Private Toll Road Set To Make Profit (local council stamps on hat)

Remember that chap in the UK, Mike Watts, who built a bypass (using his house as collateral) to allow motorists to avoid the closed section of the A431 road between Bath and Bristol? I wrote about his road-building heroism a few months ago.

Well, yesterday Matt McCaffrey at the Mises Institute provided a most interesting progress report on Mr Watt’s endeavours.

“The big question when it opened was whether Watts would be able to recover his expenses, and so far the answer seems to be, yes. Watts just served his 100,000th customer, earning him £200,000 in the process. His total expenses for the project will be about £250,000, so he’s well on his way to breaking even before the public road is scheduled to reopen some time in December.”

Think how much value Mr Watts’ entrepreneurial initiative (and financial bravery) has added to the local economy since August by solving this infrastructure problem at such a comparatively small cost, which only he incurred. Think how many local people’s lives he has affective in a positive way by financing and building this road by risking his own wealth. The local council is spending ten times more (of council tax payers’ money) to repair the old road, which won’t be open until Christmas – ten months after it first became unusable.

Those who go away concluding that the root cause of all this is that this particular local council is especially rich in incompetent idiots are entirely missing the point. The profound and simple lesson to be learned is that any service will invariably be produced at a higher cost and lower quality when its provision is monopolised. The monopoliser in this case is…? Yes, the government.

The average man on the street will agree that monopolies are bad, but somehow manages to hold two contrary beliefs about monopolies at the same time: that private one’s are bad, but government one’s are good. Of course, the average man does not perceive government monopolies as monopolies at all, which is what leads to this cognitive dissonance, or ‘doublethink’, as George Orwell once named it.

If the success story of Mike Watts and his private toll road doesn’t convince most people that society would in all likelihood have a better and less costly roads infrastructure if anyone, from individual entrepreneurs to large-scale enterprises, were free to enter the market to build and maintain small and large-scale infrastructure, then it’s hard to see what will.

Some might argue or believe that people like Mike Watts are exceptional and therefore insufficient in number for us to be able to rely on free enterprise to provide society’s infrastructure. But is Mike Watts some kind of exceptionally virtuous human being who acts only to benefit others? Hardly. His primary motivation for building the road was his own rising fuel bills as a result of the road closure.

“Our fuel bill went from £25 per week to £60 pounds per week…It was 14 miles extra but up to an hour and 15 minutes more each way,” he explained. But his motivation wasn’t entirely selfish either: “Wendy and I took the decision together that we needed to do this…for the people we know.”

The success of Mike Watts’ private toll road represents the power of individual liberty, entrepreneurial spirit and free exchange to solve social problems. The failure of his local government to repair a road in a timely fashion, all the barriers it has placed before him, and the extra costs it has forced upon him together represent the negative social and economic consequences of a government monopoly on the provision of services like road building and maintenance.

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