assets to exploit, investors are trying to push some of the crown jewels of American government – land, highways, civic infrastructure – onto the auction block. From the perspective of the owners of these assets, we the American people, it’s a terrible time to strike a deal. Why sell off prime equity assets in a down market for a fraction of their actual value? Ah, but that’s the point, from the point of view of investors: Let’s snatch these assets for a song while governments are so desperate for cash!
The latest example is a 387-acre tract of land in West Los Angeles that has long been prized as a precious bit of open space in an over-built city. The land is owned by the Veterans Administration, and is estimated to be worth $5 billion in today’s market.
As the Wall Street Journal (July 16) reports, “For 25 years, wealthy locals and veterans groups—backed by California's congressional delegation—have successfully resisted efforts to sell or develop the land, delighting in the open space and fearing the consequences of development.” But now the GOP – with scant resistance from Democrats – is pushing to sell off the land in order to raise money.
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