Pro-bridge video stretches points on Ambassador's life, U.S.-Canada links, Truth Squad finds

MICHIGAN TRUTH SQUAD ANAYSIS: “Why the new bridge is so important to Michigan”

Who: Lt. Gov. Brian Calley

What: Web video

Truth Squad call: Warnings

In this video, Michigan.gov, Lt. Gov. Brian Calley promotes the proposed bridge linking Detroit and Windsor, a partnership project with Canada pushed by Gov. Rick Snyder, who sees it as a jobs and economic boon.

The project is opposed by Manuel Moroun, owner of the Ambassador Bridge, an 83-year-old private span that is the primary commercial corridor between Detroit and Windsor. Interests tied to Moroun are funding The People Should Decide, which backs a ballot proposal that would bar the state from owning or operating an international bridge without prior voter approval. The People Should Decide has spent $4.6 million in 2012 alone opposing the bridge.

Under an agreement with Canada announced in June, the bridge itself is to cost approximately $950 million and is to be bid out to a private company, which would be repaid by tolls collected on the Canadian side. Canada agreed to pay Michigan's $550 million share of the interchange and property acquisition costs. A group that backs the bridge, Taxpayers Against Monopolies, is challenging the ballot proposal as constitutionally flawed.

Questionable statement: “We are right in the middle of the heart of the biggest trade relationship between any two nations on planet earth. Our state alone has about a quarter million jobs tied to trade with Canada.”

Census Bureau data from 2011 confirms Canada as the largest U.S. trading partner, at about $600 billion in trade, with China second at $500 billion. According to a 2009 release by the Consulate General of Canada, Michigan's trade with Canada is worth more than $67 billion, with 221,500 Michigan jobs supported by that trade. Trade included exports of $5.3 billion in automobile parts, $6.5 billion in cars and trucks, $1 billion in motor vehicle engines, and $453 million in steel plate, sheet and strip metal. 

According to the government of Canada, more trade flows between Windsor and Detroit than any other border crossing in the world.

Calley stands in front of an image that reads, “10,000 jobs.” A study by the Center for Automotive Research estimates that construction will create 6,000 jobs each of the first two years and 5,100 in each of the final two years. The $550 million Canada is shouldering as Michigan's share of the project can be used by the state as matching funds to capture $2.2 billion in federal money that can be spent on roadway projects across the state. CAR estimates that will generate an additional 6,600 jobs annually for four years. It also estimates 1,400 permanent jobs for bridge operation and 6,800 jobs from private investment.

Questionable statement: “That kind of reliance is tied to an 83-year-old structure, an 83-year-old structure that has already passed its life expectancy.”

The Ambassador Bridge was completed in 1929, a feat commemorated in a silent film that documents various stages of construction on the bridge. A 2007 inspection report found the bridge structurally sound, in “fair” condition with cracked concrete, rusted railings and corrosion.

A profile of the bridge by HistoricBridges.org found that the “bridge appears to have been well-maintained overall, despite reports that the bridge is in need of repair.” For comparison, the Brooklyn Bridge remains operational today, 129 years after its completion in 1883.

Questionable statement: “The project itself will be funded by the private sector.”

Under the agreement with Canada, the design, construction, operation and maintenance of the bridge is to be done by a private company through a public-private agreement with a Canadian  entity called the Crossing Authority. It is to make annual payments from toll revenues to the private bridge concessionaire to cover those costs.

Questionable statement: “The connecting infrastructure from Michigan roadways to the bridge will be paid for by the Canadians. If the project comes in over budget, the Canadians have agreed in this contract to bear the financial risk.”

The agreement stipulates that Canada will pick up Michigan's $550 million share of construction costs for interchanges and property acquisition.

Questionable statement: “If the traffic comes in less than what is projected and there is cash flow problems at the bridge, it is the Canadian taxpayers that are on the hook, not the people of the state of Michigan.”

Money for building the bridge will be raised by issuing bonds, which are to be repaid from toll revenues. Canadian officials have repeatedly stated that its taxpayers are liable in case of default.

Questionable statement: “There is a billionaire monopolist right now that enjoys a stranglehold on commercial transportation between the two largest trading partners in the nation. This one billionaire is funding a multimillion-dollar ad campaign to completely distort the facts.”

Forbes Magazine pegged the net worth of the 85-year-old Moroun and family at $1.5 billion in March. Moroun's company controls the only major U.S. border crossing that is privately owned.

The Ambassador, however, is not the only bridge – and certainly not the only transport route -- linking the United States and Canada.

DIBC spent more than $9 million on TV ads trying to kill the bridge project in 2011 and through June 30 this year, according to the Michigan Campaign Finance Network. Many of the ads earned “foul” calls by the Michigan Truth Squad.

Overall impression: The video accurately reflects the economic stakes of the proposed bridge to Canada. The Detroit-Windsor corridor is a critical portal for trade with Canada, with virtually all commercial trade in that corridor routed over the 83-year-old Ambassador Bridge. Hundreds of thousands of Michigan jobs depend on that trade. Moroun family interests, as Lt. Gov. Calley notes, have poured millions of dollars into efforts to stop the project. And it is true his firm holds a near monopoly on trade through that corridor.

Foul or no foul: Warnings. As it ages, the Ambassador Bridge as with any suspension bridge, will be in need of continual maintenance. It is debatable that it “has already passed” its life expectancy. The Brooklyn Bridge, 46 years older, still stands and carries 120,000 vehicles a day on 12 lanes. Also, Calley’s claim that Moroun enjoys a “stranglehold” on commercial transportation ignores the fact that trade can cross at numerous points between the two neighbors.

Facts matter. Trust matters. Journalism matters.

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Comments

KG-1
Mon, 08/27/2012 - 2:47pm
One questions that I'd really like to know about this Snyder's bridge debacle: How can a state government enter into a contract with any foreign nation only by itself? The US Constitution, Article 1, Section 10 specifically forbids it."No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility."
JBK
Thu, 08/30/2012 - 11:31am
FOUL: The DRIC, as its directors claim - is a publicly funded - BUT NOT SUBJECT TO PUBLIC DISCLOSURE LAWS in US or Canada! ( FOIA? Try it Truth Squad!) FOUL: The DRIC is an international political slush fund, first and foremost. The so-called "NITC" is a Snyder's edition of DRIC I and II They can not build anything. FOUL: The DRIC is spending millions of tax dollars -- unaccountable PUBLIC tax dollars -- not to just cripple Matty Moroun - but anyone else they don't like. FOUL: For the Truth Squad to be AOK with all of the above begs the question about the Squad -- why are they OK about public money as secret slush funds? TRUTH: Will the real truth emerge about DRIC? So far? Not a chance.
Hairman
Sun, 09/02/2012 - 10:14am
Lets renegotiate. Canadians pay for it. Once their investment is recouped we do a 60/40 revenue split. Michigan getting the 40%. fair enough??