The 407 in Ontario is privatized (well, PPP, actually) and they add lanes all the time. The traffic is almost never gridlocked.
The main reason highways exhibit the behaviour is because they are not load-costed, as the 407 is. The cost per peak traveler on the 401 (an alternative-ish public highway of similar size / etc) is around $10k per car per year, due to the immense cost of building new lanes, the slow down that costs, and the additional slowdown of everyone else on the road. And that cost was when I was studying engineering back in 2007, so it's almost surely higher.
I think "cost per peak traveler" is a pretty useless metric. But even still the math doesn't work. 401 is 4+ lanes, 500 miles long, meaning peak travelers must be up near 500,000 cars. Now, apparently the Ministry of Transportation maintains the 401 (and much more than that) and their entire estimated budget for 2013-2014 is $1.5 billion.
Cost per use seems a lot more interesting. It's hard to say exactly how many cars ride it every day, but Wiki has a table of average daily utilization at 11 points along the system. If we simply add those up, then in 2008 they counted an average of 1.1m cars per day on the highway, or 401 million riders per year. This almost certainly significantly understates utilization.
If the Ministry of Transportation spent their entire budget on the 401, that would work out to about $3.70 per ride. In reality they are probably investing less than $0.25 / ride to maintain and extend the highway.
There is very little, perhaps nothing, that can compare to the cost-benefit of building freeways for your nation.
The main reason highways exhibit the behaviour is because they are not load-costed, as the 407 is. The cost per peak traveler on the 401 (an alternative-ish public highway of similar size / etc) is around $10k per car per year, due to the immense cost of building new lanes, the slow down that costs, and the additional slowdown of everyone else on the road. And that cost was when I was studying engineering back in 2007, so it's almost surely higher.