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from Breakingviews:

Carlyle descends into a public-private inferno

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By Jeffrey Goldfarb
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

A Carlyle Group investment in Montana lays bare why so many roads are paved only with good intentions. The mayor of Missoula, a city of about 70,000 once known as Hellgate Trading Post, is trying to seize the local water utility from the buyout firm. The confrontation shows why joint efforts between public and private entities to improve infrastructure don’t proliferate.

John Engen, the mayor, on Wednesday sought court approval to acquire Mountain Water using the legal power known as eminent domain. This amounts to launching condemnation proceedings which are generally invoked when governments claim private property is needed for public use. In that context, the advance on Carlyle seems aggressive.

Missoula also tried to pry the water company from its last owner back in 1984. The Montana Supreme Court rejected that attempt. When Sam Wheeler decided to sell 27 years later, the bad blood lingered. Ultimately, Engen defied vocal opposition and threw his weight behind Carlyle in part because the deal included provisions for the city to bid for Mountain Water when the private equity firm was ready to exit.

from Breakingviews:

Privatisations a bright spot for gloomy Aussie M&A

By Una Galani

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Privatisation is a bright spot in what looks to be an otherwise dreary year for Australian dealmakers. The country is set for a flurry of activity as cash-constrained local governments prepare to flog existing infrastructure assets in order to fund new projects and create jobs.

from The Great Debate:

The middle class’s missing $1.6 trillion

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The United States was the world’s first middle-class nation, which was a big factor in its rapid growth.  Mid-19th-century British travelers marveled at American workers’ “ductility of mind and the readiness…for a new thing” and admired how hard and willingly they labored. Abraham Lincoln attributed it the knowledge that “humblest man [had] an equal chance to get rich with everyone else.”

Most Americans still think of themselves as middle class.  But the marketing experts at the big consumer goods companies are giving their bosses the unsentimental advice that the middle class is an endangered species. Restaurants, appliance makers, grocery chains, hotels are learning that they either have to go completely up-scale, or focus on bargains for the struggling and budget-conscious.

from The Great Debate:

The other inequality is structural

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For the second year in a row, the issue of economic inequality was featured in President Barack Obama’s State of the Union Address. Even some Republican lawmakers have now dared to speak the “i-word.”

Though Obama predictably avoided comparisons between the earnings held by the top 1 percent and the 99 percent of Occupy Wall Street fame, the message was familiar: The widening income gap between the very rich and everyone else is a stain on the social compact and a serious problem for future economic growth.

from MuniLand:

The Senate’s latest twist: The American Infrastructure Fund

A bipartisan group of eleven U.S. Senators, led by Colorado Democrat Michael Bennet, has filed legislation to create the American Infrastructure Fund. Senate bill 1957 would:

Provide bond guarantees and make loans to states, local governments, and   infrastructure providers for investments in certain infrastructure projects, and provide equity investments in such projects, and for other purposes.

from The Great Debate:

A ‘Marshall Plan’ for Africa’s employment challenge

To Africa’s many challenges, add one more: unemployment.

Unemployment, independent of any other factor, threatens to derail the economic promise that Africa deserves. It’s a time bomb with no geographical boundaries: Economists expect Africa to create 54 million new jobs by 2020, but 122 million Africans will enter the labor force during that time frame. Adding to this shortfall are tens of millions currently unemployed or underemployed, making the human and economic consequences nearly too large to imagine.

Thus, even with the strong economic growth we have seen over the past decade, job creation in Africa remains much too slow. Africa needs a comprehensive, coordinated approach akin to America’s “Marshall Plan” in Europe after World War Two. That effort focused on building infrastructure, modernizing the business sector, and improving trade. By the end of the four-year program, Europe surpassed its pre-war economic output.

from MuniLand:

A focus on infrastructure in the U.K.

The United Kingdom created an independent group, U.K. Infrastructure, to track, coordinate and promote infrastructure investment in the country. It announced its latest plan last week:

A new national infrastructure plan containing information on over £375 billion [$616 billion] of planned public and private sector infrastructure investment has been announced by the government.

from The Great Debate:

A road paved with sand

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Bills have been introduced into both the House and the Senate to dismantle the federal government’s role in interstate highways and leave that massive responsibility to individual states. Tea Party adherents and other conservatives are applauding this effort. The Interstate Highway System, they argue, was largely completed in the 1980s and local communities should provide their own transportation needs.

The new transportation bill proposed by Senator Mike Lee (R-Utah) and Representative Tom Graves (R-Ga.) however, tragically misses the mark when it comes to our national infrastructure needs. Their legislation would abandon the highway trust fund just when our roads and highways are most in need of reconstruction, repair and expansion.

from MacroScope:

Game of chicken in Kiev

No sign of tensions calming on the streets of Kiev, in fact today we could have a new flashpoint.

Prime Minister Mykola Azarov's cabinet is holding its weekly meeting in the government building which protesters have blockaded since Monday, paving the way for a possible showdown.

from Photographers' Blog:

Risking life for school, again

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Cilangkap village, Indonesia

By Beawiharta

This is my second picture story about students going to school.

Still in Banten province, Indonesia, around 100 kms (62 miles), or a good four hours drive from my home. These students are not like the Indiana Jones students I covered previously, who crossed the river using a broken suspension bridge, instead, they use a bamboo raft.

I received a call from a local photographer saying he had found another group of students crossing a river using unconventional means. "Why are you not taking pictures yourself?", I asked. Cikal replied, “We need to work together, you for the international audience and me for the Indonesia reader. Because I think they need a proper bridge. Maybe the students will get lucky from our pictures."

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