Public/Private Finance: Emerging Models and New Partnerships
Recently, traditional methods of capital flow between the private and public sector have undergone tremendous change. For many years the financial and social needs of both sectors were adequately addressed by traditional debt instruments, largely bonds and notes. Starting some years ago, there began a proliferation of new entities that now account for the bulk of public indebtedness. These entities are given a variety of names: Public Authorities, Industrial Development Agencies, Economic Development Offices, Local Development Corporations, Public/Private Partnerships, and most recently and dramatically Sovereign Wealth Funds including TARP. These entities have sprung up without serious examination of the reasons for their creation, their governance, their policies and practices, and their consequences. This course will examine all forms of these new entities, the law and reality of their operation, international, national and state efforts to monitor and control them, and their impacts on financial markets and government policies. Issues examined in this course include efforts by the IMF to rationalize and regulate Public/Private entities, efforts by New York State to rationalize and democratize their governance, the application of fiduciary obligation to their operations, unintended legal and financial problems, and the unresolved financial, ethical, legal, policy and political questions that remain. Cases to be studied include the financing of the new Yankee Stadium, the TARP Fund, PATH, and the Norwegian Sovereign Wealth Fund. The course will include required readings, notable guest speakers from both public and private sectors, team case studies, and a final paper.