On the surface, the project sounds like a can't-miss proposition. To ease border crossing delays in the busy Detroit-Windsor, Ontario, trade corridor, Canada and the state of Michigan have agreed to build a new bridge over the Detroit River connecting the two cities. Dubbed the New International Trade Crossing (NITC), the proposed bridge is expected to alleviate traffic congestion on the 83-year-old Ambassador Bridge two miles to the north.
Project supporters say a new bridge is badly needed to improve the flow of traffic across the border. The Detroit-Windsor trade corridor represents the busiest international crossing in North America, serving as a conduit for more than 25 percent of the trade between the United States and Canada. Right now, over 10,000 trucks and 4,000 cars cross the 7,500-foot Ambassador Bridge every day, making it the nation's most heavily traveled bridge. Increased traffic in recent years has led to delays that are said to be costing Michigan manufacturers and shippers millions of dollars. The new bridge, which would be built at a cost of roughly $2 billion, would provide the added capacity needed to meet the future demands fueled by a recovering economy.
Most believe building the bridge will give Michigan a much-needed lift, pumping billions of dollars into the state's depressed economy. A report by the Center for Automotive Research in Ann Arbor found that the project would create 6,000 new jobs during each of the first two years of construction, and 5,100 jobs for each of the remaining two years of construction. It also projected that Michigan's gross state product and personal income levels would rise by $1.5 billion over four years, and that state revenues would jump by $150 million in the same period. After construction is completed, bridge operations would mean nearly 1,400 permanent jobs. Private investment is projected to create another 6,800 jobs and contribute hundreds of millions to the state economy.
As if this weren't enough, the state doesn't even have to put up the front money. The federal government is picking up part of the tab, while Canada has offered to pay Michigan's share of the construction costs and recoup it from Michigan's share of the tolls after the bridge goes into operation.
Although it's difficult to imagine that any informed person would oppose the project, the proposal does not enjoy universal support. Some critics have suggested that the bridge simply is not needed, but it goes deeper than that.
The Ambassador Bridge is a toll bridge, with fees of up to $4.50 per axle for trucks and $4.50 per automobile. It is also privately owned and operated. For over 30 years, the Detroit International Bridge Co., owned by Michigan billionaire Manuel Moroun, has controlled bridge traffic between Detroit and Windsor. Stated another way, one man has a powerful hold on 25 percent of the trade between the United States and Canada. Moroun also owns a duty-free store that has a monopoly on duty-free fuel. He has fought long and hard to protect what is assumed to be an attractive profit, but it appears that Moroun has lost this battle and eventually will be forced to share his traffic with the new government bridge. (It's interesting to note that although Moroun maintains the traffic projections used to justify the new bridge are "wildly optimistic," he has also floated a proposal to build a new bridge himself.)
While this situation is somewhat unique in the United States, it brings into focus the discussion of private funding to help improve our infrastructure. I suspect any private entity that funds infrastructure will not be too pleased to see government competition come along at a later date. To me, it suggests once again that the government should do what it has always been bound to provide—an infrastructure sufficient to support commerce and the national defense.
Gartner, Inc.