The Truth About Privatization
Privatization. Privatization. Privatization. It’s all you hear from Republicans. But what does it actually mean?
Generations ago, America built an entire national highway system, along with the largest and best public colleges and universities in the world. Also public schools and national parks, majestic bridges, dams that generated electricity for entire regions, public libraries and public research.
But around 1980, the moneyed interests began pushing to privatize much of this, giving it over to for-profit corporations. Privatization, the argument went, would boost efficiency and reduce taxes.
The reality has been that privatization too often only boosts corporate bottom lines.
For example, consider Trump’s proposal for infrastructure. It depends on private developers, who would make money off of both tax subsidies and private tolls. So the public would get charged twice, without any guarantee that the resulting roads, bridges, or rapid transportation systems would be where they’re most needed.
It’s true that private for-profit corporations can do certain tasks very efficiently. And some privatization has worked. But the goal of corporations is to maximize profits for shareholders, not to serve the public interest.
The question should be: What’s best for the public? Here are five rules of thumb for when public services should not be privatized:
1. Don’t privatize when the purpose of the service is to bring us together – reinforcing our communities, helping us connect with one another across class and race, linking up Americans who’d otherwise be isolated or marginalized.
This is why we have a public postal service that serves everyone, even small rural communities where for-profit private carriers often won’t go. This is why we value public education and need to be very careful that charter schools and other forms of so-called school choice don’t end up dividing our children and our communities rather than pulling them together.
2. Don’t privatize when the service is less costly when paid for through tax revenues than through prices set by for-profit corporations.
America’s hugely expensive for-profit health-insurance system, for example, is designed to sign up healthy people and avoid sick people, while running up huge tabs for advertising and marketing, and giving big rewards to shareholders and executives. Which is why the administrative costs of Medicare are a fraction of the costs of for-profit medical insurance – and why we need Medicare for all.
3. Don’t privatize when the people who are supposed to get the service have no power to complain when services are poor.
This is why for-profit prison corporations have proven again and CONTINUE READING: Robert Reich (The Truth About Privatization Privatization....)
